Friday, October 18, 2013

PSDave and Venture credibiliy

PSDave has become a card-carrying member of the Venture Capital Markets Association - at least until they figure out that he's merely an infiltrator. Here's his report:
Overall it was a pretty good bitch fest about the regulators, BCSC and IIROC for the most part. There was desperation in the voices and they want to start lobbying on the political front for changes.
That would be hilarious! What federal, or even provincial, politician is going to take seriously a bunch of whining "Venture exchange CEOs" who run sub-million-market-cap lifestyle companies?

Dudes: you are nobodies to the political class. Most of them are richer than you. They don't listen to anyone whose "corporation" is so poor that they can't even get the cash together to meet basic listing requirements.

You guys are no Royal Bank or Goldcorp. Quit thinking you're going to get political attention like Royal Bank or Goldcorp. You guys are the clown who runs a chip truck who wants to complain to city hall about the cost of a street-vendor license. Shit, even the average Toronto taxi driver has a higher book value than most junior mining stocks.
Another sticking point was all the fees they have to pay to maintain a listing. My thought is if you are worth your weight in salt then these should not be an issue, but if your a lifestyle company then it looks like you are at the end of the rope.
Exactly, and my response is this:

The explorecos don't have a credibility issue as much as they have a credibility mismatch with the Venture exchange.

A Venture company is supposed to exhibit some small minimum of professionalism, financial sophistication and trustworthiness. If these clowns feel that the extremely low bar set by the V is still too high, then (as I keep saying) they should go to the Nex or the pinks.

After all, in what way are any of these companies behaving not like an OTC stock?

The only reason for these idiots to get a V listing was to trick the instos into buying them alongside the other V explorecos like Atac and Kaminak. Well, that buying stopped a few years ago. Does the benefit of a V listing outweigh the cost anymore?

Seriously, mister Venture-listed CEO, answer me this: what the hell is the point of you still listing on the V? Why the hell are you still hanging around? It's 4AM, the party is over and the booze is all gone: what the fuck are you still doing in my living room?

Your price action should have proven to you by now that nobody wants your shitty stock anymore. Delist.

Just go away.

And importantly:
Which brings me to the next issue with private placements, you always need the retail (read bagholder) there to eventually sell your private placement cheap stock and warrants to. These days there is a rush to the exits from the holder of the private placements, usually showing up about a month before the hold comes off.
Exactly. They've been running a Ponzi for the past several years. It works when the asset is going up - hey, we were all happy to buy the paper flood a few years ago - but when the asset is going down, all you create is a rush for the exits.

And as Cookie notes, these clowns print paper specifically so that the hold comes off a couple days after drill results. Whereupon the paper is sold.

By the way - how is this not a pump-and-dump? You bought paper with the intention of selling into a pump; then you manufacture a pump by (hopefully) releasing good drill data a couple days before the hold comes off, so the pop can get sold into. That's a pump-and-dump.

The industry has been killed the way Bre-X killed it years ago. The only difference is this time, Bre-X is smeared across five hundred different bad actors.

Frankly I think gold exploration is going to go the way of REEs from a few years ago: China is going to run the entire exploration industry.

1 comment:

  1. I used my alias Otta Rock... They will never know.