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

To: Jon Matz who wrote (24917)	12/26/1998 11:41:00 AM
From: Enigma	Respond to of 116762

Jon - There is a case to be made that we're in for a protracted period of low, though not necessarily falling, gold prices. With low gold prices over such a lengthy period you'd think that many marginal mines would have closed by now - or else cut back production severely. In fact, in many parts of the world the collapse of local currencies against the $US has made gold mining highly profitable again - and amongst these countries are most of the world's leading gold producers - South Africa, Russia, Australia and Canada - where underground mining exploration is having a resurgence at relatively deep levels - Gold Corp and Agnico-Eagle to name a couple. Lower prices in US dollar denominated countries has meant that exploration efforts are now directed to large low cost deposits - the kind we are seeing in South America. I'm beginning to think that we won't see a resurgence in gold prices until some event occurs to unwind the large short positions caused by hedge fund activities or by producers' hedging plans, and who can say that Barrick, for example, are wrong - they have had great success with their methodical approach to hedging strategies. So maybe the investor in gold stocks has to work within a low price scenario (gold vs the $US), and look to companies whose major operations are in softer currency areas, or look to majors who will be acquisitors eg Barrick, or take over targets like ARP and many others. In short there are many situations in which to invest - but you shouldn't be looking to higher prices to bail you out in the future. E