"Our core fundamental thesis is unchanged and we continue to believe that Barrick remains an attractive structural turnaround story. The company reported a solid 3Q14, turning FCF positive during the quarter and generating c.$200mn. We believe this FCF inflection combined with improving operations profile should help drive the stock’s re-rating. Key positive catalysts are: (1) Improving operational profile: We expect the company’s high-quality core assets to contribute c.80% to total cash flows leading to a decline in overall costs; 2) Continued portfolio optimization: We expect Barrick to continue divestments in 2014 and beyond, which, combined with strong FCF generation, should lower the company’s net debt and improve its financial flexibility; and (3) Growth in copper production: An ahead-of-schedule restart at Lumwana and commissioning of the Jabal Sayid project (company expects in 4Q15) should lead to higher copper production," he added.
There is potential for a strong upward move in gold whenever the market reverses higher for the longer term, says Jeffrey Nichols, managing director of American Precious Metals Advisors and senior economic adviser to Rosland Capital. The metal has come under pressure on negative sentiment from bullion banks, hedge and commodity-focused funds and other institutional speculators, he says. “At the same time, a very much larger group of gold-market participants – numbering in the millions – have been acquiring huge quantities of physical gold and continue to do so even as bearish speculators drive the metal’s price lower,” Nichols says. “This group includes retail buyers of coins, small bars, and investment-grade jewelry in India, China and even Western markets. It includes Swiss gnomes and Arabian sheikhs, sovereign wealth funds and super-rich family offices, and a number of central banks that are under-weighted in gold and, at the same time, distrustful of the U.S. dollar. What’s more, clients should be cognizant of the fickle short-sightedness of today’s gold bears: They may be here today, pushing prices lower, but they will be gone tomorrow, when it looks like price momentum and their technical trading models have shifted gears from ‘reverse’ to ‘drive.’ Importantly, the accumulation of physical metal by the gold bulls is very long-term in nature and much of these holdings will never come back to the market. This suggests that as the gold market shifts direction, there exists the possibility of surprisingly strong upward pressure on the metal’s price.”
Speculation arose that gold could be part of the central bank’s asset purchases after Yves Mersch, a member of the ECB executive board and former Governor of the Central Bank of Luxembourg, said on November 17 that the ECB could buy a range of assets as part of its quantitative easing program.
The fact that the ECB may soon print money to buy very risky European corporate, bank and sovereign debt from vulnerable economies such as Spain, Italy and Greece and has, from some unexplained reason, ruled out buying gold will make the Germans and others opposed to ECB QE very nervous.
Bill Gross: You can't cure debt with more debt
Central banks are trying to solve a debt crisis by piling on more debt, creating a "point of low return" for investors, bond guru Bill Gross said in a letter to clients.
The Janus Capital portfolio manager and Pimco founder takes the Federal Reserve , Bank of Japan and European Central Bank to task for using monetary policy to make it easier for governments to run up debt, all in the hopes of stimulating anemic global growth.
"How could they?" Gross asks, using nursery rhymes including the characters Punch and Judy to bemoan the possibility of "inflationary horror" that characterized the 1970s. It's probably better to read the Gross letter in its entirety-get it here-to see how he connects the dots, but his conclusion is stark:
Worlds largest Gold producer will run faster then fastest mining stock once complete reversal in place.
China’s recent decision to bring gross domestic product calculations in line with international standards has revealed activity that had previously gone uncounted.
These calculations are based on a well-established and widely used economic measure known as purchasing-power parity (or PPP), which measures the actual output as opposed to fluctuations in exchange rates. So a Starbucks venti Frappucino served in Beijing counts the same as a venti Frappucino served in Minneapolis, regardless of what happens to be going on among foreign-exchange traders.
PPP is the real way of comparing economies. It is one reported by the IMF and was, for example, the one used by McKinsey & Co. consultants back in the 1990s when they undertook a study of economic productivity on behalf of the British government.
When the ECB comes out publicly, wanting to buy from the masses. it will find that very few are willing to sell without a gun jammed in their backs.
t has been speculated that western central bankers have been dishoarding their peoples hard earned gold reserves in a futile attempt to keep the price of precious metals down and to artificially prop up fiat currencies.
Although it is a horrible crime against its citizens, one needs to understand that the source of government power comes from its ability to fool its people into thinking fiat currency has real value.
Governments have done a brilliant job in doing so and have thus been able to make promise after promise to get themselves re-elected. All while leading their countries into unavoidable bankruptcy; but that’s someone else’s problem! Or so they think.
Not only is there ample evidence that western gold vaults are being depleted, but it is becoming more and more obvious that western politicians and bankers’ influence has spread to other parts of the world.
The International Monetary Fund recently released the latest numbers for the world economy. And when you measure national economic output in “real” terms of goods and services, China will this year produce $17.6 trillion — compared with $17.4 trillion for the U.S.A.
Increase production to 1.4 –1.42 million GEO
Bring two new mines to commercial production Advance Cerro Moro and Suyai projects
Continue eﬀective exploration program
Increase mineral reserves and mineral resources
Cash & Available Credit (09/30/14) $804M
Quarterly Dividend $0.015 per share
Once we break that GOLD LOCK shackle at $1210 and Sky is yours. AUY will be the fastest growth stock among all miners. ...REASON...“Osisko will continue to follow its ideals and principles…all the while striving to add value at the drill bit with new discoveries."
Investors pay attention to the price-to-book metric, and, as the book value was decreased, Yamana Gold became less attractive to new investors. Still, the company trades at a 50% discount to its book value. While a part of this valuation has to do with the negative sentiment towards gold miners as a group, it also looks like the market assumes that further impairments could be down the road.
Q3 reported a change in Chilean tax regime for a Single Quater???????????????.
During the third quarter earnings call, Yamana Gold stated that a new tax regime could pay off in the long term via improved infrastructure and thus lowered costs. However, I don't think one can count on this in the foreseeable future. The new tax regime is a hit for Yamana Gold's future earnings, and this hit was reflected in a $329.5 million impairment charge.
IMF suggested all major economy to increase their assets based securities in order to stabilize their currencies.
China has to buy assets based securities and that only means GOLD.
CHINA - Russia - Italy -Germany - India - Australia - UK - Swiss and then USA - Central Banks to buy Gold as per IMF requirements.
Chinese Deal on the way.....
Barrick Gold Corp.(TSE:ABX)’s mothballed Pascua-Lama gold project may yet see the light of day if partnership talks between the gold miner and state-owned Chinese company, Zijin Mining Group Co Ltd.(HKG:2899)come to fruition.
A report in the Financial Post, which quoted this blog, says Argentinian mining minister, Felipe Saavedra revealed in an interview that Barrick had been talking to Zijin – a fact confirmed to him during his visit to China by the latter’s CEO.
The Minister also said that the Chinese had visited the Pascua-Lama gold project, located high in the Andes on the Argentina-Chile border, several times.
China National Gold Group Corp (China’s largest gold producer) shortly partner with Barrick Gold. Partnership will get Barrick Gold a royalties from Pascua Lama gold-and-silver project.