If you followed the advice religiously , you would have bought at $12.50 and sold yesterday at $18.21 on the open, a gain of 45% in three months. We can now count five waves up which is promising for the future, but not for the immediate future. It is now time to forget that these stock even exists and wait a few months before looking at it again. We do note that the potential for this stock to rise to about $30 exists! Not in a straight line!.
Thursday, February 21, 2013
Toronto, Ontario, February 21, 2013 – Seafield Resources Ltd. (“Seafield” or “the Company”) (TSX-V: SFF) is pleased to announce that it has executed an agreement with RMB Australia Holdings Limited ("RMB") for a CAD $16.5 million loan facility ("Facility"), arranged by RMB Resources Inc., the resource financing division of the FirstRand Group of South Africa. The use of proceeds is to fully fund the bankable feasibility study (“BFS”) for the Company’s Miraflores Deposit and general corporate purposes.
In November 2012, the Company commenced its current ongoing exploration program on the Miraflores advanced-stage gold deposit, which is part of the Company’s Quinchía Gold Project, located in the Risaralda Department of Colombia. The Facility provides the incremental financing the Company requires to complete the Miraflores BFS by the end of Q4 2013.
Facility Terms:
You take what you can get. This should be good for, maybe , a year and a half, if all goes well. Now that the market has opened it also helped to push the stock up a little bit, 3 cents with volume threatening to exceed a two year high of about 3 mln. shares. The all time high volume was about 70 mln. shares in a day.
P.S At the end of the day slightly more than 5 mln shares had traded in a range of 10 to 13 cents and closing at 11 cents, a single cent gain for receiving this lifeline. What seems to be clear is that, should the company meet with success, that is, should the exploration results indeed be “bankable”, then the warrants (and others issued to key personnel, 3 mln plus ) will be exercised and hang like a millstone around this company’s neck. At a stock price of, say, $1.10 this would up the cost by $36 mln. of proceeding. Sounds like the proverbial rock vs hard place situation.
This chart has shown up in various different blogs and since it is from the Fed.(St. Louis), I am taking the liberty to use it here as well. I have added two horizontal lines approximately where I guess the average would be over this sixty-six year period. Also added are directional arrows highlighting the direction in which these variables have been moving. The chart is difficult to read. The left hand scale tells you what percentage of GDP (Gross National Product) corporate profits , after tax constitute. So the average would be about 6% of GDP. The right hand scale shows what percentage “wages and salaries” are of GDP, about 50% on average.
The Fed. has a dual mandate. Keep prices stable which equates to keeping the value of the dollar constant (with 2% deliberate slippage!), and keep the population employed, newly defined as below 6.5%. Anyone that has even remotely sniffed at economics will know that these two are mutually exclusive but that should not bother politicians. What should bother them is that it demonstrable does not work.
A little known fact is that governments are always net borrowers. Corporations can be both borrowers or lenders but on balance the are also borrowers. Households, even if they are not always aware of it, are always net lenders. Artificially low interest rates therefore give an advantage to corporations. They also promote capital intensive activities at the expense of labour intensive activities. I could go on for hours on this topic, the simple point , however, and this is demonstrated in spades by the above chart, is that the goal is not achieved. Apparently Sir Mervyn King, the predecessor of Mark Carney, at the Old Lady of Threadneedle street, learned as much today when his board failed to support him in his quest towards more stimulus. Writing on the wall??
Then , Oct. 23, 2012 and now charts as usual;
Back in October of last year we volunteered the idea of an enormous “diagonal” as the sole bullish count that we could possible put on RY stock, but did recommend selling it at about $60. The unthinkable has happened and the stock has made another , new high, the only bank stock to do so (excluding HCG). Then we calculated a high of roughly $65 for this pattern should it become reality. Today’s high was $64.90, see below;
This should, give or take, complete the last leg in the diagonal (if that is what it is) and should unfold as a 3-wave affaire as it has. The RSI is , of course, already exploding to the upside into overbought territory for the last three months. The MACD is not confirming for more than a year now. Who could have thought that this stock could be up more than 50% in 14 months. Now it should definitely be sold.