Member Info for goldgnome

Mr T

How dare you suggets the leader of the free world is up for stage play! I guess he has got to keep moving as his debating skills are..original... to say the least.

I think there is a lot of interesting stage play going on, esp around the virus. The stats are bewilidering, and I am not going to suggest I have them right but some playing with numbers available...plus some science..and of course some speculation...

Some studies here by Inde Universities in Oz suggest that about 5 to 7 times more people could have been infected than has been measured (people with no symptoms and no reported illness, so they didnt bother to get tested)...If so then instead of 27,000 cases we may have had 27,000x5 = 135,000 cases.
Base assessment is that 80% of fatalities are of people over 70 year old, and 90% had pre-existing co-morbidity...which means if we had a more science and logic based mangement program that focussed on the vulnerabel instead of state government boundaries and petty ideological politics, the fatality rate might have been say 100...basic idea could have been to accept the recomendations of the royal commisson of 2019 and better resource and manage the aged care homes...ho hum?
This leads one to stats like 100 deaths from 135,000 cases over 9 months, supposedly from the virus. The death rate from non-virus respiratory cases (flu, pneumonia etc) runs (historically) at 1,000 per month...so in the same time we have supposedly have of the order of 9,000 non virus related respiratory related deaths, and so total either 900 for the virus or could have been 100 if there was a non-political, science/logic based mangement...

and on it goes...off topic, but the fall out for Oz is a humongous budget deficit, mass bankruptcies, mass anxiety, take over by the govt (we are here to help you, grief, shiver), loss of civil libeties by the bucket load

Looking forward to gold higher and CEY with it!

best
the gnome

Sotolo

My quick and rough figures...

50k oz drop in production q4 assume 2020 down to 430-490k ozs?, last year 480k ozs produced so 50/480 = 10% drop in ozs expected on last year
They were predicting .. from ann report.... Centamin maintains its 2020 full year guidance, targeting production between 510,000-540,000 ounces of gold (production weighted 55% to H2), at cash costs between US$630-680 per ounce produced and AISC between US$870-920 per ounce sold. Open pit material is expected to contribute 80% of the full year production driven by higher grade Stage 4 ore"
this year the ave gold price looks to ave $1750/oz, last year $1400/ozs >>> 350/1400=25% increase in price of gold realised?
AISC will likely be higher for the next qtr, have no figures to est this...a GUESS usd1100/oz???
margin = $650/oz on 70k ozs (another GUESS) = $45.5m profit ... then preceding was 375k ozs @ margin say $800/oz = us$300m...so aanual profit GUESS us$345.5m +/- 5% ????

Profit before tax was reported at us$191 june 2020 ...

The company was solidly into a life of mine optimisation study due to be reported back end of calender year 2020...so understandably there will be a flurry of new adjustments...

There is suggestion that the 90k ounces are lost, just to be mined when suitable safety is in place.
2019 annual

In the second half of the year, a series of optimisation studies, across all facets of the mine, commenced, with a focus on long term planning and identifying cost-saving, operational efficiency and improved productivity opportunities. These studies are underway and have already begun to identify potential cost-saving, performance enhancing opportunities and social improvements, including improvements to open pit operations, process plant productivity and on-site camp facilities, which are budgeted for implementation in 2020. We expect the review to be completed during the second half of 2020 and look forward to updating stakeholders on any material developments in due course.

The Sukari life of asset review is ongoing. A series of independent optimisation studies across each section of the mine are underway, with results expected in H2 2020, identifying areas of improvement

So my take is the spike down is an over-reaction, and great buying op for investors with a longer term view on gold and the values that CEY live by.

Very sound decisions made by mngt and board in my view.

22% drop in value?...stupid decision by investors...

best
the Gnome.

Quite a pathetic reaction by "the market", and an excellent opportunity for those interested in long term strategic investment to enter. I AM TOPPING UP.

This is great management by Centamin. The detection system for slope/pit failure in place, works, quick decisions taken to protect staff.

The other alternatives are

1. no safety system in place> legal issues
2. Wall fails, damages equipment > loss of equipment, production
3. Wall fails, lives lost > mine shuts down>workers upset etc > cash flow in =$0.000 or free cash flow profoundly negative!!!!

This is not sytemic failure of management, or loss of resources/assets, but rather a sound, safe move to protect lives and integrity of the mining operation, which will create a blip on short term profits.

Gold? The recent events in the USA, just add to fraility, indecision and some very fundamental questions about the direction of the US economy and the USD. The debate was a debacle, the President got the virus he never understood, ANTIFA is on the rise, so is China, conflicts in the Pacific...etc Australia about to reveal the biggest budget deficit in its history (and do we need this!) after it has revealed the floor in the federation, and on it goes. All hope and bravado down here, but the debt and reliance on the governments of various flavours to fix the problem will not be a pretty sight. Glad I am not a young person starting a career in OZ right now.

best
the gnome

The debate ended as a debacle, but the chaos that is th US, stumbles on. In fact the US stumbles from one appropriation bill to the next, each with different spending timelines. Money is often only appropriate for months at a time. Showdowns and brinkmanship over debt ceilings are as predictable as summer hurricanes. Sometimes – in fact, quite often – government stops completely.

In the small hours of Thursday morning (Friday AEST) – shortly after landing on the White House lawn following a campaign trip to Minnesota – Donald Trump signed an emergency $US1.4 trillion ($2 trillion) spending bill less than an hour after the government’s authority had lapsed.

Even before the pandemic derailed the American economy – which forced Congress to approve $US3 trillion in spending – federal deficits were averaging close to $US1 trillion a year.

Trump’s 2017 company tax cuts, combined with no agreement on spending restraint, meant US debt was around $US23 trillion in February, before COVID-19 struck.

That has since leapt to $US26.7 trillion and is rising fast.

and on the US stumbles, one wonders when it will finally fall, is it any wonder that the world of Central Banks and other professional investors are loading up with GOLD?

best
the Gnome.

Rebess,

The key is not the grade it is the margin. So you can have low grade, but high margin mines, (low strip ration, large tonnage, oxidised) this makes money by the truck load! You can have high grade but low margin mines, they are ... marginal (e.g underground, double refractory)

CEY is on a good thing to state the obvious...

regards
the gnome

https://www.youtube.com/watch?v=h9s6QxQvaUE

Have to do your research on S Michael. Have a look at the history of Arrow Minerals, and inparticular

1. The share performance of Arrow Minerals AMD;ASX
2. His remuneration and alignment with share holders..see Annual Reports

No comments on Pardey, but his movements not of interest to me

good luck,

the gnome

I have worked in this general area and looking for this style of mineralisation. I am not an investor in Hothschild, and unlikely to become.

Looking at their presentation, I mark it at the very low end of the spectrum. Critical information flow was poor, clarity on key value add areas poor...Lots of maps which inferred continuity, but the drill program suggests otherwise. The critical matter in these systems is how does one get onto the real fire (read real value) as opposed to get lost in the smoke. This is not at all clear in their presentation. What is clear is they have very large budgets for brownfields and greefields exploration which is good, but one can spend a lot for little gain unless there is a clear way of focussing in such a system. NOT CLEAR

I dont like the Au (Eq) financial metrics. Not a lot of meaning here. Lack of metallurgical info .. whats going into the plant, whats coming out, whats going to the tailings. ...

My advice to you, is to be very careful...this company needs to have exploration success to make a go of it,

Debt...some strange figures

Lot of intersections look suspect for an underground operation ...

Just some quick comments .... tread carefully
best
the Gnome

Gilyarrd

I am not sure...but I am sure they have some ripping deals on Australian Trips!
https://www.discoveraustralia.com.au/holiday-packages/train/indian-pacific/

If you missed the Wild Flower season in Perth and Kalgoorlie I suggest you come back as it is truly magnificent!!!

best
the gnome

I think it would be easy to decide.

On one hand you have a company who has been committed to Egypt for a decade or more, and on the other hand you have a company who wants to make a quick buck anywhere, anytime. The company is extended in many dimensions. The latest balance sheet data shows that Barrick Gold had liabilities of US$1.97b due within a year, and liabilities of US$12.6b falling due after that. On the other hand, it had cash of US$3.33b and US$371.0m worth of receivables due within a year. So its liabilities outweigh the sum of its cash and (near-term) receivables by US$10.9b, but its probably OK. Its in numerous jurisdictions, some of them not that healthy, and has multiple commodities. Social liscensing on the mend, apparently...
Once again, Barrick is facing legal action in the U.K. on behalf of victims of shootings and beatings by its mine security at the North Mara Gold Mine in Tanzania. In Papua New Guinea (PNG), Barrick is on the verge of losing access to what CEO Mark Bristow calls a mine with “tier one potential.” The country’s Prime Minister, James Marape, has pointed to environmental and legacy issues as factors for denying Barrick’s subsidiary a renewed 20-year licence.

Centamin is a simple, debt free, royalty free, free cash flow story, with plenty of social liscence.

I know which way I would be going if I was the Egyptian government.

For those wanting an update in Oz, Four corners current affairs, revealed affairs last night which are less than inspiring. Massive wave of bankruptcies on the way (next 3 months) in the run up to Xmas, being managed by a relaxation fo the insolvency laws, such that companies can trade out of their problems (and become zombie companies, so not a great step forward). The next step seems to be a depression (we are already in recession with a $355b hole int he forthcoming budget) The good news is that the infection rate is getting down to the level where it meets the Victoria state government targets (no one seems to be sure how they defined these requirements, ... and of course more worrying is no one in the Victorian government seems to know how or who in the government managed hotel quarantines, which were so mismanaged and are adjudged as leading to the second wave of infections and a ery high fatality rate, and I expect there is a lot more to surface, none of it inspiring...who signed off on the security contracts, what was defined in the contracts, pricing of the contracts, was there some form of open tender and if not how did a company get the nod who did not have the personnel to do the job, and subsequently to do the job made use of Whatsapp recruitment services..etc etc

Now we have the Wharfies on strike for a 6% pay rise (linked to some form of productivity or something like that?), when the country is going broke, and medical supplies are not being delivered, during a pandemic...alls fair in love and war (and life down under)

Bring back Ned Kelly...LOL

be

The average P/E for the S&P 500 has historically ranged from 13 to 15.
Gold Resource trades on a P/E ratio of 36.3,
Barrick Gold PE ratio as of September 24, 2020 is 38.94
The P/E Does Not Account For Debt or Bank Deposits
Amazon: p/e =115
Tesla: p/e =918
Zoom: p/e =522
CEY: p/e=?

Still cannot see the case against gold.

I can see strong cases against the US$ and GBP. There are no convincing management plans, and plans to date have been chaotic at best, shambolic.

No trust in govt, the pillars of the financial system have been shown to be corrupt numerous times, and the Central Banks are led by Economists who have little knowledge of the real world, and whose models ignore "the human condition"

go gold

the gnome

Clearly to repeat what has failed ad-nauseum before is not good enough. We need jail terms, and hefty ones. If one robbed a bank like these guys rob the markets you would be in prison for a long time. Whats the difference...

Financial services is already the least trusted sector among seven others worldwide, according to the 2019 Edelman Trust Barometer.
https://www.edelman.com/sites/g/files/aatuss191/files/2019-02/2019_Edelman_Trust_Barometer_Global_Report.pdf

But they are still hard at work …
https://www.icij.org/investigations/fincen-files/about-the-fincen-files-investigation/
The FinCEN files
https://www.abc.net.au/news/2020-09-21/leaked-fincen-files-reveal-international-banks-dirty-secrets/12673318
The leaked files show more than $US2 trillion ($2.7 trillion) in suspected dirty money moving through the global financial system. The records show five global banks —
JPMorgan,
HSBC,
Standard Chartered Bank,
Deutsche Bank and
Bank of New York Mellon
— kept profiting from powerful and dangerous players, even after US authorities fined these financial institutions for earlier failures to stem flows of dirty money.

And to remind everyone…( I am sure most do not need reminding)

WELCOME TO LPMCL http://www.lpmcl.com/
Notice dated 4 March 2020
"The LPMCL is co-owned and operated by 5 clearing members, each of whom maintain Business Continuity Plans (BCP) … The 5 Clearing members are
JP Morgan
HSBC
ICBC Standards Bank
Scotia Bank
UBS
LOCO LONDON is the indisputable international standard for gold, silver, platinum and palladium dealing and settlement. In this context Loco London, simply refers to the fact that London is the location where precious metals are physically held and settled. The metal leg of much of the global ‘over-the-counter’ precious metal trading is cleared through the London clearing system, managed by the London Precious Metal Clearing Limited (LPMCL), which operates a central electronic metal clearing hub, with deals between parties throughout the world settled and cleared in London

I am not suggesting a link, as its all too opaque for me...but there are some odd odours floating around ...

go gold

best the Gnome

HARD TO ARGUE THAT THE GROUNDWORK IS NOT BEING DONE FOR A RESET. FROM THE WORLD ECONOMIC FORUM OF RECENT...A SNIPPET OR 2
A majority of people worldwide support calls for global leaders to ensure we make the world fairer and more sustainable after COVID-19.
A survey of nearly 21,000 adults (0.0003% OF THE WORLD POP IS A MAJORITY?) in 28 countries, conducted by the World Economic Forum and Ipsos, found that 86% of people want to see a more equitable and sustainable world after the pandemic.
IT FOLLOWS
To achieve a better outcome, the world must act jointly and swiftly to revamp all aspects of our societies and economies, from education to social contracts and working conditions. (WHO DOES WHAT, WHO CALLS THE SHOTS??)
https://www.weforum.org/
AND WHO BETTER TO DO THiS BUT THE WORLD ECONOMIC FORUM, THE ECONOMISTS (GRIEF?), IDEOLOGUES AND ELITES - ( who would be handing down the next 5 year plan for the globe. Not withstanding this has been tried in various countries (Russia, China) and failed leading to mass starvations, rights deprivation, abuse of power etc, - so the next obvious thing is to try the same at a global level, and would we be surprised if this fails, leading to the same result...somehow not, they suggest), and so on we go ...
‘The purpose of the Great Reset isn’t merely to enact policies that would lead to additional wealth redistribution, but rather to completely overhaul the world’s existing structures and institutions.’..GOOD GRIEF! TAKE A BREATH...
https://www.weforum.org/agenda/2020/07/covid19-this-is-how-to-get-the-great-reset-right
We now have various leading lights blowing thought bubbles...
"There is a GOLDEN OPPORTUNITY to seize something good from this crisis...global crises know no borders, and highlight how interdependent we are as one people sharing one planet."
...Forum's Great Reset on Wednesday, those were the words of HRH the Prince of Wales on humanity's chance to craft a more sustainable and equitable world in the wake of the COVID-19 coronavirus pandemic.
He added: “Unless we take the action necessary, and build in a greener and more inclusive and sustainable way, then we will have more and more pandemics.” A not insigificant logic gap...so if the world is greener aand society is more inclusive... we wont have anymore pandemics? The gobblygook is getting frightening...and the woke warriors have grabbed the microphones ...
A timely read
https://www.amazon.com.au/Cynical-Theories-Scholarship-Everything-Identity-ebook/dp/B08BGCM5QZ
I suspect the only GOLDEN OPPORTUNITY, is GOLD!

The Oz virus stats, <2% of deaths under 60 years old, about 80% were 80 years or older, about 90% had exisiting co-morbidity conditions...

bizarre world we live in.
I am off to build sand castles on the beach, fabulous day in what's left of paradise
the gnome

jUST IN CASE YOU MISSED IT
Pierre Lassonde on $20,000 gold price and ‘most unbelievable margins’ ever

Should the Dow Jones to gold ratio retrace to 1:1, which it has on several occasions in the past, the gold price could climb to $15,000 to $20,000 an ounce assuming the metal catches up to the Dow, according to Pierre Lassonde, chair emeritus of Franco-Nevada.

Lassonde retired from the board of Franco-Nevada this year, but is still actively involved in the mining sector. Due to the expansion of gold prices this year, coupled with falling energy prices, margins in the industry have never been better, he noted.

“As the gold price goes up, that difference [in gold price and energy prices] will go right into the margins and you are seeing margin expansion. The gold miners have never had it so good. The margins they are producing are the fattest, the best, the absolute unbelievable margins they’ve ever had,” Lassonde told Kitco News.

https://www.kitco.com/news/2020-09-15/Pierre-Lassonde-on-20-000-gold-price-and-most-unbelievable-margins-ever.html

Prof

Just believe in gold, the other stuff is blowing in the wind...literally, and its a hot wind at that

best
the gnome

There is a talk fest of the mighty Global Investment Community in Oz, ... the Sohn Hearts & Minds conference, ...some interesting views from some of the leading investors ....on GOLD

Dalio's big picture view of the world has led him to conclude investors should be cautious, particularly when it comes to accepted wisdom about the performance of reserve currencies.

During a panel discussion between Marks and Dalio, which was moderated by Magellan Financial Group chairman, Hamish Douglass, Dalio launched a staunch defence of investment in gold as part of a diversified investment portfolio.

"I think you have to view gold as an alternative to cash," he said. Marks said gold failed his investment criteria because it did not produce cash flow.

But Dalio countered that in many countries cash does not earn a return and in several countries such as Germany and Japan the yield on government bonds is negative.

He said central banks were increasingly buying gold as an alternative to currencies.

"I think it (gold) works on the diversification and works on the relative basis. I'm not saying go crazy. But if you look at the efficient frontier, you say, what is my least risk portfolio."

Dalio says you can overlay gold on top of an existing portfolio or buy gold and displace other assets in the portfolio. He warned investors against sticking with the traditional portfolio of 60 per cent equities and 40 per cent cash and fixed interest.

He said this was a dangerous portfolio without adequate diversification. Douglass said he had long aligned his position with Marks and questioned the intrinsic value of gold because it has no cash flow.

But he said he would be asking his investment team to look at gold as an alternative to US dollar cash reserves managed by Magellan.

"I haven't reached a conclusion but I think it is a reserve currency sitting there," Douglass said.

So the counter to Douglass and Marks, is that CEY is an invesment in gold that produces cash, A very nice fit in my portfolio, I am going share and send them a small note...

On the virus, some of the science is coming to the fore and the fire
For every Australian who tested positive for COVID-19 during the first wave, up to six positives possibly went undetected, according to a new study from the Australian National University.

Before the second wave, 11,000 Australians tested positive via swab tests but the study suggests the true number was closer to 71,500. At the most conservative estimate, it says the number would have been 30,000.

So if this is true the fatality rate is far lower than advertised hysterically in the media.

nice price action on CEY, its a great investment, gtting better by the day.
the Gnome

The orebody has had
1. One consistent set of epxerienced geo-eyes over all of the core up to when CEY too it over. This hopefully means a conistent logging of geological features.

2. SWIR measurements have been made on all of the core, which provides independent observations on mineralogy, and should support observations from 1.

From 1, 2 its fairly reasonable expectation that a mineralogical zonation of the orebody has been constructed in 3d. From this a Geomet sampling program has been completed (results not known by me), and the Geo-Min zones have been mapped into GeoMet zones.

From the Geomet model, one can then derive an optimal Met flow schema. Costing etc.

My understanding is that they needed more oxide, which is what CEY went after, and have never reported back to the investors.

I think this work was done at a gold price of about us$1400. Times have seen the price go up.

I am still watching for results, and strategy etc for BF orebody.

regards
the Gnome

Indeed, you might like to look under the bonnet of the debt, productivity tables and lets not mention social unrest. We are still figuring out how to pay for JobSeeker and JobKeeper, (and threatening to cut both, sending 1-2 m into poverty?) and then the shop owners are trying to get their staff to come back to work - why work when the surf is up, and you get paid 2*unemployment rate to surf?

At the University of Alabama, 1200 of 38,500 students are infected, and the University of South Carolina's positive test rate topped 27 per cent. Even the University of Illinois, one of the pioneers in saliva testing for students, had to beg them to stop partying and increased patrols after finding more than 700 positive cases since classes began....and we have an election looming in the US (and the fun has not even begun in ernest)

Globally there are more than 26.4 million known virus (related) cases and 870,700 (related)deaths. We dont whether there is a vaccine, whether we learn to live with the virus (and it just dies out like all of the other viruses over the last 10,000 years) or shut down/lock up until total elimination.
The US has 6.1 million cases, Brazil 4.04 million and India 3.9 million.
Australia has 26,137 cases and 737 deaths as of 5.30am AEST Saturday September 5.

In Oz, We are in our first recession for more than 3 decades, state borders still in a state of shock and lock, state politicians arguing with each other and the federal govt. No clues about how to create employment (if ever a government did have LOL), police when not administering lockdown, are attending domestic violence matters every 2 minutes somewhere in Australia, with Iron Ore prices up we have one ray of sunshine, but worryingly the major buyer has taken a strong dislike to our political posturing (wine industry in disarray (accusation of dumping), barley industry likewise (beer), beef (labelling issues) and watch out for the uni students). Interesting 2 related to alcohol, which Australia has a national addiction to, which seems to compensate to some degree for the loss of sales to China. Australian alcohol consumption up 13-15% in the virus months...not much compared to USA 240% increase alcohols sales online (not sober enough to drive to the bottle shop?)

Wine Australia; there are 52 million people in China who regularly drink imported wine, ...one of the most valuable markets in the world...driven by the young and increasingly affluent, who have developed a taste for premium red wine. Last year, China bought $1.2 billion worth of Australian wine — or more than one-third of Australia's wine exports by value. This year sales are down!

So be interesting to see how the gold price goes, My bet is up long term, and no doubt there will be short term shenanikans

best for the weekend, surf up

the Gnome