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Gold/Mining/Energy : Gold Price Monitor -- Ignore unavailable to you. Want to Upgrade?

To: David R. Schaller who wrote (36037)	6/28/1999 8:12:00 AM
From: long-gone	Respond to of 116741

<<Of course, if all this is true...ABX would be the gold stock to hold. >> Or the smaller which will be bought out?

To: David R. Schaller who wrote (36037)	6/28/1999 8:13:00 AM
From: Richard Mazzarella	Respond to of 116741

David, They do have low production cost and are a desirable company in a low POG environment, but I think the forward selling is equivalent to eating their seed corn. That will minimize share price leverage when POG improves. The last 15 years shows what happens when bean counters run mines rather than miners. The poor POG is not because of market manipulators unless we are willing to call the forward sellers manipulators. <VBG> The hedging producers can just look in the mirror for the enemy IMO.

To: David R. Schaller who wrote (36037)	6/28/1999 8:25:00 AM
From: long-gone	Read Replies (2) \| Respond to of 116741

<<Who would have thought that a company could have grown so much and been so profitable over the past five years and end up with a share price 30% below what it was in 1994?>> IF(and I'm not saying they are guilty - only IF)IF they were guilty of working the POG lower would it not also have hit their dividends thus hurting the share holders?

To: David R. Schaller who wrote (36037)	6/28/1999 10:12:00 AM
From: Claude Cormier	Read Replies (2) \| Respond to of 116741

<<To the extent that their forward selling and gold leasing has depressed the spot gold price..they have hurt their own shareholders >> First, Barrick is not leasing gold. They merely enter spot deferred contracts. The bullion banker who is on the other side of the contract is going long with this contract and is likely to sell from its inventory between the signature of the contract and the delivery date. The timing is not obvious and is to the discretion of the banker. Obviously, the sell by the banker will have some effects on gold which is hard to measure. SOme experts on derivatives claims that this effect is somewhat nullify because the hedged production never makes it to the market as it must be delivered to the bullion bankers who needs to replenish his inventory. IMO, there are big difference between hedging transaction and "gold carry" trades as far as the impact on gold prices is concerned.