Second, the most important thing is that the decline in gold supply does not necessarily lead to an increase in gold prices. The above figure clearly shows that from 2008 to 20 12, with the increase of the total production and supply of mining industry, the price of gold rose. This is because gold is a unique commodity, because there is a lot of gold in the world. Therefore, the concept of peak gold production is irrelevant. It may play a limited role in the oil or copper market, but it is not suitable for the gold market. The reason is simple: the annual mining output is a small part of the total gold (estimated to account for 1-2% of the global gold holdings).
So, you can close all mining companies and nothing will happen. Or almost none, at least compared with other commodity markets. Shut down the oil mine and there will be a global disaster. If the copper mine closes, global industrial production will collapse. This is because these goods are still in use and there are few reserves. However, gold is actually non-consumable and has a relatively high inventory/current ratio. This means that the traditional theory of supply and demand does not apply to gold.