gold paying dividendRecently some, including me, have asked how a gold paying dividend would work. Here's an interview with Gold Money's James Turk about that very same subject
way back in 2003. As far as I know, it still hasn't become a reality in the mining business. The trick is to find a feasible way to do it. Maybe Bruce will work something out with Sprott Money.
World Gold: A couple of companies in Canada, Goldcorp andIamgold are actually holding gold themselves and want to pay theirdividends in gold.
GoldMoney: Their shareholders have beenresponding very positively to that. If you going to buy a gold miningstock, you want as much exposure to gold as you can, and what better wayto do it than to have gold on the balance sheet. It's the exactopposite of hedging. Hedging has a negative impact on a gold company'sbalance sheet. Holding gold as liquidity has a positive impact, over andabove the operations of the company itself.
Iamgold Corp made aninvestment in GoldMoney. They are a shareholder with the specificobjective of trying to work out a way to enable them to pay dividends ingold to their shareholders. After doing a study, Iamgold concluded thatGoldMoney was probably the best prospect for enabling that desire onthe part of Iamgold and their shareholders to receive dividends in gold.So they have invested in GoldMoney and the money they have invested isbeing used specifically to develop a product that will enable them topay dividends in gold. We hope to launch it in the not too distantfuture.
Once the first gold company starts paying its dividend ingold, we think that there is strong interest by other mining companies.A couple of mining companies have declared that in principle they likethe idea of declaring dividends in gold, Goldcorp has indicated that andDurban Deep, although not paying dividends at the moment, has indicatedthat philosophically they would like to use gold.
World Gold: What's the timing on the new product?
GoldMoney:We are running a little bit slow because we are dealing withregulators, and we have come to them with something new. So they have tocover all the bases to make sure they fully understand.
World Gold: Which regulatory authorities?
GoldMoney:We are working with a fund administrator; the Toronto Stock Exchangeand the Ontario Securities Commission. They are all involved as well assome of the big brokers and dealers indirectly through the TSX.
World Gold: Thank you.