lease rates and seasonals, page-45

Im glad you posted LSM.

And you are right how can ABX get a loan in an environment like this? The answer is pretty simple.

They produce a massive amount of GOLD to back up their promise to repay.

You see the real problem with this credit crunch is who were the lenders.

I'm sure there are people out there who think that banks should be able to spruik and loan to anyone, much like the early days in Britain when the South Seas company sought people to invest with them. When really Westminster was just looking at off-loading it's debt on ill-informed investors.

While the US banking crisis is slightly different in the sense that the Government through absence of checks and balances (that being regulatory controls) have allowed so many hustlers in the street to lend more to people than their capacity to repay. There were so many free agents who on sold their mortgages to large banks in the States.

Free market some argue, why shouldn't banks be allowed to lend to whoever they like?

I'll tell you why, because it breaks with every tenet of responsible prudential lending. We in Australia have laws that cover this problem. Its called the Corporations Law of Australia.

The law of Australia states that if a bank loans capital without first making a proper inquiry as to who they are lending to, the borrowers ability to repay and the authority of the agent acting on behalf of the company/ or for that matter the employee acting on behalf of the bank having the authority to sign off on the loan. Then the transaction can fail and the bank wears the loss. Thats right if the bank doesnt investigate the accounts and the ability of the borrowers capacity to repay then the banks can wear the loss.

These cowboys in the US have created a system whereby they "quasi-outsourced" this responsibility to a bunch of door-to-door salesman and then re-purchased the loans from them. Without any checks as to the customers ability to repay the loans. And now the largest "quasi-public" or whatever the hell you want to call them Fraudy and Funny, have no recourse because so many of these guys have disappeared off the radar through dissolution, bankruptcies or they're little operations have been wound up.

If I was an everyday hard-working bloke in the US I would be fuming at the US Congress ATM!

Should Barrick be able to seek finance in this kind of environment, yeah why not?