He's a good guy for sure. I've mentioned this site to him a few times but he's more interested in telling the bashers to their face. He's been in this since the melba issues. Long time ago. Anyway his stuff always gets pasted over here. Smart fella.

Here are his two posts, back to back (EXTRA long read now):

OK... Here's what I think about today's PR.

First off, it is better written, LOL.

Secondly, and far more importantly,

Quote: today's PR by SFMI, stating that a key part of their operation (the mill) is going to be deliberately made a profit center, [color=red]is evidence of a key difference between SFMI and all the other start-up JPM companies out there.

But this is what I really think:
I think it was a financial "DECLARATION OF INDEPENDENCE"

I also think it very important for everyone to go back, and with today's PR in mind, re-read a PR that came out on 05/23/12.

Here's that link:
http://www.sec.gov/Archives/edgar/data/1464830/000109181812000197/sfmi052120128k.htm

Today's PR is an open declaration that SFMI is better off than any other start-up JPM out there because today's PR consists of an explanation of a vector for financing that is outside of the financing choices to which everyone else is limited. I do not dislike PQ clearly stating that he is choosing, as a deliberate management decision, to build out the mill as the cash flow generating portion of this business, and taken together with the PR from 05/23/12, what we have here is an SFMI "DECLARATION OF INDEPENDENCE"!

All operations have to be financed in some manner. If folks dislike the "Declaration of Indepencence" from SFMI today, it logically follows that better vehicles for finances than the one explained in the two PR's have to be available, and that PQ is in error for not employing them, right?

Now, folks are entitled to think that other financing avenues would serve the company better than the decision to finance things via the vector of the mill,

But I disagree.

Quote: In fact, I think the vehicle for finances illuminated by the spotlight of today's PR is the best SFMI could employ at present.

So, with that in mind, I'd like to explore what other things SFMI could have decided to have done to generate the money needed to pursue their dream.

I can think of 4 general types of financing. There are variations on themes, of course, but in general, only four approaches are available to JPM start-up companies.

Basically, to raise capital, something that is a part of a JPM company has to be employed to generate cash flow. The choices consist of only these, as I see it:
(1) SHARES

(2) CLAIMS

(3) ROYALTY

(4) FUTURE PRODUCTION

Thats it. Always the same, for every JPM start-up out there.

Except for SFMI, LOL.

IMHO, SFMI's decision to build out the mill & to use it to generate an income stream is the best financing approach available to SFMI, and it is far better than the other paths available to all other start-up JPM operations.

Quote: SFMI has an advantage over the typical start-up JPM operation: SFMI has over 500,000 tons of above ground rock from old mining operations. THIS MAKES ALL THE DIFFERENCE IN THE WORLD, and this real difference makes it possible for SFMI to choose to finance its future in a manner that frees it from the constraints of the "NORMAL" JPM start-up.

Oh... and I don't want to overlook or ignore another thing: We know that the rock piles are a valuable advantage because we have the monthly assays to prove it.

Every company that ever existed that dreamt of pulling precious metals out of hard rock faced the same need as does SFMI: the need to finance their dream.

I think SFMI has the HUGE ADVANTAGE of more than 500,000 tons of above ground rock that they can mill. And also, they have an expanded mill.

Now I want to return to the PR released on 5/23/12. Like I mentioned at the start, IMHO there is a close relationship between what was said in today's PR, and what was said in a PR released on 5/23/12.

The PR that came out on 05-23-12 made clear that from the very start, SFMI has methodically avoided tracking along the failed path of selling surface claims, which is a typical path taken by most start-up JPM companies.

Here is that link,
http://www.sec.gov/Archives/edgar/data/1464830/000109181812000197/sfmi052120128k.htm

And here is the relevent quote illustrating that PQ always understood the importance of this decision:
"Most mining operations organize themselves around claims, and then sell them off to large outfits on the potential value, leaving all the profit to be made by the large corporations."

Now obviously, this comment, taken together with the PR that came out today, makes it abundantly clear that PQ always understood the advantage SFMI had, and this advantage is two-fold:
the above ground piles of rock & the mill.

Quote: IMHO, today's PR, (which sets out that the mill is to be the financial resource), and the PR which came out on 5/23, should be taken together as a kind of "DECLARATION OF INDEPENDENCE"!!

SFMI can do what other companies can not even consider doing because it has so much above ground rock, and it has a newly expanded mill.

As today's PR makes clear, the expanded mill allows it to declare its independence from the strictures and restraints of the kinds of debilitating financing other start-up JPM companies are burdened with.

And as the PR of 05/23/12 made clear, this kind of "DECLARATION OF INDEPENDENCE" has been PQ's plan, all along.

So, I do not hold that SFMI deserves criticism for having released a PR today that focuses on the mill being a financial focal point. I think SFMI ought to be congratulated rather than criticized for having done what is explained in today's PR.

I think we are better off than is commonly felt to be the case, folks. I like the way the PR today makes it clear that, unlike other start-up JPM's, SFMI has better financing choices, and it is well down the road towards having this journey turn into a golden brick road.

Thats how it looks to me, boyz-n-goilz.

:o)

Imperial Whazoo

Well, they have DECLARED INDEPENDENCE....

From the kinds of financing choices available to other start-up JPM's.

Thats been the point, all along.

Now bear in mind that the ability ot steer clear of the coral reefs and sand bars and rapids everyone else has no choice but to navigate is not the same thing as saying: "We are financially independent"

They are not saying they are financially independent, and I'm not saying any such thing either.

Neither am I saying that they are claiming profitability.

What I have always maintained, and what is borne out by the 5/23/12 PR and the PR today, is that SFMI is able to navigate differently than any other start-up JPM.

Personally, I think it is typical of human nature to dislike any entity that has the freedom, like SFMI does, to separate itself from the norms everyone else is burdened by.

SFMI started it's life as a ship sailing the wrong direction, according to norms in this industry, and the very idea of so doing is going to engender criticism. Of course, I do not think they actually went the wrong direction, other than the Melba episode, because I think they have above ground rock piles and I always believed that these piles were chock full of precious metals, waiting for the right "outside of the box" thinker to attempt a novel idea.

And we now have a long list of assay results, and a newly expanded mill. We know dore bars can be poured. There is a rather large concentrate stockpile, too, if reports are to be believed.

We have all kinds of shareholders coming back from shareholder meetings with photo evidence of vaults under construction and heavy vault doors and buildings full of equipment that is not from a movie set. We all know it is real.

And today, we get a PR about the building being all but done, and plans for new employees being hired.

The difference in story here comports with my opinion that, if any JPM in the USA ever hopes to rise above all the burdens placed in it's path by regulators alone (not even considering financiers), it has to have a "hook" that makes it different, and I think the 800,000 tons of above ground rock are the meaninful difference as regards SFMI.

I believe SFMI will soon announce that they have the commitments to plan the drilling project. I would not be the least bit surprised, personally.

And another thing: I do not agree that drills have to be in the ground. If this is funded by committed investors, we will not see interested share buyers sitting on their hands, waiting for "drills to turn".

Thats my opinion, anyway.

L8r

Imperial Whazoo