Post by Catdaddy on Nov 20, 2007 16:31:26 GMT -5
Tuesday, November 20, 2007
Lundin Mining LUN.to LMC Assestment. CS
Great quote:
Risk comes when you do not know what you are doing.
I will run some numbers later.
Bullish case for Lundin Mining LUN.to LMC in the Big Picture:
1. You are making Money when you are buying undervalued assets with near term catalyst for realising their true value.
2. You are making Big Money when "nobody wants it" and there is blood on the street.
3. You are making money when your house is safe and You Are Not on Margin: nobody can force you to Sell at Loss.
4. You are happy when your precious asset is going down in price only in One case - when you can Buy more.
5. In Lundin Mining Case you have invested because:
- You think that the US Dollar is shrinking in value, powers are shifting and Demand will be there even with USA already in recession and Chinese stock market crashed 50%. You do think so because you know that China is Planed economy with huge amount of USD paper asset which they are happy to exchange for the real goods. You have checked Shippers Talks - they are pointing to higher Demand in 2008 for all raw materials. You know that Chinese Market is still a fraction of Chinese economy and its "crash" of 50% will only put it on solid uptrend line. You think that this blip will not prevent Chinese Government from race with time: they need leap frog in building infrastructure in order to prevent aggression and attempt to democratisise them as well as to ease tensions inside the society and by urbanisation move unstable classes from poverty into New Middle Class Consumers of their own Chinese products. They have for this 1.5 trillion USD IOU from bankrupt state which by accident are still accepted in some parts of the world. This is the only positive scenario for me in the world of shifting powers: that rising powers will become quickly confident in order to prevent stupid attempt to nuke them. Once reality will be accepted: Multypolar World will become evident. Reality will be difficult to accept: it means that Average standard of living in the Western world will need to come down and Eastern World will rise. Standard of living means not amount of Credit Cards, but amount of available for consumption energy and commodities. You can fool your citizens about value of the dollar, rich have all means to diversify, how can you diversify if you are living from cheque to cheque? But you can not fool yourself: real wealth is not IOU of the bankrupt state but Real Assets which you can use to build productive assets, by raw materials, feed your workers, give them part of the profit to make them happy and then Store your Surplus Capital in Ultimate Value: Gold ans Silver before you will make another investment decision.
- You have taken into account that recent drive down on Zinc price was caused by increased Chinese export due to Reduction of Export Subsidaries which is actually indicating Strong Demand from China for the product.
- You know that Lundin Mining has the right mix of commodities to satisfy your Big Picture approach: Zinc - you need it for all white goods and cars, bridges, skyscrapers and pipelines. Copper - it is Energy, energy, energy. Lead - it is cars, millions of them. World did not noticed but people still need fridges, microwaves and cars, only one new thing: it is not in Arizona but in Shanghai.
- You know that main production assets of Lundin Mining are in stable boring Europe and even they are trading with discount to Real Value. There is no Credit for Huge Tenke Fungurume and Ozernoe deposit in the price at all.
- You have read latest release and satisfied that management is investing in existing Assets in order to increase production, putting another mine into production this year and cutting operational cost combining and eliminating six offices (economy of scale).
- You like to Buy below owners of the company, you are not so stupid to think that you can know something better then them in their business. Buying at 9.5 CAD you will feel better by 2.5 million on their recent 2 mil purchase at around 12 CAD.
- You have run the numbers and decided that it is a real bargain considering all the above.
New Company and Tenke Fungurume presentations:
www.lundinmining.com/s/Home.asp
Now, does this sound familiar? Later,
Catdaddy
P.S. Guys are in a very difficult position: they can not Promote Tenke too much untill DRC will confirm their project status: hint is that Latest Drilling was never reported, before "people have talked" about three times bigger resource (it will not be revealed by recent drilling but magnutued of potential), they have 30% cap on increase in investment with FCX. This is the catalyst.
Posted by Sufiy at 11:32 AM
Lundin Mining LUN.to LMC Assestment. CS
Great quote:
Risk comes when you do not know what you are doing.
I will run some numbers later.
Bullish case for Lundin Mining LUN.to LMC in the Big Picture:
1. You are making Money when you are buying undervalued assets with near term catalyst for realising their true value.
2. You are making Big Money when "nobody wants it" and there is blood on the street.
3. You are making money when your house is safe and You Are Not on Margin: nobody can force you to Sell at Loss.
4. You are happy when your precious asset is going down in price only in One case - when you can Buy more.
5. In Lundin Mining Case you have invested because:
- You think that the US Dollar is shrinking in value, powers are shifting and Demand will be there even with USA already in recession and Chinese stock market crashed 50%. You do think so because you know that China is Planed economy with huge amount of USD paper asset which they are happy to exchange for the real goods. You have checked Shippers Talks - they are pointing to higher Demand in 2008 for all raw materials. You know that Chinese Market is still a fraction of Chinese economy and its "crash" of 50% will only put it on solid uptrend line. You think that this blip will not prevent Chinese Government from race with time: they need leap frog in building infrastructure in order to prevent aggression and attempt to democratisise them as well as to ease tensions inside the society and by urbanisation move unstable classes from poverty into New Middle Class Consumers of their own Chinese products. They have for this 1.5 trillion USD IOU from bankrupt state which by accident are still accepted in some parts of the world. This is the only positive scenario for me in the world of shifting powers: that rising powers will become quickly confident in order to prevent stupid attempt to nuke them. Once reality will be accepted: Multypolar World will become evident. Reality will be difficult to accept: it means that Average standard of living in the Western world will need to come down and Eastern World will rise. Standard of living means not amount of Credit Cards, but amount of available for consumption energy and commodities. You can fool your citizens about value of the dollar, rich have all means to diversify, how can you diversify if you are living from cheque to cheque? But you can not fool yourself: real wealth is not IOU of the bankrupt state but Real Assets which you can use to build productive assets, by raw materials, feed your workers, give them part of the profit to make them happy and then Store your Surplus Capital in Ultimate Value: Gold ans Silver before you will make another investment decision.
- You have taken into account that recent drive down on Zinc price was caused by increased Chinese export due to Reduction of Export Subsidaries which is actually indicating Strong Demand from China for the product.
- You know that Lundin Mining has the right mix of commodities to satisfy your Big Picture approach: Zinc - you need it for all white goods and cars, bridges, skyscrapers and pipelines. Copper - it is Energy, energy, energy. Lead - it is cars, millions of them. World did not noticed but people still need fridges, microwaves and cars, only one new thing: it is not in Arizona but in Shanghai.
- You know that main production assets of Lundin Mining are in stable boring Europe and even they are trading with discount to Real Value. There is no Credit for Huge Tenke Fungurume and Ozernoe deposit in the price at all.
- You have read latest release and satisfied that management is investing in existing Assets in order to increase production, putting another mine into production this year and cutting operational cost combining and eliminating six offices (economy of scale).
- You like to Buy below owners of the company, you are not so stupid to think that you can know something better then them in their business. Buying at 9.5 CAD you will feel better by 2.5 million on their recent 2 mil purchase at around 12 CAD.
- You have run the numbers and decided that it is a real bargain considering all the above.
New Company and Tenke Fungurume presentations:
www.lundinmining.com/s/Home.asp
Now, does this sound familiar? Later,
Catdaddy
P.S. Guys are in a very difficult position: they can not Promote Tenke too much untill DRC will confirm their project status: hint is that Latest Drilling was never reported, before "people have talked" about three times bigger resource (it will not be revealed by recent drilling but magnutued of potential), they have 30% cap on increase in investment with FCX. This is the catalyst.
Posted by Sufiy at 11:32 AM
