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From jsmineset:
Massive Squeeze Coming As WGC Confirms Gold-Backed Yuan
January 23, 2013
King World News is pleased to break the news first in the world for our global readers that the World Gold Council has now confirmed the Chinese are going to back the yuan with gold. Today a legend in the business, Keith Barron, who consults with major companies around the world and is responsible for one of the largest gold discoveries in the last quarter century, informed KWN of this development and also stated, “… the gold and silver bulls are going to begin to trample the bears at some point in the near future.”
Here is what Barron had to say: “This is what I have heard firsthand regarding the silver shortage. I spoke to a dealer where I purchase gold and silver in the United States. He just told me that immediately after the Presidential Inauguration his firm immediately began selling the hell out of monster boxes of US silver eagles.”
Keith Barron continues:
“This dealer informed me that business is absolutely crazy right now and he can’t keep product on the shelf because it’s flying out the door. I would also like to mention two items which are very important that the KWN readers should be aware of.
The first one is regarding an investment group….
“This is actually a hedge fund named Pacific Group, which is converting 1/3 of its hedge fund assets into physical gold. They have already taken delivery of $35 million worth of gold bars. The head of the fund was quoted by Bloomberg as saying, “In our judgment we are in the early stages of what would likely be the world’s largest short squeeze in any instrument.”
This goes back to what we were talking about the last time I was interviewed on KWN regarding gold repatriation back to Germany. Basically what these guys are saying is if everyone goes to claim their gold at the same time, the world will witness an incredible short-squeeze.
Great post. Financing is critical now and I still think Tyhee gets it, one way ot the other. More and more entities with deep pockets are realizing that the Gold bull market is still in its earlier stages and at some point in the not too distant future Gold will trade MUCH higher than today...$3,500 with ease and much more quite possible/probable.
Tyhee is well positioned. I added even more a few weeks ago just before this latest increase in price.
Good luck everyone...great things to come.
Got Gold/Silver/Tyhee?
SM
I like what I see too.
Someone also bought another 16,000 shares this morning...oh wait, that was me! lol
Merry Christmas and Happy Festivus (for the rest-of-us) ALL!
SM
If you were building a home...the bank would have an appraisor value the house. He would look around at your "market" and assess a value. If you were building, he would assign a value to the land. Tyhee's is worth a bundle. The credits markets are just in the biggest mess they ever have been in. There are other entities out there that are looking for places to put money (invest) now as Jim Sinclair has pointed out. There are many ways to skin a cat. Tyhee is being looked at hard. If I had $200M, I would loan it because this project will pay back handsomely. I would ask for the best terms I could get though since the stock price is so unfavorable.
Having said that next week I am buying 20,000 more shares.
Kick the socker ball all...
Keep smiling... Got Tyhee? Got Gold? Got Silver?
Wait till Gold approahes ALFS numbers and more.....
RE-POST for perspective:
Remember the seventies, investing in juniors could have made you millionaires by investing a mere $1000 into the best performing juniors. The thing is like today that the junior sector didn’t wake up until the final years of the gold bull market. The first 6 years of the seventies bull market didn’t affect the juniors that much but things started to heat up dramatically from 1976 onwards. Any company with a name ‘gold’ in it saw its share price appreciating upon exploding gold prices. Juniors priced at pennies in 1975 went ballistic going into 1980. A good example concerns Lion Mines which went up from 7 cents in 1975 to $380 in 1980, or what about Warf Resources which went up from 40 cents to $560, or Steep Rock from 93 cents to $440. These are no misprints, a $50 investment in Lion Mines would have yielded a profit of $380.000, not bad I guess…
Now you may wonder how come such astronomical returns are possible? The reason is quite simple, the junior market is so small that even a tiny inflow of money would have tremendous consequences for the average junior share prices.. Today, of all invested money less than 1% is invested gold and its shares and even a much smaller share in junior mining companies. Once the juniors start rising by multiples of 100% on a year to year base (as happened since December 2008) in the face of gold prices heading into new record high territories then people want to be part of that action and money starts flowing en masse into the junior sector. Even if a tiny percentage of all investment capital decides to chase the junior stocks all heck will break loose. It would be like trying guiding the Niagara waterfalls through a garden hose, needless to say some tightness will be encountered here and there…
Does it mean to go out now and buy all companies which have a name ‘Gold’ in it? No, of course not, there will be big winners in the end but unfortunately many juniors won’t be going anywhere as well. The thing is that discovery of economic viable gold deposits is the key which will really launch a junior company. Now despite the fact over 2000 juniors are trying to convince investors they will be successful, only one out of every 2000 projects will ever make it to a mine. To make things even worse, during last decade only a very few world class gold discoveries have been made so by just randomly throwing money at juniors you will most likely end up going nowhere..
Eric Hommelberg
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UPDATED “Potential” calculations:
We know the risks. Takeover, inability to get “shareholder friendly” financing, Canada nationalizes mines, no permits, etc.
ASSUMPTIONS:
No take over, Tyhee GETS FINANCING, gets permits, and the Canadian Government behaves.
Production rate of 108,000 oz/year, shares outstanding @ time of production of ONE BILLION (Woodstock’s assumption), total debt @ start of production of $150 M @ 8% APR and 8 year amortization which is monthly debt. service of $2.12 M or $25.44 M annually, operating cost $900/ounce, Gold @ $2,500 in 2014.
Yearly Gross: 108,000 X $2,500 = $270,000,000
Yearly Net: $270 M - (108K X $900) - (25.44 M) = 147.36 M
Earnings per share: $147.36 M / 1B shares = 0.15
Assume PE ratio = 15
Therefore price per share = $2.25
At $5,000 Gold its $6.30 (And due to QE infinity+, I am now confident $5K is low!)
If production rate increases it's higher.
If there is a "blow-off" phase in the gold bull its higher.
SM