Saturday, March 1, 2014
Permashave Dave asks a pertinent question of Keith Neumeyer: "what is this I don't even"
PS Dave - what is this I don't even. Wherein PS Dave asks: remind us again, is First Majestic a silver mining company?
Why does First Majestic own March 2014 silver calls?
I mean, it's all fun playing options, pretending you know what a commodity's price is going to do months into the future; we all love playing at the casino.
But... um... that there money is the shareholders' property, guys. Does management have any sort of fiduciary responsibility? I mean, does the typical CEO take all his corporation's money, put it in a big pile, and then just set it on fire?
Not only that, why the fuck does First Majestic own shares in Sprott's PSLV?
Did they happen to buy PSLV at a massive premium, where it normally trades? Have they thought about instead following the traditional strategy of mining silver at (hopefully) a discount to its market price, and then selling it for a profit? Is that too faggy for Keith Neumeyer? He'd rather go buy silver at a premium to spot?
Couldn't he have perhaps drawn the line at buying SLV, and buying it at its spot price?
And what's he going to do with the silver that he's bought from Sprott, anyway? Isn't silver supposed to go out the door at a silver mine? Is First Majestic now a mutual fund?
And are they concerned about Sprott himself having gotten demoted to cheerleader?
You've got to wonder what the fuck management thinks they're doing. The directors obviously think they're fucking geniuses, since as PS Dave notes they've given themselves a $300K raise for successfully directing the burning of $55M in cash.
As for the FM shareholder?
Here is what the shareholder looks like, in the eyes of First Majestic management:
Remember that when you visit FM's booth at PDAC tomorrow.