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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: russwinter who wrote (1885)	11/6/2003 8:46:17 AM
From: orkrious	Read Replies (1) \| Respond to of 110194

heinz is one of the brightest guys I've ever read. nothing personal, but the odds of his analysis being severely flawed are nil. that doesn't mean he's right that it will be $45, but there is a lot of upside. just figuring they make $150 on 6 mil ounces is $900 mil or $36/share, or $3.6/share in cash flow for 10 years. what's the PV of that? certainly a lot more than $5. and that ignores the 25-50 mil ounces of silver they have and $350 gold.

To: russwinter who wrote (1885)	11/6/2003 9:08:06 AM
From: orkrious	Read Replies (1) \| Respond to of 110194

I was just thinking about how simplisitic my figures were. doody's latest rag shows production of 445k oz/year for 14 years, cash costs of $188, capex of $274 mil. plugging in and 8% cost of capital with 25 mil shares gets a NPV and $12 stock price. that assumes $350 PoG. it doesn't include silver. I am not sure where heinz gets his numbers, but I am sure there is something wrong with mine.

To: russwinter who wrote (1885)	11/7/2003 10:28:10 PM
From: TobagoJack	Read Replies (1) \| Respond to of 110194

Hello russwinter, <<CAU ... But that's a lot of ifs and ands. It's just a rank speculation now, in a bubble environment. Bubbles can end a abruptly>> I lurk here because of the interesting discussions between familiar names. I do not own CAU. I am, for the fun of it, making a comment about gold, speculation, bubbles, probabilities, and ‘abruptlies’ :0) I feel there is no 'correct price' for gold. It costs what it costs for getting ones grubby hands on it, whether by complicated way of searching and mining finance.yahoo.com , or by the fun method of looking and scavenging finance.yahoo.com and the companies, like all companies, are valued on the basis of cash flow, embedded call option on underlying reserves or unopened chests of coins, hopes, competing wagers, etc. … but also based on immediate necessities. An example of a ‘immediate necessity’ is, I suppose, the lone parachute in an airplane that is spiraling down into the mountain, or the last full tank of air in a deep scuba expedition, or the final tankful of gas in a lost Gobi desert auto rally :0) How much is gold worth when the monetary system is at the event horizon of collapse, as was the case in Argentina, Iraq, Russia, Zimbabwe, US after the civil war, … ? Gold is worth what it is worth at any moment; Speculation in gold is a wager on the health of paper monies; Bubbles are speculations gone wild, when rationality divorces from probabilities; Probabilities are a function of time horizon; and, as to abruptness, it could go either way, abruptly up or down. So, I think most of the time gold is simply insurance, and when necessary, gold is a financial life saver, much similar to the functions of reset buttons and backup disks on our PCs. Chugs, Jay