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Gold/Mining/Energy : Gold Price Monitor
GDXJ 109.23+3.7%Nov 28 4:00 PM EST
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To: Ken Benes who wrote (34543)5/26/1999 8:12:00 PM
From: Zardoz  Read Replies (3) of 116779
 
"At 270.00 gold there should be zero forward selling."

That is the most important statement I've read on SI GPM ever. I really wonder at what price the profit margin on forward selling becomes more of a liability due to risk. Just as a guess, wouldn't you need to take the premium per gold ounce sold away from the individual producers cost of production? And if so, then in ABX case they could {cost of production $180, premium $75} forward sell to $105? NOT that they would. But it would be semi safe for them to sell at least down to production price without fear of market movement.

"This has nothing to do with the dealers and everything to do with the producers."

I think it's now more of the retailer investors {hedgers} moving the margins price of gold then the CB'er or retailers investors.

members.xoom.com
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I can see that maybe it'll be a lower POG yet to come, since London is the larger market, and relative to the Pound the Price Of Gold has not had a second bottom. If we assume that the Price of gold in pounds will reach a bottom at 162.5, and that the US Dollar will achieve 0.630 GBP/USD or more in the follow few weeks, then we can suspect that GOLD will reach around 162.5/0.630 := $258 US/Oz. But this is really based on whether the US dollar can continue it's climb relative to the pound. I think with the economics in the UK, this is almost a guarantee.

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