RE: Holy Cow13 Sep 2016 23:35
Ironic- that looks about right.
Best way to think about this is forget gold and just think about the margins they make as if they were a high interest pay day loan company. It really is similar with profits recycled back into the chain to make more profit. This is what I believe is happening to is IMO obviously.
They are making interest/margin on $3 million of over 150% a year. (Which is 3% per week over a year)
In one year that $3 million is turned into $7.5 million (which is $4.5 million plus the original $3 million)
The next year the $7.5 million is turned into $18.75 million. And so on. This is assuming Wsbn have the contracts to service to make this kind of cash. We have been told already that new contracts are coming in 3-4 months and others under negotiation.
But to reiterate- they are not actually spending the money. It is standing as credit to purchase the gold and it doesn't actually get consumed. So yes this is a cash cow hence I am expecting a big re rate from here.
Everyone get it now? Good