A gold project is an oil buyer as you no doubt discovered: <<and found out that a gold project is not a gold bar >> The gold project processes the oil and turns it into gold, which can then be stored, but with a higher cost of protecting the gold than the cost of protecting an oil field. If the oil field is on the border of Saddam's Iraq, such as Kuwait's, then it might still be worth getting the oil out, producing the gold, and storing the gold well away from Saddam. Or, as in Venezuela, the oil fields might be nationalized with little or no compensation whereas gold can be moved to freedom.
Gold projects are swing consumers of oil. When oil is cheap, that's the time to be producing gold. When oil is expensive, gold is too and that's the time to sell gold stocks and stop buying oil. Some people store oil in supertankers, but that's even more expensive than storing oil as bars of gold.
Right now, oil is cheapish, or at least not expensive, so it's time to be producing gold and stashing it ready for when oil goes up, or fiat fantasy chickens finally come home to roost. Even if fiat finance doesn't implode in a pecuniary panic, it's guaranteed that the owners of the currency will continue to dilute holders at about 8% a year as they have done for 100 years.
Meanwhile, bitcoin's bet against the swindling central bankers continues apace with new world records established. Even with its high-entropy energy burning design, it has been a better bet than the big bucks of Uncle Al KBE, Big Ben and Janet Yellen.
Mqurice |
