World gold supply trend 'tragic' – Barrick founder Munk The failure of the gold-mining industry to find and exploit large new deposits of the yellow metal was "tragic", Barrick Gold chairperson and acting CEO Peter Munk said on Tuesday. "The supply side is tragic...it is the very challenge that keeps a company like Barrick and the remaining few major gold companies totally preoccupied," he said at the company's annual shareholders meeting."We're running out of major gold deposits, and the deposits we do have become increasingly difficult to come on stream." Opposition from nongovernmental organisations, as well as increasing, "yet understandable" demands from host countries that they receive a bigger share of profits from mines, was making it difficult to develop successful new operations.
AngloGold to Reduce Gold Hedge Book by 45% New CEO Mark Cutifani is not all talk. After months of openly expressing his distaste for AngloGold’s massive gold hedge book, he announced plans during the company’s quarterly results presentation on Tuesday to sell $1.6 billion worth of shares to cut the company’s hedge book down by about 45%. The company said it would issue about 69.4 million new shares next month under a fully underwritten rights offer, underwritten by Goldman Sachs Group Inc., UBS AG and Morgan Stanley. The shares will be sold for at least 172 rand each, a 35% discount to yesterday's closing price. Existing investors will be offered one new share for every four they hold.
Opportunity on a Silver Platter Once every several months, an opportunity is presented on a silver platter to purchase a spectacular investment in a strong uptrend, with loud indications of continued upward trend in price. Gold is heading well past $1200 and silver is heading well past $25 in the next several months, despite the orchestrated annihilation of honest valid reporting. How many times have the clowns on Wall Street and the financial subservient media networks claimed that the worst was over for the USDollar, gold, the USEconomy, the housing market, and bank bond losses? My guess is about once per year for the last five years, all wrong, and still wrong, just louder wrong now in tone. Has anything been fixed on the economy, housing, mortgages, or banks? No! The flow of USFed repo money to banks has improved, that is all. That is not a remedy, but a bandage tourniquet, grossly misinterpreted.
Credit crisis over? Not likely Short-term rallies and wishful thinking have buyers ready to pounce, but the end of the credit mess isn't yet here. In the meantime, here's some speculation on bank stocks. The major stock indexes blasted to two-month highs last week in defiance of wretched news on the economy, one of those reverso-world moves that the market gods use to keep the public wrong-footed. It seems negative sentiment is so pronounced right now that every time the news is one lumen brighter than total blackness, buyers emerge from their foxholes to nibble. Yet Satyajit Das, an independent debt derivatives expert who for years has warned of an impending disaster in credit markets, doesn't buy it.
Seeing inflation only in the prices that go up Next week, the Bureau of Labor Statistics will release its monthly report on inflation, and it sure is going to sound strange. Wall Street is expecting the bureau to announce that the Consumer Price Index rose just three-tenths of a percentage point in April. Over the last year, the index has risen only about 4 percent. I'm guessing that doesn't square with your sense of reality. In my household, we just broke the $60 barrier for filling up our gas tank. Nationwide, the price of bananas is up almost 20 percent over the last year, while eggs are up 35 percent. Costco and Sam's Club recently began rationing rice, to prevent hoarding. All the while, some of the big-ticket items that have been getting more expensive for years — like health care and college — just keep on getting more so.
Did Fed rate cuts help boost food prices? The Federal Reserve's seven interest rate cuts in as many months, which helped protect the U.S. economy from the full effects of the housing crisis and the resulting credit crunch, also contributed to the spike in raw material costs that has been felt across the globe, experts said. In short, the integration of world markets means that subprime mortgage fraud in Las Vegas is linked to food riots in emerging economies. Booming demand from China, India and other emerging economies as well as high energy costs and a weak dollar pushed up commodity prices, which in turn boosted prices of rice, wheat, corn, soybeans and other staples. Rice prices have doubled in the past year, and in some parts of Africa, local staples are two or three times as costly.
Numbers Racket If Washington's harping on weapons of mass destruction was essential to buoy public support for the invasion of Iraq, the use of deceptive statistics has played its own vital role in convincing many Americans that the U.S. economy is stronger, fairer, more productive, more dominant, and richer with opportunity than it actually is. The corruption has tainted the very measures that most shape public perception of the economy—the monthly Consumer Price Index (CPI), which serves as the chief bellwether of inflation; the quarterly Gross Domestic Product (GDP), which tracks the U.S. economy's overall growth; and the monthly unemployment figure, which for the general public is perhaps the most vivid indicator of economic health or infirmity.
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