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Gold/Mining/Energy : Standard Mining, ( Formerly Quest International )
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To: Robert J Mullenbach who wrote (178)10/7/1999 8:56:00 AM
From: James Mortensen  Read Replies (4) of 462
 
Robert,

Somtimes Kaplan is right, sometimes he's wrong. He called the yen/dollar arbitrage just right last year, as well as the market peak. This year he kept missing on the dow high.

I think he's right about looking at the short vs. long position, but I think he's forgetting that in a hot market you have new customers coming in as well. So gold certainly has room to grow. On the other hand, he sold his gold stocks at a good time. Look at Barrick and Ashanti and others that were highly hedged. The SOBs got what they deserved. It was their hedging in part that created the short overhang. Gold mining companies should be in the gold mining business, not hedging.

I'm glad you posted Bill Murphy. He's right about as much as Kaplan, but I think Murphy has much more of an inside scoop on the game. Kaplan does depend too much on technicals.

But either way, you and I are the same side of Standard's court. They've got the mineral. Now they just have to get it out of the ground. I heard an estimate at one time that their cost per oz (excluding cost of the mill) was estimated to be around $175. With gold trading at a conservative $300/oz, that's $55 million. Estimate the cost of the mill (including cost of capital) at $15 million, you're talking $40 million minimum. And these are conservative numbers.

Wish I had some more change to throw at Standard.

Regards,
Jim
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