Member Info for dictumdedicto

I'm in full agreement with Tester. When people get lost in the daily price fluctuations they tend to forget that the fundamentals easily justify a price multiple times what we are now. My interpretation of the gold market is that it's more likely to trend upwards over the next few months than downwards. Whoever wins the 2020 election, the result will be another low trillions cash injection. Gold will react to this. On a prudent basis a $1600 base IRR assumption is fine with me although my guess is that we will be north of $2200 at some point in 2021.

You can't really draw any conclusions from MC's movements but I would imagine that any time he has in South America would be used efficiently. If deals are to be done it would make sense to wrap them up on site. At some point in the weeks running up to Christmas it would not surprise me one bit to see the firing gun started on a rapid incline in the share price. After years of virtually ignoring Condor activity, I've started to check for progress on a daily basis. It certainly feels a lot closer.

A not exactly unusual script for AIM companies moving from a relatively 'slow' phase to something more 'exiting' is for the share price to go all over the place. My guess is that we will see some odd movements over the next 2 or 3 months so be careful not to let defeat be snatched from the jaws of victory, especially if you've been in Condor for years. Whether we get news later this month (my expectation back in the summer) or closer to Christmas is still unknown but I would imagine MC would want to announce something 'significant' well before the new year.

Despite the current gloom across the general markets - the FTSE struggles to sustain an price\volumes above 6000 - November has the potential to mark a dramatic reversal of the malaise. Brexit is certainly a drag but it's fairly minor relative to the impact of COVID. November could bring with it news of vaccines, especially gives that there are now nearly a dozen across the world in fairly advanced trials. The general market reaction to the first announcement will likely be dramatic so my view is that now is the time to position for it.

As for Condor, while gold might take a turn in the opposite direction to equity prices, I doubt it will last. The effects of trillions of currency injections into the financial system has yet to be felt and it will probably be later next year before we really see the impacts. This time around the banks are far better capitalised so the impacts are more likely in inflationary pressures. This should be good for gold in 2021.

So as we look forward to 2021 Condor's prospects look pretty good. Production of some sort is within sight, gold should resume a steady upward trend and the general markets should see a bounce on reaction to a vaccine announcement. In other words sentiment ought to change across the markets and pull CNR with it, especially with some cash flow becoming a reality.

A few pertinent quotes from Jesse Livermore:

1. “Money is made by sitting, not trading.”
2. “It takes time to make money.”
3. “It was never my thinking that made the big money for me, it always was sitting.”
4. “The desire for constant action irrespective of underlying conditions is responsible for many losses in Wall Street even among the professionals, who feel that they must take home some money everyday, as though they were working for regular wages.”
5. “Buy right, sit tight.”
6. “Men who can both be right and sit tight are uncommon.”
7. “Don’t give me timing, give me time.”
8. “There is a time for all things, but I didn’t know it. And that is precisely what beats so many men in Wall Street who are very far from being in the main sucker class. There is the plain fool, who does the wrong thing at all times everywhere, but there is the Wall Street fool, who thinks he must trade all the time. Not many can always have adequate reasons for buying and selling stocks daily – or sufficient knowledge to make his play an intelligent play.”

There's nothing new here, although like generations before me I've sometimes had to learn the lessons the hard way.

ddd

I couldn't help a chuckle .

History doesn't just rhyme but actually repeats itself in share trading. The last 48 hours have seen some panic selling on the back of overall market nervousness, but even there it was overcooked. Why people take such short term decisions on the back of an obviously short trend remains baffling to me. If you buy in to Condor you are buying in to its fundamentals i.e. a significant uplift over the next year or two. It's pointless hanging on to every intake of breath by the general market. Completion of the land acquisition process will fire the starting gun but even here it could be months before the price adjusts to underlying value.

Some patience please. And don't be panicked out of the share because of others. Wait and see, analyse and then make your decision.

ddd

I've been rooting around for gold price forecasts:

Today:
'ANZ Bank forecast gold and silver at $2,300 and $27 respectively on a six-to-twelve month view.'

July 28th:
Goldman Sachs says gold will surge another 20% and hit $2,300 in the next year, driven by rock-bottom interest rates.

July 22 (Mining.com)
'These 76 Analysts Believe Gold Will Go Parabolic To Between $2,500 and $15,000!'
(Includes a bunch of misses in this lot from the last time gold shot up).

Feb 4th 2020
“Gold Will Go To $2,500 Per Ounce” In The Next One to Three Years – Charles Nenner.

Telegraph 5 August 2020 :

Gold price hits new record but 'can go 25pc higher' as investors load up on the precious metal

The gold price reached a record high of $2,030 (£1,550) per ounce as investor caution continues to push the metal's value higher. Despite being in unchartered territory, analysts expect its price to rise even higher.

A survey of more than 1,300 DIY investors, conducted by online gold market place BullionVault, showed they expected the price to rise by 25pc by the end of 2020. This would take the price to $2,500.

Bank of America Feb 2020:

Bank of America Corp. raised its 18-month gold-price target to $3,000 an ounce -- more than 50% above the existing price record -- in a report titled “The Fed can’t print gold.”

And the list goes on.

For my part I think $2300 by the end of 2020 is possible but probably not the most likely outcome. Maybe mid-2021, and perhaps $2500 in H1 2022. As for $3000 I would go for end 2022 at the earliest with 2023 more likely. I doubt we will see $3000 in Q4 2021 as BoA forecast, irrespective of negative real interest rates.

In that sense I see Condor's path to production in pretty much alignment with the rise in the price of gold. Gold still has a lot of catching up to do.

My guesstimate on getting a second hand mill up and running would be about 18 months, albeit there will likely be all sorts of 'testing' required at low output before ramping up to full capability. I remember the heartache associated with Arian's second hand unit. It did happen but the commissioning process seemed to take forever. I don't think a toll deal would take anything like as long to set up. The complicated bit here is in cutting the right deal. I'm pretty much using Arian as a template for this which suggests to me we could see cash flow in 2021 with a toll deal and 2022 with Condor's own plant.

I would be interested to see other views on this.

ddd

Not if you have a toll deal as well. My view is that MC is a canny character and will go for both if he can.

There are a host of strategic reasons for owning your own mill.

I've just checked the interactive chart again. The actual bottom was $1869.90 although it only lasted for a matter of seconds.

Gold

As expected gold bounced in the upper $1800s, around $1882 to be more specific, and now looks like it's recovering. However, don't be surprised if we see another dip sometime in the next week. The rise to previous highs and beyond will be tempered by people who think they 'got burnt' by the recent blow-off. The good news is that nothing has really changed. All the predictions\forecasts about $2300 this year, then $2500 and later £3,000 in the next couple of years all remain intact.

Condor

I've watched the video again. It looks like we were lucky in not being out of the blocks late last year by all accounts. The wind may also be behind us in that gold will likely recover pretty much in alignment with Condor's progress towards early production. The day trading club are still selling here and there but the initial shock seems to be over with. It does indeed look like we will get some solid RNS based news sooner than my September expectations. With contracts for various aspects already flying backwards and forwards it looks like weeks rather than months, maybe even days. I'm waiting for the FOMO (Fear of missing out) crowd to return.

Markets

Still in optimistic mode. There is scepticism about the Russian vaccine but the underlying message is that one is probably on its way. My money is still on the Oxford trial delivering the goods. Fingers crossed, this year.

Gold

U.S. bond yields had been steadily climbing over the past three days, peaking at around 0.66 before starting a decline towards 0.60%. If yields continue to drop back my guess is that you will see the reappearance of buyers, probably somewhere in the upper $1800s. A reversal to $2050 will probably take much longer than the decline to $1900 but I would guess weeks rather than months. As for money creation and inflation expectations - what's changed? Nothing! The fundamentals remain solid and it would not surprise me to see the day trader/ 'Robinhood' types be replaced by more robust hands on the way back up. Personally, I think a slower incline is preferable to the accelerated moves we have seen in the last week or two. And don't forget that by all accounts there is a physical shortage of gold across the world, thus an interest by certain parties to cover their short positions.

Condor

We are going into production, and not at some far distant point in the future. All the rest is background noise. My guess is that there will be both a toll deal with Calibre AND the purchase of a second hand mill. In other words a shorter term and longer term solution. Some will be spooked by the $125 or so fall in gold while others will see this as a buying opportunity. The latter crowd are more likely to understand Condor's unit cost of production and will realise that even $1600 gold is a major gift horse, with the potential to propel the company into triple, maybe quadruple bagger territory.

Markets

Up today on vaccine optimism. It would not surprise me to see it all reverse tomorrow as the WHO and other heavyweight medical groups launch credibility torpedoes at it.

Whatever you do, don't panic. Gold had to take a breather and Condor's recent rise has been pretty fast as well. Whether this evening's steer from MC is enough to bring buyers back in remains to be seen. I think it could go either way tomorrow, down in reaction to US trading in gold, or back up in realisation that cash flow is not that far away.

I'm sitting tight as usual.

ddd

Gold

From what I can see there are two underlying drivers of the price of gold; 'real interest rates in the U.S. - bonds' and inflation expectations driven by increased money supply. Nothing whatsoever has changed on this front. On a very short term basis gold was almost certainly overbought. It went up too quickly and a pullback was inevitable. So far this pullback has been fairly mild but it's not impossible for it to go further when the U.S. opens up later today. My sense is that the Russian announcement about a Covid vaccine has encouraged people back into the market and the 'mainstream' shares (FTSE etc.) on the up may have encouraged the trend chasers to move from 'hedge' type and speculative stuff back into the big boys. As the fundamentals remain unchanged I doubt we will see a sustained move downwards and that a return to higher highs over the course of this year, and next, is probably on the cards.

Condor

One or two drivers here. The first has already been discussed. Short term 'newsflow' has fueled price expectations, probably prematurely. My guess is still later in September before we get something solid but I've no direct insight into what's happening on the ground. It could always be quicker. A combination of an immediate jump in price expectations not being met, a drop in the gold price encouraging the nervous and the prospect of instant, albeit smaller, gains on FTSE shares today has promoted some selling. As with gold, nothing has changed. I still believe that we could be well on the way to 100p by the end of the year. The pullback in both gold and Condor looks like a buying opportunity although I do understand that some will want to see how the volatility plays out in the next day or two. The price of both could still go either way in the short term.

ddd

Gawd. All our yesterdays. AGQ, SXX, DES. The madness of ten years ago. Dreams followed by nightmares. It took years to claw back the losses I made on Arian, only for Covid to evaporate about a quarter of that recovery. Gold seems to be one of the few things actually working at the moment.

The price of gold is increasing primarily due to the fact the U.S. interest rates have dramatically declined across the whole spectrum, right up to the 30 year bond. Meanwhile the FED is basically saying that there is little chance of an increase in the foreseeable future, and will continue to facilitate money creation ('liquidity'). Covid is more of a catalyst rather than the primary driver, which is more about gold catching up with the last ten years of printing money and the ballooning deficits/US debt. It's not beyond the realms of reason to suggest that even the ten year could drop down to near or perhaps even zero %.

Gold will probably take a breather or two on the way to $3000 but it's hard to see much that can stop the rise. I'm also starting to think more 2 - 3 years rather than the 5 - 6 for this to be realised.

Condor is looking more like a 3 or 4 bagger, probably more if PoG continues to chase higher highs. It will only take a spark, a robust 'progress' RNS, for a significant move upwards. One whiff of production getting meaningfully closer and the (likely) many watchers will start to wade in. August looks a little early to me but maybe something later on in September will do the trick. I don't think 100p by Christmas is beyond possibility, but even 75p or 80p will represent a good run.

I think it's coming. Slowly at first but then a sudden wave of buying. It's not exactly an untrod path.

ddd

It would seem that even Goldman are now expecting further leaps in gold:

Currie writes that "with more downside expected in US real interest rates we are once again reiterating our long gold recommendation from March and are raising our 12-month gold and silver price forecasts to $2300/toz and $30/toz respectively from $2000/toz and $22/toz."

https://www.zerohedge.com/markets/goldman-warns-real-concerns-are-emerging-about-dollar-reserve-currency-goes-all-gold

My mind is starting to boggle at the potential upside in Condor if, as and when these valuations are reached. My guess is that if it goes to $2,300 then $2,500 and $3,000 will not be far behind.

ddd

Sobering:

https://www.zerohedge.com/commodities/why-nothing-can-stop-gold-deutsche-bank-projects-feds-balance-sheet-will-hit-20

Why Nothing Can Stop Gold: Deutsche Bank Projects Fed's Balance Sheet Will Hit $20 Trillion In "Next Few Years"

ddd

FED activity.

I don't think we've seen the last of it yet. Just imagine if the FED move out of the bond world and start buying up equity ETFs like Japan. I certainly don't rule it out. If it does (and the chances are it will) go down this route I can see equity prices going mad and gold getting very volatile indeed (an initial hit followed by equity crash fears pushing investors back towards the only real 'safe haven').

If the DXY drops down to 80 it could crash even further. Perhaps this could the the start of the often foretold 'dollar collapse'. I've read and heard dozens of people talking about it being a 'long term' expectation but when does the 'long term' start? A collapse has been forecast since well before 2010.

It's feeling more and more like 2009/11 only with increased risk.

ddd

On face value silver looks like it's running in tandem with gold. The problem of course is that silver is also an industrial metal and the global economy is on its knees at the moment. I'm far less confident in a major silver run vs. gold although I do acknowledge that silver is way behind based on fundamentals.

We haven't even mentioned the point that gold might actually be at peak production, or already starting to drop down the other side of the bell curve. Not sure if silver has the same argument going for it although it's years since I've seen a proper study of earth's remaining mineral resources.

Two weeks ago I would not have believed that gold would breached $1920 as quickly as it has. Nor would have I have expected $40 'up days'.

It looks like a reaction to the latest round of U.S. stimulus money being injected into the global financial system, and the USD reaction driven by inflation fears. As mentioned before, because the banks are far better capitalised than ten years ago there is far more liklihood that the money will flow out into consumer spending. It isn't needed to prop up ailing bank balance sheets. Add to that the ridiculously low interest rates, across the whole lending spectrum (including bonds/gilts/corporate etc.) and you can see why (finally) the institutions are getting interested in gold. I'm also now starting to see comments about the 'Robinhoods' and millenials sniffing around i.e. 'Retail'.

For me the scene is set for a parabolic final quarter. 2020 is even starting to look like 2010 as far as gold is concerned with excitement mounting during the summer and money flowing during autumn\winter. And at this point I don't think we are even at the end of the beginning.

I could see $2000 being a heavy resistance point for a while but I don't think it will last. The forces at play look to be too strong at the moment.

The question of course is whether investors will see Condor as a proxy for the gold ride, at least until the next piece of news comes through. I still sense a bit of hesitation and yet the risk\reward trade off seems heavily in favour of Condor vs. say an ETF.

Gold $1940\£1507 as I finish typing. I'm expecting the highest close ever today.

ddd

To add a few words to the Caibre discussion.

Caibre's July 10th update states:

Surplus Mill Capacity at Libertad
• ~1 Mtpa•Essentially two more Limon mills paid for and on “standby”

It also highlights under 'Opportunity':

'Utilize surplus milling capacity at Libertad.'

Further down it suggests under 'Schedule/Path Forward':

'New ore source for Libertad mill in 2021'

What I'm not entirely clear on is whether that 'new ore source' is expected to be internally generated, generated through a RIO type partnership, or through a deal with a junior who has ore that needs processing.....

Cutting a deal with Calibre does not preclude working something out on the mill acquisition front. Nor does it necessarily preclude Calibre, either with or without a partner, having a crack at acquiring Condor. I guess the devil would be in the detail there.

What I'm currently reflecting on is why Calibre haven't already made a bid. I can't see any other significant reason other than financing, which brings me back to whether Cailbre and Condor cut a deal on toll processing. At the moment it seems to make sense for both parties to do so, while keeping options on a 'wider' deal open.

If Condor can come to an arrangement with Calibre, and Calibre are able to effectively partner with RIO, we could see something much larger on the table. Who knows, maybe RIO could pick up both Calibre and Condor next year.

In the meantime we all wait for some solid news on progress. I also believe things are now moving quickly but I'm thinking more the end of the summer vs. now. But who knows? I've been wrong many times in the past so maybe news will flow faster.

ddd

Judging by the spread it does look like there might be some more life left in today's spike. I kind of expected this in mid-September rather than July but maybe we have some news brewing, earlier than I expected.