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

To: tyc:> who wrote (2611)	5/10/2002 1:30:36 AM
From: russet	Read Replies (2) \| Respond to of 3558

Actually I know exactly how Barrick thinks,...because I read their financial statements where they explain it, and I have discussed it with their employees. When it comes to why Barrick writes their call options, you do not know what you are talking about. If you read their financial statements, you might be able to figure it out because they discuss it. When they wrote them, they really didn't expect them to be exercised by the counterparty,...they were just after the premium income. But if they were exercised, they were quite willing to borrow gold from a central bank to deliver to the call. It all there, ink on paper or photons on glass in the financial statements. They have about 6 million oz Au potentially coming due this year, either from the gold leasing program, or the written calls that may be exercised. Many of these written calls were written when the gold spot was much lower than it is right now. Many have be exercised by the counterparty and Barrick has either borrowed gold from central banks, or delivered from production to satisfy the calls. Others have expired worthless and they have pledged not to renew at least half of them. The hedgebook of leased gold of 18 million oz will remain intact for this year. Only the written calls and other derivatives (many inherited from Homestake) will be reduced by at least half. Read the financial statements and learn something.