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Gold/Mining/Energy : Barrick Gold (ABX)
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To: Zardoz who wrote (2205)3/29/2002 12:30:01 PM
From: nickel61  Read Replies (1) of 3558
 
Gold is overvalued? When the market price of $304 is below the all in cost of production of all the major gold mining companies? I don't think so. And before you claim that the marginal cost of American Barrick and a few others is lower then $304 consider the real "cost" of production should take all the overhead of the entire gold company into account when considering whether or not the gold you are selling is really making a profit. That analysis makes the actual cost around $320 an ounce even for Newmont and Barrick. Where the hell did you get the idea that gold at the end of a 21 year decline in price is overvalued? Now don't busllshit me. You either are not a very aware thinker or what you really mean it the central banks can continue to drive the price down by dishoarding their holdings for a considerable time to come. Well they can transfer their holdings to the private sector if they chose to depress the price but I think we all know that the number of people seeking financial security in an asset class like gold is growing rapidly and the demand will be difficult to staunch with the remaininng central bank sales. Witness the Chinese Central Bank purchases, Japanese increase in private purchases are up 600% over last year and the Middle East appears to be dramatically shifting savings out of US dollar denominated bonds into gold. Where are you getting your information? From Enigma?
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