DRA, like most goldies looks under pressure in pre-open.What I...

DRA, like most goldies looks under pressure in pre-open.

What I like about DRA currently (apart from being majorly undervalued) is that it is operating in Europe.

POG in Euro is increasing nicely. The Euro is not the world's reserve currency and their collective economy is stuffed.

Look at Spain, Portugal, Greece to name a few. Unemployment is high and not coming down - Spain 19% unemployment !!

Unlike Australia, where the dollar is strong against the US and there is cost side inflation pressures for gold miners (eg labour) these pressures do not exist for DRA, operating in Scandinavia. Sure, Scandinavian costs are relatively high but we wont get any nasty cost side inflation shocks - ie:

1) Revenue in USD
2) Euro weakening and not looking like improving soon against the USD
3) Stable Euro cost side inflation
4) Thus falling USD costs

Add to this:

1) Increasing production volumes for next few years
2) Encouraging resources upgrades potential
3) Significant shareholders coming on board
4) Free carried interest in Africa - yes sovereign risk but appears to be valued at $0 per oz to DRA so no/ little downside risk if all goes pear shaped and free carried so no investment required
5) Aussie asset consolidation - possible float?

Next little while could create nice buying opportunities.

Buy recommendation is for a few weeks time as I think the SP may fall a bit lower on general market sentiment.

cheers
John