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Gold $1325.3 -11.7
Silver $16.62 -0.56
Talk to a representative: 855-242-4121

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Alert: World’s Gold Mines Running Dry – What Should You Do NOW?

We know gold is relatively rare. Scarcity is one of the characteristics that gives gold the value it has. But the reasons for its scarcity have had as much to do with the challenges associated with the extraction process in mining gold as it has with the notion that gold is organically rare.

What if I told you we may, indeed, be at the beginning of a period that signals an absolute scarcity of gold? If that turns out to be true, the investment implications of such a condition could be seismic.

 Gold Mining in Decline

The other day, I ran across an interesting gold mining article at that makes the case the world may actually have seen its last supersized goldfields, and the trend of goldfield discoveries, more generally, is declining. The article quotes Pierre Lassonde, co-founder and chairman of Franco-Nevada, a gold mining services company, who spoke last month with German newspaper Finanz und Wirtschaft about this prospect:

“If you look back to the 70s, 80s and 90s, in every one of those decades, the industry found at least one 50+-million-ounce gold deposit, at least ten 30+-million-ounce deposits and countless 5- to 10-million-ounce deposits. But if you look at the last 15 years, we found no 50-million-ounce deposit, no 30-million-ounce deposit and only very few 15-million-ounce deposits.”

The Forbes article notes that some of history’s largest and most productive goldfields, including South Africa’s Witwatersrand Basin, which has produced roughly 50 percent of all the gold ever mined on earth, are reaching the end of their lifecycles.

What Lassonde and Forbes article author Frank Holmes are considering is the possibility that ‘peak gold’ may becoming a reality. The ‘peak gold’ hypothesis says that, at some point, gold extraction on earth will reach a maximum rate of production, after which it will begin to permanently decline.

Are we seeing absolute peak gold play out right now?

Your Next Move as Gold Mines Face Falling Production

While it may be a little early to know, for sure, here’s what you should be thinking about as a gold buyer. Whether we’re in the midst of peak gold coming to fruition, or a more temporary (but still lengthy) drop in gold mining production based on fewer dollars allocated to exploration, the amount of gold mined throughout the world is expected to be on the decrease over the next several years. This suggests, as author Lassonde notes, that upward pressure on the price of gold “over the medium and long term” could be substantial.

Interestingly, of all the reasons to consider investing in gold, including its record as a store of value as well as its propensity to thrive during times of economic uncertainty, a significant drop in gold mining production has not traditionally been one of those reasons. That may be changing, however, and, if it is, this may be a particularly ideal time for you to move forward with accumulating gold for your portfolio.

One excellent resource for learning more about whether an investment in gold is right for you is Augusta Precious Metals. The Augusta team, whose business IS gold, is well-versed in the variety of factors and influences that can affect its price, including the challenges facing gold mining companies presently. Furthermore, Augusta specializes in using precious metals in a personal investment portfolio to provide diversification, which can help protect your holdings in other investment classes. To get your questions about gold answered by the most knowledgeable professionals in the business, I invite you to give Augusta a call today at 855-242-4121.

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Michael Dallo, CPA, JD, LL.M. is a tax attorney and certified public accountant (CPA) of Dallo Law Group, a Professional Corporation. For over 10 years, Michael has zealously represented hundreds of clients in resolving tax disputes with the Internal Revenue Service and California taxing agencies, as well as developing sound tax positions and arguments to minimize their federal and state tax liability.