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The Real Cost of Gold

Jan 25, 2019
In about 3 column inches of the Minneapolis Tribune this morning, buried on page 4, I ran across an article I found very interesting. It read:

Dozens are trapped under mine rubble…A grueling search-and-rescue effort has saved 19 people from the debris of a collapsed illegal gold mine in Indonesia’s North Sulawesi Province, but officials said several dozen remain trapped.”

So, I went on-line and found an updated article at the link below. It reads: “Twenty-six people had been evacuated from the mine by Thursday afternoon, but the number of people still trapped underground has risen to 50 according to one local official.” The article goes on, …seven of those 26 people brought to the surface have died in the collapse, while 19 have been pulled out injured but alive. So, seventy-six or more people were working in that illegal gold mine. Seven are now dead and the fate of another fifty remains unknown. The article continues, “The national disaster agency said at least 140 people from different agencies were involved in the rescue effort. It said there was an urgent need for body bags.

Smug business men and women in fancy suits tell us the All-In-Sustaining-Costs (AISC) for an ounce of gold is in the $850 to $1200 per toz range. Tell that to the newly-widowed woman in Indonesia. The article stated, “A woman who took her missing husband's ID to an emergency command post cried out in anguish when an officer showed her a photo of a dead victim they believed was her husband.”

I’ve been a coin collector since I was 12-years-old in 1962. In 1965, I started buying and selling junk silver and dabbled in gold; so I’ve been watching the PM markets a long time. I’ve witnessed the struggles of miners via articles, documentaries and TV shows such as Gold Rush. Yes, I know some difficulties shown on programs such as Gold Rush are overblown and massaged to add drama. But that’s why the story coming out of Indonesia is so relevant—it brings reality to the reality shows.

PM’s, especially gold, are much more costly than the fictitious spot prices set daily by those arrogant idiots in suits sitting in London and New York. Someday, the markets are going to reflect real fundamentals and the TAISC—that’s the True-All-In-Sustaining-Costs. When that day arrives, and I believe it’s coming sooner than later, we’ll be looking at gold and silver as more than simply insurance or “wealth protection.” Call me naïve; but I call my little stack, stuck in a safety deposit box, a good investment.



Midas Member
Midas Member
Midas Supporter
May 31, 2015
Looks like metal prices are in free fall mode today which means I'm a buyer again. Buy the dip!