As I am of meager means let it be known that
I have no functional understanding of the markets:
local, national, global or otherwise whatsoever so
despite this being a totally unprecedented situation
it still utterly defies my comprehension.
The nearest to anything I can think of is say:
Company XYZ owns mineral rights to land
(that it is more than strong enough to defend)
on which is discovered an enormous oil and gas deposit.
Whatever that does to the global markets when the
resource is substantially greater than all other such
proven resources combined, I have no clue but
my guess is company XYZ’s stock goes WAY up.
7
Depends on how enormous it. Scarcity is a part of the price of all things. If so much gets introduced to the market at once that scarcity disappears, price drops. There’s a reason South Africa keeps such a tight control of how many diamonds come out of there. Keeps the price up. If there was suddenly 1000 times as much gold available in the market do you honestly think it would be selling for nearly $1400 an ounce? Of course not. With that much gold it simply isn’t worth that much. Frankly it’s not worth that much already, with 1000 times as much on the market gold probably would be trading at 50 cents an ounce. Scarcity matters.
Company XYZ may own mineral rights to huge oil deposits, but, there would be many other such XYZs that have their own rights to their own oil deposits.
But still, an asteroid made of gold that would dwarf all the known gold in the world, would devalue all of the known gold and whatever gold comes from the huge asteroid. Why is water so cheap? Oil is not cheap, but it’s not rare and is plentiful, and there are huge numbers of people who were made super-rich with oil, but, the more oil that gets into the markets, the lower the prices for the oil and its by-products. Same with gold or silver or any other ‘rare’ metal. But, get in while you can, because, eventually, a huge gold asteroid is going to land and turn gold into ‘sand’.