Disappointment with Gold mining Stocks

[Fiat Metaler]

Good post.
Dividends can serve as a theoretical restraint on share dilution through naked shorting, but many dividends are paid in shares not money.
Also, I think, the stock issueing company, can "cover" a dividend by itself--I think.

when i say dividends, i mean cash dividends. a stock dividend is unusual and basically its just a fractional stock split - its not a real dividend, just an accounting fiction.

the point is if metal prices increase and a well managing mining company is making money, then they will distribute profits to their shareholders in the form of dividends. so the PTB can manipulate prices down but eventually the profits stand out like a sore thumb. For example, newmont is paying a 3% dividend and Gold Fields is at about 5%. (Gold Fields is a bit less reliable, hence the higher yield, but the point is the dividend yield becomes a limit on downward stock prices.)

Lancers: Motives are two-fold: (1) many juniors expand by issuing new stock, so a depressed stock price cuts off their growth, and (2) keeps momentum traders and the general public out of the sector.

[lhslancers3270]

when i say dividends, i mean cash dividends. a stock dividend is unusual and basically its just a fractional stock split - its not a real dividend, just an accounting fiction.

the point is if metal prices increase and a well managing mining company is making money, then they will distribute profits to their shareholders in the form of dividends. so the PTB can manipulate prices down but eventually the profits stand out like a sore thumb. For example, newmont is paying a 3% dividend and Gold Fields is at about 5%. (Gold Fields is a bit less reliable, hence the higher yield, but the point is the dividend yield becomes a limit on downward stock prices.)

Lancers: Motives are two-fold: (1) many juniors expand by issuing new stock, so a depressed stock price cuts off their growth, and (2) keeps momentum traders and the general public out of the sector.

Outside of the first few years off the bottom this cycle I made a lot more money trading in and out of Fidelity Select Gold in the mid '80's. Since Gold took out 500-600 it has been a major bitch to make money. They can have it.

[Ebie]

when i say dividends, i mean cash dividends. a stock dividend is unusual and basically its just a fractional stock split - its not a real dividend, just an accounting fiction.

the point is if metal prices increase and a well managing mining company is making money, then they will distribute profits to their shareholders in the form of dividends. so the PTB can manipulate prices down but eventually the profits stand out like a sore thumb. For example, newmont is paying a 3% dividend and Gold Fields is at about 5%. (Gold Fields is a bit less reliable, hence the higher yield, but the point is the dividend yield becomes a limit on downward stock prices.)

Lancers: Motives are two-fold: (1) many juniors expand by issuing new stock, so a depressed stock price cuts off their growth, and (2) keeps momentum traders and the general public out of the sector.

If you own shares through Fidelity, etc, you have the choice to take dividends as cash, or, to get more stock shares
The shares were theoretically openly purchased and not printed by the company.
I believe that most large holders, such as unions choose to get more shares.
When I owned stocks, took my dividends as more shares.
There are tax disavantages to cash dividends.

[Fiat Metaler]

just so we;re clear, i'm talking about actual stocks, not mutual funds.

there is a season for everything. right now the stocks are offering good value, and about the same dividend as JNJ. if the metal goes up, so will earnings.

i do agree that you can't buy the miners with a hope they go up just becuse they theoretically provide more leverage to the gold price.

[lhslancers3270]

http://www.mineweb.com/mineweb/actio...ia_fileid=2147

[Scorpio]

Outstanding lhs,

much appreciated,