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Gold/Mining/Energy : Gold Price Monitor

GDXJ 112.58

-1.5%

Dec 15 4:00 PM EST

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To: Alan Whirlwind who wrote (53477)	6/1/2000 3:07:00 PM
From: Enigma	Read Replies (2) of 116815

I thought he said the same sort of thing as me - maybe not -but I don't see major new projects being developed beyond 3 years out to replace this huge production we're seeing. I agree that there are some moth balled deposits out there which can be re-activated - but with a time-lag. Having said that there is a lot of gold still being found round the existing mega projects. So all in all we are probably stuck with lowish prices and should focus on the companies which will thrive in this environment - and hence the merger talks going on - companies adjusting to reality. The problem is that gold can always be sold - and competition has driven costs down. This, coupled with weak currencies in 3 of the main producing nations has meant that production levels have remained high. Production cut-backs are wishful thinking and will not happen - at least not for the forseeable future - because producers are not prepared to give up market share to competitors. And, as Bob has so clearly pointed out some projects have cost hundreds of millions to develop and bring into production.

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