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Politics : Dutch Central Bank Sale Announcement Imminent?
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To: Enigma who wrote (7630)9/4/1999 10:32:00 AM
From: sea_urchin  Read Replies (2) of 81232
 
".....we're all flying blind." Agreed 100%.

Something doesn't make sense, that's for sure. If so many thousands of tonnes of gold of present/future production have to be made available to cover the short/forward selling, how come
(1) mining production continues to increase despite a falling POG?
(2) POG doesn't rise as short sellers buy in ?

Yes, the production has to be by low cost producers but, as far as I can assess, the "average industry cost" (if one can use such a term) is in the region of the present price. In fact, low cost producers are seriously shortening the lives of their mines by "overproducing" at a low gold price. I say "overproducing" because if they cut back production POG would have risen because of obvious demand.

More and more I keep getting the feeling that the mines are acting against their own self-interest by not cutting production in order to raise the gold price. Clearly, the gold mines have not learned the lesson of OPEC or DeBeers. Or else, there is another agenda.
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