gold dumping to meet margin calls

LGL has a very good gold deposit and resource however, it is the only gold mine sitting in a recently dormant volcano that is still a major geothermal source and has occiassional nightmarish problems such as earthquake induced pit wall failures and steam blow offs.

The stock is in my view being dragged down by three factors: the broad market sell of which is now a full scale rout; the rush to US Treasuries as a safe haven driving up the US$; and, finally, as demonstarted by the very recent drawdown in Streettracks gold inventory of US$18bn, a rush to cover short term margin calls on cratering blue chip equity portfolios.

IMO once the fundamentally weak dollar rally runs out of gas, there will be a stampede into gold. This process may take a couple of weeks to transpire in which time we could see LGL below A$3.00 very shortly. However, for those with the nerve to hold the upside could be very interesting to watch. We live in astonishing times!