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Gold/Mining/Energy : Corner Bay Silver (BAY.T) -- Ignore unavailable to you. Want to Upgrade?

To: Claude Cormier who wrote (1481)	10/15/2000 1:46:06 PM
From: ahhaha	Read Replies (1) \| Respond to of 4409

<<A 50% downward adjustment in expected valuation due to factoring in of development costs?>> I certainly don't think so and never said that. You said it. The market has said it. BAY trades worse than most dotcoms. A drop from from $3 to $2 isn't unusual for cats and dogs, but Hecla didn't do that. It must be that like dotcoms BAY was subjected to speculative mania or you are dead wrong in your intrinsic value calculations. We are not talking about getting a new management team, we are talking of adding new skills to an already excellent management team. All business do that when they want to grow. Right? Adding new skills? That's worse than finding capable people who are experienced with development. You claim to know about mining. Pulling dirt out of the ground is a substantially different proposition than finding it. Learn as you go? You gotta be kidding me. Why replacing management that was able to discover and prove a 140 millions ounces of silver deposit at an exploration cost of less than $0.02 per ounce. Because production is a whole different can of worms. It has to be sustained and that's very difficult. Read again, I never said they needed to line up debt financing to afford the project. They either have to do that or issue shares. A third possibility is a JV. None of these alternatives are attractive in a depressed environment which shows little if any signs of alleviation. The last two are highly undesirable. I said that dilution will be limited by debt financing. What I'm trying to get across to you is that all the ills and excesses you claim reside with traditional stocks is being actualized in BAY, so why go with a speculation which necessarily can't renew itself in the future. The project still has NAV of more than 2 times the current market valuation even with only 50% financing. And, if you know about the mining business, you should understand that a project with a 55-60% IRR will get financed easily. You can't realize these parameters unless the POS starts up. If you try, you get yourself in a conceding position and the parameters disappear. You talk as though things are fixed in cement. Much of the NAV calculation is built on cost factors which have been assumed to remain constant. As long as there is a constructive economic environment that assumption is strong, but it grows weak when the stability deteriorates. Oh! sorry, you don't know cause you never research things before speaking out loud. It is like the US debt owned by foreigners !! Your understanding of the macroeconomic environment is equivalent to the group think of the 'Bug world. When Americans buy from the low cost producers they give them dollars. The foreign entities receiving the dollars factor them back into Treasuries and other securities. The alarmists somehow have claimed that this is bad because we get material goods and they get a hand full of IOUs. When you ask these foreign entities if they don't like their paper, they say they'd rather hold the dollar IOUs because they don't trust their governments. Maybe you can tell us how much US treasury paper Canada holds. The 'Bugs say that the foreigners will cash in the dollars causing the price of Treasuries to fall driving interest rates up. Demand and supply don't determine interest rates except at the margin. Long term treasury prices are influenced by factors like expected inflation or risk premium more than they are effected by prices of short term treasuries which are more influenced by flows or by FED meddling. Even the short treasuries are not much under the control of the FED. The free market determines the price and the FED must go along. They can only fix a transient price regime. When the FED goes contrary to this either by pumping or fixing beyond what the market determines, trouble arises and trouble in this era isn't constructive for precarious mining companies. According to a 'Bug hero named Roy Jastram, deflation caused by rising rates is good for gold and silver. This kind of remarkable thinking is unique to 'Bugs. It's difficult to keep up with all the ambiguities and contradictions that come out of these extrapolations to absurdity. The killer is that you spend your life waiting for the Big One. It's called waiting for Godot. The rub is that Godot never shows. Can you show me where I was confused ? Below you claim total demand and supply of silver are in balance when anyone including you knows that isn't the case. Marginal demand and marginal supply are about equal, not the totals. Go back and review what I said about salt which had a similar environment. Can you explain of what is made the marginal demand and supply you are talking about and compare them total demand and supply. Marginal is local, transient, fluctuational, and often zero. Total is global, enduring, stable, and never zero. The sum of all the marginal contributions is often zero or if not, rarely add to the total. For example, you can have no marginal supply everywhere, but total supply isn't zero. This has nothing to do with inventory and it is difficult to understand, but it is the way the world works. How are these marginal numbers distributed among the different supply and demand sources? The marginal supply represented by one, say the major, producer is zero. Similarly with the demand of a marginal consumer, say, the US mint. Can you gives these marginal numbers for the last available year ? Yes, but I won't bother. It's like explaining calculus where everything is built on infinities. Of course total demand and supply are in equilibrium, but only when you include supplies from above ground inventories. You don't know economics so discussing this is a waste of time. Total demand and supply for silver are NOT in equilibrium. You have written thousands of words indicating that. I tried to give you a parallel explanation with salt, but that was discarded by your blind prejudice. When we talk of the supply/demand deficit of a commodity, we always exclude inventories cause they are temporary. Cause when they are gone, and it will inevitably happen some day, the deficit will cause the price adjustment to higher level. Inventory isn't a factor in the equation of demand and supply for the reason you gave above, instantaneity, but also for other reasons like differential source. I stated that the whole ball game is POS. BAY should be shut-in until the POS starts rising. If they did that, the stock would rise!