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Text size [+][-]  Thursday March 18 2010GLOBAL EDITION

Considered view
16 Nov 2009 20:58

More bang than bubble

Context News

Gold mine production totalled 2,414 tonnes in 2008 and 622 in the second quarter of 2009, according to the World Gold Council. Total supply including official sales and scrap recycling totalled 3,512 tonnes in 2008 and 927 in the second quarter of 2009. 2008’s gold mine production was down 2.8% by volume on 2006.

Gold was trading in New York November 16 at $1,131 per ounce; at that price 2008 gold production has a value of $88bn and total supply $128bn.

Total world gold stock in 2007 was 158,000 tonnes, according to the World Gold Council, which would have a value of $5.75 trillion.

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Cheap money strengthens the case for gold, and reduces the cost of holding it. Gold miners won’t slow the rally. A jump in hedge fund or central bank interest would swamp annual production, worth $88bn and falling. The 20% increase since August could be only the beginning.

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More stories by:  Martin Hutchinson






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