Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Gold/Mining/Energy : Barrick Gold (ABX) -- Ignore unavailable to you. Want to Upgrade?

To: re3 who wrote (2541)	5/8/2002 8:28:06 AM
From: Enigma	Read Replies (1) \| Respond to of 3558

Cost will not go up at the same rate unless we have hyper-inflation in which case who's to say that $1000 would be the ceiling? Those of you who are anti-Barrick seem to want to have your cake and eat it and stuff it down everyone else's throat!

To: re3 who wrote (2541)	5/8/2002 12:11:28 PM
From: russet	Read Replies (1) \| Respond to of 3558

I'm not the one that thinks gold prices are going to the moon and staying there for very long. I think long term POG is tied to the average cash costs of the biggest companies that mine the metal. Short term the gold price pendulum swings all over the place depending on supply demand variables and how bad "Chicken Littles" are screaming(gggggggggggggg) POG cycles around and allows companies that tough it out like K, TVX, AGE, CRJ, etc., etc., etc., etc., to float share issues to pay for capex so total costs become irrelevant. Reminds me of the dot coms. P/E's are always related to POG hype, or lack thereof, and what a company has in the ground, and have little to do with NPV's. But perhaps you can provide the evidence that labor costs, energy costs etc., are perfectly correlated to the POG. If they were we should have seen an incredible deflationary spiral in the last 20 years as gold went from near $900 to $250, when in fact inflation has continued unabated in most countries of the world. If true inflation was measured instead of the B.S. governments present today, the lack of correlations would really be noticeable. I went 4 years out with my simple calculation to prove that claims that Barrick would stink up the joint with an explosion in the gold price are complete bullchit. Even if cash costs go up 10% per year, Barrick still does not stink up the joint as costs will rise to only $333 per oz, so you get a reduction of $500 million dollars of revenue so they only get $3.3 billion,.....but does production stay at 6 million oz Au equiv per year,...not a chance, it probably doubles so Barrick comes up smelling like roses.