Barrick Gold (ABX) Message Board

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Gold/Mining/Energy : Barrick Gold (ABX)

ABX 8.600

-1.4%

Jan 9 9:30 AM EST

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To: Enigma who wrote (1467)	11/24/1999 7:40:00 PM
From: nickel61	Read Replies (2) of 3558

They don' have to be unwound at the same time but as a shareholder you aren't going to participate in most of the upside if the POG goes significantly higer. We are talking about 12,000,000 ounces of gold sold forward with an additional 4-5 million ounces with calls outstanding. Nobody says they aren't going to get the prices they agreed to for the next five to six years of their production. It just should be obvious that that is already in the net present value of the stock today. They have capped the shareholder's upside.They sold it over the last ten years and in the process helped significantly to depress the price of their own product.Yes they have been consistant over the last seventeen years. They have been consistently selling into a bear market they helped prolong and extend. The problem on September 25,1999 the lenders of the "leased"gold suddenly changed the game. Maybe they realized that if they continued they would drive half of the gold mining industry out of business and then they would have no way of ever getting their physical gold back. They probably won't anyways but that remains to be seen. Since you are the expert here why not answer one of my questions? Why would a shareholder own a gold stock that has already sold an amount of gold equal to the next four and half years of production forward if he thought the price of gold would go up? And if that same shareholder didn't think the price of gold would go up why would he own a gold stock at all? For the dividends perhaps? Remember while you are quite correct the amount of economically viable reserves do go up when the price of gold goes up the processing capacity of your entire operation doesn't increase at the same linear rate. Go ahead ,instead of just responding with slights and innuendo why don't you actually answer a question for once and show us just how much you do know.

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