RE: RE: RE: RE: HRATTLE Hrattle,
Don't distort my words in an effort to push your own personal agenda aginst this company.
I said "I don't know about you, but generally I find that fact something is down over 90% from the high is an opportunity for a major reversal than a future indicator of further downside."
Of course the fact something falls does not mean it has value, but looking through assets that have collapsed in price is where one often finds the best investments, particularly when the underlying companies are creating value with those assets.
Mega has created significant value in my opinion - just look at their finding cost - it is very low and there is much more to come. Just because the Headway deal has led to share price weakness as a result of the seller's overhang does not mean it was a bad deal. You need to look at what the property delivers over the long term to assess that.
You obviously have minimal understanding of risk vs return. This statement "As POG (or any investment) falls risk increases until a new floor is established" shows it. Risk is nothing to do with history or some arbritrary line drawn on a chart - it is about the future price performance and volatility of the asset. Ex-post risk and ex-ante risk are completely different concepts - we often use ex-post to model ex-ante risk, but the two are not at all the same simply because the future is often very different from the past.
Just look at the gold companies out there trading near cash in the bank, or even less than cash in the bank. These companies have prices which are so low there is actually little risk (particularly if they trade well below cash with a low burn), but investors are focussed on the past risk which has little to do with the company as it sits today.
Whilst Mega is not one of these cash rich companies it is an asset that has really huge upside potential. This is called asymetry - and mega has it in spades. Theoretically it is possble to loose 100% of your investment from here - this is unlikely though given the company has a good register of support major shareholders. BUT on the only side - it is very easy to see Mega at 10x, 20x or more its current value.
How ????- because Mega has a current resource base worth $5.6b at current gold prices but a market cap of only $14m. If you think about optionality of the company it is gigantic - even without more ozs - yet these are also coming.
You might be bearish on gold, great work - its your day in the sun - I hope you shorted a few futures and gold equities. If you had, maybe think about closing out now.
At the end of the day we have the US printing, Japan printing and Europe struggling - central bankers are going to the most extreme lengths to debase money - this is not a secular bearish environment for gold. In 1977, gold had just near halved from its high - it then went 8 fold from there.
If you bought gold equities in 1976 - one year before the bottom, you lost nearly half your money in a year. BUT if you held you went onto to trilpe or quadruple your original money and make over five fold from the lows. The current downturn in the gold and gold equities market looks very very similar to 1977 is terms of its performance.
I bet despite your strong words, you arent even short are you?
By the way - Pershing is a broker that buys stock for clients. You can see who has been buying by the changed mix of top shareholders in the presentation.