Not that we haven t been busy doing other things at the Hemlo Gold Camp; as explained later in this Letter.

Size: px

Start display at page:

Download "Not that we haven t been busy doing other things at the Hemlo Gold Camp; as explained later in this Letter."

Patricia Young
5 years ago
Views:

1 To: Shareholders of Tashota Resources Inc. JUDGEMENT DAY FOR GOLD SALVATION DAY FOR HEMLO -December 11, 2015 By: Charles J. Elbourne, President & CEO, Tashota Resources Inc. With the price of gold continuing to move sideways in a very sporadic fashion during the summer months, I thought it best to just wait until something would come along and set the stage for a breakout in the gold price, one way or the other. Not that we haven t been busy doing other things at the Hemlo Gold Camp; as explained later in this Letter. I believe stage time may have arrived as quickly as December when the Fed makes the decision to either; increase the interest rate or leave it as is. The Fed has said it would raise its benchmark federal-funds rate from near zero after it saw further improvement in the job market and became reasonably confident inflation will rise toward its 2% target; although two Washington-based Fed governors have expressed hesitance about raising rates Indications in the dramatic price movements in gold over the past few months would seem to illustrate that nervousness in the marketplace is coming to a head.

2 Since our last Market Letter on June 23 rd the price of gold has gone from a reasonably tight trading range - March through June - to very erratic trading with very volatile movements - July to the present. Unusual volatility tends to indicate something major is about to take place. No doubt some of this volatility is a combination of market manipulation by those forces, such as banks, market participants and governments; to try and make profits and control interest rates and currency. At this time there appears to be an ongoing fear in the marketplace that something major is about to happen. And as the saying goes - When the peddle hits the metal of fear; get ready for the crash in whatever caused the fear. I believe that fear has much to do with what action the Feds may take on the th of December. The chart below provides a good view of just how the Feds in the U.S. have held fast and steady with holding down Treasury interest rates since Why has the Fed been so adamant about keeping rates down - primarily to pump up the economy from the last bubble that they created in the housing market back in that caused the housing crash in and the stock market crash in By keeping interest rates down in order to pump the

3 economy back up, this has infused capital into the stock market as the DJIA chart below clearly illustrates. The question is; what happens next? The chart of the Dow Jones above doesn t really look to healthy at this point; it seems to have caught the flu around 18,000. And while there are those out there that say the DJIA is getting ready to go to 30,000, one has to wonder how that s possible with over US$18,000,000,000 in debt and counting every minute like a fire out of control, see ( Meanwhile with the first leg of a downside already finished and the rebound seems to be stopped dead in its tracks at 18,000, the stock market doesn t look that encouraging going into There are really only two scenarios that appear reasonable at this time as to what will happen with the Fed rate on the th ; either the rate will remain the same or it may be raised points just to show that Ms. Yellen has everything under control. It is possible DJIA may even take a quick run up, although unlikely; but if it does, reality should set in over the following months. One must keep in mind that the market isn t so much held up by fundamentals as it is by sentiment; and sentiment can change overnight.

4 So what could probably happen if the Fed increases the interest rate? One could expect to see a rather sharp downdraft in the gold price on the announcement at which point I would expect that gold might test the 1046 level and even drop to the 1,000 level. But that would probably be the extent of the drop because the Chinese and Russians would be jumping in with buckets of U.S. dollars and exchange the overstretched U.S. dollar for gold. Any drop would be rather contained based on the probability that the current gold price has already priced in the risk of the fed increase. Alternatively, if the Fed doesn t raise the rate, gold could immediately jump $60- $100 and then level off, but doing so would probably signal the beginning of a new bull market in gold. Remember the old saying, The public is always right in the middle and wrong at both ends so don t expect the general public to jump on the gold band wagon just yet; that will happen after gold has already started a major move north. But enough about probability pricing for gold and there is no sense talking about the bottom in oil at this time because the Saudi s have the tap wide open and they need the money to fulfill their government assistance programs otherwise the local rabble will turn on them and there goes the neibourhood. If gold does take off as might be expected after a short downdraft in price; where does that leave the junior market place on the TSE Venture and other Exchanges still in mess. As previously mentioned in the June 23 rd Market Letter, don t continue to sell this market short, because this market will come back and when it does; it will probably outperform the previous comeback because of the fact there have been more devastation with the juniors this time around. It takes time to reverse and refinance a $2,200,000,000 shortfall in working capital, and at this time the fallout is definitely in a struggling situation. Many of these juniors just won t make it; or delist for a period of time as private companies, until they rearrange balance sheets to better reflect reality. The TSE Venture really hasn t done much all summer/fall, except move sideways to down, although the majors have probably bottomed out and as I outlined in the previous Letter, they are out fishing for some good looking trout caught between the rocks and a hard place.

5 But while the majors, such as Goldcorp and Centerra Gold (as mentioned in the last Letter) have already caught some interesting fish, such as Probe and Premier; another major, Barrick, has been out there fishing in their own pond at the Hemlo Gold Camp near Marathon. As outlined in our previous June Letter, we had researched Barrick/Hemlo until the cows came home, only to find that so far our research has been spot on with regard to Barrick s progress in the Hemlo camp. In their BARRICK THIRD QUARTER REPORT, they stated, An illustration of the optionality that exists within our portfolio is the recent drill program at Hemlo. In the first quarter, Barrick completed the acquisition of surface and mineral rights adjacent to the Hemlo property in Ontario from subsidiaries of Newmont Mining. These claims included an area of geological potential adjacent to Barrick s existing underground workings. Barrick is currently undertaking an underground diamond drilling program in this area to evaluate its potential. To date, drilling has encountered a number of high grade intercepts with significant potential. These results highlight the ongoing potential of mineral deposits such as the Hemlo camp, even as they become mature operations. It would appear (based on their information above) that Barrick may have stumbled onto some big fish (core samples) in their own back yard pond; and if that is the case then this could prove interesting for Tashota Resources Inc. Based on our research and given that Barrick paid approximately CDN$47,000,000 for the balance of Newmont s claims at Hemlo in the 1 st Quarter 2015; we decided to acquire more property. We had already expanded from our Hemlo South claims (3,500 acres and approximately 1,000 metres from the Williams Mine and open pit) to include another 2,100 acres called Hemlo West. This brought our land position to approximately 5,600 acres. So we brought out the canoes and gassed up the helicopter and went looking to stake more claims or negotiate already previously staked claims We ended up acquiring the Hemlo North and expanded the Hemlo West and staked the Hemlo Black River, resulting in another 12,500 acres. This brings our total claim position to 18,000+ acres; which makes Tashota one of the largest land holders in the Hemlo Gold Camp.

6 Tashota management is looking forward to Barrick s next quarterly report and hopefully they will divulge their drilling results, because since they have already announced that they had encountered a number of high grade intersects with significant potential; it is expected that they will/ have undertaken a large drill program to further the Hemlo deposit, and perhaps even expand the open pit. Meanwhile, moving forward; Tashota is presently completing an offering to interested investors that will include both treasury and flow-through shares for those individuals looking for tax deductions from personal or corporate income. These units will include warrants. Please note the News Release which has a map outlining our additional Hemlo claims at ( For further information, please contact: Charles J. Elbourne B. Comm., M.B.A., President (416) mining@tashotaresources.com CAUTIONARY NOTE The information contained herein is provided for informational and educational purposes only, and nothing contained herein should be construed as investment advice, either on behalf of a particular security or an overall investment strategy. Neither Tashota Resources Inc., nor any of its affiliates makes any recommendation to buy or sell any security. Actual results may differ materially from those expressed or implied. Past performance is not indicative of future results. Investors should undertake their own due diligence and carefully evaluate companies before investing. ADVICE FROM A SECURITY PROFESSIONAL IS STRONGLY ADVISED.

ANTICIPATION MARKETS, OIL & GOLD

ANTICIPATION MARKETS, OIL & GOLD Page1 To: Shareholders of Tashota Resources Inc. By: Charles J. Elbourne, President & CEO, Tashota Resources Inc. Issue 4 - FEBRUARY 12, 2016 NOTE: At the conclusion of this Letter to Shareholders note