Editorial An $8-billion vote of confidence

We always knew that gold was a good thing. But what finer affirmation of that thinking than the $6.1 billion(US) that two mavericks of Australian and American business are willing to put up in order to get a piece of the action? And a mighty big piece it certainly is.

First, Alan Bond, one of Australia’s most aggressive business personalities and financier of that country’s Americas’ Cup yachting challengers, completed a $500-million purchase of St. Joe Gold from Fluor Corp. St. Joe produced almost 300,000 oz of gold in 1986 and plans to expand. This was quickly followed by news that corporate raider T. Boone Pickens, via his Mesa Partnership, has made a whopping $5.6-billion takeover bid for Newmont Mining. That company controls Newmont Gold which holds the largest gold reserve base on the entire continent — 12.3 million oz. In Canadian dollar terms the combined bids represent a mind- numbing $8.2 billion.

We’ve always remained bullish on gold. And the $8-billion vote of confidence by Bond and Pickens demonstrates, more than ever, that the bulls are putting their money where their mouths are.