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Thread: Mines closing down

  1. #1
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    Default Mines closing down

    I have an extended family member that is employed by the mining industry out in the desert. Anyway, this person is currently out of work because mines around the area are shutting down because they can't find enough investment money to fund operations. To put it plainly, the price of gold is now too low for speculators.

    To me, this means one of two things: Supply for gold far outweighs demand, and miners are having trouble selling gold for a profit; or if indeed there really is a shortage of physical in warehouses, that shortage in the near term will become much greater, and if prices do actually rebound, it will be a large rebound.

    I personally am leaning toward the former. As the global economy is stepping deeper into the recession, demand for commodities is going down.

    Anyway, just wanted to give some perspective from the mining community, as limited as it may be. Personally, I'm thinking about stacking a few pieces around this price level.

  2. #2
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    Yea, I just paid more than I ever have for a few pieces to add to the six Matthew found in my sock drawer. 10% over on silver ( $21+) 15% over on gold ( 5g was $250 but is had a nice bezel on it that cost $20 ) $13 was the most I've paid for a Silver ounce up til now.

  3. #3
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    Quote Originally Posted by Mizzle View Post
    I have an extended family member that is employed by the mining industry out in the desert. Anyway, this person is currently out of work because mines around the area are shutting down because they can't find enough investment money to fund operations. To put it plainly, the price of gold is now too low for speculators.

    To me, this means one of two things: Supply for gold far outweighs demand, and miners are having trouble selling gold for a profit; or if indeed there really is a shortage of physical in warehouses, that shortage in the near term will become much greater, and if prices do actually rebound, it will be a large rebound.

    I personally am leaning toward the former. As the global economy is stepping deeper into the recession, demand for commodities is going down.

    Anyway, just wanted to give some perspective from the mining community, as limited as it may be. Personally, I'm thinking about stacking a few pieces around this price level.


    "To put it plainly, the price of gold is now too low for speculators."


    or at least for the 99%

    "Supply for gold far outweighs demand,"


    Yes, there are tons of gold


    ""miners are having trouble selling gold for a profit"

    or at least the profit they need so they can be profitable themselves considering the cost of mining has gone up.


    I could speculate that this is planned.

    perhaps so that the Jr's can do all the work, and as their credit is squeezed the larger corps can make good investments with the due diligence having already been done.

  4. #4
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    As I understand it, most gold and silver are actually by-products of copper mining. Copper is in greatest demand when there's a housing construction boom going on. Copper pipes and electrical wiring. Anyway, with construction off for so long, it's amazing that the mines haven't all temporarily closed down long ago.
    In God we trust.

  5. #5
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    Quote Originally Posted by Xizang View Post
    As I understand it, most gold and silver are actually by-products of copper mining. Copper is in greatest demand when there's a housing construction boom going on. Copper pipes and electrical wiring. Anyway, with construction off for so long, it's amazing that the mines haven't all temporarily closed down long ago.

    That's a terrible clue in itself. Copper productions has been down for years and yet they are not running out of Gold or Silver.

    Of course what the direct miners in these PM's do is controlled by the paper price and has nothing to do with the real world availability of their products, but they can get the shaft just like the rest of us.
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  6. #6
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    Interesting article from ZH: http://www.zerohedge.com/news/2013-0...rage-cash-cost

    They seem to confirm my findings regarding the gold miners.

  7. #7
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    The days and weeks ahead will be great material for new chapters in Economics textbooks. What do you suppose the college kids in, say, 2023 will learn from this?
    Last edited by Xizang; 26th June 2013 at 15:12.
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    Quote Originally Posted by Xizang View Post
    The days and weeks ahead will be great material for new chapters in Economics textbooks. What do you suppose the college kids in, say, 2023 will learn from this?


    Probably as much as we have since 2008, not a god damn thing, unless you learned to stop spending so much money and start protecting your ass!!!
    I'm a proud member of Eggshellman's Liar, Shill, and bully club and a new member of the Super Jew Defense League!!!

  9. #9
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    Quote Originally Posted by Mizzle View Post
    Interesting article from ZH: http://www.zerohedge.com/news/2013-0...rage-cash-cost

    They seem to confirm my findings regarding the gold miners.


    That's a theory concerning a commodity that is not in short supply and it's only purpose is that of make believe value. Most of it is still around and just filling up warehouses and vaults around the world. So the price rises a little and the miners go back to work, but don't forget, there will never come a day when all those mines close down and we never have new Gold coming into the market place. Just as there are high expense mines, there are also low cost Gold mines and that does not take into account all the Gold that is a by-product of base metal mining. So it may take a lot more than the current price to dip below these current levels before something drastic happens.

    Remember, they were mining and selling Gold for under $300 eleven years ago and it had been under that level for some years. Now all of a sudden it's impossible for them to mine and sell it for under, what was that number, $1,100 an ounce.

    Right, just like they will stop mining and selling Silver below the cost of $20 an ounce, when they had been doing it for under $6 for several years a dozen years ago.

    I admit they make compelling arguments, but those Silver and Gold Sellers have always made compelling arguments.

    Does it make good financial sense to stop selling your products and keep those mines running until the price is right, once again. Yes if you have the balls and finances to do it. But what if the price drops and stays down for many years?

    I know, it can't happen because the fundamentals won't allow it, but that hasn't stopped the price of Gold and Silver to drop like rocks in the past two years.
    I'm a proud member of Eggshellman's Liar, Shill, and bully club and a new member of the Super Jew Defense League!!!

  10. #10
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    Quote Originally Posted by billmr View Post

    "To put it plainly, the price of gold is now too low for speculators."


    or at least for the 99%

    "Supply for gold far outweighs demand,"


    Yes, there are tons of gold


    ""miners are having trouble selling gold for a profit"

    or at least the profit they need so they can be profitable themselves considering the cost of mining has gone up.


    I could speculate that this is planned.

    perhaps so that the Jr's can do all the work, and as their credit is squeezed the larger corps can make good investments with the due diligence having already been done.
    Gold jumped price too fast. If you compare your paycheck when it was 600 per oz, to your paycheck now. How much would you say gold should be. There's no less gold now, as there was then.
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