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Gold/Mining/Energy : Gold and Silver Mining Stocks

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To: goldsheet who wrote (2345)	9/25/2001 8:54:32 AM
From: russwinter	Read Replies (1) of 4051

Base metal plays: These are unsustainable economics. Here's an example: Zinc cost curve (note that current prices are 35c/lb): normandy.com.au Go to "Simplifying our Business" under Digger and Dealer's presentation, then to slide 19. Zinc inventory: yesresources.com Copper cost curve (slide 13) and company that might fit my criteria, Antofagasta: incapacific.com Copper stocks (price is currently 64c/lb: yesresources.com Virtually the whole complex (a "little" better in copper)not only can't cover total costs, but right now fails to even clear the cash cost hurdle. Can only mean one thing, most of these companies are going to fail and looking at the balance sheets of a few, I'd say yesterday. This is a once in a generation rogue wave for this industry as well. Devasating! But huge leverage to the ones who can survive (are there any with strong financials?), and that have top quartile cost structures. There will be severe supply shortages in the next cycle. I think you by 'em (the survivors only) between now and the end of the year.

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