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July 20th, 2020 | 08:22 CEST

Barrick Gold, Desert Gold, Yamana Gold - the Gold Rush has begun

  • Gold
Photo credits: pixabay.com

Gold is money. Geologists of explorers, engineers of developers and the miners of producers - all are involved in bringing the world's oldest currency to us. The precious metal is also in demand in the modern society of the 21st century, and for a significant reason: gold cannot be printed and is therefore essentially different from the so-called fiat currency of central banks. Central banks around the world are currently printing money on a large scale to provide the general public with capital to prevent unrest and the collapse of the rest of the economy.

time to read: 2 minutes | Author: Mario Hose
ISIN: CA0679011084 , CA98462Y1007 , CA25039N4084

Table of contents:


    Bill Guy, Chairman, Theta Gold Mines Limited
    "[...] Both the geology and the infrastructure around the project make for a very attractive cost structure. We expect to be able to produce at 50% of the current gold price. [...]" Bill Guy, Chairman, Theta Gold Mines Limited

    Full interview

     

    Restrictions bring economy to a standstill

    During the financial crisis in 2008, the central banks for the first time concertedly provided the market with larger amounts of money with special programs. At that time, the aim was to prevent the economy from coming to a standstill. In 2020 everything will be different. Politicians have even ordered the economy to come to a standstill by imposing restrictions to stop the corona pandemic. To alleviate the side effects the money printing machines of the central banks are now running and an end is not yet in sight.

    Measures without comparison

    With the increase in ongoing government and central bank support packages, the level of measures is likely to soon reach ten times the levels of 2008 and 2009. Considering the alternatives, this political process is the better way forward. Those who have assets now have to protect themselves against the threat of devaluation and this is where gold comes in again. Gold is rare, difficult to find and costly to refine.

    Gold at an all-time high

    In many currencies the gold price is already at an all-time high. In the lead currency, the US dollar, there is not even a 10% gap until a new high is reached. The price of gold futures with a physical delivery obligation already gives an indication of what the pricing may be like over the next 18 months. The August 2020 future is currently quoted at USD 1,809.40, while the December future is already quoted at USD 1,833.20, June 2021 at USD 1,851.70 and December 2021 at USD 1,859.40. One thing is for sure, as long as the central banks increase the money supply, the demand for gold will also increase.

    Gold supply will decline

    Low interest rates help the states to get further into debt, virtually free of charge. In the past, interest rates were bad for the price of gold. Another reason why the demand for gold will not fall. In addition, there will still be supply bottlenecks in the gold supply, as the world's largest producers have recorded a 34% decline in reserves since 2012. Gold production is expected to peak this year and Barrick Gold expects the production volume to fall from around 118 million ounces in 2020 to less than 65 million ounces in 2029.

    Takeover target with potential

    Producers such as Barrick Gold and Yamana Gold are thus dependent on exploration companies such as Desert Gold Ventures, which are looking for further gold deposits in their area. Desert Gold owns more than 400 km2 of properties in West Africa in the vicinity of B2Gold, Barrick Gold and Iamgold. The current drilling program of the exploration company is expected to bring further discoveries to light. The team has been successful on several occasions in the past and is targeting the discovery of up to 6 million ounces.

    In Africa, acquisitions in 2018 have already paid more than USD 200.00 per ounce in ground. At that time, however, the price of gold was significantly lower. Desert Gold's share price has been rising for several weeks now - slowly but steadily. Investors are positioning themselves with the major landowners, a takeover target par excellence.


    Conflict of interest

    Pursuant to §85 of the German Securities Trading Act (WpHG), we point out that Apaton Finance GmbH as well as partners, authors or employees of Apaton Finance GmbH (hereinafter referred to as "Relevant Persons") may in the future hold shares or other financial instruments of the mentioned companies or will bet on rising or falling on rising or falling prices and therefore a conflict of interest may arise in the future. conflict of interest may arise in the future. The Relevant Persons reserve the shares or other financial instruments of the company at any time (hereinafter referred to as the company at any time (hereinafter referred to as a "Transaction"). "Transaction"). Transactions may under certain circumstances influence the respective price of the shares or other financial instruments of the of the Company.

    Furthermore, Apaton Finance GmbH reserves the right to enter into future relationships with the company or with third parties in relation to reports on the company. with regard to reports on the company, which are published within the scope of the Apaton Finance GmbH as well as in the social media, on partner sites or in e-mails, on partner sites or in e-mails. The above references to existing conflicts of interest apply apply to all types and forms of publication used by Apaton Finance GmbH uses for publications on companies.

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    Der Autor

    Mario Hose

    Born and raised in Hannover, Lower Saxony follows social and economic developments around the globe. As a passionate entrepreneur and columnist he explains and compares the most diverse business models as well as markets for interested stock traders.

    About the author



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