Gold production fallen by 30%?

AUandAG

Heard that on the stock channel (Bartoloma was talking to him). Don't know the guy or his
background but I thought that that was really off. Perhaps someone can explain but I did
a bit of research and found that gold production in NV in 2008 was off by 300,000 ounces
from 2007. Down to 5.7 million from 6.0 million ounces. That is hardly 30%. Perhaps he's
talking worldwide but I don't see that either. Production worldwide was stable at 78 million
ounces.

He also said that there is no real commercial use for gold anymore. That I didn't know.

He did say something that I thought made sense. That gold was not tied to the US currency
falling. But in fact was rising on demand. But if not used commercially anymore where is
the demand? Is it just for personal holdings, like IRA's, etc?

I rarely post to this forum but thought if some of you may be able to respond and clue me
in that would be great. I do have holdings.

What am I missing. If what he says is true about personal holdings then we are in a for a big
burst of the bubble as soon as the IRAs, etc get filled and demand slackens.

I believe he said that it's going to $2600 but gave no date or time frame.

Thought you guys would know more that I know.

bob


As a side note the Feds just approved another 20 years of no mining in S. Nevada. Guess my property will go to
the kids, coyotes or jack rabbits.

adamlaneus

Is why I don't listen to the media about this sort of stuff.

AUandAG

<< <i>Is why I don't listen to the media about this sort of stuff. >>



Dang, should never look at that channel. So much misinformation.

bob

adamlaneus

I always thought that jewelery is the top consumer of Gold.

Also, there are many different high-tech uses for Gold. Not particularly large uses, but uses that did not exist 30 years ago.

So many ways to spin this information.

This stuff is cyclical. It goes up and down.

I think we are in a bubble. With anyone and everyone talking about Gold, this is one of the indicators of a bubble.

But how big can a bubble inflate before it goes down? Pretty big.

Weiss

<< <i>

He also said that there is no real commercial use for gold anymore. That I didn't know. >>



...and the "commercial uses" for gold 100 years ago or 1,000 years ago were what, exactly?

South Africa has fallen to #4 in gold production recently, IIRC, after being #1 for a long time. Some theorize we've entered the next stage of "peak gold", with the major palyers' mines tapping out.

cladking

<< <i>

<< <i>

He also said that there is no real commercial use for gold anymore. That I didn't know. >>



...and the "commercial uses" for gold 100 years ago or 1,000 years ago were what, exactly?

South Africa has fallen to #4 in gold production recently, IIRC, after being #1 for a long time. Some theorize we've entered the next stage of "peak gold", with the major palyers' mines tapping out. >>




Mining is expensive and much mining is extremely energy intensive.

So long as oil and energy prices are high metal production of all sorts
is likely to be suppressed. If the economy recovers and oil reverts to
its old price we may have seen peak production of many commodities.

So long as the economy stays suppressed we've probably seen peak
as well.

ksammut

I did not see the report but gold production is down about 30% since 2001. I believe China is the only country that is showing an increase.

AUandAG

That 30% is just BS. In 2001 world production was the highest it's ever been at 2600 tons. Production in 2008
was 96% of that. Certainly a drop of some 4% but not the 30% he alluded to.

Gold production of the eight major producing countries fell by 12.3% from the maximum of 2001 while production of gold in the world declined by 3.8% over the same period.

I'm just mad at myself for turning that damm channel on. I haven't watched it in at least 5 years. Then 6 weeks ago
I retire and being a bit bored this afternoon I saw that BS. Ruined my day!

bob

roadrunner

The bottom line is that it did peak back around 2000-2001. It has dropped every year since. From what I recall it's down about 10% since then. The key point here is that the miners are going through much more ore with 3X the total investment cost to mine even less gold than ever before. They are having to dig deeper, climb higher and to go in very unfriendly places to look for gold hoping that the local jurisdication doesn't shut them down like the Mexican govt just did to one of New Gold's Mexican operations. South African production IS down 30-40% since 1970 when it peaked. Those guys are slowly becoming less important as the Rand outpaces the dollar and lack of infrastructure support takes its toll. There have been some articles printed lately that suggest that the South African proven reserves are far less than what has been estimated.

World gold production may eventually pick up if enough projects get started. But it will probably show up in 10 years and long after the price of gold peaks. This is exactly what happened in the 1970's and 1980's. All the projects planned in the 70's to take advantage of rising gold prices never made it in time. Gold production finally ramped up into the mid-1980's as the gold price fell. Today's mining environments are far more treacherous and risky than that of the 1980's.

I wouldn't bet the farm on Nevada's influences on the world's gold production even if it did or didn't fall 30%. If the US govt has its way they want to apply pollution taxes on the miners to make it even harder on them.

Investment demand may well be exceeding jewelry demand. The GFMS doesn't factor in central bank buying when calculating gold demand. When they were net sellers of 100 tons per year it wasn't an issue. Now that they are net buyers of 100-200 tons per year that should be part of real world demand. The commercial uses for gold are still there with new horizons being added all the time.

roadrunner

AUandAG

Yes, if it's not the Government then it's the locals. An Indian tribe has shut down
operations, for religious reasons, in a central Nv area that has had mining since
1860. In fact it's been continuous, albeit in a small scale, since 1870. Now the
tribe has sued because it's a sacred mountain. One of the miners has lived on the
mountain, with his family, for over 50 years and has never even met an Indian. Let
alone seen them worshiping in the area.
A fed judge just shot them down but now they get to appeal. Oh my, what miners
go through.
A good friend of mine owns the lode that was so famous many years ago in Manhattan,
NV. Huge tailings remain. Two years ago he thought he'd rework the tailings. Nope,
no can do. Has a home on the site and quit active mining about 10 years ago (he's
86 now). He knows he's left a lot in the tailings and that was his "stash". Too heavy
to steal. But now the Feds have said he's abandoned the mining process and can't resume
without going through the processes and meeting today's requirements.
Told him (I'm 63) I'd come up and help him highgrade his own ore. Should be fun if we
decide to do it!
The wild west got real tame, real quick. What ever happened to making a buck with your back?
Ye old pick and shovel, and a bit of dynamite, work wonders. But, it's the processing that
get's you big time. Too expensive to haul any distance for others to do. Stuck in that old
crevice of between a rock and a hard place.
bob

edited: don't you ever sleep Brian?