The current drop in valuation for tso is largely driven by market sentiment for gold, not because our project has turned for the worse (note almost every other gold affiliated miner on the asx has dropped in valuation). So the question you have to ask yourself is do you really think the bull run for gold is over?
The last gold bull run ran for over 3 years, from the 2008 to 2011/2012, and the major sectors affected then were real estate and finance. This time is very different, it's much more direct and profound - almost every sector has been impacted negatively either first hand (e.g. shut of tourism, travel), or from the flow on effect of reduced consumer demand (manufacturing, services, export and logistics). Take a look around (review financials of businesses, review government census statistics, the media, word of mouth from people you know), how many businesses are actually thriving right now? (in terms of companies, I mean their actual carrying on of business, not their current valuation/share price) Compare that to the number of businesses that are barely breaking even or turning over losses/have closed. Would you start a business right now? The current bull run for gold started last year, do you really think it has stopped right now? Do you think it'll stop next year?
If you think a vaccine = recovered economy, then you are really detached from reality.
Having a vaccine, mind you 1) an approved effective one that causes no harmful side effects medium or long term for the majority 2) easily stored and administered and 3) effective against all of the existing Covid strains, doesn't automatically fix the economy - it's a start. It doesn't restore the reduced volume of sales for businesses, it doesn't revive the number of businesses that have closed, it doesn't provide the millions of jobs needed to employ the millions that are currently out of work. The next steps in the recovery of the global economy is having more stimulus flow to the right recipients and establish sustainable setups to systematically reduce unemployment levels and raise overall consumer demand. The US understands this; hence, Janet Yellen (the dove) has been pre-selected to lead the Treasury. The potential Powell and Yellen Duo are very pro on providing stimulus, heck Yellen practically invented money printing. What do you think will happen to POG once more stimulus is confirmed (especially by the US)?
*PS, the pandemic is still ongoing, the levels aren't exactly dropping either *PPS, tso is still in an early-medium exploration stage, we haven't missed mineralisation in any of our drilled holes and we are getting constant news flow
If you think the price of gold has reached its peak, please share your thoughts on why - I'm kinda interested in knowing why If you think the peak price for tso is already priced in then yea maybe you should consider relinquishing your holding
TSO Price at posting:
28.0¢ Sentiment: Buy Disclosure: Held
