Ready to RallyExcellent place to buy as it was oversold on good news due to November tax loss selling. 2008 will be a good year for Golquest as they pump out more drill holes and keep the drill bit turning. Goldfields also provides the funding for much of the drillin on their other properties. Big bonus for Goldquest.. spending other peoples money to prove up their properties.
Gold is hovering just under the $850 mark and ready to take it out very soon by the looks of things.
To us what this says is that with the commodities themselves having performed wonderfully in 2007 and with the larger commodity producers and developers having, to a smaller degree, performed on the back of those underlying upward moves – that the juniors for no apparent reason were very much left out in the cold.
We have seen this before in this cycle – more than once. Barring outside macro factors which are the only potential challenge to history repeating itself, the juniors are due for a major run next year. It happens this way every time, and every time we see a doubling, at least, in the names that have been forsaken.
In the quality junior names, we oft experience quadrupling. Our major fear is the outside factors and drive towards havens of liquidity and blue chip ‘quality’ names. If, because 2008 is an election year in the US, the bubble does not burst with all of the derivative driven financial shenanigans that have been transpiring in the US, then the juniors will rise multi-fold.