If gold does take continued strength on Brexit and other global uncertainties, the lack of future supply is going to be an issue coming squarely into focus and — like we saw during the last gold boom of 2006 to 2008 — gold exploration properties will suddenly be a hot commodity.
The comments above and below are excerpts from an article by Dave Forest (PiercePoints.com) which has been edited ([ ]) and abridged (…) to provide a faster and easier read.
…Owners of gold stocks were probably the only people happy to be in the market as trading opened after the Brexit vote…and that standout performance from gold producers, developers, and explorers won’t go unnoticed.
The thing is, such an attention-grabbing day for gold couldn’t come at a better time…I believe this is going to usher in a particularly welcome period for gold exploration. After all, there haven’t been any major gold discoveries pulled off for five years now.
Just this week Newmont Mining CEO Gary Goldberg predicted that the lack of a strong pipeline of development projects will cause a 7% drop in gold supply by 2021 and, if gold does take continued strength on Brexit and other global uncertainties, that lack of future supply is going to be an issue coming squarely into focus and — like we saw during the last gold boom of 2006 to 2008 — gold exploration properties will suddenly be a hot commodity.
In such an event, it will be interesting to see who emerges well-positioned. After all, the last few years of downturn in gold have offered a nearly unprecedented opportunity to pick up unwanted exploration projects for a song and a few shares. That’s going to work out very well for keen-eyed buyers who grabbed the right ground.
I’m looking forward to seeing what big projects emerge from the woodwork if this week’s spurt turns into a protracted gusher.