Barrick CEO: Nothing like negative interest rate, fear to drive gold price
JOHANNESBURG (miningweekly.com) – “There’s nothing like a negative real interest rate and a fear to drive the gold price,” says Barrick Gold Corporation CEO Dr Mark Bristow, who also puts money printing firmly on the list of gold price drivers.
Bristow was responding via Skype to Richard Quest on CNN’s Quest Means Business from Barrick Gold’s Pueblo Viejo gold mine, in the Dominican Republic, on the factors driving up gold equities and the gold price during this period of pandemic uncertainty.
With a graphic of the gold price rise to $1 850/oz flashed up on the TV screen and $2 000/oz being the next target, Quest put it to Bristow that gold had been rising extremely sharply on the international exchanges, giving rise to investment opportunity.
“Gold, once again, becoming exceptionally popular, whilst the pandemic has been raging. I look at Barrick’s gold share price, which I have a graph of here, and I see the way it has risen so sharply, is that simply that we all fear what’s going to come next?” asked Quest, to which Bristow responded: “There’s nothing like a negative real interest rate and a fear to drive the gold price.”
“In a time of pandemic, when people are truly catastrophising, does gold become something that you need under the bed?” Quest asked further.
“Exactly, and the important thing, as you have seen, everyone is printing now, the money printing presses are rolling, and the impact of that is negative interest rates, devaluation of paper money, and that very process drives up the value of gold because you can’t print it, and you should have some in your portfolio, and, by the way, if you look back all the way to Bretton Woods in the Seventies, whether you go back to the turn of the century, or just the last two years or five years or ten years, gold has performed at the top end of all asset classes.
“From the late Nineties to 2001, gold wasn’t in favour, but then it’s the only time we’ve seen perfect harmony across the globe, economically and socially, and I’m sad to say that we don’t see any signs of that today,” Bristow responded.