holding up extremely well, page-10

I thought I'd take Chuckey's advice this morning and email CEO Mark Lynch. I received a reply extremely promptly (within the hour!) and I don't think he'd mind if I reported his comments here....


"Good morning Mr. Lynch,

I'm writing to you to ask what your position is with regards to currency hedging. We have seen the US dollar rise spectacularly against almost all other currencies in the last few months, but experts I have read are saying that this is a temporary phenomenon related to the one-off unwinding of derivative positions all over the globe, leading to a temporary surge in demand for US dollars. When this is over, which could be very soon, the underlying fundamentals of a massive new supply of US dollars created by the US government to bail out their economy will be the driving force in a huge devaluation of the US currency against all other currencies, (and also against gold of course.) It seems to me that we are in a surprising and temporary situation where currency hedging might be obtainable at very favourable rates if action is taken soon. Just this morning I was reading an opinion by an expert who claimed that the US dollar had topped, "and it could get very ugly very quickly".

I appreciate that money is tight at Citigold at the moment, but given what seems to be a very attractive risk/reward setup, do you not think that some currency hedging at this time is likely to prove to be a very good move?

regards...,"



"Hi ...,

Your thoughts and comments are interesting. Hedging is something we have not done to date and therefore not lost (or made) money thereof. We will give your comments consideration.

Thanks for the thoughts.

Kind regards
Mark


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