Financing by the Crowd
September 2012 by Mark E. BattersbyWhile a great many questions remain unanswered, there is little doubt that a new financing option for small-scale mining operations, “crowdfunding,” is growing as a viable and legitimate funding source.
One of the oldest sayings we all learned as children was “Water, water, everywhere, but not a drop to drink.” Following developments during the past month, we might rephrase that as “Questions, questions, everywhere, but not an answer to truly trust.”
First, in order to compensate for the diminishment of purchasing power that usually accompanies rising inflation, investors normally have demanded higher interest rates on their investment assets. This was particularly true in the 1977-81 era when inflation soared to almost 20% and interest rates rose to roughly the same level.
After six years of primarily sideways action, gold broke decisively to the upside by breaking above strong resistance between $1,350 and $1,400 by soaring to near $1,450 before correcting moderately.
Given the enormous expenditures that are required to bring any mining property into production, the industry can ill afford a regulatory system which, by reversing already existent approvals, can nullify the value of funds already expended.
The Bawl Mill • Cold Alaskan Gold—Part I • Wild and Scenic River Prospecting—North Fork of the American River • Detecting for Gold—Finding Nuggets Where You Least Expect Them • Potholes and Other Bedrock Traps • Wealth Beyond Your Wildest Imagination • Gold Too Big to Carry • The World of the Simple Gold Pan • New Silver and Zinc Mine Slated for Montana • Eastern Oregon Mine Seeks Permits • Mining Returns to Historic Comstock • BLM Issues Environmental Review of Wyoming Uranium Mine • Melman on Gold & Silver • Mining Stock Quotes and Mineral & Metal Prices