I knew we could count on you Patrick-what a crock!!!
Here read this from someone who knows what they are talking about:
To: rrman (16689 )
From: ole 49r
Apr 24 1997 1:52AM EST
Reply #16703 of 17306
hey, rrman, your question as I recall is WHY no earlier remedial action by bre-x, and
no quick response now.
If you've ever been aboard ship, you would know that a rudder steers even the
massive aircraft carriers, but it takes the craft a long time to turn around.
It is both corporate and human nature
when one is playing on the up and up and doing the best they know how,
to assume that this is also everyone else's MO.
Naive? Sure. Understandable? Double Sure!
The lack of independent-audit-early-in-the-game was a calculated risk/decision that
ALL e&d players have to make...Do we spend money on actual drilling, or big bucks
on consultants and outsiders which cost more??? Since money comes usually from
outsiders in these cases, it's easier to justify actual drilling than expensive auditors early
on.
In the early days of raising money, the consulting engineers aren't brought in until a co's
existing drill program proves they've "stumbled onto something big," normally at the 2
million oz threshold.
Early E&D's just can't justify the monetary expenditure to potential private
placees/outsiders when drilling is so expensive in the first place.
Secondly, this was a closely held LOW float company, something which should not be
a "revelation" to you a supposed TSE floor trader.
This means that dilutive shares money wasn't required early in the game, thus forcing
the price of the stock higher when that was not the "norm" for "tiny companies."
Therefore, this company could drill& report/drill&report/drill&report/in rapid fire
succession and could continue to postpone the "inevitable outside audit stage" long past
the time when it would have been done by another less well-funded company.
Thirdly, when a necessary step is postponed as long as BXM did the independent
audit phase, there is a mathematical correlation to how much auditing/drilling/assaying
has to be done to verify the previous 48K assays, and 300+holes over 3+ years of
drilling.
The geometric progression of such rapid development means that our aircraft carrier,
Bre-X--Busang was vulnerable to a course/price correction of similar magnitude in
relevance. Thus, we've witnessed the "slow speed of the turning of the massive ship
Busang,"
via Strathcona's audit, which has had to be more extensive, cores split 3 ways from
Sunday, flown all over the globe for assays, yadda yadda yadda.
I hope these proferred suggestive replies give you grist for your mill. Of course, under
Socratic methodology, if you are able to pose the question, then you have already the
elements of the answer within you. So picking up on your "vibes" wasn't too hard, nor
insulting, I might add!
Why didn't they do it earlier? It was a corporate decision to enhance shareholder value
AT THE TIME instead of getting taken under by ABX who was breathing down their
neck and stealing their high level employees to sabotage & slow their E&D operations
according to my sources.
My wallet is grateful, how'bout yours????
O/49r |
