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Gold/Mining/Energy : Gold Price Monitor

GDXJ 93.98

+0.6%

Nov 21 4:00 PM EST

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To: Enigma who wrote (38471)	8/7/1999 12:06:00 AM
From: Exsrch	Read Replies (1) of 116764

DoubleD, You said the following: <<..I think this paragraph contains the element that has been puzzling some of us. the prevailing market price. Exscrh feels that the prevailing market price is the spot price - and this has been a question mark for me - I think it refers to the prevailing futures market price..> The support for the sale of borrowed gold at spot price is the following: 1. The creation of a risk free (not totally risk free) off balance sheet asset invested in US treasuries. 2. If you had forward sales contract that would expose the off balance sheet to unwarrented risk. 3. And would additionally compound the original lease risk with the bullion bank and CBs. Would ABX (or you yourself) borrow gold on lease from CBs through bullion banks than forward sale via contracts than take an additional interest rate risk? However, I could be wrong but their documentations make clear that gold is sold at spot. Cheers, Exsrch

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