via FinancialPost.com - Hedging

The Financial Post is ejaculating over the return to hedging by gold miners.(even though it's just one miner) It would be a spectacular time for a gold mining company to demonstrate strong financials without resorting to special vehicles. Golden Band should be taking the hint, but the company is mired in risk due to the illusion of control, which management prefers over profitability.

That being said, a miner actively writing options contracts is not necessarily preparing for a downturn. Bullion banks have absolutely no gold and they're encumbered with derivatives contracts with absolutely no physical underlying and massive financial obligations underneath. If the former Barrick acolyte is not actively bailing out the bullion banks by guaranteeing gold at a certain price, and willing to take a discount, then they might be taking a profit on some of the higher priced options. New Gold DID mention $1300/$1400/oz.

Essentially doing what a bullion bank would otherwise do and perhaps has abandoned for neat-o derivatives toys.

Which leaves the question of why GBN.V is supporting Sprott's or The Mint's physical precious metals with a SPECTACULARILY HUGE discount rather than running a profitable operation. Has Netolitzky been taken fully advantage of by Sprott?

http://business.financialpost.com/news/mining/once-reviled-gold-hedging-makes-an-unexpected-return

via LincolnMining.com - Divestment Of Procon Investment

Lincoln Mining lost its ability to finance at a very auspicious time when gold prices fell precipitously in June, 2013, by being forced to comply with U.S. security requirements. Procon Mining & Tunnelling was a majority stakeholder, which is a Chinese state-owned enterprise. Procon was forced to divest its interest and Lincoln Mining was obliged to find a buyer.

It would not come as a surprise that political pressure to hire foreign nationals to work in the resource sector comes from Procon. As far as I know, you have to be a Canadian citizen with a social security number in order to work in Canada.

Netolitzky bought out the interest, which was some 80m. shares. He later divested the interest. In the last year, Lincoln Mining reverse split the shares as well. Eros mining has been lending money to Lincoln Mining to pay G&A expenses. Eros is the former Boss Power which merged with Virginia Energy.

During the no-bid period for GBN.V shares, Netolitzky has been very active in buying at market. He could easily have doubled his position, meaning acquiring tens of millions of shares since November, 2014. He sold LMG.V, and bought GBN.V. - probably in an equal proportion to the number of LMG.V shares that were sold. That means if you are holding GBN.V shares, you have to have enough to ride out the reverse spilt, and to be a player to own enough shares to be in the top 50 shareholders. You have to also consider that there are shareholders in LMG.V.

All of the principals from Lincoln Mining now occupy management positions @ GBN.V. They also have options for GBN.V shares that are far larger than those for Lincoln. It would not come as a surprise that GBN.V reverse splits the shares 10:1 and forms a business combination with Lincoln Mining. This does not change the possibility of an amalgamation squeeze out. The quarterly report came out with no changes, but the auspicious calendar date is April 1st.

Notable to the discussion, Netolitzky is advising Lincoln Mining, and some of the same things are occurring at Lincoln as GBN.V, the most obvious being a reserve of 500k oz. after years of exploration and BCSC complaints about technical reports.

Will we see an amalgamation squeeze out or perhaps a going private transaction under a presumed bankruptcy as we've seen with Allied Nevada, Colossus Minerals, and perhaps will see with Rubicon Minerals?

http://www.lincolnmining.com/news/index.php?&content_id=255

$Gold Daily

The daily chart in $US gold prices is piling up continuation patterns, with no firm resolution. The end of March is the quarterly and monthly close, on a shortened trading week that ends Thursday.

The look of the candlesticks says we get a rally the next trading day.

http://schrts.co/8PAOTz

-F6