However, that which has been called the equivalent of the “birther movement” in gold has been making the rounds among the bugs more often than any of the allegations that President Obama is not American and it has theorized that America’s gold is AWOL or fake, or both. Previous audits in Ft. Knox, Ky.; West Point, N.Y. and Denver failed to extinguish the wild stories about the 8,100+ tonne stash of gold that the US owns. Soon, something will be proven and it should finally lay such fairytales to rest. Maybe.
Something that, on the other hand is quite proven, is the fact that the pain in the platinum niche is the result of a combination of high mining costs and virtually non-existent marketing efforts. A detailed article in Mining Weekly cites Northam Platinum consultant Bernard van Rooyen as believing that while the current price of the noble metal is “not a bad price in terms of cyclicality” there is a problem on the cost-of-production side of the metal’s equation.
Mr. van Rooyen also believes that if current conditions persist, some platinum miners will be forced out of business. Some 60 to 70 percent of the mines currently digging for platinum are not covering their costs properly. Platinum recently fell to a $200+ discount to gold – the steepest in nearly eight months. Mr. van Rooyen thinks that the platinum’s prospects are ultimately uni-directional since “Either the price goes up because demand increases or the price goes up because there won’t be any supply if it doesn’t. The problem is that there is an awful lot of pain in the interim.” We continue to believe that investors in platinum and palladium will be rewarded with percentage gains that will far outstrip gold and silver in the event of bull moves to the upside.