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

To: d:oug who wrote (89433)	9/9/2002 2:58:16 PM
From: goldsheet	Read Replies (2) \| Respond to of 116806

<ok Bob, tell us the amount of physical gold available, that is in excess to normal usage taken deliver of> There is gold available, it is just a question of whether miners wish to cover hedges by open market spot purchases or retreiving the gold from their reserves at their cash costs. Historically, they closed hedges by deliverng production, so they did not require any "extra physical gold" as you call it. The act of closng forwards in the marketplace is a recent development, and as I stated earlier is the primary reason gold is at $325 instead of $250. Miners have gone from net suppliers to net consumers. I seem to recall Anglogold was a purchaser in the BOE gold sales. It would be rather interesting if Anglogold bought gold in a BOE sale to repay leased gold from the BOE itself. It would be one very simple way to solve the problem without actually moving any physical gold. Central banks are still selling about 450mt of gold per year, which is definitely in the correct "good delivery" form for miners to purchase and deliver to other central banks to close out their loans. <and this is the amount the central banks of the worlds need to fully bring up to levels they had before the leasing.> This assumes central banks want to call in all loans and get back to prior levels. I'm sure some will roll over the loans and keep them outstanding, while others will continue to sell off their holdings. There is no one correct level of central banks reserves, and it is up to each governemnt to decide what is appropriate for them. This is much like there being no is no one correct methos or level of hedging, and it is up to each mining company to decide what is appropriate for them.