On Second Thought ... NCM

If you are a buy-and-hold type investor, I can think of no worse stock than a gold miner. After 5000 years of mining, the best gold deposits have already been discovered. Exploration will only ever discover high cost deposits with a life of 20 years or less. 

Gold miners in the early 2000s did very well, with their low cost mines absolutely puking out 300% to 500% profit margins. What do the board of directors do with this windfall?

a) Use the money to explore and develop more mines. Pay very small dividends (but fat director fees and management pay)
b) Run the company for cash and send the shareholders huge dividend cheques. When the old mine is exhausted, place the company in hibernation and wait for the cycle to turn.

Just about all gold miners chose A. Option B was correct.