Ann: Warrawoona Delivers Strong Production in January, page-69

Hi Netraam

My unlicensed not investment advice...

* Markets are being supported by liquidity coming from the US govt. treasury general account (while the debt ceiling debate happens the US treasury can not sell bonds so it is spending the cash it has instead) which is almost equal to the Fed's selling of bonds into the market and QT in general.

* Inflation, so far, has hardly been impacted by the rising interest rates... as demonstrated by last night's US CPI numbers

* In about 4 months time the debt ceiling debates have to be concluded

* US companies' profits are falling (as also earnings) and they are laying off large numbers of people....clearly the US is in a downturn.

*** forward guidance...
* by June the liquidity in the US will sharply disappear as the US Govt re-enters the market trying to sell bonds to fund itself. The Fed will have to buy a large portion so it will effectively be ending QT.
* the reduced liquidity will hit the US markets at a time the unemployment numbers will be getting worse further reducing the strength of the US economy
* All the while inflation will be high but the Fed will have to support the Govt i.e. money printing again. Stock markets will fall as money seeks "safe havens".

What that means for CAI...

* Today it is pretty clear we have a sentiment change to a more positive outlook for CAI. As production numbers improve so will the sentiment (and share price)
* Gold is one of the big beneficiaries of the unfolding macro picture and will rise sharply
* CAI is in the early stages of exploration of "Felix" and if it turns out to be as good as it looks so far (i.e. becomes a major discovery) the T/O offers will start. Big numbers for CAI's SP in that scenario... especially in a bull market for gold.

NOT INVESTMENT ADVICE... just my opinion.