Let me put it this way, the valuation of the business is better if the future income is based on an increasing $/oz. Future income rises quicker than future expenditure - that's the key! These future net flows are discounted to create an NPV for valuation purposes...bar the poker game across the negotiating table! I WANT GOLD TO BE BOTTOMING OUT - AN ACQUIROR WILL TAKE COMFORT IN THE FUTURE MARGIN/PROFIT!
RE: Re: POG spike
It may actually be in our interest that the gold price stays depressed. That article posted by Jibbo mentions that projects with high grade are flavour of choice for takeover with a low gold price and that those with higher all in sustaining costs will only come into their own as the price of gold starts to rise.
Re: POG spike
Ok, admit it. Who else got excited? Main real events coming though. 1. Swiss vote 2. Will France respond to the possible presidential incumbents demand. French central bank must have a real dilemma now. Le Pen can't lose this round of words. Hollande will be made to look a fool and frankly the only thing he seems good at is the bedroom 3. December is a massive month for gold and silver deliveries. Massive open interest and China, Russia of India could easily decide to cause a default. Question is....will they? Just imagine the discussions taking place at the most senior level. Russia must be the hot candidate for this move. Question is what level US Treasury bonds that they all hold. Those could take years to unwind through swaps. But if gold goes to $5k an Oz will they care? But will we ever see it happen, or will China and Russia just continue to buy commercial property in the US?
Re: POG spike
Zero hedge think it was a programmer stress test gone wrong. Remember kitco doesn't report the spot price, as that's done through the london fix. Kitco have a formula based I think on paper
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