Gold in the GroundJohn Ing is CRAZY----NUTS. I mean----$ 1,000 per ounce?
Now, I have, for a very long time, have stated, and posted elsewhere,
that the Price of Gold in the Ground (POGIG) as used by institutions giving 1 year target prices
for an exploration companies, and their valuations there-of, is a WAY, WAY, too LOW.
(ie. Fraser Mac., GMP, and the like)
They seem to use a status quo type of calculation, re POGIG, that is completely out of touch with
today's reality cf. even the most conservative value for the actual Price of Gold, that they also use.
As a matter of fact, try using Percentages----(the POGIG Divided by the POG) times 100) = %age)
and use different values for the POG.
What you will find, is that as the POG increases, (which it is doing consistantly),
the corresponding "fixed" amount "they" use for the POGIG, results in a LOWER and LOWER, as
a percentage result.
The POGIG they use in their calculations should also be RAISED accordingly-----to reflect reality!!!
Shouldn't the POGIG percentage to the POG remain constant???
Right now, as the POG increases, the resultant valuation figures they use, understates the projected
value of an exploration company considerably, and correspondingly the target share prices they
"come up with" are totally out of wack, and the actual targets should be a way higher, even when
using the SAME number for OUNCES of Gold in the Ground. (which is not the case, because the
number of ounces keeps increasing, which the more drilling that is done.)
When a buy-out does come to pass-----the amount the MAJOR actually pays, is always much more!!!
Surprise?---NO!!! BUT the the guys using out dated numbers, in thier valuations SHOULD be
absolutely EMBARASSED by the amounts actually paid!!!
I am not saying that being conservative is such a bad thing----BUT---come on---get more in touch
with REALITY!!!! The status quo is completely RIDICULOUS. FAR FAR too conservative!
Continuing in this outdated manner, the good exploration companies are getting severely "short changed"!
For you that follow TRR, for example, what figure do "they" use currently for their POGIG?
$ 100 per ounce? $ 150 per ounce?
Even if they used $ 200 to $ 250, which I bet "they" don't----IMHO----that is still too LOW!!!!
I have postulated even, that "they" do so, so that they can "pick off" other small investors' shares at
extremely low prices---accumulate to their advantage a larger position.
That being said----------John Ing's figure of $ 1,000 for POGIG is a way too high.
IE. with the POG at say $ 1,500, that would the percentage for POGIG 66.5 %!!!
However; Surely there has to be some sensable common ground inbetween, for such valuation purposes?
Now, I am not a geologist, nor an expert of any kind-----but the simple laws of mathematics don't
change, or lie.
Am I completely off base here, or does what I say make any sense?
BARN BREATH