Gold Shortage Shaping Up

Gold supply is falling short of demand, and the consequences will be obvious in the months and years ahead. So says Kevin DeMeritt, President of Lear Financial, a precious metal asset management firm.

"Because there's been little gold exploration over the past eight years, there's just not an abundance of the precious metal around today," DeMeritt explained. "In fact, gold production fell 13.3 percent in 2004 alone."

He believes the stage is being set for a coming gold shortage.

"The world's biggest mines, Barrick Gold and Newmont, have all talked about it. Barrick said that at current production rates, gold reserves will be depleted in 10 years."

Meanwhile demand in China and India is heating up, pressuring the price of gold. "But that won't instantly turn gold production on. The president of Newmont said that if gold were $1,000 an ounce, it would still take four to seven years to open a new mine."

http://www.goldcentral.com/

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