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To: pocotrader who wrote (84894)	7/4/2011 12:44:01 PM
From: Boolish	2 Recommendations Respond to of 233807

Yeah I'm not sweating it. Good management team...just taking a little longer to get the drills turning. I think the lows are in on the jr's for this year now... Think the financing was done in two tranches. "The following chart shows how the TSX Venture Exchange Composite Index (CDNX) has performed relative to the HUI over the past two years. Although it is far from ideal in this regard, we are using the CDNX as a proxy for junior gold stocks. The HUI is a proxy for senior gold stocks, so the CDNX/HUI ratio is an indicator of how the gold juniors are performing relative to their larger brethren. The point we wanted to make is that this year has, up until now, gone the same way as last year, with weakness in the juniors relative to the seniors from February through to the end of June. If the similarity continues then the juniors will soon begin to demonstrate relative strength. One of the sources of downward pressure on gold mining stocks in general and junior gold mining stocks in particular over the past four months has been the increase in stock supply resulting from equity financings and IPOs completed late last year and early this year . For example, between November of last year and March of this year a combined total of about $900M of new shares was issued by the following five members of the TSI Stocks List: CRK.TO, KGN, PVG.TO, SBB.TO and THM. These are all junior gold stocks. Across the entire realm of junior gold stocks, many billions of dollars of new shares were issued over the aforementioned 5-month period. And in a lot of cases the new shares were issued by companies that didn't even need the money. Most Canadian equity financings have a 4-month hold (buyers of the new shares aren't allowed to sell until 4 months after the closing of the financing), which means that the bulk of the new shares issued from November of 2010 through to March of 2011 were scheduled to become "free trading" between March and July of 2011. It isn't possible to quantify the effect of the aforementioned share issuance on the overall performance of the junior gold mining sector, but the effect has probably been significant. Moreover, in terms of effect on stock-price performance across the sector, the increase in share supply due to the actions of gold mining companies has probably dwarfed short selling."