Miners Spend Billions to Wipe Out Bad Gold Hedges
Source: Reuters (9/14/07)
Gold miners are spending billions of dollars to unwind gold hedges taken out at prices well below today's heady levels of $700 an ounce and more, underscoring the risks in trying to predict bullion prices.
"I've been in the mining industry long enough to know that all commodities are volatile," said Ian Smith, managing director of Australia's largest home-grown gold producer, Newcrest Mining Ltd and a former Rio Tinto executive...
Investors are favouring gold miners...that have cleared away most hedging, to better weather any fallout from the U.S.-induced debt crisis.