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Gold/Mining/Energy : Gold Price Monitor

GDXJ 98.04

+0.4%

Nov 11 4:00 PM EST

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To: Alex who wrote (52657)	5/13/2000 2:45:00 PM
From: Ken Benes	Read Replies (1) of 116756

CB leasing is the flip side of producer forward selling and it is this combo that has more than made up for the supply deficit. With 30 thousand tonnes of reserves, of which at least 15 thousand tonnes is free of incumbrances, the cb's can make up for the supply deficit for a very long time. I would agree that the stellar returns in the stock market has drawn monies away from the precious metals market. The resultant speculative fever that we have seen is also the main reason that investors give a rats ass about barricks earnings. Gold investors are looking for a hedge against cataclysmic events that may shake world financial markets. To get those returns,investors will invest in companies that will experience dramatic moves with a rise in the price of gold. Barrick with its beautiful balance sheet and finely engineered hedges are not one of those companies. As we saw last fall, cleverly crafted hedges can implode and threaten the very existence of a company when the price of gold rises to high to fast. For this very reason, barrick has more of an interest for gold to trade in a very specific range than does a company that is more leveraged to the price of gold. Ken

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