Since responding to Joes comments, l have looked into further...

Since responding to Joes comments, l have looked into further commentary on where gold might head. My financial disclosure is that l own Red5 shares, so obviously have a bias toward further SP appreciation. l think it is 100% safe to say we are currently in a gold bear market so far as equities and their share prices are concerned. A conundrum occurred in 2023 when gold prices appreciated despite a strong U.S. dollar and high bond yields. Historically they are counter cyclical. Strong central Bank buying was largely responsible for the boyant gold price which should have fallen. Retail investors and hedge funds sold off their gold exposure in anticipation of the gold price falling that never materialised. This explains why there is a huge disconnect between the gold price and the Share Prices of producers (Equities prices). Those sellers never re-entered the market, which continues to explain lack lustre gold miners share prices across the board that continues as l write these words.

This is eloquently explained in an interview with Ross Beaty at the Vancover Resource Conference this past week. Ross has 40 years in mining experience and is chairman of Equinox Gold and 5 other mines that collectively produce 600,000 ounces of gold per annum. Obviously he is bullish on gold due to a strong vested interest but he rationalises his view with the following examples. The Equinox SP is down over 20% this past year despite a stronger gold price. The balance sheet of this company is robust and the SP should have followed the increased gold price but did not. He categorically states one of 2 things will happen in the next 12 months to gold miners in general. Either the price of gold drops OR the out of kilter share prices in the gold mining sector get a very healthy revaluation when investors wake up that they made a colossal mistake over selling the sector. He says doubling or trippling many miners current share prices will occur even if the current gold price stays around current levels.

Ross Beaty goes further using the example ofAlumina Gold in Canada. A few years ago, it did a pre feasibility study of its 20 million ounce tenement in Canada with 300,000 ounce per year extraction on a 21 year mine life. The valuation was 2.2 billion dollars based on a then gold price of US $1600 dollars. The same company today has a market cap of 150 million dollars and nothing but sentiment has changed. He believes this represents the state of buyer sentiment to gold miners generally which is not steeped in fact. He says this is going to change, and when it does, valuations will rocket across the board.

l have read many similar accounts from mine managers to resouce journalists that all say there is a huge disconnect between gold mining market caps not keeping up to the current gold price. If you believe this is true, then it stands to reason at some point investment money will pour back into gold equites and lift the entire sector.

This is why l think that even in the mid 40's, Red5 is extremely cheap and (sic), has lots of potential to be substantially higher.