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

To: Enigma who wrote (49756)	2/28/2000 11:33:00 AM
From: Ken Benes	Read Replies (3) \| Respond to of 116790

Out of curiousity, I crunched a few numbers. 1.6 million ounces of gold is equivalent to approximately 50 tonnes of gold. Should barrick delay the introduction of this gold plus closed out existing hedged positions at the rate of 50 tonnes of year, the total savings is equivalent to a 3% reduction of total world production per year. The oil producers were able to precipitate a threefold increase in the price of oil by reducing annual production by about 4%. If barrick has control over 3% and the other producers delay/closeout hedged positions, a reduction of 5% in annual production is a possibility. Eliminating this much gold should exert enormous pressure to the upside on the price of gold. This is simple math, the middle eastern producers understand it as does every other company in the natural resource sector with the exception of the gold producers. It is time for them to examine basic math rather than use their energies to advance very complicated derivative strategies that have blown up in their face. Ken