cheapest gold stock or any stock 4 that matter, page-41

Sugbess

Make yourself a cup of coffee or tea, sit down and close your eyes and THINK. Try to see things from a different angle.

You have been unable to give an example of a junior with a resource you deem economic. Why? Because they do not exist. Simple. The grades are within normal range and this has been proven over and over and over again. So is it economic? Do not know, do not care as I am not buying into a producer.

You could call your geo friend and ask what is the probability of your gold spec find a resource that will would be economic to mine in todays climate and if honest the reply would be, pretty close to zero chance. The junior gold mining industry has not been economic at production at all these past years, nothing to do with grades. The deposits required for an economic resource for a small junior during the time of lower gold prices just simply did not exist, or if they did were rare as hens teeth. This has led to reduced exploration and reduced investment in gold mining. The upside here is that those that do have a resource when the PPOG heads north will be well positioned to take full advantage.

So the informed investor who is looking for an economic producer simply states...I do not buy junior gold stocks as generally they are uneconomic. Grades do not even come into their decision. So any production issue you have applies to the junior gold sector in general. KAL does not have any point of difference in this regard. None at all, no junior has a shallow open pit resource that fits the criteria you demand.

So why buy?

Because all gold has a basic value, economic or not, and on a peer comparison level KAL is outstanding in value. That is comparing apples with apples. And you have made no effort to prove otherwise.

Next reason, because they are growing their resource and technically this should provide gains for shareholders.

Thirdly, because they have a significant sized resource. Many juniors have either nothing or small deposits that render them uneconomic on that factor alone. This may make them attractive as a takeover. The grades and size of the deposit are comparable to what larger producers have in their resources, it does not reduce the basic in ground value. Same whether it is a big or small company.

Also because there is an expectation the POG will increase. If it does, production or no production, the market may re-rate the basic value of in ground resources. If it adds $50 to the basic value then a company like KAL could double it's market cap because you have only paid $20 an ounce to begin with. The larger producers like say Newmont, the cost for one ounce of gold on a market cap basis is already $800 so the percentage increase will be far less. It is basically a good leverage to pay such a small amount for an ounce of gold.

And finally if you were to buy a company with low cost production the benefit of that is already factored into share price. So why would you buy even a low cost producer? Because you expect the POG to go up, the only way you will get a capital gain. So that argument is also generic to the whole industry and not KAL specific.

So go back to your geo friend and simply ask, what junior out there actually has an economic resource and they will probably not be able to name one, or if they can the market would ahve already priced it up.

So it is dishonest to say the grades are not good enough as it lends to the myth that some juniors do have economic grades based on your criteria. They do not. Yet I have seen on other threads members state there stock is worth more because it has higher grades than KAL. I take a look, small deposit, undergournd grades, stupid comparison. It is far more complicated than that. Wilson said the company said grades have nothing to do with it, smartest comment made to date on the issue.