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

To: d:oug who wrote (42652)	10/11/1999 9:06:00 AM
From: Bill Jackson	Read Replies (1) \| Respond to of 116759

Doug, Barrick has gold in the ground, lots of it. So they made commitments to gold users to buy it from Barrick on a scheduled basis as it was mined. So Barrick would have contracts out in advance for many years. I am not sure how far forward a market exists. A jewellery maker wants assured gold and does not want to get screwed if it goes to $800/oz again, but he can tolerate, say $350-450 or so as long as he has it planned in. He adds value so $400 worth of gold = $2000 worth of jewellery. Barrick can mine gold to stockpile gold or to sell gold. They are a low cost producer. They can also buy cheap spot gold and fill their forward sales from the spot market and stockpile their mined gold. A plan like this would allow them to overhedge to quite a degree as they would have their stockpile uf $150 gold they mined to meet those furure calls. So Barrick has a well managed and capable program. Cambior and Ashanti thought gold was going to be down for many years and saw a chance to make a few bucks with enormous overhedging programs, far in excess of what they could mine from their own mines. As these come home to roost they may well drive them both to destruction/takeover. Recent jumps in gold have strained their treasuries as shown by their recent share price drops. There is more to come on this as more companies get caught in this easy money trap. Just wait till the middle of November. Bill

To: d:oug who wrote (42652)	10/11/1999 10:53:00 AM
From: Enigma	Read Replies (1) \| Respond to of 116759

Those pro- Barrick aren't necessarily shareholders at all! But such a lot of nonsense is being posted on this topic - including the following by you: "I must say wow what a deal to get. But then as I don't understand any of the mechanics of this stuff I can only use common sense and assume that if only Barrick was able to get this "too good to be true, but is" deals made with those bullion banks, then either only Barrick has competent people employed or they got a "special" deal" Why can't you accept that the Barrick people are competent? They have refined their hedging programme over many years. I'm sure they aren't the only people with this sort of deal - but maybe they are - this doesn't mean there is something dark or evil about it as some seem to infer! Also - I can see that as far as Gata is concerned you are an absolute true believer - in other words your faith overcomes all questions about the excesses of paranoia they keep spilling. Yet you openly admit that you don't understand much of this at all - but accept what Gata says?