Tag Archive for: hedging

Hedging in the Gold Miners

There are two ways to run a gold mining company. One respects the simple fact that it is producing money. It is not eager to trade its the money it produces for government paper, legal tender laws be damned. It keeps its books in gold, and produces and trades to earn more money (i.e. gold). […]

Selling Low and Buying High: Hedging by the Gold Miners Part II

Gold Miners Buying High and Selling Low

In Part I, I made several points. First, that in the last gold bear market, miners capitulated after prices were low and falling for a long time. Then they sold massive amounts of their future production forward. Years into the subsequent bull market, they capitulated again, this time buying back the rights to their own […]

Selling Low and Buying High: Hedging by the Gold Miners

Hedging is a controversial topic, probably as controversial as any I have written about. Nevertheless, I want to share my thoughts and hopefully add something new to the topic. It is general knowledge that the gold miners had adopted hedging during the long years when the gold price was moving sideways to downwards, culminating in […]