Some of you, who choose to read, research and look beyond the...

Some of you, who choose to read, research and look beyond the face value of a number of ASX company announcements, would share the same frustration as I do.

The fact is, that in this day and age of the information super highway, it is too easy to accept unresearched opinions over well researched facts. As investors or punters, we are always looking for something that is undervalued or ready to go off.

PMH's announcement reads well to those who know nothing about resource valuations and estimates. To those who know quite a bit (not everything), like me, an announcement like the one released by PMH immediately sets in motion a series of unanswered questions. Before I can determine wether it is a good bet or not I need these answers.

What is the strip ratio?
Does the deposit have a high grade portion within the ore body?
What is the cost of cartage?
What is the recovery rate?

When a company fails to illuminate us with these facts, I can do little more than look at some industry standards and come up with a best guess scenario.

My calculations on PMH's latest release, based on other types of operation (all of which have much higher grade) would indicate that PMH has a deposit that will loose between $15billion and $27billion if ever put into production at todays market price of copper. The copper price would need to move to around 3 times its current value to get the operation to make $1.

Now of course, some snazzy geochemical extraction process may have been developed for the economical processing of such low grade deposits. But it has neither been referred to by the company, nor has it indicated what process it would use.

Another beef with I have with these types of announcements, is that they refer to 'Similar' type deposits in the area and the world. But they do not reference the composition of those deposits (ie) grade, and tonnage. I would suggest to you that this is very deliberate, because it would be a negative to the announcement.

ASIC have announced recently that they are going to crack down on announcements that may be misconstrued due to a lack of information.

This is a classic case of one they should have had a look at. People are going to get burnt big time.

Now I don't care if you are a daytrader, ramper, investor, or punter. We would all be benefited by a more controlled set of announcement rules and process of release.

Here are my suggestions to ASIC and the ASX

In the event that the company puts out any Resource estimate the following process should be undertaken.

1) The market should be given 24 hrs to analyse the announcement
2) ASIC should review the announcement to make sure any references to similar deposits are qualified.
3) ASIC should make sure that the process for extraction targeted is named or mentioned
4) The announcement should contain a quote from the directors as to wether they believe the resource is a viable production case or not.

If PMH's announcement had been subject to these rules. It would never have left the platform.

Now this will of course upset the experienced daytrader who just feeds on this type of hype and hysteria. But it will most certainly add more control and credability to our market.

PS,
For those who still think this is in the same category as CDU. My analysis of what CDU have and continue to grow puts their value right up with the best estimates in the game. They got slapped and rightly so, because their announcement failed to quantify a number of statements. I beleive had they waited and done that, the shares would have exploded anyway.

PSS,
Those who insist on getting hot under the colar and insist on name calling and degrading remarks should be removed and their IP address banned.

Disclosure:- I do not hold PMH (never did) nor CDU. I am big on DNL.

Enjoy your Saturday - I'm off to Flemington