No. I mentioned in another thread my connection to the gold industry. Do not invest in gold or silver.
Side note 1: I had a nice surprise in about 2011 when I found a handful of Krugerrands I was paid with one summer when I was a kid a decade plus before. Did some yard work for an old man that summer, never once got molested, but was a bit disappointed he gave me foreign coins. I remember checking the price of those every week for a month and then I forgot about them, only to discover them at the perfect time when cleaning.
Side note 2: I use cash almost every day, so I get a lot of loose change back. Since the pandemic started I’ve gotten a ton of >1963 coinage. Like half of a mason jar worth. Not for a while now, but still curious how those made it back into circulation.
I must’ve missed that thread. How come you don’t recommend it?
In addition to gold being outperformed by many other investment vehicles? The house of cards of something where the price is set by supply and demand and the supply is unknown to anyone.
Basically, there is wayyy more gold above and below ground than statistics say there is.
Gold charlatans would have you believe that we’ve extracted most of it, or reached peak gold, and that’s the opposite of reality - it’s an iceberg. Production numbers for on the book projects are vastly underreported. There are a lot of projects that began a decade ago during the boom which will begin to yield.
So there is WAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAY more gold than anyone has use for?
Makes sense.
Uh...no. Not exactly.
Most of the 'reported' gold will never be mined. CAPEX way too high and many of these billion dollar resources are so fucking remote that getting a mine constructed would be impossible. The game is to 'prove up' a resource, then shuffle the claims/project off to the next guy higher up the food chain. Meanwhile the guys lower on the food chain raise just enough money to pay themselves a nice little salary every year in the hopes that their project is the next big thing. The gold charlatans know the gold bugs are just gullible enough that just one more investment will be the big payday/motherlode.
Anything out of BC follows that scam. You're probably chasing a pump and dump with those fellas.
Mining gold is not like the guys you see on Discovery channel with bailing wire and duct tape trying to get a few nuggets. Legitimate mines cost tens of millions of dollars to construct and the lead time to get through permitting/environmental/archaelogical, all sorts of shit.
There is an actual shortage of physical gold. The squeeze will come in silver first simply because of the industrial uses like electric vehicles and lithium battery storage.
@RatherBeBrewing is correct in that some projects will start to move toward production/yield again - but that's a slow road and there's hundreds of millions of ounces that will never see the light of day for the reasons above.
I originally wrote a reply that explained what I agreed and disagreed with, but I say fuck it. If people want to invest in gold let them.
Instead, here is a giant ass truck used for mining. The BelAZ 75710.
BelAZ stands for Belarusskiy Avtomobilniy Zavod, the Belarusian Automobile Factory. Belarus is the only country to officially ban me, fuckers put a giant stamp in my passport and everything. The last time I sent in my passport for a rush renewal it wasn’t fun. The State Department wants to know nosy things like “why” and how come your passport was flagged as lost and returned to the US embassy in a different country the year after that. You get the random special TSA and immigration screening when coming back to the US every time.
This fucking truck is nearly 70 feet long and half as wide, weighs 400 tons and can haul 500 tons more. I had to procure tires for this bad boy, it’s about $1.5 mil for two sets of six. You have to be vigilant with making sure they don’t explode when on the truck, because one could literally kill people nearby with the force. I never have got to see one, but I did see backhoe that was almost fat enough to be offered a scholarship by Mario Cristobal. Here’s some scale:
It went to a gold mine in Siberia. It wasn’t a regular GULAG, it was the GULAG for those who were too dangerous to send to the regular jolly ones, and they considered it the last circle of hell. In the winter it’s one of the coldest places on Earth. Summer is muggy, and mosquitoes are the size of scrub jays. This mine operates 24/7 for 364 days per year, with New Years off. Laborers come from China, the Stans, Russia, and some Canadians, Australians, Germans, Americans, whatever to oversee the technical aspects. I forget the terms but I think something like 6 months at a time, and you can’t exactly leave early because the nearest road may be a time zone away.
It’s very expensive to operate, as you can imagine. Just the isolation alone is mind boggling. One of the most expensive mines in the world, labor costs are lower than the more developed countries and that’s its saving grace. Just the vehicles that have tires come from seven different countries, require triplicate backup parts, specialized mechanics who can keep them operating in the most extreme conditions, and an ungodly amount of fuel.
Where the point of all of this? I know what their production price was per oz. Gold doesn’t really cost what it costs. Some Czech billionaire doesn’t want you or some poor schmuck buying dowry gold in India to know there’s like 10x more than you think there is because then you’ll want to pay less for it.
I wouldn't argue that there are absolute pricing shenanigans in gold.
Mining equipment is crazy expensive. It's even more expensive when the country of operation seizes the equipment and mine and makes it their own (Holla, African mines).
I've stood in the bottom of Round Mountain which is the largest open pit gold mine in North America. It's like looking up to the top of Everest to see the rim of the pit. From the the top, those sized trucks look like ants, hauling ton after ton of ore up to the leach pad.
No. I mentioned in another thread my connection to the gold industry. Do not invest in gold or silver.
Side note 1: I had a nice surprise in about 2011 when I found a handful of Krugerrands I was paid with one summer when I was a kid a decade plus before. Did some yard work for an old man that summer, never once got molested, but was a bit disappointed he gave me foreign coins. I remember checking the price of those every week for a month and then I forgot about them, only to discover them at the perfect time when cleaning.
Side note 2: I use cash almost every day, so I get a lot of loose change back. Since the pandemic started I’ve gotten a ton of >1963 coinage. Like half of a mason jar worth. Not for a while now, but still curious how those made it back into circulation.
Interesting. Other than the occasional pre-1960s nickel you rarely see any pre-1964 dimes or quarters anymore. Used to regularly get some back in change pre-Hunt Bros attempt to corner the silver market, but when they drove silver way up in 1980 a lot of that old pre-1964 coinage disappeared from circulation. I never see it now.
I would rarely see any, one a year or so. Maybe because I collected coins as a kid or because the color is so starkly different I never missed one. Then around a year ago when there was a coin shortage it seemed like I was getting a quarter and a dime every week for a few months. Found a few in our big change jar as well, got to bore my girlfriend with the story of the gold and silver standard and the allegory of the Wizard of Oz.
I'm sure she was as fascinated as my wife was when I tried to tell her about that.
I sold 50% of my silver stash on a fairly recent bump. I bought it back a few days later for a nice profit. As a result, I became more interested in metals. I have acquired some of 2 which are not gold or silver. Both are used extensively in medical applications. Huge numbers of surgeries have been postponed due to covid. Manufacturing using these metals was essentially stopped over a year ago. Then again, I could well be the dumbest investor ever.
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Mining equipment is crazy expensive. It's even more expensive when the country of operation seizes the equipment and mine and makes it their own (Holla, African mines).
I've stood in the bottom of Round Mountain which is the largest open pit gold mine in North America. It's like looking up to the top of Everest to see the rim of the pit. From the the top, those sized trucks look like ants, hauling ton after ton of ore up to the leach pad.
Then again, I could well be the dumbest investor ever.