June 15, 2019 

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Gold Enters Major Bull Market


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 By Michael Miller

01/11/2019  3:29PM

Numerous gold reports are coming my way for year 2019. One common remark is: market risk and economic growth to drive gold in 2019. Gold demand will benefit from the interplay of market risk and economic growth. Financial market instability, monetary policy with the US dollar and structural economic reforms are cited as a backdrop: “gold will become even more relevant due to its proven track record for delivering returns.” Perceptions about gold are always included in futuristic expectations.

“Gold will be supported by the development of the middle class in emerging markets for its role as an asset of last resort.” The ever-expanding use of gold in technological applications is also a point of interest. Central bank demand for gold in 2018 was the highest since 2015, as a wider set of countries added gold to their foreign reserves for diversification and safety (fiat currency risk). China and India remain pro gold.

Gold speculative positioning in future markets remains low by historical standards, hitting record lows in the closing months of 2018. What about those shorts? United States investment and non-investment men and women generally avoid gold. Yes avoid gold until the media and money talkers rant on about its importance (which it is); however the public moves into gold right at or very near the top. How sad and predictable! My industry, those of us that actually mine the stuff, are actually in small numbers compared to the gurus: more details upcoming. It’s good to be back on the FORUM.
 By Michael Miller

09/14/2018  10:42AM

Argentina’s New Export Tax Could Hurt Yamana’s Cashflow

Less than two weeks ago, Argentina proposed a 12 percent tax on all exports out of the country as part of a plan to correct economic turmoil that has sent the peso to record lows. The tax will be capped at four peso for each US dollar of bullion and unrefined gold and at three peso for each dollar of unrefined metals.

“While the company’s favorable positioning relative to production and costs bodes well for the near and medium term, Argentina’s export tax has the potential to offset a portion of these benefits,” said Daniel Racine, president and CEO.
Racine notes that the company will work to seek a constructive resolution for both parties by determining if and how the tax will be applied. Unfortunately for Yamana, its share price was negatively affected by the September 3rd announcement and its stock lost approximately 17 percent of its value as result.
 By Michael Miller

05/03/2018  10:10AM

Published 3rd May 2018 World Gold council

Gold demand of 973.5t was the lowest Q1 since 2008. The main cause was a fall in investment demand for gold bars and gold-backed ETFs, partly due to range-bound gold prices.

Jewelry demand was steady at 487.7t, as growth in China and the US compensated for weaker Indian demand. Technology demand extended its recent upward trend. The total supply of gold increased by 3% to 1,063.5t, primarily due to a modest increase in producer hedging. Mine production was fractionally higher at 770t.

China, Germany and the US drove weakness in bar and coin investment. Global demand fell 15% to 254.9t as range-bound gold prices undermined investor interest.

ETFs saw a fifth consecutive quarter of inflows. Holdings grew 32.4t, due to growth in US-listed funds. Q1 investment was mixed, with rising interest rates on the one hand and a sharp spike in stock market volatility on the other.

Global jewelry demand was roughly flat at 487.7t. China was buoyed by holiday spending and the supportive economic backdrop improved US demand. By contrast, Indian consumers were discouraged by rising local gold prices.

Central banks added 116.5t to global official reserves in Q1. This was the highest Q1 total for four years and in line with long-term average quarterly purchases of 114.9t since Q1 2010.

Demand for gold in the technology sector continued to improve. The wireless sector was a key area of growth as facial recognition is increasingly deployed in smartphones, gaming consoles and security systems.



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