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Gold/Mining/Energy : Gold Price Monitor

GDXJ 90.35

+0.4%

Nov 6 4:00 PM EST

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To: IngotWeTrust who wrote (73036)	7/8/2001 12:42:55 PM
From: Rarebird	Read Replies (1) of 116753

Are you talking to me? In contrast to most on this thread, I've always respected ABX as a company. One need only look at their cash cost for producing an ounce of Gold and their tremendous cash flow to know that this company will not only survive but thrive if and when Gold comes back in vogue. Their debt/equity ratio is also quite low. Those things are important moving forward. Many here on this thread pooh-pooh cash flow, debt/equity ratio and average cash cost for producing an ounce of Gold. All they care about is whether the company is unhedged or not. I look at ABX as a pragmatic transcendental gold producer. ABX has always understood the realities of the Gold Market. It's head is not in the clouds, clutching for straws, blaming others for its plight, where resentment rules. It is important to understand the horizon or context in which the gold mining industry operates. Those who think that cash flow is not decisive in selecting a gold miner to invest in, should think again. HM did not have the money to develop some of their great properties. This is why HM's hedgebook increased dramatically over the first half of this year. HM needed to merge with a cash rich producer like ABX. It was a good deal for HM shareholders IMO. I know the market feels that ABX overpaid for HM. To be sure, ABX could've waited for HM to retest its lows and then put in a bid. But that was a risky bet given that the merger was planned to be treated as a pooling of interests and is tax-free for U.S. income tax purposes. Moreover, ABX has the money to untap all the gold and silver that is still lying dormant in Veladero. Cash is King in a Bear Market and ABX has 900M of it. The Reality of a Bear Market is that the Big (with a great balance sheet) get Bigger and devour those companies that can't survive on their own. One can profit during a gold bull without even owning shares of a gold miner or being long gold futures. One can go long the Euro and Aussie Dollar. There is a time and place for just about everything: A time to hedge and a time to cover hedges. From the standpoint of a Humanist, God and Value represent the limit in terms of which a human being makes known to himself what he or she is. To be Human means to reach toward being God. ABX is in the process of becoming the God of Gold producers. <first you say ABX sez no more hedgin> No. What I did say is that hedging has its place in a Bear Market to protect shareholder value somewhat. There is a time and place for most things in life. My thoughts and ideas evolve. There is a time to hedge and a time not to hedge. A time to make love and a time not to. I think ABX understands the Gold Market better than all(including me) who post here.

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