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I like to post the good and the bad
I don't want people to think it is all rosey in Zimbabwe
I still say it is a buy at these price
A new kind of hyperinflation: Zimbabwe hikes mining fees by as much as 8,000%
http://www.mining.com/2012/02/20/a-new-kind-of-hyperinflation-zimbabwe-hikes-mining-fees-by-as-much-as-8000/
What is this 51%
Is this good or bad for CALVF.
I got this off of Yahoo
Caledonia Mining Corporation -
("Caledonia") (TSX: CAL) (NASDAQ-OTCQX: CALVF) (AIM: CMCL)
announces it has signed a Memorandum of Understanding ("MoU")
with the Minister of Youth, Development, Indigenisation and
Empowerment of the Government of Zimbabwe (the "Government
of Zimbabwe") pursuant to which Caledonia has agreed to sell
51% of the Blanket Mine in Zimbabwe ("Blanket") to Indigenous
Zimbabweans for a paid transactional value of
US$30.09 million on the following basis:
16% will be sold to the National Indigenisation and Economic
Empowerment Fund;
10% will be sold to a Management and Employee Trust for the
benefit of the present and future managers and employees of
Blanket;
15% will be sold to identified Indigenous Zimbabweans;
and
10% will be donated to the Blanket Gwanda Community Trust.
Caledonia will also make a non-refundable donation of US$1.0
million to the Trust as soon as it has been established.
Caledonia will facilitate the vendor funding of these
transactions which will be repaid by way of future dividends
from Blanket.
Caledonia expects to redeploy the sale consideration in its
projects.
Caledonia has undertaken to complete the implementation of all
the components of the indigenisation transaction as soon
as possible.
The Government of Zimbabwe has agreed that implementation of
the terms of the MoU will constitute full compliance by
Blanket and Caledonia with the requirements of
the Indigenisation Act.
Further details of the MoU are subject to a confidentiality
agreement, and further announcements will be made when
appropriate.
Blanket's unaudited revenues and profit after tax for the year
to December 31, 2011 were US$56.6 million and US$19.2 million
respectively.
Mr Stefan Hayden, Caledonia's President and Chief Executive
officer said:
"I am pleased we have signed a MoU which, when fully
implemented, will represent the conclusion of the
indigenisation requirements for Blanket.
The transaction will be concluded for a value which is close
to Caledonia's current market capitalisation.
( Note
CALVF Total Current Market Cap: $55,060,421.--
[A subsidiary company;
Blanket Gold Mine 51% = US$30.09 million on the above
following basis:]
http://tmx.quotemedia.com/quote.php?qm_s... ?)
This is a significant achievement in the current environment
and the transaction is neither an expropriation nor a partial
nationalisation.
Excellent progress has been made at Blanket in recent years:
gold production has increased by over 300% from 3,148oz in
the first quarter of 2010 to 10,533oz in the fourth quarter
of 2011 and cash operating costs fell by 27% from $804/oz
in the first quarter of 2010 to $583/oz in the third quarter
of 2011.
I hope that Blanket and Caledonia can now build on this track
record of success.
The indigenisation agreement, when fully implemented, will
introduce new shareholders to Blanket and I am confident
that their participation will enhance Blanket's further
growth and development.
We look forward to working with our new shareholders in
further progressing operations at Blanket for the benefit
of all stakeholders."
For your listening pleasure
Interview with CALVF on 2011 results and forcast of 2012
Comparison 2010 to 2011
This article was put out on Dec 24th 2010
http://our-street.com/2010/12/24/caledonia-mining-corporation-a-south-african-gem-with-profits-and-promise/
latest from Caledonia web site
http://www.proactiveinvestors.co.uk/companies/news/41027/caledonia-mining-doubles-gold-production-from-blanket-in-highly-successful-2011-update-41027.html
As you can see some of the negative in the 2010 article as been addressed like the increase in cash flow.
DOGMA
ANOTHER CALCULATION
in finding PPS. I found this while doing DD on CALVF. I haven't had time to find all the numbers to get CALVF Enterprise Value per Ounce. So anybody with anytime on their hand go ahead and calc away. I will post my number but it won't be until probably next week. I have started a small position in CALVF just based on the PE ratio
When investing in anything, it pays to have a sense of value. Let’s say, for instance, you were looking to buy a house in a suburb you like. For starters, you could just charge in like a wounded bull and purchase the first house that takes your fancy. I think many of you would agree that this approach is fraught with danger.
If you were somewhat smarter, you would probably do what most people do and look at as many houses that are for sale in that suburb first and try and establish a sense of value before making a purchase (giving you peace of mind).
The savvy investor may even take this process one step further and establish a value on what all these properties have in common, the answer of course being land. They may work out a value that they are paying per square meter of land for each property inspected. Next, they would compare this with an average for the suburb compiled from recent historical sales data.
Now valuing a property by looking at the valuation of the land is of course only half the battle in establishing whether you are getting reasonable value for money. Why?
Because every house built on that land obviously differs in various ways. The house could be bigger in size and better equipped. The land itself could be located in a more desirable part of the suburb, such as on a hill or by a lake or river where there may be a view and breezes. The list could obviously go on but I think you get the general idea.
All these other factors are variables that you would take into account in order to establish what you think that particular property is worth. But your starting point would be the value of the land and you would build on your analysis from there, based on a comparison of these other variables.
How to find precious metals stocks are reasonable prices
When buying shares in a precious metals company, do you go through a similar process in order to determine whether the company you are buying shares in is reasonably priced? For most, the thought of going through this process is much too daunting. It is much easier to get your stock broker to perhaps recommend a company.
In my experience there is no substitute for being able to personally assess value, even if it is at just a basic level. There is also nothing wrong with receiving stock recommendations from newsletter writers or stock brokers on the proviso you have the ability to check these companies out yourself.
This is what will give you the conviction to buy and hold which brings me to a concept I want to introduce to you today. It is a relatively simple but practical method of comparing similar precious metals companies and establishing a sense of value.
Enterprise Value per Ounce
Let me start by defining what an Enterprise Value (EV) is. An EV is simply the Market Capitalization of a company (number of outstanding shares multiplied by the current share price) adjusted to eliminate the effect of a company’s financial assets and its financial obligations (liabilities). You subtract the financial assets which would include items such as (not an exhaustive list):
1.Cash and Cash Equivalents
2.Accounts Receivable
3.Inventories (If a producer)
4.Listed and Unlisted Investments where you can readily establish a fair value
5.Derivatives (Bought Options and favorable Forward Sales Agreements)
And add the company’s financial obligations including (not an exhaustive list):
1.Accounts Payable
2.Interest Bearing Liabilities
3.Derivative Obligations (Unfavorable Forward Sales Agreements and written option contracts)
4.Retirement Obligations
What remains is essentially the value the market is attributing to the company’s non-financial assets or its projects. If you were to look at this diagrammatically it would appear as follows:
To calculate an EV per ounce, you simply add up the total number of ounces attributable to the company via its projects and divide this number into the Enterprise Value.
The concept of EV per ounce is by no means a new valuation methodology and it certainly has its critics. Like land is the common denominator in our real estate investment example, gold in the ground is obviously the commonality when looking to compare gold related companies.
Now critics of the EV method will tell you that when using this method you are incorrectly assuming that all metal in the ground is created equally. This is of course a valid criticism if and only if your analysis was to simply stop there. It would be like saying property A is better value than property B because I can pick up the land for a cheaper rate per square meter without taking anything else into account.
Obviously this technique would be completely flawed. For instance, you can’t conceivably take a producing gold mining company and compare its EV per ounce with an exploration company and come to the conclusion that the exploration company offers better value. You would be excluding the costs associated with the development of the mine, not to mention the premium a company receives in the market for successfully developing the project.
My question to the critics of EV per ounce would be why on earth would you stop at just this first step? This limitation can be quite simply overcome by having a large enough number of companies to compare, so that you can isolate the ones that have the most in common (similar development stages) and generate the additional information required to consider the applicable variables. These might include:
¦The size of the deposit. Bigger deposits tend to attract a premium due to the higher probability of being developed based on better economies of scale.
¦Different resource classifications dependent on drill spacing and economic viability. Reserves both Proven and Probable (supported by economic studies) versus just a resource (no supporting feasibility study work).
¦The depth of the deposit. Is it shallow enough for cheaper open cut mining methods? (Generally 150m-200m or ideally shallower) Are there large amounts of overburden that need to be stripped away adding to the cost of mining (stripping ratios).
¦The average grade of the deposit. Generally speaking, higher grades are cheaper to produce and attract a premium. If you are mining underground, higher grades become essential due to the additional capital cost associated with underground mining.
¦Different economics (cash costs, construction costs, ongoing capital expenditure etc) Useful by-product credits can in turn lower the net cash costs of production. The availability of infrastructure lowers construction costs. For example, access to grid power versus the requirement for diesel generators in remote regions (more expensive). Access to ready built roads and ports versus having to build this infrastructure. Underground mines have higher ongoing capital costs associated with the continuation of underground development.
¦The metallurgy (recoverability of the metals). Sulfide deposits generally have lower recovery rates than oxide and require a more complicated extraction process.
¦The political risks. A deposit in Zimbabwe would obviously trade at a substantial discount to say the same type of deposit in Australia or Canada.
¦The exploration potential on the properties and the probability of future expansion of the deposits.
The precious metals sector is emotionally charged. When you study EV per ounce information on a large scale it becomes very apparent just how much influence market sentiment can have on a company’s valuation.
A simple way to avoid this risk is to have a basic sense of value. Perform a quick EV per ounce calculation and see what you are paying. Compare this to some of the company’s peers and establish whether what you are paying is reasonable. Don’t be the chump that is buying shares off the people that were fortunate enough to get in at the ground level and are cashing out.
One of the single largest limitations with the EV per ounce method is having enough comparable companies and all the associated information you need available to make the process of comparison easy and effective. For the average investor, you may be able to undertake this process for a handful of companies but it is not realistic to compile all the necessary information yourself.
If something like EV per ounce sounds like it appeals to you, my advice would be to find a reliable information service that does the grunt work for you at a reasonable price. Most importantly, you need to find a group that actually use their own information and can properly articulate the optimal way of using it.
DOGMA
FALSE RUMORS
I love how someone starts a rumor that China GDP was going to be above 9. I guess that what was floating around on the floor at the stock exchange. Everybody jumped in thinking the stock market is going higher. Not so fast my friend. The hedgies started the rumor and sold into the market.
1. This morning we did not get great news on the PPI and weekly Employment numbers
2. China GDP was below exceptation 8.1
3. Google did not blow it out of the water
4. Financials report tomorrow and I'm hoping they blow it.
This maybe a turning point for TVIX.
When we go up tomorrow and I say When we do TVIX will be starting the uptrend higher lows and higher highs.
I bought a shit load today.
I'm curious as anybody else notice how expensive things are getting. Everyday things like food and clothing. I went to McDonald and a happy meal cost over $5.00. I notice in the Grocery store food has gone up. The reason I'm asking is that on CNBC they keep saying that inflation is in tact but according to the PPI number inflation is creep up.
What do you buy when inflation is on the rise.
Commodities which include gold, other precious metals, real estate, and oil and gas. Gold, copper, and nickel do well during inflation because they are tangible--people can see and touch them. They know that the market won't be overflowing in such metals and that the demand won't go down. In addition, real estate has been a strong hedge against inflation
Yes can you believe it Real estate. Coule the increase in inflation be part of the bigger picture to get real estate going up. Could be a double sword too. The more you pay at the store and pump the less you have to buy property. I'm looking at purchasing property.
Enough with my rambling I just want some fee back on my thesis about the coming months.
DOGMA
Been Buying since last Friday and holding
Man holding onto alot of shares.
The word is the hedgies are going to start taking profits in April. I hope they are correct.
DOGMA
^TVIX-IV NAV on YAHOO
Somebody post this last week to track the NAV of TVIX.
Thank God I was gone last week on vacation and was in all cash.
I started a position on Friday. Keep an eye on ^TVIX-IV and make sure TVIX trades close to its.
DOGMA
DON'T KNOW
But It was low. The other day when the S&P was down over 20 points TVIX would of been up 10 to 15 points. It just doesn't move like it use to. I'm totally out I had better luck trading TZA and will start a new position tomorrow after the job reports. DOGMA
Going long TZA
Russel 2000 down 3% for last week. I started a position in TZA and added to my position in TVIX. I'm probably going to sell these position probably before the jobs report on Friday and after the jobs report probably start a new positions in TZA and TVIX and then I'm going to sit and wait. Downside is minimum.
DOGMA
GOT GOLD
So you think gold is going to exploded. I have been hearing that for sometime and the way everybody has a money printing machines I don't understand why it keeps getting pushed down.
So you think sliver is going to rebound off it 200MA and then take off to 50. I see heavy buying of the 35 and 36 sliver future options. I think Sliver outperforms gold this year. What is your opinion? What do you think about the charts on SSRI?
DOGMA
Playing Sliver SSRI
SSRI forming an Ascending triangle plus when it does break out it will fill the gap up to 20. A nice 3 point increase. Sliver must stay above the 200ma which it will. Matt does this look really bullish. Plus they are coming out with Earnings on March 12th. SSRI has the highest sliver reserve. Right now SSRI has pull back to the uptranding line and held with a lot of buying including me. Just want folks to be aware of this stock.
DOGMA
OUCH!!!!!
My precious metals took it in the azz I was up 20g in Sliver and once again I got slaughtered. I never learn pigs get slaughtered. I still came out ahead $335.35. I could not dump my shares fast enough. I just jumped back in TVIX 16.62
DOGMA
Does anybody have a spare money printing machine my broke.
Buy the precious metals stock.
DOGMA
Nice Day for SSRI
I have been flipping this thing everyday and I also have a long position since $15.50. Very nice profit and we are going higher broke through the 17.50 resistance next resistance 18ish then fill the gap up to 19ish enjoy the ride.
DOGMA
We are at a cross road
left(Bear) or right(Bulls)
The longer we trade sideway the more likely we go higher. Next Stop1400 to 1420 for the S&P and if we do get there I'm going long on shorting the market probably start a position at 1390. Flipped the TVIX on Friday for a gain and still holding the Gold and Sliver Miners. With Europe printing all this money you will see the precious metals go up and if the US come out with QE3 to the moon with the precious metals. Probably will find out this week where we go with the S&P. I'm waiting to jump in again at 14.00.
DOGMA
Did not like the way the TVIX acted today.
With the S&P down 5 points it should of been up at least a point. I think money is rotating out of the outperform indexes like the finances and into other indexes. Some chartist are saying we could go as high as the 1420s in the S&P that is if we break above the 1370 and I think it will happen.
DOGMA
Precious Metals is the play
With all the printing of paper money by every country I have been buying miners. TCK, SSRI, AG, AUMN and SVM. Money is rolling into the precious metals they are off their lows and look like they are rebounding. I think sliver outperforms gold. Check out this link
http://seekingalpha.com/article/369921-5-silver-stocks-that-are-potential-buys?source=yahoo
While I wait for the TVIX I might as well make some money. Charts look really good on SSRI
DOGMA
WAITING GAME
I'm in all cash now. Will start buying when S&P hits 1370 to 1380. Market is to high to start long positions I'll wait with cash in hand. Hope to get back in around 15.
DOGMA
They came out yesterday
I'm all cash now
I got out this morning in PRE MARKET. I wasn't going to be around a computer all day so I sold everything before the jobs and housing start came out. Will jump back in when we approach 1370.
DOGMA
Depends
On the gossip out of Europe
Right now it looks like 1 to 2 points but a lot can change before morning thank god apple and bac rolled over
DOGMA
Can feel it
The way the germs r pushing it back just get it over and lets move on
DOGMA
GREECE WILL DEFAULT
If the Germs give Greece a hand out then everybody wants a handout. They are stuck between a rock and a hard place. I'm damned if I do and I'm damned if I don't
DOGMA
STICK WITH TVIX
Watch the S&P MA when the S&P gets down to the 200MA at 1328 I'm out. a rebound not much then I will start a new position with TVIX. After that 1300. Also watch the weekly S&P if the S&P closes below last week close good sign of things to come.
DOGMA
RIGHT ON
That is why I'm eyeing up the commds they were the first to roller. I'm looking for money to roll out of the Financials into commds Copper
DOGMA
AAPL down for the count
440 to 450 get back in
DOGMA
I use the S&P to gauge the TVIX
1328 200MA for the S&P this is where I will be selling, after it bounces off of that I will be buying TVIX again.
GOOD LUCK
DOGMA
BUY FAZ
you get more for your buck
DOGMA
Like old time ROTH
DOGMA
No just one account
I have my base core which I don't touch 10g shares and then I have my other powder that I flip with, but I got caught holding 5g at 17.85 was going to sell in AH but the price kept falling so this morning I seen that TVIX was spiking and decided to hold it. I had meetings all day when I had a chance I seen where TVIX was and AAPL sold off hard I knew TVIhave a feeling TVIX is going to gap up big tomorrow. I have been in where the TVIX gapped up 17 points and you can ask the ROTH man about we both were here. Don't worry it has gapped up numerous time over 10 points. If we do gap up over 5 tomorrow I will be selling cause it comes down just as quickly and then I jump back in and start a new position.
DOGMA
STILL HOLDING STRONG
I was going to flipped these I bought yesterday, but stepped away from my computer and she tanked. Still have my core @ 14.21 and these other at 17.85 and I think I will hold these overnight and see if the Tooth Fairy comes in the morning
DOGMA
Lucky for you
I too stepped away and just got back and WTF happen. Oh well I'm going into the morning with a shit load of TVIX as long as it keeps going up the next few weeks. That is funny how a Greece conservative said that they will pay the lenders 30 minutes before close. If this would of happen middle of the day instead of at midnight Greece time "who the hell is up at midnight giving media interviews" the Market would of popped but would of faded into close. I forgot how wild this TVIX is. It will make a tough guy cry.
DOGMA
RIGHT ON
I MAY JUST HOLD THIS INTO TOMORROW WITH MY CORE POSITION.
DOGMA
Just bought some SQQQ
:)
DOGMA
DOESN'T IT
always goes up
Leave Steve rest in Peace he probably was buried with a casket made out of gold with a pillow stuffed with thousand dollar bills.
DOGMA
YOU GUYS ARE NUTS
TRYING TO TAKE DOWN THE APPLE.
Back in 2008 Apple traded down to 80 and I bought 1g. I wished I would of held them sold them at 100 and thought I made a killen. 400 bucks later or 400,000 later. Man what I would give for a time machine. DOGMA GOES BACK TO THE FUTURE.
DOGMA
MOTION SICKNESS
up & down
DOGMA
GET IN NOW
SHE PULLED BACK
I DID going to RIDE it to the close and probably sell it in AH
DOGMA
THIS WILD BEAST MOVES
One minute you are happy then the next minute you are crying.
I think we move higher 19 to 20
DOGMA