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

To: Ken Benes who wrote (60216)	10/26/2000 12:47:48 PM
From: Square_Dealings	Read Replies (3) \| Respond to of 116790

<<Barrick is not into building shareholder value,>> And you're totally full of sh#t too. How many other companies are hedged at $360 pog, are making money in this environment? The bashers are full of it M.

To: Ken Benes who wrote (60216)	10/26/2000 2:01:38 PM
From: russet	Respond to of 116790

Barrick's strategy has been very successful for Barrick,...that's all they have to care about. Recognizing the last 20 years longterm downtrend of the POG many years ago, Barrick management worked out financial strategies and created instruments to make money in a declining market. Their strategy has been proven right. I should also point out that the large overhang of gold reserves of central banks has been perhaps the biggest force causing the POG to decline in recent years. If you accept that, realize that anything that acts to get rid of that physical is a good thing for the industry. Barrick (and other shorters) are actually friends of the long term POG by shorting the chit out of the central bank reserves. I hope once the banks sell all their physical, the shorters turn around a tell the @!@#$%@## central banks they will only pay their gold loans back with good ole US$. That will show them (gggggggggggggggggggg). And I don't care what the stupid contracts say,...contracts are just more pieces of paper ;-)) With only 15% of proven reserves hedged, Barrick has managed to make billion(s) of dollars that few, if any, of their peers have equaled. They own a bullion bank now, so they can make even more than in prior years. If the POG goes up, they have a year or two of diminished returns compared to the industry, but will still have increased comparable revenues and profits from years prior. In two years the hedges are gone, and Barrick emerges as the lowest cost producer with huge reserves to bring on line. Note they defered starting construction of Pascua until next year. That defers supply,...perhaps they are listening to you Ken (gggggggggggggggg). Barrick is building shareholder value, compared to their peers. Ever lower POG is what's been happening for 20 years. It ain't going to change no matter what Barrick does. Accept it, get over it, and you may recognize why Barrick has been the most successful Au mining company over the last 20 years, and continues to make money in a gold depression. If gold continues to drop, Barrick continues to make money to re-invest in low cost prospects. If the POG goes up, profits and revenues don't decline, they increase less than the industry for a year or two, and then explode. In the meantime, lowest cost is what the commodity business is all about. Barrick is the lowest cost producer in the industry, and continues to invest in lower cost producing properties. They are doing what economics dictate they do in a cyclical commodity market. They are looking to the future, and making sure they stay afloat during the POG depression. They are diversifying geographic production to lessen country and political risks. They are accepting that POG will likely continue to consolidate or decline, and devising strategies to make money in spite of that reality. They are investing only in lowest cost resources. They are very active in prospecting, mainly by supporting juniors. They continue to build production so fixed costs can be minimized by being distributed over higher production. If you are going to make a living mining gold longterm, Barrick is the best of the best. They will likely be around twenty years from now whereas many others won't. If you're looking for shareprice gains in the gold industry, you will have to take on more risk and go for the junior prospectors, or diversified miners. Finally, Barrick isn't the only company suffering with shareprice declines in the last year. Seems to me most of the market has collapsed lately;-))