To give you an idea of how obscene this trade has become, when the XAU was trading at today's levels back in January of this year, gold was trading in the low $1300's!
What is astonishing is the silence of far too many mining company CEO's while their stock value is getting systematically destroyed. A bounce in the metals should bring some valued based buying into the mining shares particularly at these levels.
Dan - I enjoy your articles very much. Your comment about the CEO's not speaking up is very true. It also could have been said about the CEO's not going on the offensive about the silver/gold price suppression for very many years running. My belief is that one CEO acting on his own would fear government, banking cartel or market retribution. Most recently, in a departure from the norm, upper management from ECU Silver Mining has gone pubiic with their concerns about stock price suppression. Unless they speak out as a group, I think the CEO's fear permitting issues, EPA or OSHA violations, increased taxes on the mining sector, etc.
ReplyDeleteThings might change in a hurry if one or more large mining companies decided to offer physical gold as a dividend. The logistics probably are a nightmare, but I don't think it's necessary to actually deliver tiny amounts of gold to everybody. A "paper credit" for gold in something (e.g., Sprott, GoldMoney, Perth Mint) that credibly is backed by 100% secure physical metal and regularly audited would be okay for me.
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