Member Info for goldgnome

https://www.youtube.com/watch?v=EC2YRkbnxSw

"Big tech companies are laying off 10% of their workforce, this is going to have a huge effect," warns E.B. Tucker, bestselling author of Why Gold, Why Now? "We are slowly grinding towards a position where something weak will crack," he tells Daniela Cambone on this episode of Powershift: Outlook 2023. "The crypto story is speculative mania blow off coming back down to Earth... To their detriment, central banks are going to make their own crypto," he continues. "Nothing is going up in value on a speculative basis. You have to remain solvent in order to play the next inning," Tucker says. While the Fed remains on their current path, "it's really hard for people to wait, but you're in a scenario right now where if you make a big move, you're probably going to get hurt," he warns. "The [gold] resource producer is beginning to assert power they haven't had in 25 years. You want to own the actual physical resources," Tucker says. "The people that think the dollar is going to crash are dreaming, it is not something that just disappears," he continues. "The system is majorly broken, it's a centrally planned economy," Tucker concludes

There comes a point in every politician’s life of doublespeak when he has to tell the truth. John Kerry’s came this year in Davos. Asked how to achieve the always-receding goals of climate control, he said, “Money, money, money, money, money, money, money.”

Federal spending for most people normally runs as background noise. But the Democrats’ assumption that voters don’t notice spending may be wrong and for a familiar reason: the pandemic.

The pandemic put the federal government inside everyone’s head, and what the government did was spend, spend, spend money, money, money.

The spending rivers included a bipartisan Covid-relief bill of $2.2 trillion; the American Rescue Plan’s $1.9 trillion, and then a bipartisan infrastructure bill of $1 trillion. Mr. Biden’s 2023 budget proposal was for $5.7 trillion. In December he signed a $1.7 trillion spending bill.

But that’s not all.

Amid the traditional trillions, Democrats ostentatiously added a permanent spending commitment for climate and clean energy subsidies. And already that isn’t enough, as Al Gore’s rant and Mr. Kerry’s plea made clear in Davos.

Interest payments on the debt are an astounding $400 billion annually.

In his Martin Luther King Jr. holiday speech, by tradition an opportunity for healing, Mr. Biden called the Republicans “fiscally demented.” Is it the view of this president and every Democrat that $31 trillion of debt doesn’t matter, that $400 billion for interest payments doesn’t matter, that a federal budget close to bursting through $6 trillion doesn’t matter, or that off-loading billions of student debt on everyone else doesn’t matter?

Joe Biden promised normalcy. This spending isn’t normal, and the American people know it. If Mr. Biden can’t find the words to talk about it, voters may start looking for someone who will.

I THINK THE CIRCUS IN THE US HAS GOT TO SUCH A STAGE OF ABSURDITY, THAT ANY CLAIM OF TRUST IN THE US$ IS LOOKING VERY TENUOUS. $400B ANNUAL INTEREST PAYMENT AND WITH INFLATION AND RAISING INTEREST RATES YOU KNOW WHERE THIS IS GOING+CLIMATE CHANGE+WAR+A CHAOTIC HEALTH SYSTEM+CIVIL UNREST BEGGARS BELIEF, AND WE MAY WELL SEE THE MIGHTY DONALD BACK IN THE DRIVERS SEAT?!

Go Gold

the gnome

https://www.youtube.com/watch?v=EC2YRkbnxSw

Some companies stopped theire exploration programs as hey were taking 3 months to get gold assays back from the Labs...so they could not get the mission critical feedback as to whether they were chasing grade or was it just smoke, or just alteration. Some pulled back on their budget, but limped along

Portable PPB has now solved this issue, allowing ppb gold analyses to be done same day in the field, using a capex of about $50k

https://portableppb.com/our-technology/
Ths allows the explorer to look for gold by using gold, and not relying on As or Cu or some other indicator [s] which are not as relaible as good old gold
best wishes

the gnome

There is a fair bit going on in the debt markets and in inflation. Some interesting articles by Ray Dalio

We all know that there is no real debt limit because what is called a debt limit never actually limits the debt. It’s a farce that works like a bunch of alcoholics who write laws to enforce drinking limits, and when a limit is reached, they do a farcical negotiation that temporarily eliminates the limit which allows them to have the next drinking binge until they reach the next limit at which time they go through the next farcical negotiation and continue to binge. I gather that this is the 79th farcical negotiation that has taken place.
Not only does this tragically comical ritual lead most people to be confident that the debt limit will be gotten around, but it also tells us that those running our political system lack discipline or they tacitly agree that binge borrowing is OK. I think it makes clear that the long-term prognosis is for the debt bingeing to go on until a crisis ends this dynamic. However, most people seem comforted that the debt limit won’t trigger a debt default and don’t worry about the debt bingeing continuing. That raises the justifiable questions: Is it a good or bad thing that we are getting around this debt limit? Are high debt levels and high levels of new borrowings that require high levels of government selling of debt assets not risky? I think those are reasonable questions as we have been hearing warnings of a debt Armageddon for decades yet none has occurred.

https://www.linkedin.com/pulse/farce-consequences-debt-limit-ray-dalio/

I am on the beach and throwing a prawn ont he BBQ

HAPPY AUSTRALIA DAY

The Gnome

Cowichan

Why dont you cut and paste the facts as you see them. I would like to have a look

best
the Gnome

When you look at the facts in Met testing they test a very small fraction of the ore volume (<0.01%), and invest a very large part of their project capital ... on the results of this absurdly small, biased, sampling. When you look at the assumptions built into the sample of this ultra small portion of the orebody, there are very significant risks inherent. Yet happily they claim 15% accuracy. State your case in facts, as to how one could sample <0.01% of an inhomegnous 3d orebody, sampled by pin pricks (drills, which have strong directional and sample bias), logged inconsistently by several geologists over lets say a 3 year period (think staff training, turnover, developing nations) and lay claim to be accurate to 15%? Please lets stick to the facts. It is NOT an easy task, and it is fraught with dangers. Look at the studies of underperformance in Australia, and then ask, what would be the basis for thinking it would be a lot better performance in Cote Ivoire?

I am most intrigued

the Gnome

I was in the "Last Chance Saloon" the other night, and CEY was not there. But it was packed out, and the beer was good

One of the groups I did see drinking hard were Team USA. It looks like the Ponzi scheme they run, has just leveraged up another record!

Most games of chicken do not have trillion-dollar stakes. But such a spectacle is common in America when Republicans in Congress face off with a Democratic president over the debt ceiling. This legal limit on the amount of debt held by the Treasury is periodically raised (whenever they want and there has been a fair amount of want)—but never by enough to avoid a repeated stalemate. Without a bipartisan political deal to raise the ceiling America would be in uncharted and dangerous territory, bumbling into pointless default (recall they defaulted in 1970, but of course they called it something else!!!. recall in 1971 when the United States unilaterally terminated convertibility of the US dollar to gold, effectively ending the Bretton Woods system..it was a convertability problem of a barbaric relic, LOL

On January 19th Janet Yellen, the treasury secretary, announced that the country had hit its maximum debt (of $31.381trn) and that she had begun taking “extraordinary measures”—accounting tricks such as deferring pension investments to conserve cash. These measures, which have become routine (!!??), buy several months before the calamity actually arrives, called the “X-date”. The last close call, in 2011 when Barack Obama was president and Joe Biden was vice-president, was resolved with only days to spare, spooking stockmarkets and leading one ratings agency to downgrade the federal government’s credit.

Republicans must repudiate their use of the debt ceiling as a negotiating tactic, and congressional Democrats and the Biden administration must abandon their refusal to negotiate. The American people would welcome these steps as a rare sign of common sense from their leaders.

Common Sense is not common these days! Especially in politics, anywhere!

regards
The Gnome

Intrigued about the Met story you refer to Cowichan.

Do you know that Met testing is done on between 200-400 kgms of "representative ore". There is a fair bit to it, and plenty of room for errors, as has been noted by several studies (the industry tends to bury the bad results but sometimes bankruptcy is a bit difficult to bury). Some reading that is fairly reasonable in describing the process
https://www.ausimm.com/globalassets/insights-and-resources/minerals-processing-toolbox/anderson0503.pdf

Key is to have competent person sign off, and this should be personS, plural. It needs competent senior geologist AND metallurgist. One without the other increases probability of poor design, long lead time in commissioning, plant under-performancem high AISC..and project failure. What has impressed me about Horgan is his constant referral to Geology, and its important role (I am not a Geologist, but know a bit) in exploration, resource estimation and metalurgy. You do not hear this 3 bagger very often.

In McCarthy (2003) in a study of where things went wrong in feasibility studies showed that 27% of the issues arose in the metallurgical testwork, scale up or process plant equipment design. Of these issues the key areas where things went wrong included:

>Metallurgical domains within the orebody not understood
>Testing done on unrepresentative composites
>Failure to identify process contaminants
>Inability to handle ore types as per mining schedule
>Process water chemistry differs with lab

Plenty of very poor form by the industry! I am quite happy to build on solid foundations and what I hear and read is looking solid, even if it does take a little longer than armchair critcs and analysts think. Both will be the first to criticise when things go wrong, as they should but lets assume they are doing a good job, being fastidious. Investing in a $x00m plant and equipment is not to be rushed into.

A report from global consulting group McKinsey, "Optimizing mining feasibility studies: The $100 billion opportunity", has found that more than four out of five (80% !) mining projects came in OVER budget with over half recording an average budget overrun of 49% (!!!) – and this was just for those projects that reached production phase.

“Scope of work must be “is it feasible?” and not “make it feasible”.

There are plenty of clowns out there, wearing suits talking with arms waving..no feet on the ground so to speak. Happy in CEY

the Gnome

Thanks Siko

I think the new policy in CEY mngt is to be measured and err on the conservative side, which sits well with me. I think they have probably been very measured and restrained around the Sukhari mine site, whilst there was some legal risk (why would you put excess capital at risk). Now this has been removed then I think we will see a lot of new developments happen, and some of the satellite ore poisitions will be worked and known more.

I think their position in West Africa is solid. The mineralisation is on scale and grade. The fact that it takes a bit longer, is really more a function of thats the way it is in West Africa, and managing risk. I would far rather they build a solid foundation than rush in due tot he whims of some of the "arm chair CEO's" one hears and see's floating around.

Happy to stay invested, there are a lot of gold companies that are on my avoid list at the moment.

best
the gnome

The trouble with Barrick, Endeavour is their growth story, going forward. Neither is convincing from an organic growth perspective, which leaves .... MandA

Thanks Siko!

The response from Horgan will be the real catalyst for SP movement. If I was Horgan, I would have tempered my investment plans on the 160km2 permit. Now with all lights green, what is the new plan? I am all ears and eyes. Is this breakout time?

the gnome

https://fred.stlouisfed.org/series/RRPONTSYD

Thanks Spoon...

The Banks are being careful with their messaging for obvious reasons. Here is the next joke bouncing down the road...

Treasury Secretary Janet Yellen called on Congress to raise the debt ceiling as soon as possible, warning that the government could become unable to pay its bills after early June ! What a surprise!!!

In a formal letter sent to party leaders in Congress, Ms. Yellen said the government would hit the roughly $31.4 trillion borrowing limit on Jan. 19, when the Treasury Department will begin implementing so-called extraordinary measures to manage the government’s cash flow.

“While Treasury is not currently able to provide an estimate of how long extraordinary measures will enable us to continue to pay the government’s obligations, it is unlikely that cash and extraordinary measures will be exhausted before early June,” Ms. Yellen wrote to Congressional leaders.

“The president and the country will not stand for anyone saying, ‘unless I can cut Medicare, Social Security, Medicaid, or other programs seniors and middle-class and working families count on, I will cost tens of millions of Americans their jobs and retirement savings’,” White House spokesman Andrew Bates said Friday.

“The thing that makes me most concerned is the timing,” said Mark Zandi, the chief economist at Moody’s Analytics. “This is all going to come down to later this year…when most economists think recession risks are going to be their greatest.”

Its all fairly obvious...but we wont talk about it in polite company

best
the Gnome

The biggest U.S. banks are preparing for a recession but aren’t feeling one yet.
They pointed to rising interest rates as the reason for the likely economic slowdown, though their quarterly earnings are only starting to reflect that. The four largest commercial banks collectively stowed away $2.8 billion in the final three months of 2022 to cover potential loan losses. As investors p****d the first batch of bank earnings, U.S. stocks climbed into positive territory, with the S&P 500 gaining 0.4%, the Nasdaq Composite up 0.7% and the Dow Jones Industrial Average adding 0.3%.

What about the economists..?

Laugh a minute with the predictions. Really a bit of gamesmanship as in reality no one really has a clue.

Look at suppl/demand and you dont go to far wrong. Supply side in terms of new discoveries is an all time low, and going down. Nothing will stop this trend

best

the gnome

Interesting new discovery by Endeavour, in the vicinity of Doropo. Always thought the area has huge potential and is underexplored.

https://www.endeavourmining.com/media/news/endeavour-makes-major-greenfield-discovery-cote-divoire-maiden-1.1moz-indicated-and-1.9moz

Suggests more synergy between Endeavour and Centain...

best
The Gnome

Having been involved with Nyakafuru and surrounds, I will rpedict the exploration upside is very limited...probably why Resolute would not hang onto it,...they certainly had a good crack at trying to find more gold ...

good luck

I am not that baffled.

I think CEY has been undervalued, for reasons we have discussed ad nauseum, over prpmotion and essentially for underperformance,

Now there is another story emering, and it is tending tobe understaing and consitent performance with an emerging potential for outperformance.

The reserve / resource positioning is excellent. I am waiting to see how many of the Doropo Inf ounces convert to M and I resources and to reserve ounces. Gut feeling there classification is on the conservative side. Met seems v straight forward. Gut feeling there are more Resources to be found. Great posiiton to be in.

ABC is the dark horse, but at 2.2 M ozs, this is ore than interesting. Early stage. Great macro address, and clearly there is a large gold system operating.

The AISC cost rise is a strong function of energy costs (which will go down), and they are positoning themselves very well with the Solar Farm. Look forward to the $20m annual saving here. My bet is the energy costs will go down, as the Ukraine - Russia conflict ends, and sanity returns. So they can double down on energy. I think the approaches that CEY is making onlocal labour, local mngt is excellent. The overall approach of CEY gives me confidence in their management and their ability to control/manage cost...impressive in these times.

I like the way the underground resources are building, and a 10 year mine life is very doable, and again conservative. I will not be surprised to see a 20 year mine life, but drilling it out up front now is not that smart use of capital. I think the ounces will be found, but lets do this when we need these ounces to be firmed up.

The social license to operate in Egypt is very strong, the employment of local staff, the upskilling programs, the royalty payments etc are very significant...I would imagine CEY's presence and policies in Egypt are more popular than the governments, LOL. CEY delivers, and is delivering sustainably, and it now looks like on a generational scale.

Happy to sit this out, no surprised the SP of CEY is rising, wuality cash producunginvetsments are few in these times.

If anyone loves conistsent big hitting in cricket, you will enjoy this link. I was glad I was not a bowler or fieldsman on either side!!!
https://www.youtube.com/watch?v=RQEeDeUwZLo

best

the Gnome
(If anyone can bat, can they please come to Sydeny and give the South Africans a hand!?)

Some of the facts

The national USA debt ($31.33 T) is the total amount of outstanding borrowing by the U.S. Federal Government accumulated over the nation's history... (most of it inthe last 10 or so years!!!)

INTRAGOVERNMENT DEBT
Intragovernmental holdings totaled more than $6.82 trillion in October 2022.

Why would the government owe money to itself? Because some agencies, like the Social Security Trust Fund, take in more revenue from taxes than they need. These agencies then invest in U.S. Treasurys rather than stick this cash under a giant mattress!

Social Security trusts, including the Federal Old-Age and Survivors Insurance and Federal Disability Insurance Trust Funds, held $2.75 trillion in Treasurys as of August 2022. The next largest agency was the Military Retirement Fund at $1.18 trillion.

PUBLIC OWNED DEBT
The public holds over $24.29 trillion of the national debt.1 Foreign governments hold a large portion of the public debt, while the rest is owned by U.S. banks and investors, the Federal Reserve, state and local governments, mutual funds, pensions funds, insurance companies, and holders of savings bonds.

The Treasury breaks down who holds how much of the public debt in a quarterly Treasury bulletin. Foreign and international investors held over $7.6 trillion, according to its September 2022 bulletin, which included data through March 2022. State and local governments held $1.45 trillion and mutual funds had $3.26 trillion.

The national debt held by the public is not only in Treasury bills, notes, and bonds. It's also in Treasury Inflation-Protected Securities and special state and local government series securities.

RECAP. So in 1971 the US Govt defaulted on the exchange of gold for US$, because they had spent more than they earnt. The euphemistic way of explaining this, was that the strength of a countries currency was directly related to the stength of its economy...and of course this meant the US$ was a paramount in the world currencies, as the US Economy was the strongest...a MOST EXORBITANT PRIVILEGE #2 for the good ol USA. BUT IN REALITY THE THE US DEFAULTED ON ITS DEBT AND CURRENCY OBLIGATIONS BY CHANGING THE RULES AND USING LOVELY LANGUAGE...

And what happens when the US Govt finds out it cannot pay for all of the military niceties, or its social obligations ... it just prints more money and on the show goes...

Poor old Bernie Madoff went to jail for this sort of caper?

Good luck with your fiats, dont get caught holding them ... you know which way their value is going, and that is down, down down.

GO GOLD

best
the Gnome