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Pastimes : All Clowns Must Be Destroyed -- Ignore unavailable to you. Want to Upgrade?

To: Lucretius who wrote (33476)	5/17/2000 2:12:00 PM
From: pater tenebrarum	Read Replies (2) \| Respond to of 42523

chart-wise it looks pretty disastrous. i think it's beginning to smell the acceleration in inflationary pressures.

To: Lucretius who wrote (33476)	5/17/2000 2:37:00 PM
From: re3	Read Replies (2) \| Respond to of 42523

luc, this one is one of your picks, correct ? Munk stands by Barrick's 'rock solid' hedging strategy Risk free: 1999 record year for the gold producer Keith Damsell Financial Post Glenn Lowson, National Post Peter Munk, Barrick Gold chairman, told shareholders at yesterday's annual meeting not to get taken in by "confusion and propaganda." Peter Munk, the mercurial founder of Barrick Gold Corp., defended the company's "rock solid" hedging strategy yesterday, a forward-selling gold program that has generated profit and controversy for the Toronto mining giant. "Don't let yourself be taken in by confusion and propaganda," Mr. Munk, chairman, told shareholders at the company's annual meeting in Toronto. "There's lots of talk of hedging and how it benefits Barrick and hurts the industry. It does the opposite. It's the only means to regain the confidence of the capital markets." Hedging allows a producer to guard against a fall in the price of gold by selling future production at a fixed price. But a sudden rise in gold prices can spell disaster. When gold rallied to US$339 last October, Montreal's Cambior Inc. and Ashanti Goldfields Co. Ltd. of Ghana were forced to cover massive hedging debts by anxious lenders. The two companies are in the midst selling assets to cover losses. The crisis tainted the entire industry, including hedging pioneer Barrick. To reassure the investment community, the company restructured its hedge book in February. At present, the company has 13.4 million ounces sold in advance with a minimum price of US$360 an ounce, about US$80 more than the current price. Despite promises the company's hedging program is risk free, shares tumbled to a low of $22.50 in March. The stock's 52-week high is $38.20. "This very hedging, after a decade of proven performance, has come under a serious cloud," said Mr. Munk. "The only risk [a gold producer] takes is if it fails to deliver gold. A company like Barrick has for 15 years, day in and day out, week in and week out, month in and month out, year in and year out, never missed a target." Hedging has helped make Barrick the world's most profitable gold company. Over the past six years, the company has produced 16 million ounces of gold and earned about US$1-billion profit. In comparison, the rest of the Western world has produced 140 million ounces and lost US$1-billion during the same period. "No one will be able to get a higher gold price than Barrick under any scenario," said Mr. Munk following the meeting. For the company, 1999 was another record year. Key mining operations in the United States and Peru boosted production to 3.6 million ounces. The opening of mines in Nevada, Chile, Argentina and Tanzania are expected to increase production to five million ounces by 2003. Earnings, cash flow and reserves all rose last year and the company continued to lower production costs.