$SPTGD Weekly

The S&P Global Gold Index is showing a similar correlation to a time when the gold price broke through a psychological resistance level, and gold mining shares rallied strongly. This was when gold prices were still below ~$500/oz. US.

At that price, gold companies were looking at financing through capital raise. Later, companies issued debentures, kept issuing shares, or resorted to financings with staggering interest costs. GBN.V falls into this camp. And yet, we are still seeing the same predations in the market.

Gold prices were simply not strong enough to carry the load for mining companies. We are in a situation now that gold prices ARE strong enough to carry the load.

Mostly financings were a public affair in the gold sector, but GBN.V resorted to off-balance sheet arrangements and a swap agreement, after ~$90m. in capital raises. Much of the information provided in the news releases is compelling, but much of it is trial-ballooning. Some of it is also misinformation intended to mislead. Information is missing where the company is endeavouring to keep secrets.

The surprise will be that the total of capital raised plus deficit write down should equal ~$1.4 B.

There was a surge into gold mining companies during 2005-2006 as the psychological resistance fell, and gold shares were strongly correlated with a rise in the gold/silver ratio, a rare occurrence. This is gold miner's 'second chance'

http://schrts.co/zwmFYa

-F6