Golden Band Resources

Production? Where? When?

As a general rule of thumb, never buy moose pasture that produces gold.

Here we are, near the end of November with production promised in Q4 and no news, whatsoever. But the news gripping shareholders is the voluminous of selling of shares. Production could have started years ago in the mill zone, but instead we are involved in building a pyramid with which to house our guiding light.

I can tell you from experience that the company (or Netolitzky, who I would characterize as singlehandedly strangulating this gold play) will wait until the discount rate rises before releasing any news. For the most part, the discount rate has remained aloof from the reversal in the markets, but has not climbed out. The peaks of the discount rate have determined when news is to be released. So, no rise, no news.

From my point of view, I would characterize Netolitzky as being involved in an equity swap deal, where he is a credit default swap holder in his own company. If not him, then someone on the board, or an outside interest such as another mining company. Netolitzky must defer to this interest, since they have voting rights even though they don't hold any shares, but have the same rights as would bond holders. It makes sense, then that he also has been buying at market, since the swap deal is probably bid to cover and cash is being raised by selling shares or the position closed. So he is buying partially to save face, but perhaps also to prop up the share price, but also possibly that the position will close. If this is truly the case, imo, Netolitzky should step down.

The number of shares being sold far outstrips those being sold by Resolute, quite frankly. In the highest volume month in company history, the share price has barely moved. This kind of selling has been going on far longer than people wish to acknowledge. The sell-side broker involved in this kind of selling without first owning any shares could very well be digging in his heels. If it were the case that the sell side broker knew insider information that an underlying equity position related to an equity swap were to be sold in the tens of millions of accumulated shares, then they would feel fully justified in front-running this liquidation relentlessly. fwiw, those huge, empty sell orders have been immediately pulled any time any buying is supported by large bids as it has today. This normally would occur before a breakout. (please note that Sprott providing senior secured financing may have been the signal for swap holders to settle.)

This is the scenario as I understand it, and boy do I ever wish to be proven wrong. Disgruntled hedge fund managers have long since sold out because of the insane irrationality here, so this is another fib the company is promoting through IR. Its a major embarassment for the company if both Resolute and Pollitt & Co. dump their positions. A MAJOR EMBARASSMENT

Two things the company cannot control: A rise in the gold price, and a decline in the discount rate. imo, the sell-side interest is check-mated here.

Presenting Your Best Prospect In A Straightjacket

If anything, the Bingo mine is being presented in a limited and very restrained manner. As if it were in a straight jacket. From my pov, the mistake made here was ignoring the mill zone and focussing on exploration prospects. Unless, of course Bingo is a much better prospect that they're letting on. Compare two prospects, Bingo smaller than Rainy River's Beaver Pond, but very much alike in disposition.

source: rainyriver.com

Bingo looks identical, but about half the size. So if Rainy River has a prospect with several million ounces, then Golden Band has a mine on its hands of about half the size. Note that RR.V presents an uncut version, while GBN.V presents a version with an extreme top cut.

RR.V with 75 million shares out, is trading ~$11+ a share. So, considering that GBN.V has several options with which to mine, and a float four times greater, then a $2-3 share price is not out of the question.

Market Depth Friday, Nov. 19

source: TMXmoney.com

-F6