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

To: Silver Super Bull who wrote (17626)	8/12/2004 10:28:59 AM
From: mishedlo	Respond to of 110194

From Heinz on DROOPY: imo the market has overeacted. it's not as if it wasn't known that the SA operations would disappoint with the strong Rand. note that overall, DROOY made an operational profit, since its PacRim properties were VERY profitable. in fact, 6 months after buying into Porgera, it has already gotten over 50% of its investment back. but this happens sometimes...apparently the market chose to focus on the negatives from SA, since they DID contain a few nasty surprises, especially the performance of Blyvooruitzigt. still, at the current price the market assigns de facto a negative value to those operations, since Australasia alone would justify a higher share price imo. also, DROOY labors under the impression that it simply can't get things right at its SA deep level mines. however, they now have new operational management there - the guy they had previously apparently tried to defraud the company and didn't look after the mines well. a stroke of bad luck, but not the first one unfortunately. in sum, the downside risks have been wrung out here imo - certainly most of the weak hands have sold, considering the trading volumes over the past two days. note also, institutions have bought the decline according to my reading of the tape. so far, DROOY's share price has never reflected the successes in the PacRim. but they deserve recognition, and will get it once the general mood in the sector turns more positive. also, since the SA operations apart from Blyvoor operate close to break-even on a cash cost basis, there remains enormous leverage to the eventual weakening of the Rand. even if the Rand does NOT weaken, things are bound to get better on account of the inept van der Mescht being replaced. what one hears about the operational deficiencies at Blyvoor suggests things can't possibly get any worse.

To: Silver Super Bull who wrote (17626)	8/12/2004 10:54:28 AM
From: Knighty Tin	Respond to of 110194

deadbull, Krudlow must be snorting again. Prices on crude have more than tripled while Greenjeans continued to lower rates. I would say that shows that crude prices have zero impact on the master of economic disaster.

To: Silver Super Bull who wrote (17626)	8/12/2004 10:54:37 AM
From: mishedlo	Read Replies (1) \| Respond to of 110194

Kudlow made a very interesting remark the other day. He said that the Fed would increase interest rates if oil prices continue to head higher, because of an 'institutional memory' at the Fed with regard to what happened during the '70s. I think he is dead wrong. It will take jobs and retail spending to get him to hike. Rising oil is spooking the market and taking a toll on the economy already. .50 bps hikes did nothing to solve rising oil and nor would another .50 or .75 either. Mish