Win us with honest trifles

Santacruz Silver (SCZ.v): While on the subject of silver mining companies blowing smoke up the market’s ass…

…am I the only one who’s noticed this? Seems from the way the stock is rallying this morning that there are still people who trust the bullshitter Prestamo leading up SCZ. Mad fools.

Exhibit One: When SCZ arranged its original $28.4m pre-paid silver deal it said the cash was to build its San Felipe mine. Here’s the October 2nd NR that announced the deal’s closure:

VANCOUVER, Oct. 2, 2014 /PRNewswire/ – Santacruz Silver Mining Ltd. (“Santacruz” or the “Company”) (SCZ.V)
is pleased to announce that it has finalized and closed the US$28.4
million Pre-paid Silver Purchase Agreement with JMET, LLC  (“the
Agreement”) previously announced on September 18, 2014. The funds will
be used to advance the development of the Company’s second project, San
Felipe, in Sonora State, Mexico.

Exhibit Two: This morning SCZ said it’s not going ahead with San Felipe so…it’s only borrowing $12.4m. Here’s the excerpt:

Pursuant to the original agreement the Company received an upfront
payment of US$28.4 million . With the quantity of silver ounces to be
delivered reduced to 2,600,000 ounces, the upfront payment has been
commensurately reduced to US$12.4 million .

Therefore the obvious question: If you’re not building the mine any more, why are you going $12.4m into hock, Arturo? The obvious answer: SCZ is bullshitting, it’s got no cash, its mine isn’t FCF+, it needs to go into debt to keep operating.
But don’t expect an honest answer from a liar running a silver miner. So don’t even bother asking.

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