GOLD REACHES DIZZY HEIGHTS, UP AGAIN

All the “experts” are delivering their reasons why it continues its upwards trajectory. Everyone has an explanation. Some say “global economy”, some say Biden will deliberately collapse the economy if looks like losing to Trump, or America is in an out of control cycle of debt with over US$26Trillion. Others say supply and demand is the reason for spiralling upwards.

Why is the US$ so strong? Well, as usual the experts always shoot from the hip, they don’t know. Well, I’ll tell you. The New York Federal treasury hold 7,000 tonnes of gold. Another 146 million ounces in Fort Knox. There are ~32,260 ounces in a tonne of Gold. So, America, alone, just in NYC Federal treasury holds around $US226 Trillion. A debt of $US26 Trillion, pales into insignificance. Every time Gold goes up the US value of their gold holdings goes up with it.

Ok back to why Gold is rising.
1.⁠ ⁠Cost to mine is almost 20 times higher of what it was 30 years ago.
2.⁠ ⁠⁠exploration costs out of control.⁠
3.⁠ ⁠⁠wages for employees, costs soared 5-fold over the past 10 years for contractors and professionals.
4.⁠ ⁠⁠costs for administration and staffing.
5.⁠ ⁠⁠Cost of chemicals, explosives, maintenance have soared.
6.⁠ ⁠⁠maintaining employees, accommodation, fly in fly out etc.
7.⁠ ⁠⁠Royalties and taxes, costs have exploded especially in Australia and especially in Queensland.
8.⁠ ⁠⁠EPA demands for massive unexplainable bonds for rehabilitation are just out of control again especially in Queensland Australia. QLD is a no-go area for mining with current Government. QLD is So over regulated. No go zone!
9.⁠ ⁠⁠Fuel costs and transport, road taxes, port taxes

The above is part of the reasoning for Gold gravitational pull North. However, margins are still remaining relatively high.

The prime reason for Gold increasing in price is because “people and corporations, nations, just want to buy it, for whatever reason. Even countries, that normally not delve into gold, are buying Gold. Reasons for Perth Mint upsurge in sales? Why would anyone want to hold Australian currency.? It’s almost half the value of the US$, so, because Gold is valued in US dollars Aussies get the benefit of having a worthless currency in the global scheme of democratic stable economies.

Australia along with Russia, hold the most un-mined gold reserves in the world. Australia has an estimated 9,500 tonnes of unmined gold left to mine then that’s it. That’s 17% of the estimated Gold in the world left to be mined.

Mining Revenue 2022/23

All we have going for us in Australia for serious revenue is the Australian mining industry. We manufacture nothing, just consume. For the year the total revenue from Australia’s combined mining industry, was for 2022-23, $A455 Billion. Of that total, 301 tonnes of Gold or 9.7million ounces worth around $A30 billion was attributable to gold.

The Australian Government hold approximately 2.56million ounces of Gold valued today at around $A7.68 billion.

Funniest of all, we don’t even trust our own Government to store it. The entire of Australia’s Gold reserves are held in the Bank of England in the UK. The infamous and greatest (in his own mind) Australian Prime Minister John Howard and Treasurer, “world’s greatest treasurer”, Peter Costello sold the majority of Australia’s gold holdings in 1997 for $US306 per ounce and both claimed to be geniuses for getting such a great price. They sold nearly all of Australia’s gold holdings 556,000,000 ounces for only a miserable, $2 billion!

So where is gold price going to go from here?

I’ve personally been up to my neck in the Gold Mining Industry, mining, processing buying, trading gold, for 50 years. Gold Price? Your guess is as good as any of the so-called experts and advisors. The short answer is “No one has a clue”. It will go where it wants.

I will make one final comment to end:

I believe the day may come where Gold will do a “Hiroshima” and it will be just as brutal and devastating. In the meantime, it will “bob around like a buoy in the ocean.”
You may also ask: “is Gold a manipulated commodity? “
Right now, the most manipulated commodity on the planet other than husbands by wives.

Goldman

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