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Gold/Mining/Energy : Gold Price Monitor

GDXJ 121.93

+0.8%

Jan 9 4:00 PM EST

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To: gold$10k who wrote (73628)	7/18/2001 4:44:29 PM
From: russwinter	Read Replies (2) of 116846

If you notice lease rates are falling mostly in the very short months, not the long months. I think producers are delivering gold against maturing hedges and not rolling over, therefore gold gets returned to the CB's vaults. The higher lease rates out a year mean borrowing demand is still there from the hedge fund carry trades. Just my theory? The main thing to focus on are forward rates (the contango), because that's a variable miners use to make hedging decisions on. As long as it's under 3% as now, there isn't much incentive to put on a hedge. This impending production shutdown in South Africa could also be significant, if it goes on for long. Really puts pressure on the hedgers like PDG, AU abilities to deliver physical gold into previous contracts. kitco.com I think we are fine on the producer side. It's the nasty "autopilot" hedge funds that are leaning on this market now. Message 16093663

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