Gold is cheap. The World Gold Council's efforts to "improve" the gold mining industries reporting of "actual" costs is backfiring, at the same time the COMEX traders are having fun shorting gold. Has investors unnerved about the question of exactly how profitable most gold miners really are. But all things come to pass....
Put yourself into the shoes of your average gold mining company CEO: What do you do?
Answer: slash costs, and trim capital expenditures on new projects, squeezing more efficiency and production out of existing operations.
You will see the industry more in this direction very quickly (it's already happening and will continue).
Eventually, the gold miners will put up better numbers.
This will slash these inflated "all-in" cost per ounce numbers at the better miners, and the weaker sisters get put on care and maintenance.
Eventually, supply is effected, and the price goes up. But the interesting dynamic going on in the PM market today is demand goes up as prices fall. This is usually true for life's staples (groceries, for instance....) but not so for investment products.
At the end of the day, most western world fiat paper is doomed as it's supply growth exceeds that of the PM complex. So gold will ultimately prevail, but it will be a bumpy ride getting there.
So basically you're saying it's a better time to buy now than sell.
Soon enough this will be valued more on the copper and moly production than on the gold.
(Who would have thought I could say that, and even moreso like saying this two years ago?!? Times have changed...)
So, soon enough the fortunes of TC will be tied to global and more importantly, perhaps, North American economic activity. Hopefully, that will be a good thing. Who can tell right now?
with TC having sold 52% of the gold already, it isn't the huge factor it was in the price, say 2 years ago. Moly and Copper are much more important and have industrial uses. I guess it depends on if the world population is going to continue to grow and people in third world countries will want higher standards of living (cars and electricity and plumbing). I am betting yes.