Re: Area Plays.
in response to
by
posted on
Oct 12, 2007 07:03PM
The company whose shareholders were better than its management
Fellow Investors,
it is good to see more and more of the legit posters from S.H. come over to this forum.
It was another good day for us ARU longs and with a couple more days like this we should have some nice sustainable momentum finally going for us. It would appear for now that my earlier prediction of ARU setting a new trading range on 43-101 news has come to fruition. With a couple more days like today perhaps we will be finally setting a new high also earlier than I had anticipated.
Some interesting news out today for those who may have missed it. S.A. gold output was down again 5.5% for August compared to August 2006. By the end of this year total S.A gold output will probably decline by aprox 7%. This trend will continue as aging S.A. mines have to go continually deeper to mine. The deeper the mines the less productive they become and the more prone to life threatening disasters they are. These accidents are occuring at an increasing rate in S.A. who have the deepest mines in the world. At one time S.A. produced 80% of world gold production and they today only produce around 15%.
NYMEX set an open interest record for gold futures contracts for the 5th consecutive day. There are some anaysts that I respect very much for there knowledge that say there is heavy manipulation being used in this market to suppress the spot price of gold by selling paper gold in the futures market. There is no economic sence to what is going on there so I am inclined to beleive it. The lid will really blow off the top of the gold price if some large players calls for delivery and it is reported that it cannot be met.
Mean while countries continue to expand there money supplies at double didget growth. China announced today that its M2 money supply for the last month increased by a huge 18.45%. Its surprising that there inflation is only running as reported at 4.4 percent. Though some government agencies say that could increase to 8 % by middle of next year. I would think that that was a very likely bet.
I keep seeing in the news once again reports all over how gold buying is down in the middle east and India. Similar to the doom and gloom reports earlier this year when gold ended up setting new sales records in most of these regions. Gold buying is down because of Ramadan in the muslim countries and religious festivals in india where it is considered inappropriate to by gold. This occures every year from roughly the middle of Sept. to middle of October. Hopefully if the seasonality of this trend is true we will see a rise in gold price next week along with a continued rise in ARU share price.
For that poster who asked about the area plays around ARU I would suggest sticking with the know discovery, that being ARU. While there is always potential that one of these companies might find a deposit, almost always they do not. The potential for a discovery of course depends on there proximity to ARU find and location of there claims. If there claims are located withing hundreds of feet of the main discovery or along the strike of the fault that carries the hydrothermal mineral bearing fluids then of course the possibilities of them find a discovery is much better. Since in ARU's case they own much of the promising area it does not look that promising for the area plays around them in my opinion. Most area plays end up being little more than pump and dumps.
Have a good weekend all
Regards,
F.F.