The Gold Report: Since you last spoke to The Gold Report in March, the price of gold has collapsed. What happened?
Rob Cohen: Gold has collapsed when compared to the U.S. dollar, but not when compared to other hard assets. For instance, since gold was allowed to float in 1971, its average price ratio per ounce to the price of a barrel of oil has been 15:1. Right now, it's about 13:1, so it's not that far from the mean. We remain a little puzzled by what has happened. Going back to 2008, there's been a strong correlation between the expanding balance sheet of the Federal Reserve and the rising price of gold, but that link has been cut, at least for now.
We have also had some positive economic data out of the U.S.
TGR: Is this positive data really all that positive? Continue reading "Miners Must Mind Their Margins"