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GBN.V management are acknowledged to be secretive about their company to the point of not reporting findings till months after they are stale, cacheing production numbers in disclaimers, even to the point of resorting to loopholes in regulatory requirements and not reporting their cash position.

For myself, it makes the effort of justifying to someone else that the investment of time and effort in GBN.V shares a daunting task. The question people won't ask from you if you present the company to them is: Do they do everything correctly? Mostly you get questions over the size of the float first, where it all starts or ends very abruptly, or why haven't they made a major discovery yet, or perhaps they question why the share price is so low.

You risk being ridiculed.

OTOH, the shares are cheap enough that you can buy more ounces of available production for your hard earned dollar than most gold projects, and this includes the majors. With the number of shares out, that means the up-front costs are high to begin with, but that's the same everywhere.

You won't get wildy exaggerated grades here, huge capex requirements, or political problems. The workforce that does the mining is non-unionized, subcontracted, and the company has a cash buyer for their production should a major financial crisis intervene in the markets.

I was sick to my stomach for a couple of days buying shares here, and watched helplessly as bond prices rose, and share prices sank for a couple of days afterwards. I'm also very sick of carrying risk without any real notion of whether GBN.V management are serious about providing a return to shareholders.

So I dug up in the archives again to find what I had posted in previous years:

'Sleeping Giant Awakens In Gold Belt' April 5, 1986

http://ow.ly/ddF82

'Star Lake Gold Mine May Be The Start Of Something Big' April 14, 1986

http://ow.ly/ddF1j

'Gold Drilling Shows Promising Results' April 29, 1986

http://ow.ly/ddFkT

http://ow.ly/ddFf3

The La Ronge gold belt only attracted attention very briefly while in production, but they made no great discoveries at the time and were hoping for more. Soon, company officials will see the error of their ways and wake up and realize that they're sitting on a gold mine. Either that, or they're going to stub their toe against the impossibility of it all and shut it all down.

While looking for a huge discovery, they easily missed the possibility that mines can be run continuously with the grades and prospects that they have, since the gold prices are not likely to disappoint as they had in prior years.

Prior to the U.S. dollar devaluation during the depression, gold mines were cast-off assets, like they are now, and even though mines were small, they produced excellent yields.

I think the media story here is there is no major discovery to be had, and that the mines will be abandoned. Certainly GBN.V management has done very little to actively dispell that notion.

http://www.globaltoronto.com/golden+moment/4163404/story.html

What you would be looking for right now is an indication that there is mine expansion in the Roy Lloyd mine. We certainly have seen that for Komis.

GBN.V Monthly Chart

The monthly chart does not lie. If it indicates that the rout in share prices are over, the daily details of reaching that point might be difficult to fathom. Its too early yet before the monthly close, but its interesting nonetheless to see where prices wound up during the rebound in the intermarket, as GBN.V shares are strongly inversely correlated with bonds.

The price low in August signifies that traders have resorted to day trading in both bonds and stocks, without looking any longer at the implications of assuming more risks than they realize. 'QE is coming' everyone says.

One thing GBN.V might consider as an escape clause to the obvious strategy of selling the miner and buying bonds is by providing a dividend.

supersize:

http://www.flickr.com/photos/11747277@N07/7854026048/sizes/l/in/photostream/

http://scharts.co/P5qOWY

-F6