Member Info for goldgnome

MrTibbles (and others in the UK)

Just what is going to happen in the UK with Brexit? On the polite side it does look like the political process is an utter shambles. Do you think it might be a good thing to find and appoint a bennevolent dictator?

best and good luck. [We are going to need it downunder when our election comes up.]

regards
the gnome..

Yes MrTibbles,
The interesting thing about Goldman, is they are active in the market, at such a scale as they can make the market. It is in their interest to be able to shape the market, and one such device is "proving" their predictions are right. I am not saying this is what they do, but what they can do. So one could imagine them saying that the gold price will go to $1500 per ounce, and prior or even as they do, that they take positions which might benefit from this prediction. They could then run the gold market so the prophecy takes shape, etc etc. I dont think the rattlesnake can do that, so my money would be on Goldman. So I am inclined to expose myself to a position that would benefot from a $1500 (say, or in this particular prediction $1425/oz) gold price...but watch very carefully in case the rattlesnakes head appears. So I would be listening for the rattles very carefully and constantly....

The fun is on in the Australian Open, and McEnroe is back in form
https://www.youtube.com/watch?v=TIDFx92P7a0
https://www.youtube.com/watch?v=wyjiKYiqGFw

and for those who missed Andy Murrays post (last?) match interview, well worth a look and listen
https://www.youtube.com/watch?v=EHFzpS0b-gE
best
the gnome

Uncertainty abounds and not just in the good ol' UK.

Goldman Sachs, ... now expects a gold price of $1,425 over the next year.

...physical gold in exchange traded funds has risen to 71.9m ounces, close to the record high of 72m touched in May 2018.

“We haven’t seen flows like this since the first half of 2016 — when the gold market really took off,” ..... VanEck in New York.

China getting wobblier,, trade relations strained, embargoes...mountains of debt, (US with debt-to-GDP ratio looking v bad) interest rates probably not going to be a strong player ...

Definitely late in the cycle, although I am getting less sure about what constitutes a cycle ... the simple view is that fear is the dominant emotion.

Gold looking good ....and so is Alex de Minaur in the Oz Open Tennis ....

Could I suggest a good day for CEY shares?
best, the gnome

Interesting question Rebess.

I think the assett CEY has in Egypt is first class, and there is considerable upside. They have built excellent infrastructure and contacts and won a lot of support and respect from the govt. Focussing on this and surrounds and other exploration and mining in Egypt makes sense, at least from a technical sense. In addition it appears to me they have been very careful and astute in their bilding of a social liscense to operate in Egypt.

When they have tried to invest outside of this, their judgement has been demonstrably poor, and hence this would suggest they should focus on their knitting, ...on what they do and know best, learn from their mistakes (they do not have the skill set to expand internationally within the current board and mngt, despite what they think of themselves and what they pay themselves) and deliver consistent sustainable perfromance.

Josefs investments speak for themselves....Indiana Resources..hmmm??? (etc). Life is too short. Josef should consider what his knowledge and skill base is very carefully...One swallow does not a summer make...

best

the goldgnome, ... who sometimes turns red and is now heading for the Australian Open Tennis ....

i woudn't be spending too much time or money on following josefs new investment here....far better things to invest in....

best
the gnome

Yes, the beach is lovely, a bit hot yesterday, so it is a sunburnt gnome reporting from downunder. The politics in the UK is mirrored in Oz, where as my African friends have reminded me we have the gold record fort the most coup d'tats (but of course we are far more civilised than firing guns at each other) of our leaders, and now we are graced by a new "leader" of "Where the Bloody Hell are you?" fame. Demagoguery seems pervasive these days ...
Very pleasing to see Rob McEwan take out the CEO for 2018 award. Some notes, and these should be studied by the CEY board ...

>>>>>>And year after year, investors take their hats off to McEwen who stands by his $3 annual salary.

In a November (2018) interview with Kitco News, McEwen said his advice to other CEOs was “reduce your pay.”

“In the last seven years, the CEOs of the 15 largest companies in the industry paid themselves just under $700 million,” McEwen said. “Pay yourself less and get your stock performing better and buy shares in your company,” he heeded.

this message was loud and clear:

“McEwen, keeps the company afloat with little to no debt and has skin in the game,” said one voter.

“He has a natural talent for finding good mines and putting them into production for less money than competitors.”

“He takes little salary and acts in the best interest of the shareholders of which he is one.”

“He puts his money where his mouth is, and continues to expand the company through tough times while keeping investors frequently and fully informed of the progress and challenges.

“[McEwen] believes in his company. Puts his money where his mouth is. [He] Does not take compensation. Every other mining CEO is getting rich at the expense of the shareholders.”

Leaders like McEwan few and far between in the industry, be nice to see one in charge at Centamin ....

i will put more sun cream on today...31 d C max predcited....
best
the gnome

Yes mrtibbles, BREXIT leaves me rather breathless, and I suspect uite a few others. Here is another note, which provides some interesting analysis of Europe.

The euro has just celebrated its 20th anniversary to scant fanfare. This is hardly surprising given that it caused
a savage Greek depression,
an outright decline in Italy’s private sector GDP over the period and
Germany blowing out a current account surplus that peaked last year at about 9% of GDP, resulting in huge deflationary pressure being exported to Europe and beyond.
Today, France has more civil servants than ever, the UK is set to leave the European Union and the eurozone may be entering another recession. Against this grim backdrop, readers may be surprised that today’s note will consider whether now is the time to buy eurozone financials....or indeed gold.

has been long argued that the euro system would bankrupt nations, followed in short order by those countries’ banks. This is the juncture at which we now find ourselves, especially as many national banks have turned into badly run hedge funds trying to earn a crust by playing a leveraged carry trade using government bonds. Hence, my Europe-focused asset allocation reports usually have a health warning not to own eurozone banks, and indeed over the last decade they, as a group, have lost about -80% of their market value.

As was the case with Japan after 1990, there has been a simple way to outperform the European benchmark since the crisis of 2008: avoid financials.... huge divergence between the broad market and financials. Look closer, however, and more adventurous readers will see that an interesting trading opportunity may have emerged.

Europe’s bank index has fallen to the level of 91, which is right where it was 30 years ago ... This level has been touched many times in the ensuing years, but on each occasion the monetary authorities did something to prevent the index from going lower. The last such intervention was in 2016 when the European Central Bank agreed to start buying euro-based corporate bonds. At the same time, the broad eurozone equity index is positioned on its uptrend line, when measured from the bottom of the 2008-09 bear market.

As a result, investors face a fairly simple decision tree:...

You can read the full take at below link (I like the research this group puts out),

Chill seems to have entered the air in Europe, and it seems to make me a glad to be in Oz, down at the beach enjoying life! and invested in gold ! If only the Australian Cricket team could perform!

best
the gnome at the beach....

https://research.gavekal.com/article/silly-recommendation

Hi All

The uncertainties are stacking up, and it seems a lot more than previously? The one uncertainty is the bounding levels of debt around the world. Its not a bad thing perhaps but how is it being used ... and how does it stack up against public assets .... ?

Global debt increased at the fastest rate at the beginning of 2018. In just one quarter, total global debt jumped by more than $8 trillion. That is quite surprising as total world debt rose by $22 trillion for the full year in 2017. Thus, the increase in global debt last year averaged $5.5 trillion each quarter.

However, global debt according to the Institute of International Finance dropped by $1.5 trillion in the second quarter of 2018. While mature markets saw their debt decline in Q2 2018, emerging market debt increased by $1 trillion led by China. In looking at the data from the Institute of International Finance (NYSE:IIF), they stated that global debt jumped by over $8 trillion in the first quarter of 2018 to $247 trillion, but then declined $1.5 trillion to $247 trillion in Q2 2018.

So, the global debt must have jumped by $9.5 trillion to $248.5 trillion during the first quarter of 2018 and then dropped $1.5 trillion in Q2. Thus, the IIF must be revising their figures each quarter. Either way, the net increase in global debt in the first half of 2018 was $8 trillion.

https://asia.nikkei.com/Economy/Global-debt-ballooned-40-in-decade-after-financial-crisis

The Apple/China story is an interesting lead into the changing future, as is the 5g moves.

https://seekingalpha.com/article/4232623-bites-apple

This is interesting if not entertaining, for those interested in Gold future trends ///....

https://www.youtube.com/watch?v=P3ntNZpTAuA&feature=youtu.be

regards, enjoy, the gnome....

Thans Bardill, I assume the pilllars will be recoverable, but probably of lower grade? Shouldnt probbaly be a big reduction?
regards
Gnome

Thats a very reasonable result, consistent with recent guidance. I would not believe there is any merit in Josef providing guidance which is not accurate, so I would tend to not go down this part. It defies any logic and learning from past events, and I don't think Josef is that stupid.

I would tend to think the grade issue is behind us as a lot of learning has no doubt taken place. They have 2 macro ore types, one which is more homogenous due to weathering, and the other which is more heterogenous, due to the existence of very high grade ores, mixed with lower. It is hard to deal with the latter, especially when one only has the drill hole information to use for modelling, which is essentially one dimensional (line like, so basically we are using lines of informaiton to extrapolate into a 3d model - very tough ask )), but they are well past that now, and so with the mining they will understand more about the controls on the high grade distribution, and hence take this into account in the modelling.

In regard to Brexit, there seems to be more emotion and hysteria than media mouths and opinion makers really doing proper detailed analysis, and thinkiing about the path forward.

Trump is going to blow hot and cold as we have seen since elected. I think uncertainty is a good thing for gold, as gold is more stable than Trumps opinion, and for that matter the British voters?!

I think Centamin is in a good space....

cheers
te gnome

No end of the uncertainty around Trump and political processes in the US .... Looking ahead, Milling-Stanley said that he could see prices pushing to critical long-term resistance between $1,350 and $1,400 an ounce.

Interesting to note takeovers are mounting, notwithstanding at the big end of town with Barrick/Randgold. Its one way to grow a company, when exporation fails to get suitable funding or fails to deliver the goods in the time frames wanted.

And at the bottom end
https://www.proactiveinvestors.com.au/companies/news/191949/primary-gold-surges-30-on-takeover-offer-from-hanking-australia-191949.html
https://www.australianmining.com.au/news/ramelius-resources-commences-59m-takeover-of-explaurum/
China takeovers of sorts
Focus Minerals gains $227m investment from China's Shandong Gold
and of course always interestig to watch the Chinese in their forays into gold
http://en.sd-gold.com/comcontent_detail.html

and the next targets

Resolute Mining Limited (ASX: RSG) and Perseus Mining Limited (ASX: PRU), and one wonders whether Centamin would be a suitable catch/prey

More headlines?

THE NEED FOR SUSTAINABLE GOLD REPLACEMENT STRATEGIES......
For every ounce of gold produced ... the industry is discovering half that
The average life of a gold mine is 12 years compared to 19 years in 2009
The world’s mineable gold reserves fell 17% from 2013 to 2015
The world may have no more than 20 years remaining of mineable gold reserves
It takes ~20 years to bring a new discovery to production compared to 12 years a decade ago
https://s1.q4cdn.com/766430901/files/doc_downloads/2017/Growth-in-a-Time-of-Reckoning_-April-2017_April-17-FINAL.PDF

It is widely known there have been a decreasing number of Tier-1 discoveries globally over the
past 20 years, a trend that is even more marked in mature exploration environments like
Australia where the last Tier-1 discovery was in 20051. The challenge is “are we finding and
developing enough new mines to fill the production gap left by the inevitable closure of our existing
operations?”. In other words, how sustainable is Australia’s mining industry in the longer term?

WORDS FROM RICHARD SCHODDE, WHO HAS HAD HIS HANDS DIRTY WITH ANALYSISING THE MINING AND EPXLORATION INDUSTRY FOR THE LAST 40 YEARS....
https://www.minexconsulting.com/publications/Long%20Term%20Production%20Forecast%20Report%2016%20Oct%202017.pdf

You can see and free downlaod all of Richards very informative analysis and presentations at below web site, recomend for those wanting to dig deeper, (and thats excatly what the mining industry is going to have to do!)

https://www.minexconsulting.com/publications.html

best to all
The Gnome.

Yes, peak oil, ... end of history..all marvellous captivating headlines...all shown to be voluminous rubbish...but it sells a few books, magazines, more hits to the web sites etc, and gives someone their 5 minutes of fame?

You can also look at the larger note/e-book, which is available for free at

https://www.principles.com/big-debt-crises/

You might have to subscribe now, but if so subscribe, download, and unsubscribe. Its a large piece to read, but very informative if you have not burrowed into the world of debt, which is the world we live in now. Whilst the debt amounts are enormous, the amount of "money" looking for real physical investments are much more,

It appears like the scene is set for a re-appreciation of gold as an asset class, and hence proce appreciation in coming months and years. Deloitte, when it released its 2018 Tracking the Trends report, identified ‘Reserve replacement woes’ as a key challenge being faced by the global mining industry. They comment "Thanks to intense cost cutting, a focus on fundamentals, and a commitment to portfolio simplification, the fortunes of many mining companies are on the rebound. Yet this tentative turnaround cannot remedy the supply constraints that currently plague the industry. Mining companies will need to find a more agile way of replacing reserves—one that allows them to engage in exploration and development without sinking in large amounts of capital for long periods of time." Sinking in large amounts on exploration is what is needed is exactly what will not happen. At best it goes to brownfields exploration around existing mines, NOT TO FINDING THE NEXT MAJOR NEW GOLD MINE. AND ITS IN THIS AREA WHERE THE PERFORMANCE OF THE GOLD INDUSTRY IS ABYSMAL, SUCH ABYSMAL PERFOMANCE DOES NOT ATTRACT NEW INVESTMENT BY AL BUT THE BRAVE AND FOOLISH. To build a first class exploration team requires funding and board committment out over 5-10 year period at least, and is only done by the major producers. The Juniors are berefit of both technical, experiential and financial capacities, and will only ever be good at opportunism in my view. Building a mine is prolematical and even successfully completing a feasiblity study is not for the faint hearted
https://amcconsultants.com/experience/why-feasibility-studies-fail/
To develop from a discovery to a mine takes 15-25 years, and the time is now getting longer.

FURTHER ...

Gold is getting a boost from weak equity markets, rising to its highest level in six months on Wednesday.

The precious metal, which is widely seen as a safe haven investment, touched $1,287.31 a troy ounce in early trading, its highest level since June 2018. Gold disappointed investors last year, falling to a low of $1,160 a troy ounce in August despite rising trade tensions between the US and China.

Those fears were heightened with the release of weak data from China. The country’s manufacturing sector contracted for the first time in 19 months in December, according to a private survey.

...

“We think gold’s ‘safe-haven’ status remains broadly intact. However, headlines on geopolitical risks and uncertainty are unlikely to result in sustained gold upside – there needs to be an expectation of lasting effects on the economy,” said UBS analyst Joni Teves in a report.

“Gold’s safe-haven role is likely to become more evident as investors seek protection from uncertainty associated with an anticipated economic downturn, such as soft patches in economic data; a more prolonged and pronounced selloff in equities; a dovish shift in monetary policy, particularly in the US; or rising concerns about systemic risks,” she added

Hope the below works, gives an interesting broader view on the worings of markets, buy someone who has been there and done that, so to speak ....Very nice riseinSP today!!! May it continue

https://www.linkedin.com/pulse/help-put-recent-economic-market-moves-perspective-ray-dalio/?trk=portfolio_article-card_title

GOLD in US$.
The main Dawes Points thesis is that China (1400m people) and India (1300m) will continue to grow their economies and that rising middle classes will continue to absorb all the available gold produced in the West.

Gold will become a very tight market.

Gold is still priced in US$ but over time the gold price in Chinese Yuan and Indian Rupees will become more important.

So the current focus is on US$ pricing.

The technical breaks of the 2011 downtrend in gold vary with individual currencies.

Here the US$ gold price had broken its 2011 downtrend in 2017 but has fallen again to test that downtrend and now seems to be moving up to test US$1300-1320.

Attention must be still focussed here.

The downtrend in A$ appears to have been broken as we have seen and maybe also in Canadian $.

Gold has broken the 2011 downtrend in Sterling, Rupees, Sth African Rands and also in Swiss Francs but not yet with the Euro nor the Japanese Yen.

The 2011 downtrend also still exists with Nth American gold stocks.

The 2018 sell off brought the XAU Index back to the levels of 2008 and provided an excellent long term turning point but the 2011 downtrend is still well above the market so the immediacy in this sector is not as strong as in Australia.

Nevertheless, markets have leaders and Barrick is the market leader in capitalisation and gold production (before and after the Randgold merger).

It is leading the market and is close to breaking its 2011 downtrend. A weekly close above about US$14 would confirm the break.

512df284-14a7-4a80-9c60-e3e88aead5fd.jpg

The recent sell off in the US markets led by Tech Stocks may be over for now but gold is unlikely to rally strongly just because of stocks falling.

Do note that many non-tech 'value' US stocks were making new highs in late Nov- early Dec 2018 so it certainly wasn’t an end of the world event.

A better indicator of future market action to follow might be silver.

Most small gold and resources stocks have been performing in line with US$ silver.

8123950b-2a95-4cdc-8ba0-334eb39fc378.jpg

A pretty miserable sight for the past seven years and for now but just look at the next graphic.

Silver is at extremes against gold and very oversold.

Any snap back could be very powerful.

Yes, Kees remarks about equipment falling into a void they created was an eye brow raiser to say the least. There are quite a few other amateurish remarks that I won't bother commenting on, as its a New Year and I have resolved to spend my limited time in better ways! A glorious start to the New Year in Oz, and I am off for my first swim in the Ocean!.....Best to all

Thanks MrTibbles

Be happy to do this. I am not suggesting either party is innocent or guilty, but rather that both parties have to improve, and improve significantly.

I am most interested in the best and most informed independent opinion. Kees is a long way from the ideal, and Centamins reporting is likewise.

My gut feel is that Centamin can make a lot more money out of this ore system, and presently are not transparent enough to be understood by the investment community. They need to think carefully about how they represent themselves,and to assume there are investors who are very capable at differentiating between twaddle and fact.

Kees seems to be a more of a $/word personage, and as such not serious in my opinion.

best and happiest of New Years...

the gnome