You know something is seriously wrong with gold investments when the head of the largest asset manager's precious metal fund says gold miners will go bankrupt.

Evy Hambro, who manages BlackRock[profile]'s World Mining Fund, said companies have to stop producing ounces that don't make money and focus on the ones that do if they want to stay in business, according to Bloomberg's Thomas Bieshuevel.

Hambro, who went on Bloomberg Television's "The Pulse", said he expects to see big write-downs in the industry.

“I think it’s going to lead to major write-downs within the sector this year because obviously the gold price assumptions that companies use to value their assets from a carrying point of view in their books are going to be far lower than in the past,” Hambro said.

The upside to gold's downfall this year is that it will force the industry to examine itself and make the necessary changes, as the industry companies operating and reinvestment practices leave much to be desired, Hambro said.

To read the entire story, click here.  

Edited by: Casey Quinlan


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