Gold and gold stocks came under pressure during May. Gold ended the month with a US$59.58 (3.1%) decline to US$1,837.35/oz. The dollar was the main headwind, rising sharply to reach 20-year highs on 12 May. Gold stocks came under additional pressure from heavy selling across broader stock markets.
Markets and the economy are beginning to show signs of an imminent recession. The US Federal Reserve will eventually have to choose between lower inflation and higher growth. It can’t have both, and it might get neither if stagflation sets in.
Gold has fallen below its bull market trend-line that has been in place for three years. We will be watching to see if gold either gets back on trend, establishes a new trend or begins trending sideways in a broad US$400 band. Regardless of the trend gold takes from here, we expect it to test the top of the range again over the coming year, driven by inflation, geopolitical tensions, a weakening dollar, other risk-driven events or if the Fed changes course.
Not a new comment, but a new impetus, and if CEY has any sense they shoud consider their options in this space.
The gold mining industry will need more mergers and partnerships to dig up harder-to-access (deeper, more difficult jurisdictions) deposits in an environmentally friendly way, according to the head of the world’s biggest producer.
“We are seeing fewer and fewer large-scale and transformative gold discoveries,” Newmont Corp. Chief Executive Officer Tom Palmer told an industry conference in Toronto on Tuesday. “Instead, we are seeing lower grades and more-difficult-to-reach ounces.” THE IMPORTANT INFERENCE ABOUT LOWER GRADE, IS THAT THE NEWMONTS WILL NEED LARGER OREBODIES TO CONTAIN THE SAME OUNCES. LARGER OREBODIES MEANS LARGER AND MORE COMPLEX GEO-METALLURGY, WHICH IS AN AREA OF GREAT NEGLECT BY THE MINING FRATERNITY, AND WHERE THE DEVIL IS IN THE DETAIL.
To tap those ounces while assuring the industry addresses “critical sustainability issues” will require access to capital and agility, Palmer said at the Prospectors & Developers Association of Canada gathering.
“There are only a few gold mining companies who have the capacity to deliver on all of these elements: size, scale, mine life and access to capital — clearly making the case for further partnerships and consolidation within the gold mining industry,” he said.
Those who don’t understand such fundamentals “are doomed to be left behind,” Palmer said. “While gold will always exist, not all of us will without collaboration and consolidation.”
AMEN, AND SO ENDS THE READING FOR TODAY.
Best
the gold gnome
Cowichan
You play to the cards dealt. Steve P has not got infintie monies to invest, so he plays to his strength. Fast mover, obtaining good grond, and doing the low cost drill target definition. Define lots of high quality targets, advertise and get others to pay for "shots on goals". More shots, the luckier you can be, greater chance of success.
M Horgan is playing a necessities game, he has to explore within the life of mine volume (radius=trucking distance, and depth =depth of commercial mining) around the mine infrastructure. At this stage lots of well meaning waffle which has been going on too long in my humble view, and well paid staff, but nothing produced.
Compelling targets in front of investors...NO
Compelling new drill results..NO
So my money is with the Steve P/Altus plan, and so calling him a ding-a-ling is probably not the best description. Pull your finger out Horgan is my advice, and perfrom and stop waffling.
There is more to it than what I am saying, but lets leave it at that, time is short.
Petrol GBP2.50/liter of USD5/gallon!? Now thats great management isn't it?
In Australia, despite our having huge resources of gas and producing [Australia produces 2,384,327.54 million cubic feet (MMcf) of natural gas per year (as of 2015) ranking 16th in the world] heaps , we have none for domestic consumption, and so the new warning is that winter is going to get a lot colder?! Truly pathetic management by a yet another third rate government in a first class land.
And we have councils now starting to talk about a new tax on land which is not covered by at least 25% trees?! Not sure how the wheat farmers are going to react? High rise apartment owners etc etc/ Just another airey moment, and we have more than most it seems, although there is stiff competition...!!??
good luck all, we will certainly need it
The Gold Gnome
Well, inflation now moving into double figures in the US, and we are away to the races that were predicted a long time ago, but somehow not predicted by the Federal Reserve?
https://www.reddit.com/r/Wallstreetsilver/comments/va0xp6/this_is_the_most_legendary_speech_of_our_time/
NOW AN UPDATE: It’s a fallacy to keep GOLD prices low to show the economy is doing alright, says Dr. Ron Paul, former U.S. Congressman and Host of The Ron Paul Liberty Report.
He surveys the U.S. economic landscape and asserts that, "the depreciation of money [U.S. dollars] is ongoing, and it's not going to stop." [THIS GOES FOR ANY OTHER CURRENCY, AND SOME WOULD ARGUE ITS THE PRICE WE PAY FOR THE CONVENIENCE OF HAVING A CURRENCY?]
Dr. Paul: that "transitory" price inflation is playing havoc with the economy, where some Americans are feeling the effects of this much more than others. "The transfer of wealth from one group to another we are witnessing," stems from the Federal Reserve, where he says it's time to, "get rid of the Fed."
Dr. Paul encourages the flourishment within the crypto and GOLD communities concluding that, "liberty is the most valuable asset that we can strive for."
https://www.youtube.com/watch?v=dtQcEk8ZeWQ
ASIDE: WHEN I WORKED IN ZIMBABWE, WE USED TO HAVE TO PAY THE WORKERS BEFORE THEY WOKED AT THE START OF EVERY DAY (NOT WEEK OR MONTH!). ON PAYMENT THE RECIPIENT WOULD GIVE THE MONEY TO THEIR PARTNER/WIFE, AND THE PARTNER/WIFE WOULD MAKE A DASH WITH THE CASH TO THE GROCERY STORE. IF SHE DELAYED THE VALUE OF THE CASH WENT DOWN SIGNIFICANTLY, END OF THE DAY...
FOOTNOTE: The peak month of hyperinflation occurred in mid-November 2008 with a rate estimated at 79,600,000,000% per month, with the year-over-year inflation rate reaching an astounding 89.7 sextillion percent.
LESSON: DON'T GET CAUGHT HOLDING THE CASH, AS THE END OF THE DAY IT WILL BE WORTH LESS THAN AT THE START.
The Gold Gnome
Yes, and then there was the remarkable ..... David Sassoon, a member of a prominent Jewish family in Baghdad. When forced to leave by the Turkish rulers, he moved to India where, even though he never learned English and wore robes and a turban, he partnered with the British East India Company in expanding its trading empire throughout Asia. Along with his eight sons and their wives, Sassoon “piloted his family to dominate China trade, subdue and shape Shanghai, control the opium business, bankroll the future king of England, and advise prime ministers.” Controlling the Opium business of course started the Opium wars and the rest is History, as they say. Ripping trade and some ripping yarns.
I did here they had a very good exposure to GOLD in their portfolio, through the ages.
the gnome
Thanks Mr T
I have signed up! I do wish the Bankers would come clean, just as the commodity traders are now getting their due recognition for their dirty affairs. Morals left the room decades ago, if they ever had them.
the gnome
Switzerland’s Federal Administrative Court has decided in favor of four big gold refineries that were under pressure to disclose their gold suppliers. IS ANYONE SURPRISED? The Swiss have probably hid a litany of crimes, illicit transfers, tax evasion etc etc behind their wall so self serving secrecy.
This content was published on March 31, 2022 - 18:27March 31, 2022 - 18:27
Other language: 1 (EN original)
The Bern-based Society for Threatened Peoples (STP) said Thursday that it took note of the court’s decision to “protect business secrecy.”
“Importers can now hide behind trade secrecy and are not accountable to anyone regarding the origin of the raw material and associated risks,” the organisation said in a press release.
In February 2018, STP had submitted a request to the Federal Customs Administration to examine the files relating to the origin of gold imported in Switzerland .
This request was made due to “the complete secrecy in the gold trade”. The had STP raised the question whether Switzerland is a hub for risky goldExternal link in a report focused on gold sourced in the United Arab Emirates and Peru.
“Swiss gold importers fail to take their duty of care seriously enough when it comes to trading gold from the UAE and Peru,” that report concluded.
The Swiss customs authority rejected the request presented by STP, which then launched an arbitration procedure through the Federal Data Protection and Information Commissioner (FDPIC).
The FDPIC recommended that the demands of the STP be conceded and, as a result, the customs administration ordered the disclosure of the data.
Toothless due diligence
The gold refineries appealed against this order at the Federal Administrative Court, which decided in favor of the refineries and rejected the NGO’s request.
"Transparency in the gold trade is the be-all and end-all for a clean and fair gold business," says Christoph Wiedmer, co-manager of STP. "Without this, due diligence is toothless, as no one can verify the decisions of this audit."
The decision imposed procedural costs of CHF1,000 on STP and CHF 8,000 on the customs administration as compensation for the refineries.
The STP considers this a punitive measure that discourages simple requests for information that are in the public interest.
The gold refineries arguments – notably that trade relations are subject to commercial secrecy – persuaded the court!?
https://www.theguardian.com/news/2022/may/06/swiss-politicians-vote-against-loosening-notorious-banking-secrecy-law
https://www.occrp.org/en/suisse-secrets/historic-leak-of-swiss-banking-records-reveals-unsavory-clients
very poor form as usual!
Had to have a dig, so deserving
best the gnome
Lodan, relax
Gold is a great investment. In 1972, the price was $38 and then raised to $42.22 in 1973, and so on, we have charged on, with the most outrageous Ponzi scheme ever created.
Led by Central Banks of various flavors, all acting in collusion, (illegal behavior amongst the peasants?) who are so blinded by their own ideologies they could not see inflation looming large, and those that did thought it was a spike?!
Being disconnected from the real world seems to be a key criterion for employment, as one wag suggested! Perhaps it might be a next career move for Boris?
So as the (bull) dust settles, gold will live on
CEY is trying to rebuild from years of "marginal management", and is in a good position I believe,
The gold exploration business has performed according to its historical performance, and failed to allow large companies to grow at a rate which replaces reserve and resource depletion. THats what happens when you get too big, and what happens when exploration (continues0 to underperform, despite the hot winds that blow.
If you want to make a quick buck, then go for trading, time the market, and good luck! Don't complain when you lose your shirt. I have not the time to time the market, so I am in for a longer run. Happy to get the dividends and I have not lost as I have not sold. Happy to see the pipeline develop, the mine develop on engineering grounds rather than whims of a Geologist, (always a good time to head for the exit in y opinion...geology and engineering is a problematical risk exposure I avoid)
CEY have a solid foot hold in one of the most prospective, and most underexplored, gold provinces in the world. Very itereested how they develop this strength!!!
good luck and good night!
the gnome
When you cannot grow by exploration success, and you need to grow or diversify your earnings , then MandA is the way. This is the history of the larger gold companies, and here we go again. The trick is to not overpay.
Exploration success int he gold industry, is very poor, and replacing gold ounces by exploration is a rarity.
With the acquisition oy Yamana by Gold Fields which will add much needed diversification, with projects in Canada, Brazil, Argentina and Chile to its mines in South Africa, Ghana, Australia and Latin America. The combined company will have a market capitalization of $15.9 billion, making it the world’s fourth-largest gold miner, behind Newmont Corp., Barrick Gold Corp. and Agnico Eagle Mines Ltd.
...an attractive takeover because of its existing mines and pipeline of projects in the Americas. Gold Fields has in recent years worked to diversify its operations outside of South Africa, where it faces declining and increasingly hard-to-reach gold reserves and other issues (!).
Expect this to continue at the larger end of town, and CEY is well positioned (as a target) with a pipeline of near mine opportunities. Trick is to make your bid at the right time and price.
Egypt is looming now is the most under explored gold province in the world, and with regulatory reform to boot. West Africa held that mantle for decade or 2, and is still a very good place to explore
Going to be an interesting next 6-12 months!
best
the gnome
Don
They will surely drill a hole in any investors pockets, LOL.
Madness to grant exploration permits to companies that at best can only flip the tenement to a professional company, and at worst just sit and do nothing for years. This when coupled with the vast array of illegal miners now working Egypt with their 35-ton excavators etc. (not paying any taxes etc.) indicates the appalling management skills of the government in managing what are primarily the assets of the Egyptian people. No wonder there are revolutions. Quite a shame, as it is not too hard to do significantly better
the gnome
Thanks Cowichan
A "small" matter perhaps, but a lot of the "small scale mining" in areas of Egypt I have seen are anything but small, pick and shovel.
These are medium scale, highly destructive illegal mining using 25 -35 ton excavators. Sure, some of the excavator operators make some money, but 99% of the money goes to the owners of the excavators and that not a peasant.
The questions are
1. Who are the excavator owners?
2. Why are they allowed to rape the land, avoid paying any tax to support local communities, health, education?
3. Where is the government who are meant to be protecting and managing the natural assets of the country?
A: Lost in administrative detail and comfortable in their air conditioned offices, or writing new amendments to the legislature...all while Rome burnt
Q: Really, cui bono?
Cui bono is a Latin phrase that means “who benefits?”, and is used to suggest that there's a high probability that those responsible for a certain event are the ones who stand to gain from it.
sadly
the gnome
I wouldn't go slashing my wrists just yet. Time for very cool heads, and sadly there are not many of those around.
A market correction has been forecast ad nauseum. The current S&P500 10-year P/E Ratio is 30-35. This is 50+% above the modern-era market average of 19.6, putting the current P/E 1.4 standard deviations above the modern-era average. This suggests that the market is Overvalued!?
https://pages.stern.nyu.edu/~adamodar/New_Home_Page/datafile/pedata.html
The ever charging earnings of some of the darlings in the US looks like it is going to run out of steam, and to be frank a lot of is so much hot air. The market in the US believes its own BS, which is generally not in short supply.
My investment is in companies that produce something of value, have a decent moat, good management, and good fundamental assets to keep producing from.
For CEY, I would like a smart Mining Engineer to have a look at how best to do the underground mining.
https://finfeed.com/investor-101/australias-gold-mines-by-production-grades-and-costs-part-1/
cheers
If Endeavour takes away a man or womans livelihood (scratching for gold), and there is no replacement and no social security payments, then what do they think is going to happen? If Endeavour had redeployed these people doing some purposeful dignified work from which they earned a small income, then this would not have happened. Today people can waffle about ESG and employ well-meaning consultants to invent various metrics to measure ESG, but in time gone by it would be called commonsense and been done immediately as part of solid community relationship building.
the gnome
One of the prime outcomes of education (my humble 2 bobs worth) is to give the educated persons the power to be able to see through the mountains of misinformation or manure, and discern the truth and the relevant.
Sadly, the education system has failed many, which does lead to one of the lead assumptions in democracy, ... each person one and equal vote being flawed. So in the end and as we experience it, we have a flawed political system, which produces such natterers and nutters and similarly flawed individuals as we see around the world in democraticised nations...and we get the ludicrous shenanigans that thinly passes for "politics"...lets invade Ukraine, regime change in Libya, Iraq, Afghanistan etc etc...
Lets tune up the education system
Twitter being worth us$45b about sums it up for me ... what a lot of twats
best
the gnome
Could not agree more Cowichan. The board of Centamin looks
> relaxed and comfortable
> irrelevant
and is underperforming in its key duties to share holders
... lots of senior roles, and lots of professional experience, and member of the right professional societies and tea clubs, but rarely have been leaders and one would wonder how they define success...
I would like to see a large shake of the board and get in new people who are successful in areas of importance to the company.
just passing by
best
the gnome