This Month in Gold – August 2011

Gold Mining Commanding a Premium
Financial Post – Gold, like oil, is getting harder and harder to find. That is the conclusion of a recent report by Clarus Securities. Employing data from the Society of Economic Geologists, analyst Laurie Curtis finds that deposits yielding high quantities of gold per ton of ore extracted peaked in the 1980s. The cost of discovery, in particular, has nearly quintupled to $47 an ounce in 2009, up from $10 an ounce during the 1980s. Higher capital expenditure and a steadily increasing gold price will be the only way for supply to keep up with today’s surging demand. Read Full Article>>

Gold Standard Emerging as World Order Unravels
The Telegraph – Ambrose Evans-Pritchard, international business editor of The Daily Telegraph, writes that with Japan and the West likely at debt saturation, gold is making a comeback to its historical role as an anchor of stability in a sea of liquidity. Squabbling politicians in Washington and Brussels make for good theater, but generate little confidence in the eyes of investors as regards the medium- to long-term resilience of the purchasing power of their respective fiat currencies. No alternative asset class exists that is capable of absorbing the impending wave of wealth on the lookout for safekeeping. With the post-Bretton Woods global monetary order growing increasingly threadbare by the day, a new gold standard is just over the horizon, forecasts Mr. Evans-Pritchard.
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Swiss Mull Re-Linking Franc to Gold
MarketWatch (WSJ) – The Swissie has performed admirably over the course of past three years as the flight to quality has taken center stage. But for the right-wing Swiss People’s Party (SVP), a strong, resilient Franc is not enough, and certainly does not equate with a bulletproof Franc backed by solid gold. Later this year, the Swiss Parliament, which decoupled the Franc from gold as recently as the year 2000, is expected to debate the introduction of a parallel Gold Franc. The little Alpine nation still holds almost as much bullion as gargantuan China. Per capita, it is #1, with $6K in gold per person – six times the amount per person held by the US.
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