The reason why unfunded developers have been going nowhere (except down on average) in the last 4 years despite POG' ascent is that virtually nobody will risk long-term funding a mining operation with the memory of POG's 35% plunge down to $660 between May and October 2008. Sure it recovered reasonably quickly in 2009, but that was because of the perception that the crisis was averted, at least temporarily. Simply put, it's been risk on, POG down, and risk off, POG up. But the overhanging threat of another crash pounding POG, and hence turning a profitable mining enterprise into a losing one, deters that initial big financing commitment. So assuming that if now the POG keeps going up that will guaranty that developers prosper fits into Einstein's famous definition of insanity. The overhanging threat of a 2008 replay or worse is our downfall.

In order to break loose the capital required, and correspondingly the animal spirit of investors in the likes of TDC, we need the combination of a 2008 crash replay and POG going up as a result. That will turn the risk on crowd to gold and gold miners and developers. Somewhat counterintuitively during a market maelstrom mine funding would then loosen up because the meltdown will not reflect itself in POG. Gold miners would virtually be the only place to invest profitably. Speculators will know this means the bottom of the food chain will benefit most and the money flow into microcap miners will drive stock prices up dramatically.

So I would pay more attention to gold's direction during times of market stress.

Strike