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Stocks B / Barrick Gold Corp.


Subject:  Re: Hi All! Covering ABX for TMF Date:  5/8/2008  10:02 PM
Author:  TMFSinchiruna Number:  244 of 247

Hi Boise,

I'll get to your question in a minute, but first some thoughts on Barrick.

Barrick produced some pretty numbers this quarter, to be sure:
The original draft of the article had more info on the insider selling, which I consider to be a huge red flag. Please see my blog post here:
Now, it's possible that those insiders predicted the present correction and sold accordingly, but the fact that almost every one of them reduced their company holdings to zero troubled me greatly. I have tried several sites to check up on insider trading data for the stock to see if those same individuals bought back in, but oddly no site seems to have such data on Barrick.

To be clear, I feel sure Barrick will do well as gold continues its rise. If I were holding Barrick stock, though, I would consider holding for the short term as the gold price recovers out of the present correction, and then switch into a less encumbered major like Goldcorp or better yet an intermediate producer like Agnico-Eagle or Kinross Gold. :)

Now, to your question. With all the evidence available to support the bull argument for gold, I guess my first response would be to request some evidence from whoemever was presenting the bear argument... evidence that A), it's overproduced (that supply is outpacing demand), and B), that it has no real value in the modern economy.

I have plenty of evidence to the contrary, so anyone presenting such an argument would need to be ready for a hearty debate. :)

First the overproduction part. Mines all over the world are scrambling to increase production, but bringing new production online is a very time-consuming process, so the ability of mining companies to respond to higher prices by bringing more production o