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Pastimes : Clown-Free Zone... sorry, no clowns allowed
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To: Knighty Tin who wrote (272554)1/4/2004 1:09:57 PM
From: Joan Osland Graffius  Read Replies (1) of 436258
 
T,

>> It sounds like he's saying forget the SA miners.

We could see a period of tough sledding for the SA gold companies. IMO, the cost problems will get resolved one way or another. They can not move the work to China or India. <g>

Some of the SA miners have been using their cash to buy/invest in assets in other countries. Even old Durban Deep recently took a stake in an offshore mining company.

The market has not been kind to the SA miners this year, which is good. The prices of the stocks have not got to the point where they are over priced relative to the price of their assets in the ground. I believe the leaders at Gold Fields and Harmony will continue to buy mining operations in countries other than the SA to diversify their holdings.

I also believe these companies will close mines as they become unprofitable. As the article noted this will cause unemployment in the SA mining sector. The SA government will have to do something to solve the problem. They could play the Greenspan game and devalue the currency. Also we could see the unraveling of some of the recent legislation to collect royalties on mining properties. The bottom line is SA needs a financially healthy mining industry.
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