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00:00Want to turn to your latest short which is a sink of gold based in Vancouver and we have some photos satellite photos from your latest report showing before and after. This is photos of a wall failure what you're calling a wall failure at the end cron mine. There have been some questions posed by analysts over the validity of these photos. What do you have to say to them to assuage concerns really. The photos are valid. I mean guys I've been doing this seven years. If I were the kind of person who were putting fake information into reports like that I think Muddy Waters would have ended a long time ago. Please see Sino Forest and similar accusations that were leveled at us by that management which I think is still on trial for fraud. So the photos are valid and if that's the only thing that's keeping a buy recommendation on the stock is your doubt about the photos really it's time to switch the rating and break it down for me in terms of your take on management and how they're pitching concerns about the water quality in this particular mine. This is their only mine but they have several projects there. Can you talk to me about whether you see this as outright fraud. Is this a cover up . Well look fraud is not not to be too technical here but I mean fraud is really about a state of mind. You know if I were if I were to say OK these guys are committing fraud I would have to know that they are intentionally saying things that are not true . I can't know that from this point. From this vantage point I mean it's definitely not the most transparent company. There are other management teams would perhaps have fallen on the sword sooner and let investors see the problems. But you know I I can't I can't really give you an opinion as to whether they're committing fraud. I mean that's not to be clear we have not called it a fraud but you know at the end of the day we think it goes the way of substantial frauds regardless of whether it's a fraud or not. And that is we think it's headed to zero and management is calling this end run mine a place holder of sorts and they say that you know presumably they're going to have some other projects coming online very soon the Dynamite Hill one potentially in a couple of weeks. Do you see that as another leg of cash flow that could buttress new projects that in the context of how do they avoid bankruptcy. Well these satellite deposits of which Dynamite Hill is one the company is constantly shuffling around which satellite deposit is going to be next. And to be clear neither Dynamite Hill nor any of the other satellites has the cash flow potential in our view to help this company get out of the corner that it's in. So you know it's a positive headline for them but substantively that doesn't change anything. That's that's our view. I mean the really big one that they need to figure out how to develop is a source . And they need a lot more cash flow from any crime than the one hundred sixty six thousand ounces that they're one that they just reiterated they can pull out of there relatively easily without a. You know a lot more cash flow to develop as I say then they're going to get from those hundred sixty six thousand ounces. And you know what's interesting from their response . There are a number of things I could say but I guess really directly to the point here is I mean we speculated in our report that the company is about to walk away from any crown and that the mine is therefore about to pinch out. And their response just focusing on one hundred sixty six thousand ounces that they can obtain without a pushback really validates that concern of ours that the mine is about to pinch out or effectively already has .

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Carson Block Says Asanko Gold Is Headed to Zero

Carson Block, managing member of Muddy Waters, explains his short on Asanko Gold Inc. He speaks with Bloomberg's Lily Jamali on "What'd You Miss?" (Source: Bloomberg)

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