Gold Is The Answer As Financial Markets Face “Turmoil,” Goldsmith Says
NEW YORK (AP) _ European investor Sir James Goldsmith, named Monday to the board of the gold mining concern Newmont Mining Corp., said the world financial markets face turmoil and gold may be the only safe haven.
″I do not believe what is currently being said about the stability of the financial systems, nationally and internationally,″ he said. ″My own view is we’ve never been in a more financially unstable position in my lifetime.″
Goldsmith, once considered a leading corporate takeover artist, escaped the 1987 stock market crash largely unscathed because he sold most of his assets beforehand.
″I believe 1987 was no more than a seismic warning,″ he said Monday.
Since losing a bid last year to take over British conglomerate BAT Industries PLC Goldsmith has described himself as retired from the business world, concentrating instead on gold-based investments and on environmental efforts.
Goldsmith said he was concerned that estimates of the 1992 federal budget deficit released last week by the White House were unrealistically low, and wondered where the money would come from to make up the difference.
However, he said, ″I don’t want to sound like Dr. Doom. I’m not an economist.″
Goldsmith was in New York to attend a meeting of Newmont. He controls 49 percent of the Denver-based company, one of the world’s leading gold mining concerns.
Newmont said Monday Goldsmith was elected to the company’s board of directors and will head an advisory committee of the board.
Newmont announced last week it had ended merger talks with another major gold mining company, American Barrick Resources Corp. of Toronto.
Gordon Parker, Newmont’s chairman, said the talks on the $2.8 billion merger broke down because ″we had a lot of substantive issues that we weren’t able to eliminate.″ He declined to elaborate.
″There were a lot of areas where there were incompatibilities,″ said Goldsmith, who was involved in the discussions. ″The two companies have different cultures.″
Goldsmith said the merger would have given Newmont advantages that come with greater size, but that the company was strong and had bright prospects without the combination.
Parker said Newmont believes it can achieve many of the benefits a merger would have brought through a joint venture with American Barrick to jointly develop a gold deposit in Nevada. The two companies own adjoining sections of the Post deposit.