Barrick Gold is sitting on an unrealized "mark to market" hedging loss of $6.165 billion, and the loss is growing. They hedged 9.5 million oz. of gold at $296/oz. in "project" hedges. With the gold price at $945/oz., they are losing about $649/oz. on the hedge. $649 x 9.5 = $6.165 billion loss. Barrick's loss grows by $950 million for every $100 increase in the gold price.
I am a subscriber to Jason’s newsletter and know him to be very smart and usually right. He has been collecting gold under $300.00 per ounce so you could say I’m a fan, but this is too much even for me. Would short that ABX? Well there are a couple of ways (1) by shorting a 1/4 position with a stop at the 52-week high of $54.00, of (2) buying an in the money put for say October 2008 or January 2009. Nothing goes up in a straight line everything pulls back sometime, but shorting a gold stock now a days that’s un-American.
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