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| 10/11/2008
www.insidemetals.com |
Vol
3, Issue 18 |
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In
This Edition...
Precious
Metals Market Update
Gold & Silver ETF's
Geopolitical View
Gold
Producer News
Website Updates
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|
| Dear
Subscriber, |
The
newsletter will next be published on
October 25, 2008
|
| IN
THIS EDITION OF INSIDEMETALS |
|
In this edition of the InsideMetals
Newsletter, we'll take a look at gold
& silver ETF's, production, pricing
and news, as well as precious metals
trends, gold producer news and recent
website updates.
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|
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| In
This Issue |
| Precious
Metals Markets Update |
| 2007
Silver Nevada Miner Bar |
| Geopolitical
View |
| Whitney
& Whitney Inc. |
| NYSE
Gold Producer News |
| AMEX
Gold Producer News |
| NASD
Gold Producer News |
| InsideMetals.com
Website Updates |
|
| |
| PRECIOUS
METALS MARKET UPDATE |
 PRECIOUS
METALS MARKET UPDATES
Gold
closed at $883.50/oz (London Fix) on
October 9, 2008, 2008. This is a 19.4%
increase over the $740.75/oz (London
Fix) closing price on September 25,
2008, when data for the previous
newsletter was gathered.
Silver
closed at $11.64/oz (London Fix) on
October 9, 2008. This is a 12.7% drop
from the $13.34/oz (London Fix) closing
price on September 25, 2008.
Platinum
closed at $1027.00/oz (London Fix) on
October 9, 2008. This is 14.1% lower
than the $1195.00/oz (London Fix)
closing price on September 25, 2008.
Palladium
closed at $203.00/oz (London Fix) on
October 9, 2008. This price is 16.0%
lower than the $242.00/oz (London Fix)
closing price on September 25, 2008.
3rd
QUARTER METAL PRICES
Gold
closed at $884.50/oz (London Fix) on
September 30, 2008. This is a 5.7%
decrease from the $937.50/oz (London
Fix) closing price on July 1, 2008, the
first trading day of the 3rd quarter of
2008.
Silver
closed at $12.96/oz (London Fix) on
September 30, 2008. This is a 26.26.2%
decline from the $17.56/oz (London Fix)
closing price on July 1, 2008.
Platinum
closed at $1004.00/oz (London Fix) on
September 30, 2008. This is a 51.6%
plummet from the $2075.00/oz (London
Fix) opening price on July 1, 2008
Palladium
closed at $201.00/oz (London Fix) on
September 30, 2008. This price is a
56.8% drop from the $426.00/oz (London
Fix) closing price on July 1, 2008.
YEAR TO DATE GOLD vs. EURO/U.S. DOLLAR
CHART
The year-to-date Gold vs. Euro/U.S.
dollar chart shows a recent rise in
the price of gold as the U.S. dollar
has weakened. In the last several
months the price of gold and the
Euro/U.S. dollar have declined
together. Note the recent separation
as gold prices approach $900 an
ounce in the midst of the efforts by
the U.S. government to fix the
financial markets.
|
| Advertise
to a world-wide targeted audience |
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| Gold
& Silver ETF's |
The SPDR Gold Trust (GLD) controls
over 24,500,000 ounces of gold. In the
last month there has been significant
volatility in the ounces held as the
price of gold has reacted to the
recent financial turmoil.
The iShares Silver Trust (SLV) shows a
continuing increase in silver ounces
to over 220,000,000 ounces in spite of
silver price declines. The increase in
silver holdings reflects strong buying
interest at low silver prices.
|
| 2007
Silver Nevada Miner Bar - 99.9%
Pure 5 Troy Ounces of American History |
|
|
| GEO
POLITICAL VIEW |
 GOLD
BULLION OUTPERFORMS GOLD STOCKS
Since September 1, 2008 there has
been a strong upward movement in the
price of gold. The closing price of gold
(London Fix) on September 1, 2008 was
$822.25 an ounce. Gold closed today
(September 9, 2008) at $883.50 an ounce,
a rise of $61.25 an ounce (a 7.4% gain).
Over the same period the AMEX Gold Bugs
Index (HUI), an index composed of 15 of
the nation's largest
"unhedged" gold mining
companies dropped 12.5%. The index on
September 1, 2008 was 324.86 and closed
at 284.21 on September 9, 2008.
Generally, when gold prices are on the
rise, the Gold BUGS Index also tends to
rise. BUGS is an acronym for Basket of
Unhedged Gold Stocks. The index was
created on March 15, 1996 with a
starting value of 200.
Gold bullion prices are now down
approximately 12.6% from their March 17,
2008 closing price of $1011.25 an ounce
(London Fix). Over the same period the
Gold BUGS Index has dropped
approximately 43.8%. The value for the
Gold BUGS Index was 505.76 on March 17,
2008.
Why haven't the common stock prices of
mining companies similarly moved upward
as gold bullion? Mining stocks have
dropped on fears that the global
financial crisis would impact resource
demand for raw materials that would be
used to produce goods for export. China
has been fueling the big commodities
boom as it imports metals from resource
rich regions of the world. China had
built up a large inventory of iron ore
before the summer Olympic Games and
currently has a supply of approximately
70 million tons.
China, the world's biggest steel maker
reported in October that its mills are
reducing demand for iron ore and has
asked iron ore producers to postpone
deliveries because of tightening credit
facilities and a decline in demand for
iron ore due to current economic
uncertainty. The rest of the world is
cutting production and that means they
don't need Chinese steel.
The same is true for copper. The London
Metals Exchange in September reported
that Chinese copper imports in August
were down 3.4%. China's imports of
unwrought copper and semi-finished
copper products fell to 178,047 tonnes
in August from 186,136 tonnes in July.
While the common stock prices of mining
companies declined along with equities
representing other sectors, the price of
gold bullion rose as gold again became a
safe haven from the risks associated
with a strengthening U.S. Dollar,
weakening banks, tightening credit and
volatile equities. The DOW has fallen
25.5% from 11,517 (its close on
September 1, 2008) to 8,579 (its close
on October 9, 2008). This has been a
drop of 2,938 points since September 1,
2008, and a staggering 5,619 points from
its all time record high of 14,198 that
was reached nearly one year ago.
Commodities have underperformed stocks
and bonds for the first time in a year
and commodity price declines in the
third quarter have wiped out gains for
investors in almost every major metal
except for gold. As gold prices rise,
the common stock of gold producer stocks
will follow.
|
| Advertise
to a world-wide targeted audience |
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| Whitney
& Whitney Inc. - A Nevada
Based Management Consulting Firm |
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|
| NYSE
GOLD PRODUCER NEWS |
 September
29, 2008: Barrick Gold Corp (ABX)
announced that following the terms of
the Placer Dome 2.75% Convertible Senior
Debentures due in 2023, and in
fulfillment with the terms and
conditions of the Debentures, they may
be surrendered for conversion until
December 31, 2008 at a conversion rate
of 40.1321 Common Shares per $1,000.00
principal amount of Debentures.
October
2, 2008: Gold Fields Ltd (GFI)
announced an agreement with Bateman
Engineering N.V. to sell its BIOX
Technology Business to Bateman
Engineering for $8.84 million. BIOX is a
patented process and technology, which
is used for the pre-treatment of
refractory ores and concentrates prior
to gold recovery through conventional
cyanide leaching techniques.
October
3, 2008: Silver Wheaton Corp
(SLW) has agreed to purchase 25% of the
life of mine silver produced by Alexco
Resource Corp. from its Keno Hill
project located in the Yukon Territory,
Canada. Keno Hill is historically one of
the highest-grade and most prolific
silver producing districts in the world.
SLW will pay Alexco $50 million to
acquire 25% of all payable silver
produced from the Keno Hill project, for
the lesser of US$3.90 or the prevailing
market price per ounce of silver
delivered. The upfront payment will be
made in several tranches, with a total
payment of US$15 million to fund ongoing
underground development made upon the
satisfaction of certain conditions, and
the remaining US$35 million payment to
fund mill construction and mine
development costs made on a drawdown
basis, upon the satisfaction of certain
additional requirements, including the
receipt of operating permits. Silver
Wheaton is not required to contribute to
further capital or exploration
expenditures and Alexco has provided a
completion guarantee with certain
minimum production criteria by specific
dates. Payment for the transaction will
be drawn from Silver Wheaton's existing
credit facilities.
October
6, 2008: Iamgold Corp (IAG) has
made an offer to acquire all of the
outstanding shares of Euro Ressources
S.A. for cash of EUR1.20 per share. The
offer will remain open for at least 25
trading days. The expiration date of the
offer as well as the final timetable of
the offer will be set at a later date by
the French Autorite des marches
financiers.
October
6, 2008: Compania de Minas
Buenaventura (BVN) announced during the
shareholder meeting the Board of
Directors was given permission to issue
unsecured notes, in an amount not to
exceed $350 million, and was also given
the power determine the conditions of
the issuance.
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| AMEX
GOLD PRODUCER NEWS |
 September
30, 2008: Eldorado Gold Corp
(EGO) presented an update on its 2008
exploration activities in Turkey, China,
Brazil, and Nevada. Subsequent to the
Brazauro Resources transaction, EGO
anticipated planned total expenditures
to be $20.0 million in 2008. Refer to
the EGO press release for details
October
3, 2008: Pacific Rim Mining Corp
(PMU) has started discussions with
Nevada Resource Recovery Group (NRRG)
related to the terms of the October 2004
Property Purchase and Sale Agreement.
Under the Agreement, NRRG has agreed,
subject to certain conditions, to
purchase from the Rawhide JV the lands
occupied by the dormant Denton-Rawhide
open pits. NRRG intends to build and
operate a landfill on the site for
non-hazardous municipal waste. The
Rawhide JV will receive compensation for
the transfer of this property primarily
in the form of dumping fees over the
life of the landfill operation.
October
6, 2008: Western Goldfields Inc
(WGW) announced a new mining plan that
will boost production to over 700,000
ounces of gold with a cost per ounces
sold of $420/oz, for the period from
2009 to 2012. This equates to about
65,000 ounces per year more than the
previous plan. For the third quarter of
2008 WGW sold 47,534 ounces at $857/oz
and produced 42,372 ounces.
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| NASDAQ
GOLD PRODUCER NEWS |
 October
6, 2008: Royal Gold Inc (RGLD)
announced closing the acquisition of
Barrick Gold Corporation (ABX) royalty
portfolio effective October 1, 2008. The
deal with ABX totaled approximately $150
million net cash and a restructuring of
RGLD's royalty positions at ABX's Cortez
Pipeline Mining Complex in Nevada,
valued at $31.5 million. ABX's royalty
portfolio consists of royalties on 72
properties, including 8 producing
royalties, 2 development stage
properties, 19 evaluation stage
properties, and 43 exploration projects.
Approximately 75% of the portfolio
consists of precious metals royalties.
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| INSIDEMETALS.COM
WEBSITE UPDATES |
 PAID
SUBSCRIBER RESOURCES: The
Business Summary for Hecla Mining
Company (HL) has been updated on the
website. The Business Summary now
reflects HL's reported operating and
financial results for the 2nd quarter of
2008.
Paid subscribers can view this update by
clicking the "All Gold Stocks"
button bar under the "Subscribers
Resource" area on the left margin
of the website. This will take the user
to the Index of listed gold companies
where the subscriber can then use the
"Quick Nav Bar" on the Index
Page and then click on "B" to
view the Business Summary for the
requested company.
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We
hope you have enjoyed our newsletter.
The newsletter will next be published on
October 25, 2008
Until next time!!!,
InsideMetals
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