By the way, personally I am not interested in more acquisitions. Let them first develop la Preciosa and Joaquin and turn the company into a stable profit-generating machine. Shareholders have had to wait long enough for that.
IMO short-term it is a win-win situation, because Palmarejo can start using Don Ese material from early 2016 onwards. And that takes out the risk out of CDE, because it will bring down costs of production substantially within a year. That is probably why the Coeur share price is recovering now and that is to the benefit of PZG holders as well.
Long term I believe PZG got the better deal, because as LPET argues at higher metal prices all Coeur assets (4 mines + 2 resource projects) would have to be valued much higher and a 4:1 deal would have been too expensive. PZG would have obtained less.
Coeur has chosen for security against the possibility of stagnant metal prices for a a few more years. Bad for long term shareholders, unless the Palmarejo profits coming in from 2016 onwards will give Coeur an edge to do other, more low priced acquisitions in a beaten PM mining sector.
So between mid-December and mid January only a reduction of 1 mln in the official short position.
Today's volume of 6.1 mln shares traded is huge. Far above the average, while for instance SLW is trading far below average. Remarkable. Last year SLW used to have a volume at least twice that of CDE.
Andrew Macguire gave the following comment last week on this new price fixing platform:
"This exchange allows institutional and physical investment buyers to share the same global platform 23-hours a day, where their transactions are totally hidden from the controlling LBMA bullion banks — who currently have the advantage of front-running physical orders."
Things are changing.
The naked short sellers have made a big mistake by taking CDE so much down. They are trapped now.
"Intercontinental Exchange (NYSE:ICE), the leading global network of exchanges and clearing houses, and the London Bullion Market Association (LBMA), have today announced that the new LBMA Gold Price, which replaces the long established London Gold Fix, is expected to be launched in March 2015. As announced by the LBMA in November 2014, ICE Benchmark Administration (IBA) will officially become the administrator of the new pricing mechanism. As the administrator for the LBMA Gold Price, IBA will transition to a physically settled, electronic and tradeable auction, with the ability to participate in three currencies: USD, EUR and GBP"
Does anyone know what the official short position is in CDE?
I see such a lot of bashing and other weird activity on this message board, that 5the short position probably is still very high and that some large short hedge funds are getting extremely nervous.
Considering the explosion of bashers/spammers on this board, it is clear that the shorts want to cover. And I understand why they are in a hurry.
1.7 mln shares in the first hour.
Must be panic breaking out amongst the shorts due to the new ICE run price setting mechanism for Gold, which will start in March and will be pysically settled and involving Chinese banks.
Most miners missed the big bullion run for the past 10 years and we both now why. It is not just because of Coeur that the HUI recently bottomed at the same level as in 2002. Only a few companies did better than the average.
And I also agree that under Wheeler a lot of decisions were incomprehensible. Mind you, management in the entire PM mining sector has shown similar behaviour.
However, during the last 7 lost years for the mining sector, and particularly since Krebs took over, Coeur had advanced a lot and taken a lot of correct decisions.
Finally, I would like to say, that charts of most miners have been painted by the bullion banks and collaborating hedge funds to make them look like an awful investment during the last 10 years. Easy, when you are allowed to sell short to infinity without owning the shares. So I am not so much impressed by price behaviour like you are. I am more influenced by what is happening on the ground and I like what I am seeing.
Always with a long term view to a normalization of the free markets, how long it takes.
If we take out $1310 gold, we are off for the races. And also the ceiling for PM and miners seems to be removed later this month.
I don't want to compare Coeur to its peers. Actually, there are very few peers. We have a sector which is full of explorers and would-be miners, but those actually producing and having a track record in mining are few. The last few years of depressed PM prices have stopped many prospective mines of finding the capital and being build. What has resulted is a tremendous gap between those that have the in-house experience of building mines, making them operational and finetuning processing and those that have not. Not only did Coeur build up precious experience in developing new producing mines, it has also been able to attract the best mining engineers in the sector, since so few new mines are being build.
The market should realize that, once metal prices start to recover, only a few companies will immediately benefit and Coeur is prominent amongst them. In spite of rock bottom PM prices, it has continued investing, building and finetuning. Certainly this occurred at a high cost to existing shareholders, but all this processing capacity and know-how, that currently is valued at next to nothing by the market, will give the company a tremendous comparative advantage against all those that had to wait for better times or had to put producing mines on hold.
"in a nation and world without true marketplace discovery...lacking a free market"
Perverse economic incentives everywhere. Interventions and derivatives have killed all markets. The smaller ones first and now we have reached the biggest markets (energy, currencies). So many years in a row with perverse incentives kills any economy. All to survive one Kondratieff winter. Outsmarting nature: insanity.