Thursday, May 22, 2014

Pierre Lassonde: Mining Cycles Are Good for Royalty Companies and Investors


Pierre Lassonde revolutionized investing with the creation of the first gold royalty company. Three decades later, he is as confident in this model as ever, especially considering the difficulties of the majors in discovering large, high-grade reserves. In this interview with The Gold Report, this director and former chairman of the World Gold Council discusses the significance of the shift in gold ownership from West to East, the problem of mining scale and the results of the industry’s failure to develop new prospecting technology.
The Gold Report: You wrote “The Gold Book: The Complete Investment Guide to Precious Metals” in 1990. What have been the biggest changes in gold investment since then?
Pierre Lassonde: The first biggest change is the development of gold exchange-traded funds (ETFs). They began in 2004 and went from zero all the way up to over 2,650 tons of gold. Ownership is now down about one-third, but that’s still about 1,750 tons of gold held by this instrument.
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