Short Squeeze?, page-9

Huge short position. Especially in a macro environment which is long gold.

Seems likely that the short position is being taken by investors with analytical ability and supported by strategic logic.

My guess is the big short position motivated in part by big computer power algorithms assessing:
- Jurisdiction. Mali is increasingly dangerous from every key risk perspective.
- Technical. "Roaster upgrade scheduled". Roaster issues equals low production and high cost. It is a problem that is not going to go away.
- Financial. Big debt pile and limited pathways available to repay. Not currently making any free cash.
- Growth. None. Production profile is falling and requires large sustaining and non-sustaining capital.
- Lack of returns. Dividend policy has been quietly dropped.
- Management and Board. Directors own no shares and none of the incumbent directors are serious miners. If you chart the track record of the individual directors in other stocks the resulting line of best fit is a very ugly red line indicating multiple examples of generating significant losses of shareholder value over time. RSG is run as a club - very comfortable slow moving conservative strategies which sustain status quo.
- T/O veto. Usually shorters would be worried by and limited by the threat of a take over. RSG has very limited TO threat due to the issues above.
- Lack of any available positive catalyst. There is simply nothing I can think of that could make this jump upwards. Recent management and board changes are simply more lipstick on the pig and make no material difference to direction. Exploration team are non-existent other than as a cost center. Operational performance improvement is a long road that seems to be doomed by bad luck and technical setbacks.

I suspect will be a slow drift downwards from here (unless we see a strike/coup/roaster event which could cause a sudden plunge).

Oh, and if you are in the "About to fly" "Get set we are going to the moon" camp please fire at will. Just tell me what I am missing. RSG does not make any money, has no intention of paying a shareholder dividend, has serious operational problems, and has no growth agenda and nobody who could drive one if they did have.