Confucius Says...Real knowledge is to the know the extent of one's ignorance
So, based upon what we know so far, and how the market is reacting, what are the risks here? Risks are the following:
- Cash burn continues with further OS dilution in to next year as more work is needed to understand the ore body. This dilution would be crippling at current prices (alternate view: Cash generated from recent in-pit spatial data awareness ramps up monthly revenue past $3-4M eliminating cash burn and any need for additional share dilution)
- Unsolicited takeover is received at these low prices that is not indicative of the overall value of this project, thus eliminating the possibility for the 5-10x SP possible gain (alternate view: Legacy investors leave and give up, new investors come in realizing the multiples in SP gain over the next few years that can take place. If an unsolicited offer is received I doubt that the major holders would give it credence unless it was a very sweet offer)
- Gold price continues to fall with interest rate increases, thereby reducing value of GMTN (alternate view: Gold price stays steady or rises with the fall of stable currencies whilst interest rates can longer be sustained without additional QE)
- Stock market crashes and GMTN goes to cash level with the SP, or below (alternate view if a crash were to happen: GMTN initially crashes and then goes up 600-1000% with a massive pop in Gold due to currency collapses)
I'm sure there are plenty of other risks but my thought process was to give alternate views based upon the micro and macro picture of what is known. I don't think the Fed (at this time) will allow a crash to happen in the overall market. In fact, I think we still have one more big blow off in the market at some point over the next 1-2 years. There will be extreme volatility along the way. Also, I believe that GMTN has a good hold on the ore body. They are moving phase IV drilling to 2023 to ramp up production fully focusing on revenue generation, and that they will be successful in doing so. If they didn't have confidence in the ore body then they would have gone in to a full shut down mode on most activities to eliminate cash burn. This did not happen.
All the best,