August 18, 2022 

How to Approach Thin Veins & Cost


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 By fredmcain

03/17/2014  9:18AM

I would like to add a recent development to my post below on North Bay Resources and The Ruby Mine. I found out today that North Bay is planning to “spin off” The Ruby Gold Mine Co. with a new I.P.O. of stock. The proceeds of the sale will go to paying a one-time “stock dividend” to current North Bay shareholders. It will be interesting to see how this pans out.

North Bay’s common stock is now around two cents. (OSTO shareholders take comfort!). Obviously investors don’t seem to enthusiastic about this.

However, from what I can tell Ruby Gold seems to have some good people working there. Of course, I don’t know them personally so maybe someone on our forum can expound on this.

I can tell you one thing, though, when I e-mailed them at their website they were responsive. Surely that’s at least a step in the right direction.

Fred M. Cain
 By Michael Miller

03/10/2014  2:46PM

First, I appreciate your thoughts below. Our trade action lately is so bizarre. Recently, someone wanted to negotiate a loan to us based on the company's value according to these trades. It was unacceptable.

Traders always keep shares in street name with the broker in order to make quick transactions. A clearing house like CEDE holds the shares one of two ways: NOBO or OBO. The NOBO is a Non Objecting Beneficial Owner and an OBO is an Objecting Beneficial Owner. We get a list of the NOBO's if requested for a fee. Thereby we know the number of shares, geographic location and name of the shareholder. The OBO's are owners who want to remain anonymous. We haven't a clue who they are.

In the past, share certificates were ordered by the broker upon request by the client without a charge. Then a modest charge was required to offset either or both the expense from the transfer agent and broker. It was a courtesy offered by brokers to keep clients happy. A company cannot demand this or follow the path of street name sales and purchases...impossible.

On our FORUM stock topic, our company cannot allow existing shareholders to offer stock for sale without the corresponding stock certificate and written instruction by the seller. When a match is made, we act like an escrow agent (without a fee) to carry out the transaction. Transfer costs are between the seller or buyer depending on the amount of dollars exchanged.

I stand by my suspicions that as the volume of share transactions per hour increased on NASDAQ, NYSE and other marketplaces, the established method was not quick enough to handle the traffic. Short cuts were made and now due to apathy by stock market investors, share certificates are being phased out. There will be a financial storm someday. There will be computer challenges that cause havoc in the share accounting process and some people will lose or have the burden of proof to right their situation.

As to who pays? Owning a stock certificate is similar to insurance. We pay the inconvenience or price for security. Since this silly market game of selling/buying OSTO shares for pennies has some unidentified gamers, their financial stake is negligible. They don't need insurance.

Other reasons apply why a corporate president should take an interest in stock trading. Gamers who like to short stock do so by borrowing the shares from someone. For example, I could make my shares available to a stock shorter for a fee, and he would be covered. Brokerage accounts don't allow naked shorts or they did not in the past. Where does a short seller get shares then? Why he borrows them from a depository like CEDE, your stock.

I got into the stock market when I was ten years old. My dad speculated as well as investing. He promoted a project to drill gas well test holes around Vallejo, California in 1952. I addressed the mail out pamphlets. My pay was $100 or 200 shares of the deal. I took the shares. The holes did not support economic gas wells. I lost it all with no regrets. What I took away from that experience was the thrill, coupled with truth that the money raised was spent looking for gas. I knew this to be true because he took me to the drill rigs. I also saw his excitement and later disappointment. It was a good shot but failed.

During several periods of my life, I spent time speculating and investing. I won and lost but never lost money in a short sale trade. It is far easier for gamers to manipulate a downward plunge of price than the crawl upward.

What the public is witnessing in many small cap stock tradings are various manipulations. The largest manipulations are bogus trades to increase volume. These are not necessarily illegal acts but sometimes they are. It is not difficult for me to follow this in small cap gold stock companies. Surprisingly, gamers of the big boys do the same, but it is less noticeable due to the high volume of shares traded.

I encourage those in street name to get a certificate because it gives OSTO a name and address. Mail outs were cut back due to the need to spend all available money on servicing the mine workings. This will cease as soon as our fortunes improve. If we don't know you are a shareholder, you won't receive a newsletter. Also I look forward to the day when the short sellers are hung out to dry. It happened once before on the Pacific Stock Exchange. The specialist oversold and needed a seller to supply some shares to maintain an orderly market. A past director helped out.
 By fredmcain

03/10/2014  4:52AM

Blue Jay and Group,

One thing I was wondering about, could we stabilize the “pink sheet” shares simply by buying them up? I don’t mean to suggest that the COMPANY should do this but rather we individual investors. I mean, at 5½ cents a share, it’s hard to go wrong. If we should each spend a few thousand dollars it wouldn’t take long before the share price is well over a dollar. The pink boys would have trouble manipulating the stock ‘cause there would no longer be too many shares left out there for them to manipulate..

Of course, another idea I had too would be if we could develop a “money pool” where we would all contribute a little bit toward the cost of sinking a new shaft and dewatering the mine. It would not be a loan and neither would new shares be sold to do this.

Our reward would be the high possibility that Mike would find new gold – and possibly a LOT of new gold. That could result in higher share prices and possibly even a dividend. What do the rest of you think about this? How much would that cost and how many ways could it be split up so that it would not be a hardship on any individual member?

Fred M. Cain
 By bluejay

03/09/2014  12:39PM

It looks like the last sale on the pinks is $0.055

The Pink Sheets is just a daily register of "so called" market markers with their firm name and phone numbers. Completely different that "real" OTC traders that are hooked up on a computer network. To this day, I do not know how "GTC orders are handled. The result is trading through entered orders that have no standing. I have had orders in with the pink crook-sters only to see my limits danced around like they meant nothing and who do you complain to?

I think Mike has a go at unraveling this mystery with the pink-boy-(so-called)officials but it has always resulted in a dead end for him. The whole pink sheet operation exists so certain so-called market makers can rip off the public. Their rationale is: I want the lowest price to buy these thinly traded issues for I know not when I will be able to sell them for a profit in the future, regardless if there are better orders willing to purchase. And for complaining, who has the time to service a complaint for a few hundred dollars, absolutely no one. So these market makers know they can, basically, steal and no entity will ever hold them responsible. I know personally all about complaining for misdeeds in the trading arena.

There used to be small local brokerage firms that specialized in small area companies of which in California we don't have. In Spokane and Coeur d'Alene they do have them. Just to mention a few, Dillion in Spokane and PennTrade in Coeur d'Alene.

Maybe when gold moves higher again the public will have an increased interest in California gold mines but for the moment, I don't foresee a local brokerage house, if there are any left, specializing in the local companies.

The pink sheets could be tightened up with investor interest even now but at what expense to the company? The expense would be spending money for news releases. I could write news releases that would excite many but unless there are concrete results attaching in the future to optimistic releases, a loss of market creditability would result and so would the selling into the hands of the pink boys.

SO, for the moment we just wait for the next million or two dollar day when the news crews will be driving up the mountain to give us our free publicity and hopefully, new buyers and a better public understanding of what Mike is trying to do and the potential for rewards.

OSTOOriginal Sixteen to One Mine Inc. (OTN)Delayed quote data
3/4/2014 03:43 PM
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Percent Change:
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52 Week Range:
0.05 to 0.45
 By Rockroby

03/08/2014  7:00AM

 By Rockroby

03/07/2014  3:51PM

That's not the reason I was trying to sell at a quarter, it was to get positive movement on the the pink sheets..
It may sound easy to do but it's not, It would be very pricy if not impossible to get my shares out of UBS ( over 25,000 ) and get them up to you to get signed..
Look at other mining companies on the sheets and they have almost daily movement..
That 96,000 trade day was the most I have ever seen traded. If someone inherited those stocks and looked at the movement of the stock they wold tell their broker to get what they can and sell it all...
The way I see it you should welcome pink sheet trades, and E-Trade will search out shares that are not in their system..
Thanks for the reply
 By Michael Miller

03/07/2014  2:10PM

Just because, I am willing to but 750 shares at $0.25 ($187.50) but I do not have an E-Trade account. I want a certificate in order to secure my ownership. Any ideas on how to do this? I have one idea. If any reader of this forum has an E-Trade account and purchases these 750 shares, I will send them $235.00 for the certificate.
 By Rockroby

03/07/2014  7:33AM

The sell order is through E-Trade and only for 750 shares, if I went through my UBS account for the 1,000 it would have a better chance of being filled.
If it's a all or nothing order? it's not going to make it. It would be pricy and big loss going through UBS...
Sloppy writing, out/out have a great weekend all, I'm going placer mining.
 By Rockroby

03/07/2014  7:01AM

Hi Fred
Good news, looks like the miners did pull out fifty or more ounces out in 2013.
Just to see what happens I put in a sell order at .25 cents, not that I want to sell it's to see if we can get some positive movement going.
 By fredmcain

03/07/2014  4:38AM

On the subject of our "grey" shares, the last trade was for six cents. Now for several days I have had an offer in my brokerage account at Vanguard for 1,000 shares at 25 cents.

So far there has been no takers. What gives? Makes me a little suspicious. What if I changed my offer to three cents? Maybe then those ding dongs would sell. I just can't figure.

Fred M. Cain
 By fredmcain

03/06/2014  6:03AM

Does anybody on our forum know if there are any other small, publicly traded mines that are mining with rail?

I have found The Original Sixteen To One and The Ruby Mine. Are there any others?

You may post this information or contact me off list.

Fred M. Cain
 By fredmcain

03/05/2014  4:43AM


Thanks for your post and update. The posts you mentioned from 2002 and ’07 are most interesting and informative but it’s still nice to get an occasion update.

Obviously, I must have some faith in what you are doing or I would not have bought shares in the mine. Is it high risk? You bet! But you have a most fascinating and historic operation and I have a desire to be a part of that in the only way I can right now.

I would like to mention something about risk. All investments have a certain amount of risk and not everyone has a firm understanding of risk. If you put your entire life’s savings into an F.D.I.C. insured bank account, you are STILL incurring risk. In that case you have a high risk of seeing your investment get eaten alive my future inflation. I know so many people who just simply do not understand this. They wouldn’t touch any stock with a ten foot pole ‘cause stocks are “too risky”. Better to put it in the bank where “it will be safe”. Wrong – dead wrong.

A pretty safe way to invest for the long term is in a mutual fund. Mutual funds spread your investment around over a large number of companies which lowers company risk. In the case where one or two companies “blow up” and go bankrupt, it doesn’t affect your overall investment very much.

An excellent way to invest in mining is in the E.T.F. “XME” which is actually a fund that invests in “baskets” of mining stocks and is traded daily on the open stock market. But operations like the Ruby Mine or the Original Sixteen To One are just plain fun so putting a little bit into to those doesn’t hurt a bit. As things stand right now, I am satisfied with my investment in the Sixteen To One.

I would really like to know where we stand on the legal situation (the Clean Water Board) mostly out of a friendly concern more than anything else because it really does affect us all. Someone suggested that some of these topics would be more appropriately addressed over the telephone than on the forum and I agree.

I would love to call you and talk to you about this but I know you are very busy – and so am I :) Nevertheless maybe we’ll finally get around to it one of these days! The shareholder meeting? I’d just LOVE to come but it’s not looking very promising from my end this year, either. Oh well. Maybe someday.

Fred M. Cain
 By Michael Miller

03/04/2014  6:13PM

Most small traded gold mining companies will never show “some color”. Their game is always a promise, called in mining lingo, exploration. The fearless ones combine some words to suggest that some color may be beneath the surface of claims they operate. Those fearless ones are betting that authorities will not come after them for stock fraud and manipulation.

Check those junior financial reports closely, especially the revenue of the income statement. Do they show revenue from gold? Most do not. Check the balance sheet as well. Most small (and surprisingly Barrack and Newmont) continue to issue millions of shares each year. Dilute, dilute, dilute. This is how they fund exploration.

Most small gold mining companies do not own the land they plan to mine. Even most of the big guys don’t own the real estate; they maintain a mineral right subject to the federal government’s laws. How secure is this? Do you know that a major concern of all natural resource companies is that once they invest millions of dollars outside the US, governments are changing the rules. Companies are walking away from serious investments due to government fickleness. Today those few companies that actually mine gold on unpatented mining claims are concerned about Congress passing a new royalty on production.

The means for Fred and lj to grab their concerns are already explained here. I looked back to when this topic first appeared and read input from AuHound (May 15, 2002) and Bluejay (June 15, 2002. It is a worthwhile trip. My first participation in this topic was on June 7, 2003. When you get to April 26, 2007, a letter from an outraged shareholder appears. Interestingly a reference to April 2, 2007 in Correspondence from the President topic adds fuel to the stock pricing situation.

Many qualified people with valuable information have participated in this topic. For Fred and lj, there is much for you to ponder about your questions, especially Fred with his writings in How to Approach Thin Veins & Costs. I highly recommend you start here. More comments tomorrow if I can get away from the mine.
 By lj

03/04/2014  12:40PM

I should have saved the financial statements that came with my shareholder package. I am assuming that the Sixteen to One has liabilties that must be considered when looking at the assets. In addition, I consider "legal skirmishes" to be potential liabilities,

The news page of this site doesn't have news of any finds of gold, even in insignificant amounts that I can find. Really, we don't even know that there are miners actually working in the mine. If not, the chance of finding gold is pretty low. But if we want the share price to represent the real value of the mine rather than the "badly undervalued" price, investors need to see some color.
 By fredmcain

03/04/2014  11:06AM

David & Group,

Yes, that's true! To this I could only add that you might look at the really nice photos on this page here:

Please take note that in order to visit that page you have to copy and paste the address to your browser 'cause URL's do not "highlight" on our forum.

If you can find it, scroll down and check out that awesome switch just outside the adit! I'd love to visit this mine someday, too, although I don't know what their attitude is on mine tours. Hardly as liberal as Mike Millers! :(

Fred M. Cain
 By fredmcain

03/04/2014  9:56AM

Dear “Lj”,
By and large, I tend to agree with most of what you’re saying here. Anything, be it a pair of pants, a stereo, an automobile, a house or a SECURITY is only worth what people are willing to pay for it. As far as I’m concerned this means that shares of OSTO are worth somewhere around five to fifteen cents each right now.

As far as Mr. Miller supposedly insinuating that the shares traded on the pink sheets (“grey” shares if you will) aren’t “real”, I didn’t quite get that from what he’s said in the past. He has actually intended to mean (I THINK, I hope he corrects me if I’m wrong) that his shares are badly undervalued and the big brokers who trade large blocks of his stock are completely unfamiliar with his mine and might not know what they’re doing. Indeed, he might be right about that.

For a case in point, if you take all the shares outstanding and multiply them by 0.07 you get a figure somewhat over a million dollars. That is actually LESS than the standing timber on the mine’s property and the real estate around the mine are worth. Something is indeed wrong with this picture.
So, although I stick by my premise that the shares are only worth around 7 cents right now (because that’s probably all you’d get if you sold them at the moment) they may ultimately be worth more at some point in time.
Consider also that there are a couple of other mining companies that have publicly traded stock, too, which is also trading around the same (or worse) as OSTO. North Bay Resources (The Ruby Mine) is trading for three cents. Emgold has been stuck around three cents as well for over a year now. Sutter Gold has been trading up and down between about 10 cents and 28 cents over the last year. Are their shares undervalued as well? Who knows? The only danger in owning them is if the company goes out of business altogether – then you’re stuck.
What *I’D* like to know about OSTO, is how much of this mine is actually being operated right now, how much is flooded, how to we get the mine dewatered and the operation expanded and where do we really stand on a couple of legal skirmishes? I hope that at some point in time I might find the answers to these questions but I can also understand that it might not be prudent for Mr. Miller to post them on this forum.

Fred M. Cain
 By lj

03/04/2014  7:47AM

I have re-read some of this thread, and am still wondering about the so called "grey market shares." I hold shares in the Sixteen to One Mine in my brokerage account. I also hold shares of Apple Computer. I assume that Charles Schwab is reputable, and that my shares of both have value.The value of anything is esentially established by what a willing buyer would pay for it, and a willing seller would sell it for, so the price of the shares of either of these is unimportant. I am not going to bother having my brokerage produce certificates for either aapl or osto. But statements in this discussion seem to imply that somehow the Sixteen to One Mine shares at my brokerage are not "real." Mr. Miller has does nothing within the discussion that I can see to support, or establish that the Sixteen to One Mine is a real company that deserves to be traded on the open market. Rather, he implies that only the shares signed by him are real. I would think that having shares traded on the stock echanges is a good thing. Am I missing something?
 By David I

02/28/2014  6:17PM

If you have interest in the ruby mine, you need to look up the web site for NBRI. Clik on the Ruby mine project. Read the geoligist report. The ruby is in Production.
 By fredmcain

02/28/2014  9:29AM

I just recently learned of the Ruby Mine also located in Sierra County. I guess North Bay Resources has been involved in project to reopen the mine.

I sent them an e-mail asking if they would continue to use their mining railway in the mine and the response I got back was something like "Yes, absolutely".

Like Emgold,their stock is currently trading around 3 cents. But like the Sixteen To One it may be undervalued.

I am thinking about getting some. Comments?

Fred M Cain
 By Rockroby

02/27/2014  6:55AM

Hi Mike
And all the other miners and investors out their. Would be buying more Sixteen stock but have just started working again and see other miners that are undervalued also..
Scoop did mention you found some gold in 2013!!! My question would be how much?
I know that you and the rest of the crew are going to hit one of the many plums that are left....
Just a matter of time and when my finances are back in order will be bringing that market cap back up.
May the next blast turn Golden!!

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