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yeah looks like some people are still recovering from that shock. On the other hand, there is nothing new to waste time with :)
just checked the numbers again.... it's the top 10% make a little more than 4K, top 20% make 3K... still a joke ;)
London may be slightly different from most markets of course and I see why you would want to sell the house there. I live in Frankfurt and it's the same, although not as crazy. I am also aware that worldwide people are much better off. A german cleaning lady goes on vacation once or twice a year to a decent resort which before was only possible for rich and even the 5 Star resorts these days are very much affordable for the average person given that they have a job. However, if you look at retirement figures as well as property prices, it's a very different story. I make a good living but I tell you this, the properties I look at to buy are ones that I saw as a kid and thought to myself "poor bastards who have to live in a place like this".
In Germany the avg. retirement has dropped to under 1000€/month. In the past a mailman could afford to buy a little house which now costs you 600K unrenovated, so roughly 800K with all expenses. 90% of Germans make less than €3000 after tax. And trust me, the mailman or a nurse are not even close to that. My monthly insurance cost alone is at €1500 (privately insured), so think about this for a second. So while people are able to pay for their daily needs (cars/clothes etc) easier these days, the long term investments are getting ridiculously expensive.
This all works until people have jobs and this won't change in most of the developed countries for some time I guess, but think about this:
A Wholefoods in the US needs 400 employees. An AmazonGo of the same size would require 9.
Daimler is trying to figure out how to keep just 10% of their workforce in 2030. Yes, 10%, this is how large an impact this will have on our lives. A lot of jobs will go away and I am not even talking about basic jobs, but also a lot of the white collar jobs. If you work in a very creative job that cannot be substituted by a machine, you'll be on the sunny side of society.
I am still young, I have two little boys and I think it's really a situation where society may be splitting dramatically. I need to make sure that they will be people living on the sunny side of society, meaning that they need to have excellent education and own cash generating investments and most importantly be immune to the disease of consumption. I mean I go to town and see young people running around with 4 Primark bags :) I think people don't get it.
I for my part will be buying my second apartment building next week. So I think I will be able to pay for health care and education when I grow older ;) but you never know ....
Hi Lawrence, I don't see a stock crash coming.I have been waiting for a crash for the past 3-4 years, hence my interest in gold stocks, however time has proven me wrong again :) What I do see is a whole lot of very hard to predict issues with the economy and therefore more volatility which is not exactly good for people like me (perma-short VXX).
Here are the issues I am seeing:
* central bank balance sheets
* still very low wage growth @ record low unemployment
* asset inflation (real estate/stock market)
* social unrest due to the discrepancy between rich and poor increasing
* massive social issues coming due to AI killing jobs (automated supermarkets/self-driving cars etc...)
* corporate debt bubble
* trade wars
* faster than expected interest rate hikes
* Donald Trump
* etc...
All in all, I think uncertainty is high which means we could see many flash crashes, but a real market crash which lasts for a longer time is not probable as long as earnings keep rising as they are. Who is to say when an Amazon or Netflix will be too expensive as they are conquering the world. There is so much money out there and people are willing to spend it on stocks. The other day I read that LeBron James is going to the Lakers and tickets for his first game there on Stubhub cost $3500 (worst seat). And... people are paying those prices, which tells you something. I am just amazed how gold has not reacted to all this. Maybe Crypto sucked up all the funds that would have otherwise gone into gold :)
I will stay put and try to diversify, trying to get rid of my cash, so when inflation hits, I will be ok ;) POG for me is part of that diversification no more and more less. I have about 0.5% of my net worth in it so I am not going anywhere ;)
Well Rusty. I believe in the core operations of POG including the POX hub. That's why I have not been selling. I just think, we need more time than what I had previously imagined. My earlier guess late last year was that the share price would start going up right around now until the completion of the POX hub. I also thought that gold would pick up. I underestimated the IRC issue and I underestimated the weakness of the gold price.
Regarding hedging if you read my posts, I am a very strong supporter of hedging for obvious reasons. But I think the last board did not share that view. My argument was simply, that this board will do the right thing and start hedging again, but as Murphy's Law dictates, hedging now will probably be the worst or "unlucky" timing. Anyhow, I am still for hedging, just that it only makes sense if you do it consistenly which I believe the previous board did not do (correct me if I am wrong there).
Anyhow, let's hope the gold price goes up from here and medium to long term we all benefit.
One thing that worries me is that the gold price is dropping and it's dropping fast. I bet the discussion about hedging will be back if we drop some more and guess what, everybody will now be yelling "why the hell did they not hedge". What will happen is, the new board will start hedging here and they will catch a bad price of course. Unfortunately, they will be unlucky and when the price rises again, everybody will be yelling again "why did they hedge at these low prices". Arrgh!!!
Anyhow, we are left with the same situation. The strategy remains the same now. Maybe one difference is their motivation to get rid of IRC issues (nepotism), which could still be something that kills our prospects.
I don't see the share price going anywhere until they get this final issue resolved which I really don't see happening :(
No... without peter there, we probably would have lost everything. I disagree with you there. When it comes to whose fault it was to be in this situation, clearly it was old management!
I honestly thought Peter was coming back. Thanks for pointing this out. Anyhow cabs and Slevin + Rakishev + PM&PH have roughly 36%. Remember that shareholders not voting will be plenty, so I think they almost have what they need already
... old board will come back. You simply cannot beat Rakishev+old team+cabs and Slevin. We would need some 90% voting and 90% in favor of the new board. The bad part is, Peter & Pavel actually worked for the little guy when the RI happened. I think he will wake up tomorrow, knowing that us little guys have voted against the old board, and he will be the new CEO. This means that he won’t care about us anymore, after all he probably expected a positive vote/more loyal vote from us
... and who will be on the floor for us, reporting?
whatever the outcome of the vote, I assume there may be some dumping. Whichever party loses, may lighten up on their position since until now the upcoming vote was a motivation to own more voting rights.
One strategy would therefore be to lighten up a bit before the vote and then buy back later on any drop.
Rusty, I think your thoughts are on the right path, although I wouldn't put too much blame on the old management for the reason of taking this risky gamble. I think everyone is allowed to make mistakes, it's easy to say they shouldn't have done what they did afterwards, but that wouldn't be fair. Investors took this gamble and they bought their story, so everybody should blame themselves frankly. Gold Mining is a very old business and the gold moves back then created opportunities that made people blind of what could happen. Management was blinded as well and so were all of the investors. Now we know, that this business is like it's always been about incremental risk taking, conservative projections and efficient operations rather than trying to make a quick buck by over-leveraging yourself with the hopes of higher gold prices. If gold would have continued to soar higher, we would have seen PH on the cover of fortune magazine for his achievements. I think the new board demonstrates that they want to make it a conservative and controlled turn around without short cuts. I think this differentiates them from old management. Maybe the old board has figured this out as well and has navigated the company again in the right direction, but are we sure that they would not make the same mistakes when things look slightly better again? Also, one of the key points you mention is the given connection with IRC. When you see nepotism, it should be a red flag to any investor. This was the biggest mistake, Humbro&Co made. They should have never vouched for that 234Mio and if you ask me, we will never get out of this loan until it's fully paid.
To be honest, I don't even know how to vote via my new broker "Lynx" which is apparently part of Interactive Brokers (UK). Anyhow, if I do figure out how to vote I would probably go with the current board, I don't like this whole cover up. I have 100K ;)
RB, excellent comments. Thanks for the correction with only 100Mio being convertible. In that case, the assumption changes significantly. Also, I do see the importance of voting rights, although if it doesn't happen now, it won't happen at all. Overall, I disagree with the 100Mio being so little. If we assume a 10x multiple, that 9Mio adds 90Mio in higher valuation plus 100Mio of a stronger balance shee... I would say that's a lot. Maybe not worth 1 Bn in shares, but it's quite a lot of value ;) Regarding gold prices, I would assume that we would be significantly more expensive at those levels since profitability would jump disproportionately (compared to cost)...
I don't quite buy it. If I was a holder of those bonds, I would ride this out. They pay a wonderful premium and if POG continues to pay and the share price appreciates why worry, you can always convert later at 15p, 20p or 25p if you really want to. Even better, you can short at 20p if the price gets there to lock in the profit and the premium. Also, I don't buy the theory of the shareprice dropping from 20p to 15p when the debt is converted. That would be assuming that the company value remains the same upon conversion. It's clearly not the case. Here is a simple assumption: A company with 500Mio in debt Market Value 250Mio. The same company without debt probably 750Mio + some premium X (higher multiple due to reduced Risk) Now, adding 33% more shares doesn't change much, because the company value triples or probably quadruples due to Premium X. Now, I am not saying that this is exactly how it plays out, but it will be somewhat like this. Just like when the RI happened, the market value jumped significantly, it's simple math. Now, go ahead and plug in your numbers for POG and you'll have your target price. I see 25p possible with such scenario and much more if POX works as promised. The bond holders will convert just before the bond expires and at that time, you better be long, but I don't think you will have that much time to buy, as the market will figure this out and will be buying the shares in anticipation of conversion...
@rusty, I bet you, we will not get rid of any guarantees...
btw... I don't think that POG gave that money to IRC. It's more like POG vouched for a bridge loan coming from another bank probably....
btw... watching IRC share price, it looks like nobody is too confident that those covenants will be relaxed. I hope that we didn't just dig a deeper hole ...
when we were in the position of debt threatening our business, we did a rights issue. Essentially the bond holders squeezed our balls about it and received nice convertible bonds in return. I wonder why we are not able to get anything out of such a bridge loan. We should have at least received some more shares of IRC. To be honest, that's the least one can ask for. Not that it matters much, because IRC shares are worthless, but then again, it would have shown some decency as well as good negotiation skills by our leadership...
heheh, my bad... I guess we are here for about the same time then. I have close to 5 years now, which is still nothing compared to some others on here. Hopefully, this one pays off. Good luck to you