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Gold/Mining/Energy : Barrick Gold (ABX)

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To: russet who wrote (2944)	5/20/2002 11:32:05 PM
From: FuzzFace	Read Replies (1) of 3558

First, I suggest you reread the TOU - you are getting abusive. Nothing you said in the prior post argues in your favor. "Just extracted" - there's no "just" about it. It costs a significant part of gold's final price just to extract it. Growing crops is comparatively cheap, by contrast. There are conditions which impede mining just as there are conditions which impede agriculture. A year or so ago, a mining company had to write off a mine completely - because heavy rains flooded it. Stopped by flooding, just like agriculture, but agriculture recovers sooner. A miner, like a farmer can go belly-up and not deliver into the hedges. The further ahead either is allowed to hedge, the greater the likelihood an unforseen change in conditions bankrupts either - exactly the reason farmers are not allowed to overhedge. Miners are exempted from this common sense limitation. Again, the reason has to do with what government wants to suppress and what it wants to subsidize, and not with any inherent hedge-worthiness of miners vis a vis farmers.

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