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To: Proud Deplorable who wrote (20121)	11/16/2004 12:07:11 AM
From: The Vet	Read Replies (2) \| Respond to of 313111

mostly don't apply to mining stocks. PE ratios and Earnings are not a good way to invest. Good advice ralph, but even so called analysts can't figure that out. A mine is a finite resource. The first day you start extracting metal is the start of the decline of the value of that mine. Industrial and technology stocks are usually not limited by the availability of their raw material and they make value by expertise or process which can grow providing they can find a market for all they produce. Gold miners can always market 100% of their output but the more they produce and sell, the less they have left. Earnings and PEs can be "improved" by high grading which ultimately reduces the potential value of the mine and often leaves reserves that could have been mined, uneconomic. In the end regardless of their past earnings or PE during the mine life, all that is left is worn out, rusting machines and a hole in the ground that costs money to reclaim. Logically, on the day that a mine with all the infrastructure in place and ready to go that has never produced an ounce of product (no PE or earnings)starts mining the enterprise value should be at it's maximum. This is obviously oversimplified, but I always believe that the first place to look at any gold mining operation is the remaining P&P reserves.

To: Proud Deplorable who wrote (20121)	11/16/2004 10:04:33 AM
From: Condor	Read Replies (1) \| Respond to of 313111

Thats nice but mostly don't apply to mining stocks. PE ratios and Earnings are not a good way to invest. I understand what you are saying but basically the mining that you and I invest in here is casino gambling. In the real world of investment and long term gains etc. PE still is important. (refer: Hathaway) I hope you read beyond the 1st paragraph. There were many other DD items that are worthwhile. It occurs to me that the companies that aren't a reflection of PE's are not long on the planet. The Inco's, Placer's, Western Mining etc etc all respond well to PE investing. However, you are right, the puppies we play with will probably not be around in years to come but will be owned by the big PE's or just die on the order paper. Doesn't mean we can't pump a few loonies in the old exploration slot machine and hit the odd jackpot though. The tech boom of 2000 scoffed at PE's also as I recall. Cheers C