MDMN - 2016-04-04 Weekly Discussion

[annella]

TRY this

Gold is the pile of poker chips in the next global crisis

[papplesnap1]

Very interesting read. Thanks for posting the link.

[mrbubba]

Excellent points, mdeman. Auryn is in the BEST position of anybody around here at this point in time to “value” the mountain. I’m very sure they didn’t just pick a number out of their most private recesses. And, I’m quite confident that MDMN is privy to much of the same data and that the option for an additional 5% was the subject of rational negotiation. Assuming such negotiation took place (I’m given to believe MDMN had appropriate professionals representing them), reasonable minds could conclude that the value MAY OR MAY NOT BE more than the purchase price of the 5 additional points, but that the valuation negotiated by the parties is much more realistic than the approx. $20 Million market cap the market is placing on MDMN at this time, 1.5 cents per share. According to the valuation of those in the know, simple math indicates they believe MDMN is worth a minimum of 37 cents per share ($5 Million per point x 100 points / 1.35 Billion shares = 37 cents per share), which suggests an approximate 25:1 market disconnect (37 cents / 1.5 cents per share = approx. 25). On top of that, I humbly suggest people don’t invest to break even. Just the opinion of a non-miner layman.

[newleaf]

@mrbubba

According to the valuation of those in the know, simple math indicates they believe MDMN is worth a minimum of 37 cents per share

In five years.

[mrbubba]

Yes, I did not consider present value - but the deal will in fact be available now (at the end of the month … allegedly).

[newleaf]

@mrbubba

Yes, I did not consider present value

There will be a lot of drilling and mining during the 5 years along with the time value of money.

[Baldy]

@mdeman

Maybe you can explain how the option for an additional 5% of Auryn was calculated. It seems to me that there is some mutual expectation that the value of Auryn with 5 years or so will be in the range 1 billion. If it weren’t (or there was no expectation of such within a short period of time) then exercising the option would be a bad investment by MDMN. If the valuation was going to be greater than 1 billion within 5 years, then Auryn is leaving money on the table. So if the mountain develops as knowledgeable people expect, what do you think the value of Auryn will be 5 years from now?

The simple answer: there’s no way anybody could/can assign an accurate present value based on where we will be five years from now. A foal from a championship thoroughbred will be valued at premium for obvious reasons. MDMN deserves to trade a premium based on some very impressive historical holes and initial drill results. However, AMC has barely scratched the surface from a relative exploration standpoint. People like Doc can incessantly refer to disconnects and claim that “the market doesn’t get it” ( a common stance from people in a losing investment) but, the market needs to get it for us to get paid. The market is looking for a defined resource before assigning value. To claim that our present value is worth $500M-$1B is (or that 10% of AMC is worth $100) is just insane. It’s unfortunate that some of the seemingly “knowledgeable” posters have convinced the Bubbles/Babboons of the world that an orange is actually an apple.

Once AMC determines the mountain is worth more than our market cap they will be taking advantage of the “disconnect” through a TO. I think AMC realizes that anything less than 8 cents (ish) won’t be approved soooo they can either enter the market to gain a controlling interest orrrrr our share price will appreciate in anticipation of the same. IMHO

[Baldy]

@mrbubba

According to the valuation of those in the know, simple math indicates they believe MDMN is worth a minimum of 37 cents per share ($5 Million per point x 100 points / 1.35 Million shares = 37 cents per share), which suggests an approximate 25:1 market disconnect (37 cents / 1.5 cents per share = approx. 25).

Just to confirm. You claim to be an accountant?

[easymillion]

@annella

TRY this

There is much speculation continuing about what the SGE may do to the price of gold and the effect on world currencies in various articles:

China plans to launch yuan-denominated gold fix on April 19
China plans to launch its new yuan-denominated gold pricing fix on April 19 this year, sources familiar with the matter said on Thursday.
The launch date has been officially settled and draft trading rules have been sent out to those banks that will be involved in the Shanghai fixing, FastMarkets understands.
http://www.bulliondesk.com/gold-news/update-china-plans-to-launch-yuan-denominated-gold-fix-april-19-sources-109581/

China just revealed how much gold it’s been hoarding for the first time since 2009
Byline
• Tyler Durden, Zero Hedge
• Jul. 17, 2015, 7:46 AM

The amounts to a new grand total of 1658 metric tons, an increase of 604 tons from the 1054 reported last in 2009 and which according to the PBOC was also the May 2015 total.
What is surprising about this release are three things:
First, while we welcome some long overdue “transparency”, the number is well below official expectations. This is what Bloomberg said previously: "The People’s Bank of China may have tripled holdings of bullion since it last updated them in April 2009, to 3,510 metric tons, says Bloomberg Intelligence, based on trade data, domestic output and China Gold Association figures. A stockpile that big would be second only to the 8,133.5 tons in the U.S."
Second, China has finally admitted that its official gold numbers were fabricated (alongside all other official data released from the communist country) as it is impossible the PBOC could have bought 600 tons of gold in the open market in June when the price of the yellow metal actually dropped by 2%.
China Reveals Gold Holdings

[mrbubba]

Yeah, sorry - you’re right, I was going from memory, and I did not take only MDMN’s 25%. Working hard lately …

[mdeman]

I think your math is off. $5 million for 5% implies value of Auryn at $1 billion within 5 years. MDMN would be 25% of that or $250 million / 1.35 billion shares or $.185 / share for MDMN valuation. In 5 years as newleaf pointed out.

[jrn6391]

deleted by me

[Albireo]

OK, let’s now leave the guy alone. He made an accounting mistake and he publicly acknowledged that.

nnuf said.

[TheRod]

Good links today boys (sorry didn’t see a female put up a link).

Well worth reading them is you can take the time.

Rod

[mrbubba]

Thanks Albireo, but it really doesn’t bother me when I make a mistake, for a few reasons. First, I’m not in it for anything else other than to assure that ALL sides of every argument are presented for a healthy discussion. If everybody on this board was trying to push management to never sell out in a TO and just sit here until the dividends start rolling, then I’d be encouraging at least consideration of the other side. In my view, that’s what provides value to a forum like this. Those who are intolerant of the view of others and insult others in order to try to distinguish themselves are killing the purpose of this board, not to mention showing their true colors. Second, my ego is not involved, as I have absolutely nothing to prove to anybody here. Period. Thanks all the same.

[Baldy]

@mrbubba

Thanks Albireo, but it really doesn’t bother me when I make a mistake

Next thing you know, you’re going to tell us that a $50 price target was a mistake. That would ruin my day.

[hulkster]

Yes they do with analysts predicting gold at 1350.00 first quarter 2017 by then our mountain will be worth billions ,37 is not that far off.