Goldman Sachs report 20 years known mineable gold reserves, Scarcity creates value, Peak production 2015?

gold

Goldman Sachs report 20 years known mineable gold reserves, Scarcity creates value, Peak production 2015?

 

From Zero Hedge March 27, 2015.
“Peak Gold? Goldman Calculates There Is Only 20 Years Of Gold Supply Left”

“Late last year, when looking at a Goldcorp slideshow, we noticed something surprising: the gold miner had forecast that 2015 would be the year when gold production would peak among the mining industry.”

“According to a report issued by Goldman’s Eugene King looking at commodity scarcity, the chart below “shows that there are only 20 years of known mineable reserves of gold and diamonds.”

Some futher observations on gold and scarcity in general from Goldman:

The combination of very low concentrations of metals in the Earth’s curst, and very few high-quality deposits, means some things are truly scarce. Perhaps unsurprisingly, these are the so-called precious metals (and diamonds), and that their value is derived from the fact they are rare.

 

Their relatively scarcity, and the market’s belief that new discoveries will be limited, is what drives the price of these super rare commodities. Take diamonds as perhaps the most extreme example. A diamond has very little intrinsic value. Its value is determined by a belief that it is rare and, for a natural diamond, unique.

 

Gold has been used as a measure of wealth for more than 4,000 years, as the ancient Egyptians soon worked out that gold was not only shiny and heavy, but rare.

Of course, this analysis is meaningless in a vacuum: if the “known reserves” of gold plunge in the coming decade, no matter how many gold futures and GLD short sales are conducted by the BIS, the price will have to go up, and it will go up high enough to where a new surge of gold miners will come online and find thousands of new tons of gold reserves around the globe.

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