And as to the news itself....
The news this morning answers my private concern that unrest in the Middle East would threaten the income stream of the sale of the gold & silver.
I talked by phone to several people during the shareholder's meeting and expressed my surprise that the Chinese had not gotten the refining contract. For the benefit of folks other than those with whom I talked back then, here's a recitation of my thinking.
First off, I had followed the pattern of the Chinese refiners in all kinds of metals for some months and I had seen that they were willing to pay extremely quickly (as reported on SEC filings of other companies I follow) for their refining services, whereas all other refiner relationships in both the U.S. and Canada acted more like ordinary businesses, with payment happening after the service had been rendered.
This "pay upon service rendered" approach includes the Abu Dhabi refiner, who proposed four pathways to "settling up", all of which involved determining exactly what was in the shipment and then paying out for it (point being that the only entities out there willing to pay extra quickly were the Chinese).
Now, since the Chinese, as a nation, have long been awash in the fiat currency coming out of our Federal Reserve, the willingness of the Chinese to be quick payers made sense.
After all, since they logically could be expected to knowhow to run a spreadsheet and see how their gazillions of dollars actually lost value over time but made money if the transaction was made up front in precious metals, they could reasonably be expected to have comprehended that they could accomplish two extremely important goals by being known as quick payers:
A.) get more business by having a quick pay policy, and
B.) they also lost less value in dollars by taking precious metals in, paying quickly, and settling up over any differences later
OK. so when SFMI cut a deal with Abu Dhabi, and that deal involved the settlement after refining (according to one of 4 possible settle-up methods), I was surprised.
Well, with today's news release, we see a backup deal being cut with a US refinery. Frankly, I never liked the idea of shipping our precious metals overseas; whether to China or to the Middle East.
Quote:
So on that basis alone, I like the new deal.
I also, like it a LOT because I have had considerable concern over the unrest in the Middle East. To be plain, Abu Dhabi is too close to Iran for them to be a safe business partner, IMHO. The first thing that will happen if Iran acts out some of the violence many fear will soon happen is the closing of the Straits of Hormuz.
Translated into an event that effects SFMI, and thus damages me personally due to my holdings, the increasingly likely threat of the closing of the Strait of Hormuz is a BIG reason to dislike the deal in place between SFMI & Abu Dhabi.
So, to summarize, I am pleased we now have a business partner to whom to sell who is in the US for two reasons:
1.) we do not have to physically ship our precious metals overseas.
2.) we now have a buyer who is not threatened by the closure of the Strait of Hormuz
As such, IMHO, this news of Republic, out of Miami,
http://www.republicmetalscorp.com/
now being in the equation is fabulous for us. We are much better off selling to them than to either the Chinese or Abu Dhabi, IMHO.
But let me add another reason to be exhilerated.
Notice that the shipment date being in OCTOBER is reiterated.
Recall, 0ryx, that reports from the shareholder's meeting that they would be trying for a sale as early as October were repeatedly challenged. (Actually, reports that there would be any shipments at all have been challenged, LOL).
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Well, NOW (with today's PR), officially, the date is set to where I understood it was intended to be: October.
Notice, if you will, that we are presently in the latter part of October. As such, all of this nonsense about there not being anything real in October is confirmed to be absolute nonsense.
We will now see a sale in October, and as such, it is clear that the assertion put out there by PQ that he hoped for a total of 3 sales by the end of the year is on track
So, net/net: There are 3 EXCELLENT reasons to be delighted with the issuance of this PR today:
A.) we are not shipping overseas
B.) we will not be completely cut off by a closure of the Strait of Hormuz
C.) We are confirmed to be on track for THREE sales by year end.
Pretty good PR, if you ask me.
:o)
Imperial Whazoo
