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Page added on September 9, 2014
Is the World at ‘Peak Gold’?
This week, Chuck Jeannes told The Wall Street Journal that either this year or next, miners will have reached “peak gold.” Peak gold means that the amount of gold being pulled out of the earth will begin to shrink every year, rather than increase, which has been the case since the 1970s. Jeannes is the chief executive of the world’s largest gold mining company, Goldcorp, so it’s probably safe to assume he knows a thing or two about mining the yellow metal.
Let’s put this into context. Central banks continue to stockpile gold (even Scotland is wondering how much of the United Kingdom’s gold it will get if it becomes an independent country). Nobody knows how much gold China is hoarding, but pretty much everyone assumes it’s a lot more than the official reports. Smart economists like Peter Schiff and Jim Rickards have been pointing out for a year now that gold buyers throughout Asia are accumulating more and more gold from Western investors, and they have almost no intention of selling it.
For physical precious metals investors, all of this news should hit home. What happens when this robust demand for gold runs up against the hard limits of the mining industry? This is simple supply and demand – prices go up.
“As gold production declines, the miner’s job becomes harder, as companies compete for increasingly rare deposits. Discoveries have already tapered off. In 1995, 22 gold deposits with at least two million ounces of gold each were discovered, according to SNL Metals Economics Group. In 2010, there were six such discoveries, and in 2011 there was one. In 2012: nothing.”
Read the Full Wall Street Journal Article Here…
21 Comments on "Is the World at ‘Peak Gold’?"
MSN fanboy on Tue, 9th Sep 2014 2:53 pm
And the point is?
I cant eat gold, if i want some i’ll scavenge it post peak oil / collapse.
peakyeast on Tue, 9th Sep 2014 4:40 pm
The world reached peak-useful-gold a long time ago – and its possible that this particular peak has been reached forever.
trickydick on Tue, 9th Sep 2014 6:20 pm
This will be an interesting trend to follow, perhaps plot alongside oil discoveries…
Makati1 on Tue, 9th Sep 2014 8:01 pm
I’m laughing at the pros and cons above, of holding gold. If you have everything else in preparation, then gold is good for what ever wealth you have left.
If you think the value will go away, you are correct for most of the common folk. They will not have any and will die out. Those who have gold will use it to return to power after…if there is an ‘after’.
No, gold will climb fast if China decides to back their Yuan with it. There are about 100 million people with wealth in excess in the world today. All are looking for a secure place to park it until after.
I own no gold outside of a few rings, but if I had excess income, I certainly would not buy stocks with it. At least gold is useful and pretty and lasts forever.
WhatNewYorkUsedToBe on Tue, 9th Sep 2014 8:07 pm
are we sure this guy isn’t saying this just to inflate the price of his company’s
gold? why else would he broadcast this information?
i1 on Tue, 9th Sep 2014 8:59 pm
peak clownbux.
Stercus Feri on Tue, 9th Sep 2014 9:28 pm
My precious metal of choice is ammo. Lots and lots of ammo.
Makati1 on Wed, 10th Sep 2014 1:22 am
Stercus, if you are outnumbered, you can have a ton of bullets but… It will take a small army of armed men to protect you from the hoards that will be roaming the wilds after. After all, you have to sleep sometime. Watch ‘Mad Max’ sometime to get the idea. If you doubt the world will go that way…
Beery on Wed, 10th Sep 2014 1:28 am
You can’t eat ammo.
Stephen on Wed, 10th Sep 2014 3:49 am
If gold production is in decline, maybe Fiat Money won’t ever go on the gold standard again in any country. While gold prices may go up, the interesting factor will be what value gold has in the post-oil economy. If there is no jewelry cutters, metal melting equipment, etc still left, the value of gold may decline. Let’s face it, gold cannot be turned into food.
ghung on Wed, 10th Sep 2014 7:24 am
For an idea of what role gold will play, post-industrial era, I suggest we look at what roles it played pre-industrial era.
Davy on Wed, 10th Sep 2014 7:38 am
Any way I look at it gold will play a part in the future. The spectrum of the descent scenarios leaves gold’s position in a post industrial economy in flux. I see multiple reasons why stable fiat money has a limited future. I again chime in if you have some money invest in some gold. 1/10oz coins are $150. They stores easy and will be tradable because of their size. I do not value my gold now. It is strictly a prep investment like the many other lifeboat investments.
Kevin Cobley on Wed, 10th Sep 2014 8:08 am
Plenty of people in the past thought the same as a lot of the doomsday pundits are touting today.
On April 5, 1933, President Roosevelt issued an executive order forcing delivery (confiscation) of gold owned by private citizens to the government in exchange for compensation at the fixed price of $20.67/oz. And less than nine months later, he raised the gold price to $35, effectively diluting the dollar in every wallet 41% overnight and swindling everyone who had turned in his gold. There were of course criminal penalties for gold hoarders.
A large group of people in a European country hoarded Gold, Silver, Diamonds and works of Art, when it became clear to them via their religious teachings that the value of paper money was going to collapse. These people ended up dead.
Gold has to be physically held to be of value (paper gold is worthless), it can’t be physically held in a Bank, storage facility because those businesses when the shit hits the fan will make off with your gold. If you have to hold the gold physically on your person or property you need the means to protect it.
A pair of shoes, a set of tools or an overcoat is a much better investment.
steve on Wed, 10th Sep 2014 8:17 am
I used to believe in gold back when I thought that there would be a slow collapse….now I don’t anymore….who would you possibly trade with? And if you do in a complete collapse that trading gold might get you or your family killed as word gets around that you are holding lots and lots of the stuff—-even if you aren’t.
Makati I would suggest you get a gun and lots of bullets…the Philippines has more guns per capita than anywhere I know….I would not want to be there on the descent mad max on steroids!!!
JuanP on Wed, 10th Sep 2014 8:26 am
Beery “You can’t eat ammo”
True, but everything you kill with it is edible, it can be used to trade for food, and it will be the only thing that will allow you to defend your family and any food plants or animals you may own.
I like you, Beery, but you are more of a romantic than I am. Romantics won’t die of old age. You are going to wish you had a gun and knew how to use it in the future, even if you go back home to England.
I don’t own guns or ammo because I am suicidal and that is a no go for me. I don’t want to own something I can very easily kill myself with, but my wife and I practice target shooting at the range, and know how to safely use, disassemble, clean, assemble, fire, and maintain rifles, shotguns, pistols, and revolvers.
steve on Wed, 10th Sep 2014 8:35 am
Coffee!!! All those old farts will trade anything to get their hands on it…In the states they drink it like it is water…
ghung on Wed, 10th Sep 2014 8:40 am
“A pair of shoes, a set of tools or an overcoat is a much better investment [than gold].” ??
These things aren’t mutually exclusive, you know. I’ve never advocated folks put all of their wealth into the gold basket and bury it in the back yard. I just always wonder at those who say, on one hand, that gold will be worthless, and, on the other hand, someone will kill you for it. Try to make sense of that.
Buy gold in small, untraceable increments. Don’t advertise it to others. Keep it on hand (yes, burying it in the back yard is an option). Just another tool in one’s tool kit. Silver may even be better.
Again, look at the role precious metals played before the industrial revolution. Look at history. More often than not, it has been handy to have some around. No one has been able to explain to me how this time will be different.
Davy on Wed, 10th Sep 2014 10:14 am
Damn G, I keep seconding your messages. You must be on to something.
You folks that cut gold down should realize everything you own is subject to confiscation. Also you trade it in a stable situation or offer it as a bribe to save your life. Try offering a pair of shoes that does not fit to an attacker. I will gladly take gold in exchange in the future collapsed world for cattle or meat I am selling. People that cut it down generally don’t have any and that is their problem with it. Just like people that cut down marriage. They have never had a good marriage or woman.
Beery, I have significant wildlife potential here on the farm and my long rifles double as hunting equipment. I plan on wildlife supplementing my food rations. Ammo around here is as good as money to trade even now with a functioning BAU.
Northwest Resident on Wed, 10th Sep 2014 10:29 am
I would never dismiss an opportunity to own more gold, or silver. I wish I had a treasure chest full of the stuff, even if all I ever did was bury it somewhere “for a rainy day”. But if you’re just starting out on getting prepared for the big TEOTWAWKI event, or in the process of doing it, just make sure that you stock up on sufficient long-term food, security (guns/bullets), secure water supply and other vital necessities before moving on to buying gold/silver. I have a little gold and a fair amount of silver, I plan on getting a lot more if time and price allows, but there are more important things — like being able to produce my own food. If you can produce your own food, then in a BAU-crash scenario, that food will be just as good or better than gold/silver.
Makati1 on Wed, 10th Sep 2014 8:43 pm
steve, better check your ‘facts’ on gun ownership in the world.
US: 90 guns per 100 people. (#1)
Philippines: 4.6 per 100 people.(#105)
Norm on Thu, 11th Sep 2014 12:20 am
Ya . In USA lots of guns. In Philippines lots of bananas. What is more interesting is where does gold come from? Its not created by the normal life cycle of stars. Its only created by a collision of two neutron stars. This is a very rare event. One example of it was recently observed by astronomers. The gold gets flung into space by the explosive star collision. But very little of it landed here. It proves scientific knowledge about the universe. But the fat slobs in monster trucks do not know what is a neutron star. Oh well.