QUESTION: Mr. Armstrong; Won’t the decline in gold prices reduce gold production? Isn’t that what eventually reverses the decline?Thanks FG

ANSWER: Actually the answer is NO. What happens is typically production increases. Mines will focus on the highest grades and they will slash their exploration costs. They will also increase hedging. The price for gold would have to drop under $1,000 before we will actually start to see any reduction and that will come with mine closures of those unable to focus on high grades or slash exploration costs. Precisely as the economy declines, government raises taxes because they need money. They kill their own economy but are too wrapped up in their own self-interest to care about doing the right thing. This is human nature – survival of the fittest.