International Precious Metals (IPMCF) Message Board

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Gold/Mining/Energy : International Precious Metals (IPMCF)

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To: Karl Zetmeir who wrote (20942)	9/17/1997 4:27:00 PM
From: Claude Cormier	of 35569

<< I guess we need a reality check here? Can you help with what the current demand for gold is? You've already said the shortfall in demand vs. supply will be 6-7 mil oz.? (200 tons) >> Karl, Non-Monetary Demand is currently growing at a fast pace because of low prices. In the first 6 months of 1997, 1500 tons or almost 200 tons above last year level. For the entire year of 1997, the increase in demand could well be 300-400 tons.. That is not the annual shortfall.. which is in the 600-700 tons level. So for the DD to have a serious impact on gold and other gold producers, they will have to produce much much more than 200 tons 4-5 years down the road... knowing that demand will continue to grow and production (assuming current prices) will continue to shrink. What is having an impact on gold is not the DD and will never be. The monetary role of gold is what drive this market. There are 90-100,000 tons of gold above ground that is held has a money... Demand for gold as money is currently low for the reason you know. When monetary demand picks up for gold, whatever tonnage comes out of the DD will not stop the rise in gold prices.

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