스포트라이트
Newmont (NEM): A Golden Ticket To Hard Money
The Eternal Shine Of Gold
When it comes to mining metals, the bulk of the attention goes to industrial metals, from the massive production volumes of iron and aluminum to the more niche products like tungsten, platinum, rhenium, rhodium, or uranium (follow the links for a detailed investment report on each of these metals).
One metal, however, tends to catch the public and investors’ attention more than any other, despite its lack of use in industry: gold.
Gold has been used since time immemorial as a symbol of power, luxury, and wealth. It has also, by far, been the most common and long-lasting form of currency in history. To this day, gold is still one of the main reserve assets held by national central banks, forming the foundation of the global financial system’s stability.
Still, it looked for a while that the best days of gold were in the past, with the precious metal described as a “barbarous relic” by leading economists. With the end of the convertibility of the dollar into gold in the 1970s, it looked indeed like gold would no longer play a role as a prime financial asset.
This was until the last months, when gold kept breaking new records for all-time-high prices, ending up outperforming the S&P500 over the last decades.
This naturally brings back attention to gold miners, whose margins should improve dramatically from the rise in gold price. And first among them is the world’s largest gold miner by production volume: Newmont.
(NEM )
Gold Hitting New All-Time-Highs
Since the end of the convertibility of gold into US dollar (USD) in 1971, there have been two gold bull markets in the 1970s and 2000s. And we are now in the midst of a new one, especially with the very strong run in gold in 2024 and 2025.
Source: Google Finance
A major driver of each gold run has been concerns about the economy and the persistence of the dominance of the USD over the global financial system.
This is what is partially driving the current gold bull market again, with the US government piling up debt like never before. And with rising interest rates in parallel, this has caused the interest payment to go above the 1 trillion USD mark for the very first time.
Source: Federal Reserve Bank of St Louis
For reference, this is larger than the US defense budget, itself 40% of the global military spending.
Growing & Diverse Concerns
Contrary to previous gold bull markets, this one is the result of a convergence of multiple factors and not just the worries about US deficits and debt.
