b/s sp cycle, page-12

Howdy Baggins,

I hear you!
I don't disagree with what your saying about what
Labor has done to the country and the mining industry
in particular.
AGO usually tracks the IO price, in 2012 it got smashed as
soon as the MRRT passed the senate in March, then it got smashed by the IO price drop, then again when the
MRRT commenced in July and got clobbered again by the IO price.

I remember hearing one of the American analyst talking about
the Aussie miners being discounted by 20% because of the Tax.
It is still in play and the market won't react to it until
it is actually gone forever.
Industrial relations also had become a nightmare for Australian businesses, then we had the Carbon Tax and all
things considered, the Labor government are very much responsible for the damage done to the mining industry!

They are at the very least responsible for scaring away several hundred billion dollars worth of mining investment
in Australia which AGO would of benefited from!

The problem is as I have shown here AGO is not making any money at these IO prices. I still believe it is a very good
bet for the future, because I am still very bullish on IO.

I am bullish on IO because:

1) China's insistence on growing at 7.5%pa.

2) Although there is large amount of supply coming online
what some analyst fail to appreciate is High grade IO is verymuch a finite resource.

3) Most of the people in Asia still live in very primitive
conditions. One thing I know from living in Asia for over ten years is they would all like to move into new houses. New Houses built in Asia are constructed with steel frames and steel reinforced concrete!

4) What's changed in the last few years is most people know somebody who has a modern house. Therefore the demand is not going away.


Getting rid of the Carbon Tax and the mining Tax, combined with potentially strong IO prices as per the futures contracts now being sold may well end up driving the AGO SP right back up again towards the end of the year.

As for now they are not making any money, here are print screens directly from AGO reports for you to consider.
Apart from my question and the red outlines, everything else comes directly from the reports!