More important than the 123 million ounces of proven and probable reserves, though, is that the management at ABX has vision. Rather than hedging, or locking in prices at present levels out of fear that they’ll decline, Barrick decided to leave their contracts open to the possibility that prices will go up – and Cramer said the move should pay off.
Barrick has a down side, though: increased cash costs. The good news is that Cramer doesn’t expect them to last long. Skeptics said the increase came from inflation, but Cramer attributed it to a mine-related issue that should work itself out. The company is also opening eight new mines. These too will cut into the cash costs, “so the cost problem is going away,” Cramer said.
Barrick’s business is spread out across the globe too. ABX has mines in North and South America, Australia and Africa.
“I think gold is going higher,” Cramer said, "and ABX is the best way to play it."
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