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Gold/Mining/Energy : Gold and Silver Juniors, Mid-tiers and Producers -- Ignore unavailable to you. Want to Upgrade?

To: Claude Cormier who wrote (62917)	1/18/2009 11:11:55 AM
From: tyc:>	Read Replies (3) \| Respond to of 78426

It's an interesting situation. There is no doubt that your views reflects the market's views, explaining the market's disinterest. But is the market correct ? Is it efficient ? It ignores one salient point; it is not the market that determines whether the mine should be built. It is the board of directors (including Goldcorp)and they have already decided to proceed; only the credit freeze is holding them up. If fears about the present or future price of copper were the stumbling block, they would have said so. But there is not a hint from them that this is the case. To the contrary they have opted for production as soon as the credit market un-freezes; and THAT will be top priority of the coming budget (which admittedly doesn't guarantee success). Production envisages 97M lbs of copper at a Base line Canadian price of (2.75/.89c) = C$3.09; the current price is ($1.51/.8)=C$1.88 . Expected gold production was 265,000 oz at a Canadian price of (600/.89) C$674. The current C$ price is C$1050. Arithmetic says current total is C$ 456.8M compared to the original base line C$478M. a decline of less than 5%. But we are both wrong, to dwell so heavily on the current/future prices or trends. The poeple who have alreeady made decisions, and the feasibility study they used, did not try to predict the future nor give undue weight to recent prices. They looked at profitability over a range of prices.