Hi Maurice, <<Platinum?>>
Message 15774373
“Hi Pezz, on Barbaric Gold and Savage Platinum
<<Gold? Platinum?... Why is it different now than a year ago, two or three years ago? ... Still don't see it ... Maybe someday.>>
Simple answer: because it has been three years, or twenty, depending on the count, and thus that much closer to a day when they shine again.
Slightly more involved answer: because they are potential contra-assets, beautiful to look at, cool to fondle, exciting to contemplate, and scary to many.
Involved answer (all numbers approximate) for platinum:
(a) Rarer than gold;
(b) No CB monetary stockpile worth mentioning;
(c) 3-3.5 mm ounces of platinum mined per year, by a few large entities, some publicly traded, some not, mostly concentrated in two make belief countries (Russia and S.Africa);
(d) 1 mm goes to Japan and is hoarded in the form of bars and jewelry;
(e) 1 mm goes to China and is hoarded in the form of jewelry (from a running start of zero ounces to 1 million, within five years, in an environment of rising prices);
(f) 1-1.5 mm used in auto applications, with more needed as regulations tighten, and with commercial alternatives scarce;
(g) 1.5-2 mm needed for other industrial applications, such as petrochemical processing, glass making, hard disk drive coating, etc;
(h) Excess demand supplied out of Russian stockpile that has been running down for 5 years;
(i) Future applications in many fuel cell technologies;
(j) From a running start of zero, introduced in India for jewelry applications; and
(k) Many platinum mining shares pay a dividend higher than cash and even treasuries.”
… and Angloplat’s recent announcement of increased mining output for 2002 (1-2 million ounces) did not cause the metal price even wiggle down, and with Angloplat (AAPTY) and Imperial Plat (IMPAY) costs going down due to rand devaluation, there should be more dollars to pay dividends.
<<Platinum … gasoline-powered Otto cycle 20th century engine exhausts … moving on … fuel cells … big deal any time soon … Too expensive. All that platinum for a start!>>
If you believe in CDMA, you must also have faith in databases, and the storage disks they reside on, coated with platinum, but not recycled.
<<whether the herd will stampede to gold or platinum is quite a gamble>>
Not really, because the physical stuff has true value - rarity, industrial, decorative, and monetary safety; and the mining shares pay a dividend higher than inflation, and higher than any treasury I know. And, please do not forget petrochemical/energy applications yet to be invented in this world of diminishing supplies.
So, as we step into that time machine, together with the Japanese, travelling to a new world, what do you want to be carrying in your one piece of luggage.
On …
ak.planet.gen.nz
… from the Krugman article …
“The savings problem is not simply one of Japanese culture. It is a problem exacerbated by the perceived need for "retirement savings"”
… This, in fact, is and will become an even larger and global problem. The Japanese, with their to be reduced population, will have plenty of savings to tide them over, by investing what they have in their immediate surrounding but animosity-soaked nations, but when they do, as they are already starting to do, the bubble of savings will be pulled out from where they are mistreated now.
“The problem that I can see with the Krugman solution is that monetary inflation (ie printing heaps of money) in Japan may not actually lead to higher prices ... It may be necessary to go further than Krugman suggests, by forcing banks to pay negative interest rates (or higher fees plus zero interest) on savings accounts, and by cancelling all banknotes six months after they have been issued. Even then, Japanese people might not spend their money. Rather they would buy gold at inflated prices.”
… Yup, the economic rule books are no longer applicable, and the study of 1929 excitement is not relevant.
“Paul Krugman frequently talks about "crony capitalism" and "collective stupidity" (eg Radio New Zealand, National Programme, 9/8/98). Japan has less of both problems than we do”
… If true, NZ is no more, and so it cannot be true.
Chugs, Jay |
