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Gold/Mining/Energy : Barrick Gold (ABX)
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To: russet who wrote (2976)5/21/2002 6:08:22 PM
From: nickel61  Read Replies (1) of 3558
 
NO I am too smart to waste the time...the calculation is really what effect did the leading gold producers AngloGold and Barrick have on the rest of the industry as they loudly proclaimed that they were going to hedge almost all of their future gold production. It provided a backdrop of threat for all gold producers who did not hedge there own production and clearly pointed to the destruction of their companies if they did not go along. And in the last six years many of these companies have indeed disappeared or been bought by other companies who could survive the low price of gold. To directly answer your question there is around 2500 tonnes of gold production this year and around 600 tonnes of scrap. But the total gold derivative positon held by ALL gold producers is only eleven percent of all gold derivatives. SO we can agree on something, the real force behind burying the gold market over the last seven years is not Barrick or even the gold producer forward hedging in total, but the very bankers and their hedge fund clients who most benefited from the gold carry trade as the price of gold declined and their leveraged bond positions shot upward in value. Maybe it is time you understand the gold carry trade if you don't already, because as the numbers of the gold derivative market represented by ALL gold producers means that the forces fighting this process are much bigger then Barrick.
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