Perspective The price of gold has risen from around $500/oz in early 2006 to over $1900/oz in Jan 2012, during which time this rapid rise allowed many marginal economic mines to attract capital investment. The immediate and medium term prospects do not look good for these producers. However, even for the well heeled producers, there hs been a rapid escalation in overhead and indirect costs to the point that they need the price of gold to exceed $1000/oz to return a decent ROI.
This is a classic business cycle brought on by boom conditions. The priority becomes getting the product to market, inefficiencies in labour and overhead get built in which take time and pain to reduce. So, when revenue (price) drops rapidly by 30% expect substantial dislocation in the sector.
The well capitalised with promising mining grades will eventually prosper in this environment and I believe GLW will be among them.