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00:00WHY IS THAT? NIGEL: I SUPPOSE GOLD BROKE THE MARK. WE HAVE SEEN A SURGE IN IN DEMAND. WE WERE PROBABLY JUST DRIPPING BEFORE BUT NOW IT IS RUNNING FULL TROUGH. RIGHT NOW, OUR BIGGEST RESTRICTION IS THE AMOUNT OF UNREFINED GOLD WE ARE GETTING FROM PRODUCERS, BECAUSE EVERYTHING WE GET IN IS GOING STRAIGHT OUT OF THE DOORS. THEY DEMAND RIGHT NOW. IT IS NOT JUST INTO ASIA. WE ARE SEEING THIS IN COINS AS WELL. YVONNE: IN THIS MARKET RIGHT NOW THOUGH, WE ARE SEEING CHINA BY LESS IN THE METAL THAN THE MARKET EXPECTED. WHO DO YOU SEE IS BUYING RIGHT NOW? NIGEL: WELL, BASICALLY, WE DISTRIBUTE IN THE MARKET VIA THE BANKING SYSTEM, BUT WE KNOW IT IS THE TRADITIONAL BUYERS OF GOLD WHO ARE TAKING IT. THAT BASICALLY MEANS CHINA, INDIA. ALSO OUT OF THAILAND AS WELL. WE FIND THESE COUNTRIES TEND TO BE VALUED IN BARS AND LOOK TO STOCK UP ON THE PRICE IS RIGHT. YVONNE: A LOT OF PEOPLE HAVE BEEN TALKING ABOUT THIS FOR THE LAST COUPLE OF DAYS AND WEEKS. IT HAS BEEN A PAINFUL TWO YEARS FOR A LOT OF THE GOLD MINERS AND THE GOLD BULL. WE SEE A LOT OF PEOPLE TALKING ABOUT PRICES DROPPING BELOW 1000 AND COULD EVEN REACH $800 IN THE WORST-CASE SCENARIO. THE BIGGER PICTURE -- WHAT THE UC FOR GOLD RICES -- WHAT DO YOU SEE FOR GOLD PRICES? NIGEL: GOLD PRICES ARE HARD TO CALL AT THIS POINT, BUT I THINK ONE OF THE FLAWS IN THE MARKET IS THE COST OF PRODUCTION. IF IT FALLS BELOW THE COST OF PRODUCTION, IT MAKES IT WORTHWHILE FOR A MINER. IN AUSTRALIA, WE HAVE A SLIGHTLY DIFFERENT SITUATION BECAUSE WE HAVE A WEAKENING AUSTRALIAN DOLLAR. THAT PUTS THE GOLD PRICE AROUND THE $1500 MARKET. AUSTRALIAN PRODUCERS ARE DOING REMARKABLY WELL AT THIS TIME. YVONNE: SURE. YOU KNOW, YOU TALKED ABOUT THE IMPACT ON PRODUCTION ON SOME OF THESE PRICES. HOW BIG OF A HIT DO YOU EXPECT FOR THE MINERS, MAYBE NOT THE AUSTRALIAN ONES? NIGEL: WELL, AS A GOVERNMENT OWNED ORGANIZATION, WE ACTUALLY DON'T MAKE PREDICTIONS ON THE GOLD PRICE, BUT WE HAVE TO WATCH IT VERY CLOSELY. IT IS GOOD TO SAY THERE IS SOME SUPPORT AT THIS POINT OF TIME AROUND $1070, BUT AT THIS POINT I HAVE TO SAY I WOULD NOT BE AT ALL SURPRISED TO SEE IT FALL. THERE IS EXPECTATION WE WILL GET DOWN TOWARDS $1000 AND CLEAR THE MARKET OUT AGAIN BEFORE IT HAS ANOTHER RUN. YVONNE: SOME EVEN ARGUE IN THE DISCUSSION ABOUT GOLD -- IS IT A VALUABLE ALTERNATIVE CURRENCY? NO DIVIDEND, NO YIELDS. THE STRONG DOLLAR -- MAYBE IT IS BETTER TO BUY BONDS. WHAT DO YOU THINK OF THOSE CRITICS? NIGEL: WELL, THEY ARE GOOD POINTS. I GET THAT IS REALLY WHY WE HAVE ACTUALLY SEEN GOLD GOING DOWN TO WHERE IT IS AT THIS POINT. HOWEVER, GOLD STILL DOES HAVE INTRINSIC VALUE, TOO. YOU CAN LOOK AT THE VARIOUS CENTRAL BANKS AROUND THE WORLD, PARTICULARLY IN RUSSIA AND THE FORMER RUSSIAN STATES WHO HAVE BEEN BUYING TO BOLSTER THEIR RESERVES. THE BELIEF IN GOLD HAS NOT DISAPPEARED COMPLETELY. WE ARE STILL SEEING SUPPORTERS, IN THE OFFICIAL MARKET TOO. THE AMOUNT OF INDIVIDUAL INTEREST THAT SEEMS TO HAVE BEEN GENERATED IN RECENT TIMES IS INTERESTING. DOWN TO SMALL INVESTORS AS WELL. IF YOU LOOK AT THE COIN MARKET, FOR EXAMPLE, THE ONLY RESTRICTIONS ON COIN SALES IS THE AMOUNT WE CAN PRODUCE. IF WE CAN FIND MORE SKILLED PRESS OPERATORS TO MAKE MORE COINS, WE WOULD BE SELLING MORE AS WELL. WE HAVE BIG DEMAND OUT OF THE U.S. AND EUROPE. THEY FILTERED OUT INTO THE HANDS OF INDIVIDUAL BUYERS, TOO. THERE IS A LOT OF DEMAND THAT IS SUDDENLY HITTING THE MARKET. YVONNE: WHAT ABOUT DUAL THE RETAILERS -- JE WELER RETAILERS BECAUSE YOU ARE SEEING DEMAND OUT OF ASIA? IN HONG KONG, RETAIL SALES HAVE TAKEN A BIT OF A TUMBLE. NIGEL: YES, JEWELRY. WE DON'T TAKE ACCURATE READINGS ON THE JEWELRY MARKET. IT SEEMS LIKE IT IS MORE THE INVESTOR MARKET AND COLLECTOR MARKET WHEN IT COMES TO COINS THAT ARE ACTUALLY THE SOURCE OF DEMAND AT THIS POINT. JEWELRY SEEMS TO HAVE TAKEN A HIT. IT IS NOT A GOOD MARKET RIGHT NOW. ONE OF THE OTHER AREAS TOO IS OUR DEPOSITORY MARKET. WE JUST LAUNCH THE NEW ONLINE PRODUCT HERE. THIS IS JUST AN ONLINE, 24/7 PRODUCT THAT ENABLES PEOPLE TO INVEST AND BUY IN GOLD. ONCE IT IS LIVE, IT IS MORE ADVANCED BETA TESTING. WE HAVE MADE NO PUBLICITY BUT HUNDREDS OF PEOPLE HAVE FOUND US THROUGH THE WEBSITE AND OPEN TO ACCOUNT WITH US. WITH NO PUBLICITY AT ALL, A VERY VIABLE BUSINESS IS JUST STARTING OUT. THIS IS JUST INDIVIDUALS TAKING VIEWS ON GOLD. YVONNE: SALES ARE TAKING MOMENTUM. NIGEL MOFFATT, THANK YOU FOR JOINING US. NEXT, OUT WITH THE OLD AND IN WITH THE NEW.

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Perth Mint's Moffatt Sees Gold Falling to $1,000 (Video)

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