This week's report lists 114 silver stocks. There are 30 silver stocks that list reserves, resources (and exploration potential.) which I calculate by using my "ounce in the ground" forumula. There are 54 explorers. There are about 30 additional "silver" stocks with incomplete information. Additions & Changes from last week are in bold.
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To read about my religious bias, see my other website, bibleprophesy.org There are two essays near the top of the page that explain why I believe the entire world will return to using gold and silver as money again before the end times. Hint, see Ezekiel 38. To read more about my religious bias when it comes to investing, see my essay, Biblical Guidelines for Managing your Money
Kitco reports silver at $5.71/oz. as of Friday, 3:00 PM West Coast US, which was used to calculate the following figures. The CAN $ / US $ conversion factor is .7197. I will use .72 for ease.
How to read the following table: Stock Symbol that works at Yahoo! Finance (Company name) / Silver oz. "in ground" for 1 oz. silver's worth of stock. / valuation price change since last week relative to silver price change (and stock dilution, and resource changes, if any) / additional comments (EXPT is "exploration potential")
I'm working on automating a summary table of the calculations I do each week. It will cost me just over $5000 for the programming for this, and perhaps $500 to $2000 per month for the data feed, depending on traffic. Once it's done, you will be able to see a summary table of my work, like the one below, but the calculations will be done with 20-minute-delayed quotes, and you can see this every day, and watch the changes during the day, not just once a week, like now. I will probably start this out as an additional free benefit to my paid subscribers, but hopefully, in the long run, I aim to make it public, and free. I may be able to provide this service for free, if I get some advertising that I think I could round up from a few mining companies. Would you be interested in this? If so, please email me at jasonhommel@yahoo.com
ABX (BARRICK) 1 even --infamous hedger (18 mil oz. gold hedged, 3 yrs production) hedged?
IPOAF.PK (INDUSTL PENOLES) 1.7 down --current producer, mostly family owned, hedged?
CDE (COEUR D'ALENE) 1.4 even --current producer, (gold bonus) in debt.
SIL (APEX SILVER) 3.6 up --large zinc bonus, low grades, cash rich--$345 million! in debt
GRS GAM.TO (GAMMON LAKE) 3.7 down --current producer, owns 26% of Mexgold
NBG.V NBULF.PK (NEW BULLET GP) 54 - 150 "exploration potential"
SDR.V SDURF.PK (STROUD RSCS)
ATN.TO ATNAF.PK (ATNA RES. LTD) partners with Expatriate Res.
CHMN.PK (CHESTER MINING)
EPZ.V ESPZF.PK (ESPERANZA SILVR)
GNG.V GGTHF.PK (GOLDEN GOLIATH) --Historic silver district in Mexico
GPR.V GPRLF.PK (GREAT PANTHER)
MMG.V MMEEF.PK (MCMILLAN GOLD)
SHSH.PK (SHOSHONE SILVER)
* KRE.V KREKF.PK (KENRICH ESKAY)
EGD.V EGDMF.PK (ENERGOLD MINING)
PCM.V PAOCF.PK (PAC COMOX RES)
LEG.V LEGCF.PK (LATEEGRA RSCS)
BGS.V BLDGF.PK (BALLAD GLD SLVR)
* AUN.V AUNFF.PK (AURCANA CORP)
SRY.V (STINGRAY RSCS)
TUO.V TEUTF.PK (TEUTON RES)
ASLM.PK (AMER SILVER MINI)
BBR.V BBRRF.PK (BRETT RES)
ROK.V ROCAF.PK (ROCA MINES INC)
MTB.V (Mountain Boy Minerals Ltd)
LSM.V LASCF.PK (Langis Silver & Cobalt Mining Co Ltd)
CBP.V CPBMF.PK (CONS PAC BAY MIN)
* = I own shares Silver oz. "in ground" means and counts all "silver oz. in the ground" as the same, but they are NOT EQUAL. Some are more certain and others are more speculative. Some are higher grades, some are lower grades. They range from most certain to least certain such as: "proven & probable reserves," "measured, indicated, inferred resources." This single number next to each stock symbol above represents the approximate number of ounces of silver in the ground you are buying title to when you invest the equivalent of one ounce of silver into buying shares in the company at current prices. Here's the math on how to get it. 1. Get a market cap in U.S. dollars. Divide that by the silver price, so the market cap is denominated in terms of silver ounces. Then, divide the ounces in the ground by the market cap as denominated in silver. This tells you how many ounces of silver in the ground you are buying when you give up one ounce of silver in you hand for shares of stock, instead.
(It does not include zinc, or copper, or lead, but it does include gold at a 1:10 ratio of gold:silver.) At goldsheetlinks.com, they add 100% of proven & probable reserves, but only 70% of measured & indicated resources, and only 50% of inferred resources. I don't do that. I count them as all the same.
I believe that the two most important numbers that a silver mining company can report are the resources in the ground, and the number of their fully diluted shares. Of course, there is much more to a mining company than that, but without those numbers, it is extremely difficult to even start an evaluation. This report highlights those key numbers, where possible. If you think those numbers are also important, please email the executives of the mining companies you own, and ask them to make sure their numbers are clearly published at their websites.
To quickly "tab" down to the company you are interested in, note the symbol. Then hit "control-F" to "FIND" the symbol below. ___________ If I use a word you don't understand and is not listed in the dictionary at www.m-w.com you can look up the meaning at http://investorwords.com/
------------- WEEKLY COMMENTARY (All new in this section):
In general, regarding the prices of silver stocks... Things are extremely volitile right now in many silver stocks, and they are trading on extremely light volume. It's like all the stocks are in a huge air pocket. Tiny selling will move prices down 15%, and tiny buying will rise prices 15%. It seems like nobody knows how to value the stocks right now. It's as if those who were scared out by the recent price drop have all sold, and the true believers are all remaining firm, but are already fully committed, and thus, have little left to buy more. Looks like even the market makers have been scared out, or all bought in! One stock was up 17% on 250 shares, and another stock was up 13% on even fewer shares traded. But both stocks lost all those gains soon afterwards. I think this goes to show that you must remain fully invested in order to participate in the big run up that I expect will soon occur. You can't "buy back in" at the last moment without paying up to 30% more for the shares... first, you will wait to see them move up at least 15%, and the next day, your buying back in will drive the prices up 15% again!
In sum, they basically lie and say that there can't be a short selling manipulation, because if there was, and if silver was priced too low, then others would be able to buy whatever they wanted, without restriction, which would end it. This is such a lie, it's amazing, because they also admit there are position limit restrictions of 1500 contracts per delivery month, which means that people can't buy whatever they want without restriction!!!
Highlights: --They acknowledge the production deficit that is not meeting demand. --They acknowledge that demand has been met by a draw down of existing above ground refined silver supplies (stocks). --They note the total GFMS estimated identifiable world silver stocks at the end of 2003 are 671 million troy ounces. --They believe that historic above ground supplies (stocks) of silver, which have been drawn down, explain the low price for silver. And they note that, "Had these stocks not been available, silver prices surely would have risen higher." -p.4
--They believe that the large commercial shorts are not primarily naked positions: "Based on information that we have, we are satisfied that what may appear to be large net short futures exposure are often offset by other market positions, including physical silver inventories, forward positions, positions in other derivative products, and positions in non-U.S. markets. We believe that the characterization of the largest commercial short positions as "naked" short positions is simply not correct." --They acknowledge that most hedgers (shorts) never participate in delivery of real silver. --That they believe there is no collaboration or collusion or manipulation, and no evidence of the shorts working together to suppress prices. --They believe there is no motive to manipulate silver prices lower. --On page 6, there is the ridiculous assertion that "a magnitude of the silver price exposure that could be hedged" is the following: all world silver supplies at 671 million ounces, and all world mine production for one year at 596 million ounces in 2003, and production from scrap at 192 million ounces, for a total of 1.5 billion ounces. --They admit that the shorts, "by knowingly selling something for less than it was worth, they would put themselves at grave risk since they could never know when the market price might correct."
--They lie when they write, "Because there is unrestricted access to the market [?????], many knowledgeable and well-capitalized traders would readily buy any silver offered at artificially low prices. The buying by these traders -- buying that the alleged manipulators would have no way of preventing -- would quickly cause the price to rise to its appropriate level." --The above statement, that "there is unrestricted access to the market" by those who could buy silver is a lie, because they also acknowledge there is a position limit of 1500 contracts in the spot month!!! p. 8 --In further direct contrast to their statement that there is unrestricted access to the market, they say that purchases by longs can be manipulative, such as the Hunts in silver and Sumitomo in copper. p.3 --They admit that the position limit of 1500 contracts exists for the spot month because, "That is when the requirements for making or taking futures delivery are most pressing, liquidity is diminished because the numbers of open contracts and volume are generally declining, and time is running out to decide how to settle an open position -- liquidate it outright, roll it forward with a spread trade, or be involved in actual delivery of the physical commodity." --Finally, they admit that "good, clever writing can carry half-truths and total falsehoods as easily as it can carry accurate information." They damn themselves with this statement, since it is abundantly obvious that they are lying when they say that longs have unrestricted access to the market, and then turn around and hypocritically say they also describe long accumulations as manipulation, and say there are position limit restrictions!!!
Michael Gorham, who wrote this CFTC response, also indicates that we should read his letter of July 26, 2002 "for a more detailed discussion" of the point that the longs are unrestricted from buying more, which, I believe is the most blatent lie of his entire report. http://www.cftc.gov/files/opa/press04/opatedbulter07-26-02.pdf
Gorham admitted that the large long position of the Hunt brothers was a manipulation of the markets, ostensibly resulting in prices that would be too high, and Gorham took pride that such manipulation (as it was called) was stopped!
I would argue that it is impossible for longs to manipulate markets in free markets because freedom means that anyone is free to buy as much of anything as they wish. That's what freedom means.
However, it should never be legal to allow people to sell what they do not have, because that is the very essence of fraud, and fraud is not to be tolerated wherever justice and free markets are enforced. A short manipulation is dangerous. It will hurt everyone who holds the commodity and who is invested in producing the commodity. Furthermore, a short manipulation ends in a short squeeze or bankruptcy and default by the shorts, the kind of default that regulators, such as you two gentlemen, are supposed to prevent.
Gorham wrote, "Any attempt to hold prices at artificially-low levels would require visible, systematic, and comprehensive efforts to block the ability of users, investors, and dealers to take advantage of too-low prices."
I agree! And there have been visible efforts to block the accumulation of the longs, thus proving that prices are at artificially low levels! Warren Buffet bought 130 million ounces of silver in 1997 and was effectively blocked from the market, blocked from accumulating more. To Warren Buffet, this silver represented less than 1% of the portfolio of his holding company, Berkshire Hathaway. In fact, it is still unknown to this day and remains a topic of discussion in the silver investment community whether Warren Buffet actually received physical bullion for all of the 130 million ounces he attempted to buy!
I appreciate that the CFTC finally addressed the other key point of my letter, which was asking about what percentage of short sales are naked positions. But their assertion that they believe "naked shorts are not characteristic" still does not solve that particular problem. The problem is that naked (unbacked) short sales are even allowed, and the problem is that there should be regulations that prevent naked short sales, not just in silver, but in all futures markets!
The other problem is that the longs are restricted to access to silver through the silver futures market, because of the position limit requirements. There are over 500 billionaires, but the limit of 1500 contracts of 5000 ounces each, at $6/oz, is a limit of 7.5 million ounces, or a limit of $45 million dollars in a spot month. That's a very low limit for a billionaire, 4.5% of a billion dollars, and very restrictive for a billionaire who may wish to limit his exposure to the falling dollar by buying silver! If there are 5 spot months per year, it would take a billionaire over 4 years now to buy a billion dollars of silver at $6/oz.!
I am also shocked to see that they believe there is no motive to keep silver prices suppressed. Clearly, the motive is to keep the fraud of the dollar alive, and that is an extremely profitable enterprise, worth many trillions of dollars.
------------------------- This week, I was going to provide a guest commentary, "Golden Opportunity," by Richard Greene of http://www.ThunderCapital.com
But it was published at goldseek.com on May 16th, so I will just provide the link: It is a very good article, and I suggest you read it if you have not already. http://news.goldseek.com/GoldSeek/1084731753.php
Here is a letter from Richard Greene, in response to my commentary last week, that I wanted to share (which led to Richard providing the commentary, above):
This is also one more reason we are at rock bottom prices for the metals: Even I cannot convince my parents to sell their real estate. And I'm a leading advocate on the internet for precious metals, or so people tell me! --Jason
Jason
Sorry to hear about your parents and their real estate. It is frustrating when the ones you love the most can not see what is so clearly right in front of your eyes. I have a true story I would like you to show them. I will make it as short as possible.
My grandfather came from Italy in the early 1920's to work on the high rises in Manhattan. He built a two family home on over 100 acres in Islip Terrace, New York, one bag of cement at a time. He owned it free and clear. When the depression hit he lost 98 acres as the government raised his property taxes beyond his means. He lost 98 acres on a $29 annual property tax bill that I have seen with my own eyes.
The moral is: even if you own your home free and clear, you still don't own it because the gov't can tax whatever they want and take your property because they too are desperate when finances go out of whack as they are even more so today. I have sold all my real estate two years ago, put it all in gold and mostly silver and I have made much more than I would have in my real estate and there are no expenses or taxes.
My parents still own this two family home with 3 building plots attached. It is probably worth more than $1 million and they do not see the danger ahead, particularly my mom. She thinks real estate is always good and does not realize there has never been more debt attached to real estate than there is today. The taxes are now $9800 a year. Does this not prove the currency debasement message you are trying to enlighten them with? As far as renting, if a deflation scenario eventually unfolds good luck collecting any rent at all, in a hyperinflation few tenants will be able to keep up with rents. WHAT A DISASTER! SELL SELL SELL SELL SELL! If you did not get Jason's message, let me add this SELL!!!!!!!!!!! If I can convince your parents to sell just one of their properties it would make me happy I have done something for YOU who by your educational weekly letters is doing so much for so many people.
I convinced my dad to buy some silver coin bags and he has doubled his money on them but they can not see this is like the horse taking the first step out of the starting gate. The paper market is the only thing stopping the metals and time is short.
Richard Greene
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When I recently attended the precious metals resource conference in Calgary, a number of people asked me, "How did you first become interested in precious metals?" Well, when I was 9, it was late 1979, and early 1980, and the gold price was going up very rapidly, past $500 and past $600. It really was the topic of the day among many of the discussions of most of the adults I knew, who were expressing their concern and worry. I was confused by their concern. I asked, "If you are so afraid and so certain that gold is going to go up in price, why don't you go out and buy some gold?" (The implication was, "What are you, an idiot?") Every adult, of whom I asked this question, had no answer. They still don't.
If the gold price goes up, it does not, and cannot, hurt the economy, contrary to popular myth. It can only help the economy in about a million ways. If the gold and silver prices go up so that paper money becomes non-existent, it will be a boon to the economy in many ways. 1. It will eliminate the debt burden that is denominated in terms of paper money. The economic slaves will be set free. 2. It will provide jobs as gold mining booms as an industry. 3. It will limit intrusive and abusive and tyrannical government, who must now fund itself through honest money, thus eliminating income taxes, the welfare state, and socialism within the U.S. 4. The use of gold and silver as money will provide a framework for honest exchange between all participants within the economy, and will provide a base for the next economic boom. 5. The use of gold and silver as money will facilitate trade, and boost the division of labor, and will reward genuine productivity and industry, thus providing the framework for increased prosperity for all people.
For more on why rising prices will be good for the economy, see my article: Rising Gold Prices Will Help The Economy - 02 December 2003 ------------------ How much cash and how much silver does one keep on hand? One month in cash? 6 months cash? How much savings does one have? How much can you afford to move into and out of silver on a regular basis?
Let's say you are living off of savings. In this case, I think you can put all of your savings into silver bullion (and stocks) and just keep selling silver bullion once a month as you need cash.
Let's say you are a mining company, and that you get money once a year, or even less often. Should you keep a year's worth of expenses in cash then? Would you buy silver, and then sell silver as needed for each month's expenses? Buying and selling creates a commission loss. You have to balance that against the potential gains, and also against the volatility.
On Thursday, http://www.tulving.com/ has a spread of $195 on a $4175 purchase. That's a 4.6% spread as follows: 90% Silver Bags- Buy at $3,980 (you pay shipping) Current Price - $4,175 Delivered (tulving pays shipping) Shipping cost for one bag is about $50 at the U.S. post office. Shipping makes the spread actually 5.8%.
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Gresham's law says that bad money drives out good money. In theory, when people have a choice between using spending real money and debased money that are valued equally in the market place, they will spend the debased money first, and hold on to the real money. And thus, bad money drives good money out of circulation, which is hoarded. That's the theory. But that principle only works when there are unjust laws in place (and that people are obeying) that unlawfully decree that an unjust weight and measure must have the same value as a just weight and measure.
When such unjust laws are not in place, or when the people ignore such ridiculous laws, good money will then drive out bad money.
Currently, due to vast ignorance about silver among the population in the United States, people are not actually hoarding silver coins. The general population continues to sell silver that they inherit. Thus, good money is coming to market, at historic low prices, and nearly everyone is using bad money, paper dollars, or worse, electronic banking dollars, as a form of savings--as a matter of habit or conditioning. The good money, the silver, should be hoarded, according to Gresham's law, but it isn't, because so few people even realize that silver is good money, let alone money at all. In fact, on the chat boards at yahoo, you will even find silver stock investors who will strenuously argue that silver is not money at all since it is not used in daily transactions! How absurd! The reality is that, people who inherit silver assume that "it must be valuable", and "I must be able to get something for it if I sell it". Our society is so under-educated about silver, and wants instant gratification, and thus, people tend to sell silver within a month or so after it is discovered that they have inherited it.
I know this is taking place, because the coin dealers tell me so. Their "buy" prices also tell the story, because many dealers will pay as little as 3 or 3.5 times face value for 90% silver bullion U.S. coins, when the fair market value is as high as 5 times face value, with a real market bid/ask spread of 2/10ths times face value, not 2 times face value! (face value is $.10 for a silver dime. A silver dime selling at "5 times face value" would thus sell for $.50.) The local coin dealers pay so little, because there is a constant stream of ignorant sellers. It may be next to impossible to measure the size of this supply of silver being sold to the market.
Eventually, however, silver will be regarded as good money. Ultimately, the good money will drive out the bad money. Currently, silver is up from $4.15 about a year ago to $5.71 today, a gain of 38% ! Amazingly, this has caught little attention--even among silver investors, and silver company CEO's, who only look at the previous month's decline. If this was widely realized among the market place as being the start of an historic rise, then the rush for silver would have already begun. But the rush has not yet begun. So far, we've only seen a tiny trickle, if any, of the potential investment and monetary demand.
Soon, regardless of whether or not investment and monetary demand will materialize, people will see silver appreciate and go up 30% to 100% each year for several years in a row, and at the same time, they will see the value of paper money being slashed 25-40% per year, and they will begin to realize and understand which is the good money, and which is the bad money. Then, demand for good money will increase, and the desire to hold on to bad money, especially in the form of bonds, will decrease. Good money will drive out bad money, regardless of any and all laws that may be enacted to prevent people from selling bonds and buying silver bullion.
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Since oil hit $40/barrel, many people have been emailing me about oil. Lots of people are concerned about oil and they want to know what I think about oil, and they want to know how oil may relate to, or impact, the silver market. Just like rising interest rates, rising oil prices are very, very good for the price of silver.
In the early 70's, an ounce of silver was worth the same as a barrel of oil. Each about $2.50. In the late 70's, they were again worth about the same, about $50. The implication is clear. Silver is headed up towards $40/oz., for starters, and could go higher depending on oil prices. That's a lot of upside potential for silver!
Some people are very concerned about oil. They fear we will "run out", and that modern society is doomed. I don't believe so. I believe the world may run out of extremely cheap oil that we have today, but we will never "run out" completely, and our modern society is certainly not doomed. As the price of oil will rise once again, then production will increase, and demand will decrease, and it will be in balance. Oil is not like silver and gold, where increases in prices will increase demand. Oil is not money, and can never be money. If it is too inconvenient and heavy to use silver and gold as money, think how much less convenient would be oil? If you had a choice to lug around an ounce of silver, or a barrel of oil, which would be easier? It's a no-brainer.
Today, oil is probably too cheap for several reasons.
1. I drink only distilled water. I do so, because it is the cleanest water available, and I believe the healthiest. Distilled water costs about $1.50 per gallon. It's not that much less than the price of gasoline, which is merely distilled oil. Water, as everyone knows, is rather plentiful. If gas and water cost about the same, may I suggest that oil may be more plentiful than some would suggest, and is certainly very cheap if its price is not much higher than water.
2. Oil is too cheap, because alternative forms of energy are described as too expensive to pursue, compared to the cost of oil.
3. Oil is too cheap, because we are paying for it with paper money. We are not paying in real money, gold and silver. We send two $20 bills, or the electronic equivalent, for each barrel. We do not send silver or gold at all! Even though oil is far more expensive relative to silver than historic prices, (the oil being worth far more than the oz. of silver today), we are not sending and not paying in terms of silver or gold!
Since we are getting oil for nothing (paper fraud), and since oil costs about the same price as water, and since oil is a finite resource, it is elementary that such a low price for oil is unsustainable. Oil prices will move up for many reasons, but primarily, because the fraud of the dollar cannot last forever.
Interestingly, oil was once not so cheap as it is today, and yet we still had an industrial revolution in the U.S.A. Industry got along just fine, through a very inefficient initial development phase, without the extremely cheap oil we have today. Thus, may I suggest that our post-industrial society will survive, even with rising oil prices? Rising oil prices will help to cause change, but the change will be good, acceptable and manageable. Alternative energy sources will become cost effective, and silver prices will move up to match.
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Speaking of oil, I received the following, from U.S. Senator of California, Barbara Boxer. Her comments are indented. Included is my response.
Dear Friend:
Rising gas prices is an issue that impacts all Californians. Whether you drive a car, own a business, or buy groceries and other goods, you feel the pinch of higher gas prices. For months, both in Washington and in California, I have been focusing on the critical problem of rising gas prices.
Over the past three months, gasoline prices have spiraled out of control. Nationwide, the average price per gallon of gas has risen from $1.54 on January 5th to $1.88 on April 12th. Here in California, the price increase over this same period has been even sharper, from $1.61 to $2.15. In some areas of California, the price is much higher. In response to these rising prices, I have come up with a 9-point plan to fight rising gas prices. My plan includes:
As per your request, I have feedback about your 9 point plan. So that you know, I'm well researched in economics, and I have an email list of 9000 who read my weekly reports on the silver market. I do not own any oil stocks or have any interest in any oil companies.
1. FTC Investigation of Current Situation
First, I have called on the Federal Trade Commission to investigate the current gas price spikes in California, which began in mid-February. I have met with the Chairman of the FTC, who confirmed that there was an "anomaly" in California’s gasoline market and that the FTC was conducting an informal investigation.
There is no need to investigate the gas companies. You need to investigate how the free market works. Here's how it works: If prices are high, it will encourage competition that will move in to take advantage of the profits, by charging less than others. Competition is always welcome in capitalistic societies, since it creates the best prices. Furthermore, the gas belongs to those who own it, and thus, they can sell it for whatever price they want, and it is no crime. On the other hand, your threats of "investigation" are like a false accusation that the gas stations are doing something wrong, and they are more apt to fear government reprisals. This creates increased risk, as they may fear government. Increased risk leads to less competition, and higher prices, which they will need to charge to compensate for the risk. Thus, point 1 is a horrible idea, and will lead to the exact opposite of what you intend.
2. Automatic Investigations of Rapid Price Increases
Second, I have introduced legislation that would require an automatic investigation of the gasoline market for possible manipulation any time that average gasoline prices in a state increase by 20% or more over a three-month period. If the FTC finds market manipulation in a given case, they would work with the state’s Attorney General to determine penalties to be imposed on the companies.
Please kill this legislation. Again, investigations for people who have the right to charge what they like, for assets they own, are like false accusations (and hints of communism) that increase the risk of doing business. If I was a gas station owner, and if I knew I could not raise prices more than 20% over 3 months, I'd try and charge the highest price I could as soon as possible if I thought prices may head up. Again, your intention will lead to the exact opposite result. Thus, point 2 is a horrible idea.
3. "Cease and Desist" Orders in Highly Concentrated Markets
I am cosponsoring the Gasoline Free Market Competition Act authored by Senator Wyden, which would give the FTC the authority to issue "cease and desist" orders in order to prevent market manipulation whenever four or fewer gasoline companies control more than 70 percent of the gas supply in a given market.
I have no idea what you are thinking. If you issue a "cease and desist" to a gas station, and they go out of business and stop doing business, you will be reducing competition even more. This will not increase competition. What are you thinking?
4. Strategic Petroleum Reserve
We need to stop filling the Strategic Petroleum Reserve – which is now at 93% of capacity – in order to increase the supply of gasoline on the market. We should also establish a short-term "exchange" in which some oil in the SPR is released immediately and refilled later, just as SPR reserves were released four years ago to ease the home heating oil crisis in the Northeast. It doesn’t even make sound economic sense to buy gas for the reserve when prices are at a peak.
This is a good idea, if we were not at war, but we are. The Strategic Petroleum Reserve is not meant to help smooth out prices for the market. It is there in case of war. Given that we are at war, it should be topped off, and be at 100%. But if you want a government stockpile, to add to when prices are low, and sell when prices are high, you should have another reserve for that purpose. It would also need to be operated by the same people who control inflation, since gas prices are not only a function of how much gas is available, but also, they are a function of how much money they are creating.
5. Increased Production by OPEC
I am cosponsoring a Senate resolution that calls on the President to work with OPEC to increase world crude oil supplies in order to achieve stable crude oil prices. President Bush should work with OPEC to increase supply.
Excuse me? Neither a senator from California, nor the President of the United states, controls OPEC. OPEC, in case you don't know, was formed as a result of the U.S. leaving the gold standard, and paying for oil with irredeemable dollars. If you want the President to "work with" OPEC, you should be advocating a gold standard, and not working to continue the fraud of the unjust weight and measure of the dollar.
6. Subject OPEC to U.S. Anti-Trust Laws
I am cosponsoring a bipartisan bill authored by Senator DeWine that would subject OPEC to the laws prohibiting collusion, market manipulation, and other anti-competitive behavior.
Now you are just being ridiculous. Do you think the Arab States are states of the United States? They are sovereign nations. Do you propose we wage war on all of them if they do not comply? Furthermore, owners who have products to sell cannot manipulate markets. Markets are manipulated by shorts, who sell what they do not have. And by nations who produce fraudulent paper money, which is a broken promise to deliver gold we do not have.
7. Save the Bakersfield Refinery
I have called on Shell Oil to find a buyer for its Bakersfield refinery and commit to keeping the refinery open until a buyer is found. I have also asked the FTC and Attorney General Bill Lockyer to use their powers to stop the refinery from closing. We cannot afford to lose any more California refinery capacity. If this refinery closes, it will only further stress an already tight California market.
Given all the talk of government taking over refineries and energy plants after the California energy crisis, I don't blame Shell for trying to sell their refinery. If you want to save the refinery, I suggest that California apologize for even hinting at confiscating the property of Shell Oil. I also suggest that California reduce any taxes and environmental regulations, so that they can operate a profitable refinery, in peace. Without profits for the local Oil refineries, local gas prices will be even higher as transportation costs will increase.
8. Oxygenate Waiver
Along with Governor Schwarzenegger, Senator Feinstein, and California’s bipartisan Congressional delegation, I have called on the EPA to grant California a waiver from the requirement that an oxygenate – MTBE or ethanol – be added to gasoline. Adding ethanol to gasoline may already be driving prices higher in some parts of the state.
This is a great idea. Reduced legislation and regulation! Wonderful!
9. Fuel Formula Investigation
We may be able to reduce price spikes by reducing the number of different fuel formulations now required by different jurisdictions. I have asked the General Accounting Office to investigate whether we can do this while maintaining the same air quality benefits that we get with California's cleaner-burning gasoline.
Again, another great idea. Get government off the backs of the producers, and they will be more efficient.
I believe that these steps, if implemented, would go a long way toward easing gasoline price spikes in California and preventing further price gouging in the future. If you have questions about any item on my 9-point plan or if you would like to send me any other idea, I encourage you to contact me at http://boxer.senate.gov/contact/webform.cfm
In conclusion, 2 out of 9 would give you an F in school. But I'm glad you had at least 2 free market solutions on your list. Too bad they are at the bottom, and not at the top of your list. To my readers, please contact Barbara Boxer at the link above. I do not want to live under communism in California.
Barbara Boxer, you need to learn to trust in the free market and you need to trust capitalism to provide solutions to problems. Government's role is to provide an environment where true free market capitalism can flourish, so that all of society will be better off. If you really want to do something great to help California, you should sponsor a "sound money" bill, as they are doing in New Hampshire.
The problem with gas prices in dollars is a problem, not of gas, but of dollars. The dollars are the problem. Right now, the U.S. government is set on a course of inflation, to devalue the dollar, so that we can, in theory, compete with other nations in exporting goods. Other nations will do the same, and devalue their currencies. It is literally a race to inflate, and devalue the overvalued fraudulent dollars in society. All who hold dollars stand much to lose. But the race to devalue fraudulent money is real, and the winners will be those who devalue first, just as China has devalued their currency! The winners will really be those who devalue all the way, and who go back to using gold and silver as money first. Those who use gold and silver first, will be, essentially, buying and holding gold and silver while it is least valued, and not in use in other places, and thus, will become the most wealthy in the long run.
Included below is information about the sound money bill in NH.
------------------ My goals and solutions. Due to my research on the huge size of the bond markets, and the tiny size of the silver and gold markets, I believe that if far less than 1% of the U.S. population became educated about money, and sold bonds for gold and silver, then meaningful and prosperous monetary change could occur almost overnight. Therefore, I began this "free silver stock report" months ago.
I created several ways that this report could help the process of mass education and communication, and be be profitable, and thus, self-sustaining. I earn money through finder's fees, by helping companies to raise capital through share offerings. And, I earn money from the "look at my portfolio".
However, what I have neglected so far was the "non-profit" way to take in money, and spend it on marketing. So, I'm planning on forming a Political Action Committee, or some sort of organization that can take in donations to help spread the word about silver and gold as money, in order to assist my goal of communicating with as many people as possible. I honestly believe convincing less than 1% of the population to act will not be that difficult to do. In fact, I regard it as being a great advantage, and I see my advantage as being as great as David's in the fight against Goliath.
------------------ Although I may not be able to pursue every idea I have, I can certainly share them with you... I can help you to educate others about precious metals, and do so in a profitable manner. Here is my suggestion: Become a silver dealer, and do it in a pro-active and educational way. Don't set up a shop, instead, take out newspaper ads! Take out ads in the newspapers in a big city, to hold a free seminar about estate planning, money, investing, and precious metals. Then, create an hour-long presentation based on the information contained in this free report. You don't have to tell your audience about me, and I won't sue you for copyright! At the end, you should be taking orders left and right for silver bullion. Take orders on the basis of, "When your funds clear, we will then call you and lock in your price for silver, and place your order". This way, it's safe for you, and you won't even need any money to start, other than to place the ads, and book the meeting place. If you do it right, your average order size should be about $25,000 from each person, and you should be able to charge about 10-15% above the spot price, which should earn you a rather healthy commission. You might be able to make $10,000 to $20,000 per presentation, per weekend! In fact, you may be able to make more money doing that, than I make from both the subscriptions to the look at my portfolio and the finder's fees combined! In this way, you will also be reaching people who may not yet be on the internet, and have no knowledge of the facts contained herein, because they get their news from TV or the papers only! If you don't want to do the public speaking yourself, you can actually hire someone to read this report, and do that part of it for you! Good salesmen can always be hired for the job. This can be a serious business that can be started for less than $5000! I see that the largest potential problem would be to convince people to trust you with their money, if you don't actually have silver bullion that you'd be selling them at the moment. The best way around this, I believe, would be to bring as much silver bullion to the presentation as you can afford. Even if it's only one bag of bullion, that may be enough. You could also get a website and business cards rather easily enough, to help establish credibility. The other issue would be that you'd want to make sure to get everyone's name and phone number at the start of the meeting. This way, if they slip out before you close, you can call them, to follow up and get an order over the phone later. A really, really good presentation would be one where people got and were able to follow up on referrals. And a bonanza would be to be able to make such a presentation to an entire Church.
Presentations like these were actually happening during the late 60's and 70's. And it was a very profitable business. It ended in the early 1980's, of course, with the major decline in silver prices, as people got disgusted with silver. But it's probably long past due for people to start this up again. The facts today are far more bullish than they were in the 1970's. Although, given that we now have the internet, this suggestion may be an "old school" way of doing business. However most of the money of this nation is held by very old people. They may not have the inclination or technical savvy to read up on the internet, but I do know that they attend "free estate planning seminars" in herds! Your ad could combine "estate planning" and "silver". After all, leaving silver and gold as an inheritance is the best estate plan of all, since it is outside the system, not tracked, and therefore, untaxable.
I may end up trying to get into starting up that kind of business myself. Not sure at the moment, as I'm so busy. If I do it, I will certainly let everyone know how it goes. The reason I would is that I don't fear competition, I have always welcomed it, and I'd welcome getting the nation back to using sound money again. ------------------
At the Calgary show, I met several people who bought silver futures contracts and options. I spoke with a man this week who said he was an avid silver investor, who regularly read my material. Yet he admitted he invested in futures contracts. I asked him if he read my papers condemning buying futures contracts. He said he did, and that he understood my "point of view", but he replied that he needed futures contracts "for the leverage", because he did not have enough to buy bullion alone. I replied, and said, if you can buy a silver dime today for 40 to 50 cents, and that silver dime was once a day's wage, which is worth up to $200 today, what need do you have for leverage? Silence. I further retorted, "If it's so clear that they are using futures contracts to manipulate the market, then it is equally clear that the ones who buy the contracts are the ones being deceived. I don't like to be deceived, and so I don't buy them." Again, silence.
The point is that to buy one single futures contract is about $3,375, with the increased margin requirements that took place right near the peak of silver prices of $8.40 oz. You also have to keep an additional 125% on margin in your account in cash, which is another $4218. That's a total of $7594 just to "control" one contract, minus the cost itself, and that you don't really control. The contract is for 5000 oz. At $6/oz. silver, that's $30,000 worth of silver, for $7594. So, you actually have to put down about 25% these days, which does not give you very much leverage, really, and you run the risk of market default, as well.
Now, let's see if a person took that $7594, and bought silver bullion instead. If they bought 90% coin at the spot price for silver, they could buy a bag for $6 x 715 = $4290 per $1000 face value bag. That would contain 10,000 silver dimes, of course. Actually, for $7594/$4290 means they could buy 1.77 bags, which would contain 17,700 silver dimes at about 43 cents each. Eventually, these dimes will be more valuable than a day's wage because silver is now more scarce than at any other time in human history. Thus, I expect that each dime will be worth more than about $200 today, and thus, the whole pile will be worth more than $200 x 17,700, which is $3,540,000. That's a lot of money for someone who says he can't afford to buy silver. How greedy are these people, and how much do they need? For an investor to say he "can't afford silver, and must buy futures or options", really goes to show that they are enormously and disgustingly greedy and really ignorant about the opportunity now in silver. There is no other answer that I can see to explain it. I guarantee you that no futures contract will be honored by the time silver moves back to its historical price.
------------------ I think a lot. I think a lot about silver, our economy, and how we arrived at this peculiar investment opportunity that is a once-in-human-history opportunity. It's the proliferation of paper money. Paper money creates artificial wealth and artificial boom times. Housing, currently, is in a boom, because extra paper money home loans are available to anyone with a job. Even people who have recently declared bankruptcy can get a home loan. Housing needs copper, for the pipes and electrical wiring. Maybe houses in the third world are not built with copper pipes and copper wiring, but here in America they are. As most of you should already know, most silver is produced as a by-product of copper, gold, zinc, and lead mining. Not much of the approximately 600 million ounces of silver produced each year come from primary silver producers, as anyone can see by examining this silver stock report. So, there may also be an artificially high boom in copper production, and in zinc production, seeing as how the excesses of paper money are creating an artificial boom. Therefore, more silver is being produced than would otherwise be produced, if not for the excesses of paper money. This is one more reason why silver is cheap today, excessively so, because more silver is being produced than would otherwise exist. Once the housing prices collapse, and the building boom stops, what will happen to the demand for copper? It will likely go way down, as will the price. And with less copper mining, there will be less silver coming to market as a by-product of copper mining. Instead, it will be as it was in the old days, and copper will be produced as a by-product of silver mining, which is where the primary profits will be out of deposits such as the one owned by Mines Management. ------------------ Here is a thoughtful letter I received this week:
HI Jason: As always, I enjoy your letter and views, although I am of the 100% physical view and would never participate in the silver stock game. I wanted to run a thought by you in regards to the silver miners using silver as money and why the bullion banks might not get hurt by their short position in the silver market. Isn't it possible that many of the major silver mines are in some way controlled by the bullion banks? It would only make sense that if there is an effort by powerful interests to control the price of silver that they would not only influence the futures market but also have control, or at least some control, of its production!! It almost seems assured. The miners themselves may be trying to keep the price of their own product reduced! Owning the producers would also give a no-fail insurance policy against any short position since they would own the silver in the ground to off-set any losses in their paper contracts if they ever lost control of the futures market. Of course such a miner would not want to use silver as money as that would be the very thing they are there to ensure DOES NOT HAPPEN. To protect the fiat regime at any cost. Wouldn't it be ironic to own shares in silver companies controlled by the very organizations that are trying to suppress silvers price. An odd thought to be sure.
Yes, it would be ironic. And very counterproductive for certain silver stock investors. I do not think your suggestion is such an odd thought! It is very reasonable, and may well explain the outright hostility that the largest cash-rich silver miners have to the idea that they use silver as money. Certainly, in the gold mining world, the hedgers were contributing to the price decline, by placing bets on it that would cost money if gold went up!
I think it is very important for silver stock investors to know the positions and beliefs of the management of their silver companies. There are two ways that the company you own can be sold right out from underneath you. Debt is one, and hedging is another. Mining companies must renounce both debt and hedging at all costs. If they don't, the companies are ripe to be raped by the banks, and can destroy shareholder value.
------------------ Several people have written in the last month, wanting me to comment on this article: Silver? No Thanks, We Got Lots by Mark Taylor, April 14, 2004 http://www.safehaven.com/article-1449.htm I didn't comment on it earlier, because I thought that the article was too lame to be worthy of rebuttal. But enough people want a rebuttal to it, so here it is.
First of all, this line is laughable, "silver began trading in the 1960's."
Second, he writes, "It traded there for 5 years before the first outright manipulation occurred. We know who pulled that one off, the Hunt Boys." I maintain it is impossible for longs to manipulate a market. It cannot be illegal to buy a physical commodity that you want with your own money, unless you live under communism.
Third, he doesn't understand what is meant by the silver deficit. The deficit is the fact that less silver is mined annually than is used by industry annually. This deficit, of course, is met, and satisfied, by the dwindling supplies of above ground resources that have been mined previously in human history. Of course it is impossible to have a real deficit in any physical thing that is exchanged, where more is used than exists, or more bought than sold. Of course the numbers must balance, in total. The fact that the deficit between industrial use and mine supply is being met by government sales and investor sales, does not mean there is no deficit.
Fourth, he writes, "7 years later I can buy all the silver I want, and so can you." This is false.
Refuting that false assertion, first, there are position limits on the paper longs at the COMEX, that are limited to 1500 contracts per person or entity. The shorts also have this same limit, unless they have an exemption, which, of course, they have. There are no exemptions for longs. This is a limit of 1500 x 5000 ounces, or 7.5 million ounces. Furthermore, the restriction may well be 1/10 of that, since I have heard that the COMEX has the option to limit total deliveries to as little as 3/4 of one million ounces of silver in one delivery month! I still have to look into that.
Second, many coin dealers report that there are only about 50 major coin dealers across the United States. Most of these dealers express shock and disbelief that any of the dealers have over 100,000 ounce of silver bullion in inventory in their local shops. Others say there cannot be more than 5 with such large inventories. I have actually found 5 that claim to have at least that in inventory. By asking for referrals, and by asking my list of 9000 readers to provide me with other dealerships that may have more, I have failed to find any more. Therefore, if you want significantly more than about 500,000 ounces, after you clean out those 5 shops, you have cleaned out most of the silver of the nation, and thus, you have to go directly to a refiner, such as Johnson Mathey, JM, or go to the COMEX. Reports are that to get a large order from the big refiners, you will have to wait over a month.
Therefore, supply in the real world is rather restricted. No, you cannot buy all the silver you want. I know, because I have had extreme difficulty getting all the silver I have, which has taken me over 3 years to accumulate!
The reason most coin shops do not have large inventories of silver bullion is that silver is also difficult for them to find and sell silver on a consistent basis, and they have few buyers walking through their doors. The coin shop owners may also not even believe in silver, given the 23 year bear market that they have lived though, and has now just ended. They regard holding silver as risky, and unprofitable. From their view, they think, "Why carry inventory of a product that's going down in value, that you cannot find, and few people will buy?" Basic economics, there. And it also explains why the price is low! No public interest. And this is exactly why I'm buying!!!
So, no, you can't buy all the silver you want, because most coin shops carry zero silver bullion in inventory, or perhaps about one bag of silver, if you are lucky. That's less than $5000. Peanuts!
You can only buy all the silver you want if you are poor, and have virtually no money to invest.
Fifth, he writes as if there is no difference between refined silver, and unmined silver in the ground. The assertion that we have almost no silver left are referring to above ground supplies that have been refined to .999 fineness. This supply is down to perhaps 250 million ounces left, as reported by the silverinstitute.org, and there is an annual deficit that requires using up that remaining silver! Unmined silver is not the same thing. The supply of over 400 million ounces of silver per year as a by product of copper, zinc, gold and lead mining, do not go to show that we have infinite above ground supply! This annual supply is being totally consumed, and then some, by the total silver demand of about 850 million ounces!
Finally, he concludes, "I think it is pretty evident why the price of silver stays in a range of around $5 an ounce, it is not because Central Banks are controlling the price or because of Commercial hedging.....it is just that silver is very abundant, it is everywhere.Which leads me to wonder, what motivates Butler and others like him to continue in their attacks and claim that there is no silver to be had? Are they as smart as Mr. Buffet? I imagine to a degree they just might be. So what are you doing right now, buying at higher prices or following the golden rule of investing and selling at higher prices?
Remember, successful investing is a matter of knowledge, not luck. So rather than closing with the usual "good luck all".... I'll stick with good day....luck is for rabbits."
Unbelievable! Mark Taylor demonstrated his thorough confusion on the concepts of supply, demand, deficit, and the difference between refined and unmined silver, and showed he is both poor, and clueless as to the relative the scarcity of silver. (Literally, there is perhaps less than 1.2 million ounces of silver bullion available, to you personally, if you wanted it immediately from the five biggest coin shops and COMEX.) He has no knowledge of how scarce silver is, as money, compared to how available bonds are, as money. It's literally tens of trillions of dollars in bonds, and only a few hundred million dollars of silver. The difference is a factor of 100,000! There is literally over 100,000 dollars in bonds for ever one dollar worth of silver available, and that's if you count all the silver in the registered category at the COMEX, as "available". But with position limits on paper longs, it actually may be much, much less!
------------------ Virus alert!
As many of you know, many viruses will get an email address, and pretend to be sent from it. These viruses have hit the gold community rather hard, and my email in particular. If you get an attachment, or a short and cute note, saying it's from me, it's not. Here's a most dangerous virus!
Dear user of GoldIsMoney.com,
We warn you about some attacks on your e-mail account. Your computer may contain viruses,
in order to keep your computer and e-mail account safe, please, follow the instructions.
Further details can be obtained from attached file.
Attached is a pif file that is a worm. The link below can show you how to disinfect your computer. The link below is not a worm or virus, and cannot hurt your computer if you click on it. What is dangerous, is to open attachments.
http://www.snopes.com/computer/virus/beagle.asp ------------------ I have been thinking about forming a political action committee (PAC) to advocate the use of gold and silver as money. Doing this, would allow me to collect donations which would be tax-exempt. After speaking with several attorneys, they have advised me to form a 501 c3 non profit organization, which cannot support, endorse, or give to political candidates. A 501 c3 non profit is supposed to be able to receive donations, and the donor is able to claim a deduction on their taxes, as if they did not earn the donated money in the first place, and so, they pay taxes on a smaller income. So, the government thus encourages people to give to government sanctioned groups, with the tax deduction. However, the government can also disqualify and revoke the 501 c3 at any time, and charge back taxes, and destroy the non-profit organization. And the restrictions are a violation of free speech! Furthermore, and this is perhaps the most important point, donors who give to a 501 c3, and who report their giving to the government, are disobeying God's command to give in secret in order to be rewarded by God!
(Mat 6:1-21) Take heed that ye do not your alms before men, to be seen of them: otherwise ye have no reward of your Father which is in heaven. {2} Therefore when thou doest thine alms, do not sound a trumpet before thee, as the hypocrites do in the synagogues and in the streets, that they may have glory of men. Verily I say unto you, They have their reward. {3} But when thou doest alms, let not thy left hand know what thy right hand doeth: {4} That thine alms may be in secret: and thy Father which seeth in secret himself shall reward thee openly.
Therefore, I will not form a 501 c3. But I will accept your secret donations, so you will have a reward from God. Your donations will be used to further expand my advertising, expand my market reach, and further advocate the use of silver and gold as money. I do not yet believe that the time is right to sponsor bills and legislation, or support political candidates. Right now, I believe more people need to be educated about the supply and demand fundamentals of the silver market. These are numbers produced in silver reports that are sponsored by miners and users in the industry, but their market reach is limited. People also, in general, do not see much of a benefit of precious metals over paper. We need, first of all, to get more people to invest in silver than are selling silver bullion! I do not fear government confiscation, or unjust laws enacted now, simply because the silver market is too small, silver is too cumbersome, and is not worth it. Confiscation may become a factor after the price of silver rises up to over $100/oz. Silver confiscation did not happen in 1980 when it was at $50/oz, which is like an inflation adjusted price of $150. People who fear government confiscation at today's prices are overly fearful, in my opinion.
If you believe that God hates unjust weights and measures, as I believe, then we have the same beliefs. I may not receive as many donations as would a 501 c3. But what glorifies God, and what will God honor? I believe God will honor and bless obedience, and I would rather work with less money and have God on my side than have more money, and not have God's blessing. Gideon's army won his fight with 300 men, after God had him reduce the size of the army in order so that God would be glorified. With God on our side, who can be against us?
I think we only need to get the message out to less than one tenth of one percent of bondholders, 1 in 1000, and then the price of silver will be roaring wild!
So, you can send your donations to: Jason Hommel general delivery Grass Valley, CA
If you donate, please also email me at jasonhommel@yahoo.com so I will know to check the post office. ------------------ Another way to help out is by buying a "look at my portfolio".
Because I have a market reach, I also receive a lot of tips about silver stocks. And thus, I believe I may have invested in some of the best ones that came my way. If you believe I may have an edge based on my work and position... then the best way for me to share this with you is to is tell you where I put my money. It's not investment advice. I offer a monthly "look at my portfolio". I do not issue recommendations, and I don't list number of shares or the size of my portfolio, but I will show the top investments in my portfolio, by rank, updated monthly.
Price: $39.95/monthly, or $49.95 for a single month, or $295.00/year To order: Click here
If you have any questions about billing or order fulfillment, you need to contact my support staff at support@goldismoney.com and not me. I manage a large portfolio, and I don't have time to process billing requests. I don't bill any cards, my support staff handles all of that. The toll free telephone customer support line is: 877-895-6824.
------------------ I will be attending the following two mining/gold shows in the next month:
I will be speaking in Vancouver. In case you can attend one of the shows, and if you want to know what I look like, there's a picture of me here: http://www.goldismoney.com/about.php
------------------------ General Commentary on Silver (slightly modified from last week):
The sponsors of the Sound Money Bill in New Hampshire are now looking for donations so they can take this to other states!
For news on the New Hampshire Sound Money Bill, that proposes to use U.S. Treasury minted Silver Eagles and Gold Eagles as money see: http://www.nh-inews.org/ http://veritasradio.com/ -- site temporarily disabled.
Current status of the NH bill: The bill will live until the November elections. It'll have a different #, but we now have 6 months or so to get EVERYONE we need on board.
Now looking to raise $25,000 to $35,000 for "phase II", to get set up with an office and staff training.. Looking to raise $500,000 for "phase III", to take this to about 5 other states.
Send any donations you can, to: [These are not political campaign donations.]
SOUND MONEY FOR AMERICA, c/o Henry W. McElroy, 15 Iroquois Rd, Nashua, NH 03063 ANY AMOUNT, ANY LEGAL TENDER CURRENCY - U.S. OR FOREIGN !
Video copies of the sound money bill press conference are available for a $35 donation.
For more info, contact Rep. Henry W. McElroy, NH State Representative Sponsor of the bill 603-233-5892
Harvey Wharfield 978-635-9586
We also need assistance with the following.
1. Please contact your local representative to your state government. Find out whether they might support a similar "sound money bill" in your own state.
To contact your state rep to the federal goverment, see http://www.house.gov/writerep/ To contact your state rep to your local state government, you will have to find that on your own. Try searching for "contact state representative california" and replace the name of your state in the search.
2. If you know of any local representaives to your state government, who may be GOOD, LIKE MINDED REPRESENTATIVES, SENATORS, and GOVERNORS, who may like to support, or sponsor, a sound money bill in your state, please tell them about the NH initative. Copy the above, and send it along to them. And call Henry W. McElroy or Harvey Wharfield, and let them know of the other reps who may assist the cause.
3. If you have an email list to people who may be interested in gold and silver as money, or who may be good conservatives, please send out this notice to the list, so the project can move forward! -------------------------- See my article: Biblical Guidelines for Managing your Money
As the New York Times, January 11, 1859, page 2 said--- "It is well known that the most colossal fortunes the world ever saw have been based on silver mines..." --quote found by Charles Savoie ----------------------------
WHERE and HOW to BUY SILVER BULLION http://www.goldismoney.com/buy-gold.php ---------------------------- My 2004-2009 price predictions for gold and silver: 2004: $595/oz. gold, 50:1 ratio = $12/oz. silver 2005: $1011/oz. gold, 30:1 ratio = $34/oz. silver 2006: $1719/oz. gold, 10:1 ratio = $172/oz. silver 2007: $2923/oz. gold, 5:1 ratio = $ 585/oz. silver 2008: $4,969/oz. gold, 1:1 ratio = $4969/oz. silver 2009: $8448/oz. gold, 5:1 ratio = $1698/oz. silver 2010+: infinity dollars/oz. gold, infinity dollars/oz. silver.
I calculate the gold price rise by guessing that by 2009, M3 will have a "gold-value" like it did in 1980, which is to say, M3 was worth 2 Billion oz. of gold or less. It also assumes M3 will about triple in that time. These figures are conservative, because I see no reason that M3 should be valued more than the gold the U.S. actually holds, which is a mere 261 million oz., not billion. Today, the M3 value is $8870 billion / $425/oz. = 19 billion oz. of gold M3 could buy in theory. The silver:gold ratio is also a very, very vague guess, reflective of monetary demand chasing silver, which is more scarce than gold in above ground, refined form. I have no idea when the ratio of 15:1 will be exceeded, I'm just totally guessing. I suppose it could happen this year or next month for all I know. Of course my real price targets are infinity dollars per oz. for both gold and silver when all is said and done, I just don't know how long that will take, nor what year it will be. But my point in producing the price predictions is to show my bullishness for silver and gold.
---------------------------- I wrote an article predicting that Silver Companies will buy silver, and urging Silver Companies to buy silver with their cash, to use silver as money, and sell silver as needed for expenses. See http://news.goldseek.com/GoldIsMoney/1069879327.php
That article is now having an effect! It is being discussed by several large "cash rich" silver companies, who are seriously considering the idea of holding their cash in the form of silver.
Note, there is virtually no monetary nor investment demand. Note, the 2002 mine production (585 mil oz.) is greatly exceeded by industrial, photo, and jewelry demand. (838 mil oz.). Note the chart on page five, "Supply from above-ground stocks".
The difference between mine supply and industrial demand was met by a combination of three factors: 1. Government selling, 2. Private selling, 3. Recycling
U.S. government selling is ending, as their stocks have run out, or will run out. This factor will reverse, because the U.S. government will need silver to continue their coin program, and/or need silver when they wake up and decide they need to replenish their strategic stockpile for domestic security. Silver is a war material. China's selling of silver will also likely turn into buying, as China will need silver for continued industrial development, or when they also lose faith in the U.S. dollar.
Private selling has been rapidly shrinking and is now almost ended, and should turn into buying, and become monetary demand. Monetary demand is everything in the silver supply / demand situation. It's not now. Now, it's nothing. But it will become something incredible, because the dollar is dying.
---------------------------- The following is a "must read": Ted Butler's best ever explanation of how silver is manipulated lower than it should be. http://www.investmentrarities.com/11-04-03.html
Ted correctly points out that a lower price creates excessive demand from consumers. However, Ted Butler does not point out, and neglects to mention, that a perpetually low price also creates lack of demand from investors who are "trend investors".
I think most silver experts over-analyze all the supply and demand factors of the silver market. No factor is more important than monetary demand. The force of photographic demand is like a light breeze compared to the hurricane or tornado of monetary demand. Monetary demand is everything. ----------------------------
Consider the gold market for a moment: Even short selling at the COMEX is nothing compared to monetary demand. The short position most certainly helps to depress the price of gold as the short position is growing larger. However, it adds fuel to the fire if there is short covering, and thus, it can boost the gold price later. But the commercial short position on the COMEX is next to nothing compared to the non-reported "over the counter" trading that is done that does not appear on the COMEX.
(Numbers in metric tonnes, 32,152 oz. per tonne.)
870 tonnes -- the paper position at the COMEX, 280,000 contracts for 100 oz. each. 5,000 tonnes -- the official number admitted that the central banks have sold. 15,000 tonnes -- the number GATA research shows that central banks have sold / or leased. 30,000 tonnes -- the number of official central bank gold, minus either the 5000 or 15,000 tonnes. 145,000 tonnes -- all the gold mined in the history of the world. 2,600 tonnes -- annual mine supply 4,000 tonnes -- annual demand
And all of that is nothing compared to the amount of dollars out there that exist that could buy gold. $20 trillion bonds, $9 trillion M3 = $29 Trillion. A mere 1% is $290 Billion, which, at $500 /oz. is a massive demand of 18,039 tonnes. Do you understand what that means? That means that far, far less than 1% of dollars, in either bonds or M3 can buy gold, because there simply is not that much gold available.
Long before 1% of U.S. paper dollars tries to buy gold, gold will be going up well over $1000/oz., and silver will be headed up over $50/oz.
---------------------------- To scare away investors--that is the entire reason gold and silver are manipulated in the first place. Only the trend investors can be deceived. The problem is that nearly everyone is a trend investor. So few investors understand value. If people knew the facts and used their brains, the available above-ground refined silver would be gone by tomorrow, and the price would be well over $20-50/oz. But don't trust me, follow the urls and check the numbers:
1,000,000,000,000: 1 Trillion dollars 1,000,000,000: 1 Billion dollars 1,000,000: 1 Million dollars $33,000,000,000,000: World bond market, yr end, '01: http://tinyurl.com/vr7u
$26,400,000,000,000: World stock market, June 2002: http://www.nyse.com/press/1044027443845.html $20,200,000,000,000: U.S. bond market, yr end, '02: http://tinyurl.com/vr7g $11,300,000,000,000: NYSE U.S. stock market, April, '04 (363 bill/s x $31.14/s ave.) http://nyse.com (See: Market info: quick facts) $11,038,000,000,000: U.S. annual GDP, 3rd q.'03 est. http://tinyurl.com/vr9y $8,879,000,000,000: M3 (money in the banks) Nov. '03 http://tinyurl.com/vra0 $7,001,312,247,818: US debt, 12-31-'03 http://tinyurl.com/bbp $2,360,000,000,000: U.S. annual budget 2004 $2,572,160,000,000: Marcos/Phillipine "black/unofficial" gold: 200,000 (to 500,000) Tonnes @ $400/oz. (Book: "Gold Warriors") $1,860,000,000,000: World "official" gold, 145,000 T @ $400/oz. http://tinyurl.com/vrcc $700,000,000,000: U.S. budget deficit (current). $554 billion ending fiscal year, 09/30/'03 http://tinyurl.com/bbp $272,000,000,000: Market Cap of Microsoft (03-2004) http://tinyurl.com/vrcn $180,000,000,000: Debt of Ford Motor Co. (03-2004) http://tinyurl.com/vrd1 $104,400,000,000: US gold, 261 mil oz., @ $400/oz. http://tinyurl.com/vsr9 $100,000,000,000: all the world's gold stocks (estimated?) $75,000,000,000: Money flowed into Equity funds in the first quarter, 2004 $7,090,000,000: all the world's silver stocks (59 of them on this list, as of Dec. 5th, 2003) (Perhaps $10 billion by April?) $6,710,000,000: 671 mil oz. of "identifiable" silver bullion in the entire world, according to GFMS @ $10/oz. $490,000,000: 49 mil oz. of "registered" COMEX silver bullion @ $10/oz. http://tinyurl.com/vrcw
So, what do all those stastistics mean?
For a while I was using M3 and dividing that by the US gold (261 million ounces), which implies the us dollar is 84 times more valuable than it should be, and that gold should hit $34,000/oz. after the fraud is destroyed. Today, I realize I need to add in the Bond market, because bonds are an asset class designed to siphon away and replace real money, which is to say, gold. This gives a price of about $111,111/oz. for gold. At $ 430/oz, this implies that US bonds and paper currency are 258 times more overvalued than gold.
Gold is overvalued relative to silver, because at current prices, it takes 68 ounces of silver to buy 1 ounce of gold. Historically, this ratio was 15 or 16. Given the silver shortage, this ratio will hit 10:1 or 5:1, or even 1:1. Thus, gold is perhaps 68 times more overvalued than silver.
Silver is overvalued relative to certain select silver stocks, perhaps by a factor of 3 or 10 or 20 to one.
Thus, if you multiply all those numbers, 258 x 68 x 10, You will see that bonds and currency are overvalued relative to select silver stocks by a factor of 139,000 to one. In other words, if silver stocks reach their true value, and paper currency disappears as it always does, then you might expect certain silver stocks to go up in relative value by a factor of 139,000 times more than they are worth today. By that time, you should definitely sell the silver stocks, and buy gold.
Can silver stocks really appreciate so much? Is there historical evidence for such a crazy thing? Yes.
See http://www.sterlingmining.com/old.html Excerpt: "CDE rose from penny stock status (.02 in 1967) to an NYSE-listed, $60 per share stock in 1980. In fact, the average share on the Spokane Stock Exchange rose in value nearly 16000% (yes, sixteen THOUSAND percent), as America could not get enough of silver and silver stocks."
CDE rose by a factor of 3000, or 300,000%, and by 1980, the metals boom was stopped short, and paper money's death was postponed. If paper money dies a death that lasts a generation world-wide, then even greater gains should have been expected.
For this reason, a wise silver stock investor should NEVER sell silver stocks for paper cash. A wise silver stock investor who looks for value would never sell a fairly valued silver stock for an overvalued silver stock that traded for hundreds of thousands of times more value than it should be. Likewise, there is no excuse for a silver stock investor to have any cash or money market or bonds in his portfolio for any reasonable length of time, except for when selling one silver stock to raise the cash for another silver stock, or for when you need to raise the cash to buy silver, or a private placement in another silver stock.
So, if you want some fairly liquid alternatives to cash, in case you don't know what other silver stocks to buy at the time, here they are: 1. Buy silver. You can hold silver in an IRA. 2. Buy CEF. Central Fund of Canada, ticker symbol CEF. It's gold/silver bullion fund. It has 50 oz. of silver for every 1 oz. of gold. The fund is fairly liquid, you can buy it as easily as any other stock, and is a good cash substitute. Unfortunately, given the current ratio, about 55% or more of the value is in gold. 3. Buy a fairly large cap silver stock, with fairly large volume, that is still fairly cheap on the list. SSRI is probably the best candidate.
----------------------------
The sheer stupidity of big money not recognizing the value of the world's remaining silver is utterly shocking to the rational mind. Clearly, bond holders are utterly deceived, and totally unaware of the situation. All my readers should understand and know that bonds were originally invented to suck the capital and money (gold and silver) away from the people. Bonds today are a paper promise to repay paper. What a con game! Are bond holders conservative and safe? No, they are fools! There is nothing safe about holding a paper promise to receive more paper when we have been experiencing hyperinflation for the past two and a half years!
---------------------------- And the fund investors who buy paper silver futures contracts instead of real silver are a very odd bunch of fools, for they should realize that nobody can deliver the 800+ million ounces of silver promised in the paper contracts and options that does not exist. It's like the paper longs are betting on the bank run happening, but they all are making sure they get at the end of the long line. Instead, they could go front and center, where there is an open window available where you can go and get physical silver, and nobody is there. Idiots! If you know a bank run is going to happen, and you are actually willing to bet on it, then go and withdraw your money before it is too late! Don't bet on it happening, which, if it does happen, your contracts will be defaulted on! Amazingly blind idiots. Wake up!
How bullish am I on silver? Here's an interesting way to put it: "68 times infinity" dollars per ounce.
I believe the dollar will eventually be destroyed, likely within my lifetime, hence the "infinity" part. I believe the ratio of silver to gold may be equal during a spike, when the market realizes that above-ground refined silver is more rare than gold. Thus, silver may outperform gold by a factor of 68 times better. Currently, the ratio is 68 ounces of silver can buy one ounce of gold or 68:1.
I may end up selling silver for gold, some at the 10:1 silver to gold ratio, some more at 5:1, and I would sell any silver remaining at a 1:1 ratio, that we may hit during a supply/demand crunch during a paper money collapse.
How we can tell if silver is leading gold, or if gold is leading silver? IE, which is going up more, faster than the other? The way you can tell is by looking at the ratio. If the silver:gold ratio is going up (say, from 60:1 to 80:1), then gold is moving up faster (because it takes 5 more silver oz. to buy an oz. of gold. If the ratio is going down (from 60:1 to 40:1), then silver is moving up faster. So, keep an eye on the ratio.
A good website that hosts posting boards for many of the smaller canadian stocks (that Yahoo! finance does not have boards for) is stockhouse.com Click on "Bullboards". ----------------------------
This is a list of primary silver stocks.
I count a company's ounces of gold as 10 oz of silver. Why? Because I have a very strong positive bias in favor of silver over gold.
Given my bias in favor of much, much higher silver prices, then, to me, the grades of silver are far less important than buying more oz. in the ground. More oz. in the ground at a lower cost is the most important consideration for me.
My method is simple. Cost per ounce in the ground. How much do you get (silver reserve totals), and how much does it cost (market cap)? The cost is the market cap divided by the silver reserve totals. Cheaper is better. Buy low, sell high.
Disclaimers, Warnings, and Advice: I have gathered the information below over the course of several months. I believe it is accurate to the best of my ability. I may have made mistakes. I probably did. I'm human. I have collected the information from public sources such as company web sites and public information found at yahoo.com to get the stock prices. This report in no way guarantees the accuracy of the information below, since the information may change at any time. The number of outstanding shares can change as a company engages in new share issues to raise more capital through private placements, or if outstanding warrants (and options) are exercised and converted into shares, or if shares are bought back. Shares can be consolidated, or split. The number of ounces of silver in the ground can also change, as these are often only estimates. The number can also change up or down, depending on drilling results.
This report is not investment advice. This report contains information that may or may not be up to date, and may be inaccurate. I urge you to contact the company and do your own research to verify the information contained in this report.
This report is not an offer to buy or sell any securities. I am not a broker. Only your broker can buy or sell securities for you.
I urge you to consult with your investment advisor to determine whether these kinds of investments are right for you.
I also caution you to be aware of your investment advisor's advice, they are sometimes paid to push things like mutual funds, bonds and other securities that may not be in your best interest to buy. Some investment houses are short physical metal, and thus, they may attempt to strongly discourage you from buying precious metal or precious metals investments. I believe that the propaganda machine in support of frauds such as bonds and the dollar is so strong, that they may even believe what they say when they give bad advice to avoid the safety and protection of precious metals. It is most likely that they simply do not understand the precious metals market as well as you do.
All total estimates of "ounces in the ground" can vary widely. There are "proven and probable reserves" which are the highest category of certainty which is obtained through many drill holes, and then at the least accurate, there are "inferred resources" which are hardest to estimate. Additionally, every miner always has "more silver properties that need to be explored, which probably contain more silver". For the purposes of this report, I have added all those numbers together. It is believed that all these "ounce in the ground" estimates can be profitably mined at $5-6 per ounce silver, or lower. Thus, I believe that when silver trades for $15/oz. or above, that all of these ounces can be mined at a substantial profit.
I may be wrong. (I probably make mistakes in every article, and there have been updates and corrections made each week, especially as prices change.)
Mining is a risky business. You need to be willing to sustain a total loss of your investment for various unforeseen accidents. Silver stock companies can do stupid things to shareholders such as take on debt, or issue more stock at too low prices which reduces the percentage of the company you may own (dilution). Yet, they need to issue shares to raise capital for drilling, and then an even bigger dilution to build a working mine. They may sell YOUR silver too cheaply, or worse, hedge the price of YOUR silver just as it begins to go up if they lock in a price which then proves to be too low if the dollar is destroyed. Mining is a risky business as estimates of assets in the ground can change. There is political risk and environmental risk. They can't franchise the business, are stuck in one location, are subject to government confiscation, or taxes, or union wage negotiations, and corporate looting.
Do your own research. Be responsible for your own investment decisions. Again, please, before investing in a mining company, call up the company, and speak either with the CEO or the Investor Relations contact person.
So, at the very least, check the company web site, read the annual reports, check my numbers, check my math, and email the company. That's what they are there for, to answer your questions, and to speak about the opportunity of the company. Don't trust everything you read over the internet. I am a biased source. I own silver mining stocks. And I'm not a broker, nor an investment advisor. I'm just a private investor trying to make sense of this crazy world, and sharing my information and thoughts on silver companies.
Surely, there are scammers in the mining industry in the past, and there will be scammers in the future. Remember the fraud of Bre-X. The new 43-101 compliance laws put in place after Bre-X will not prevent a "certified" geologist from lying if he feels lying will create a better payoff. The Bible warns, "trust no man", yet at the same time advises us to "cast our bread upon the waters", and to not issue "false allegations" against others. Physical gold and silver provide the "payment in full" as long as the coins or bars themselves are genuine and not fake.
This report may be copied, and transmitted by other people, and may become outdated by the time it reaches you.
I can't tell you how you should invest your money, of course. The reason is that I don't know how convinced you are of the silver bull market, nor do I know how soon you will be needing the money back, so I don't know how long you can wait to see results, nor do I know how much liquidity you need. Nor do I know the size of the money you have to invest. It is very hard to invest large quantities of money in a small market cap stock.
That being said, my investment strategy seems to be working for me, so far. And so, here is how I have valued the following silver companies to make my own investment decisions.
---------------------------- (Market cap is always converted to US dollars and denominated in US dollars because I divide by ounces of silver, which are also denominated in dollars)
The Market Cap is the usual tool to value a company. It is what the company "costs to buy" if you could buy the entire company, all the shares, at the latest share price. It is calculated by multiplying the share price, by the total number of shares that the company has issued. In reality, you could almost never buy an entire company at the price of the Market Cap, but only a small portion. Usually, even small buying pressure, such as trying to buy 1% of a company, can push up the price of a stock by up to 10-50% higher. In my reports, I list Market Cap in terms of millions of dollars as "$75 mil MC".
To calculate the Market Cap, I try to get and use the number of "fully diluted shares". A company creates shares when they sell them to investors in what are called "private placements", or "initial public offerings" (IPO). These usually consist of shares and warrants, sold for cash that the company will need to grow and expand.
The "outstanding shares" is the number of shares that exist out there if you count them all, and it does not count the warrants, which are like options. The investor can "exercise the warrants" which is a right, but not an obligation, to buy more shares from the company at the set price of the warrant.
If the company does well, and the stock price moves up, all the warrants will be, or should be, exercised and converted into shares, especially if they become "in the money", and the warrants are significantly cheaper than the stock price.
Now, "fully diluted shares" is the total number of shares, plus the warrants, counting warrants as if they were all exercised and became fully trading shares. I think "fully diluted shares" is a better number to use to calculate market cap than by using "outstanding shares" as most do.
Finally, I go beyond valuing a company based on Market Cap alone; instead, I value a company by dividing the Market Cap by the assets of the company, which are usually the silver reserves in the ground. Thus, I can get a sense of what you are getting for what you are paying. And then, I denominate the whole thing in terms of silver, and not dollars, to get a more constant measure.
---------------------------- (These first three companies, BHP, GMBXF.PK, and BVN produce a lot of silver, but are way to expensive to buy for the silver exposure for your portfolio.)
BHP Billiton Ltd (BHP) http://www.bhpbilliton.com/ --'produces 40 mil oz. silver annually from one mine' Additional comments: unfortunately, BHP has a 53 Billion market cap, so we can't buy BHP for the silver exposure. IE, $53 Billion / oh, say, 1000 million?????= $53/oz.
Dear BHP: By all means, keep mining the silver if you want the silver exposure, and want to be in the silver business. But don't sell the silver. Keep it. Let the profits of your entire company accrue as an increasing physical supply of physical silver. In fact, do as Buffett did, and buy more silver if you can. It would be infinitely easier for you to buy silver from yourself than it would be to buy 40 million ounces of silver from the COMEX, which, today, might be impossible.
Grupo Mexico SA de CV (GMBXF.PK) http://www.gmexico.com/indexi.html 651,646,640 shares (2002 annual report) @ $4.00/share $2606 mil MC "Grupo Mexico ranks as the world's third largest copper producer (copper at $1.24), fourth largest producer of silver and fifth largest producer of zinc." They produced 28.2 million oz. of silver, worth $129 million, in 2002. (P. 5, annual report.) Total value of produced metals: $2527 milllion. (but the company lost money in 2002). They mainly produce copper, 900,000 tons worth $1.5 billion in 2002. Thus, silver, at 2002 prices, is only 5% of their production value. Silver is a by-product for them, not a main product. I don't have silver reserve figures, nor do I see any need to find them or add them, since they are not a primary silver producer, and I don't think anybody would be buying them for the "silver exposure". If we assume 280 mil oz. of silver (ten years reserve for production), then we still don't have anything exciting for the silver alone. $2085 mil MC / 280 = $7.45/oz. cost.
KGHM Polska Miedz --KGHM is the world`s sixth-largest copper producer and second or third in silver. --Copper/Silver mine in Poland. --Market capitalisation is about $1.52 billion.
Compania de Minas Buenaventura SA (BVN) http://www.buenaventura.com/ NYSE:BVN - Peru´s largest publicly traded precious metals company --produces over 10Moz of silver per year --looks way too expensive for the silver alone: 3.6 Billion market cap. -------------- -------------- --------------
ABX (Barrick) http://www.barrick.com/ 535 million shares @ $18.79/share $10,052 million Market Cap 5.5 million oz. / year gold production. --production hedged out for 3 years, or about 18 million oz. (most notorious hedger of the industry, the "leader") --price of hedges locked in near the market lows, perhaps $340/oz. on average, nobody knows for sure, because Barrick will not say --reportedly, Barrick is trying to "unhedge". --reportedly, they plan to deliver 1/3 of production to hedges, which means they will be hedge free in about 10 years. --the size of the hedge, 18 mil oz. gold, at $400/oz., would be valued at $7.2 billion dollars. At $500/oz, it's $9 billion. --but they claim to be "debt free", if you ignore the gold they owe for delivery, at locked in, low prices. (only true if gold is not money) --cash "rich" of about $1 billion dollars. Silver Reserves reported to be 850 million ounces! Gold Reserves reported to be 86 million oz. (x 10 = 860 mil oz. + 850 silver = 1710 mil oz. "silver equiv." $10,052 million Market Cap / 1710 mil oz. = $5.88/oz. silver You get "approx" 1.03 ounces in the ground for 1 oz. silver's worth of stock.
Additional comments: Over the years, Barrick has hedged their production, which many claim has helped to depress the price of gold and silver, by artificially adding to supply. (Barrick's promises becoming the extra supply.) The declining price of the precious metals has put other miners out of business, which Barrick has acquired at low prices. If Barrick goes bankrupt due to their hedges, and rising gold and silver prices, then perhaps Barrick's many properties will, once again, be sold at distressed prices.
Barrick boasts a "cash cost" of $189/oz., for gold for 2003, yet their cash has dropped from $2 billion down to $1 billion. It could be due to the hedging, locking in precious metals prices at low prices, and/or hedge covering that explains the monetary loss in the light of their low cash costs.
About a year ago, perhaps spring 2003, ABX made an announcement about covering 30 million ounces of silver they sold short. Then, a large buyer showed up in the futures contracts for about that amount. I do not know whether, or how, that has yet been resolved.
I expect silver bullion to continue to outperform ABX stock at these prices. IPOAF.PK (INDUSTL PENOLES) http://www.penoles.com.mx 397.5 mil shares outstanding (2002 annual, unchanged since 2001) @ $3.50/share $1391 mil MC 419 proven and probable reserves of silver (from 2002 annual report on website) $1391 mil MC / 419 oz. silver = $3.32/oz. You get "approx" 1.72 ounces in the ground for 1 oz. silver's worth of stock.
Additional comments: Industrias Penoles is the world's top producer of refined silver. They actually derrive more revenue from silver than any other source. But they lost money in 2002.
The word late Feb. 2004 from ECU Mini, who reported to lemetropolecafe.com, is that Penoles has hedged several year's worth of silver, that is, they have locked in to sell mostly all their silver at low prices. Set when prices were lower. How much lower, and at what price, is anyone's guess. As reported at lemetropolecafe.com, "We know the market is so tight even the world’s largest silver producer, Mexico’s Penolas, wasn’t thrilled about supplying 1 million ounces for a special project with ECU Silver, led by their extremely able CEO Michel Roy."
78.5 million oz. silver refined by the metals division in 2002, and 1 mil oz. gold. They probably refine almost all the silver that comes out of Mexico. They probably produce about 34 mil oz. of silver from their mines annually, and they have expansion plans.
I've heard this stock is tightly held, most is family owned.
Their oz. numbers are "proven & probable reserves", which is much more certain than most of the others which are mostly "inferred and indicated resources." They undoubtedly have "inferred and indicated resources" in addition to the "proven & probable reserves," I just could not find any info on that at the website or in the annual report.
Given the report in March, 2004, that Penoles has hedged silver for two years, I expect silver bullion to continue to outperform IPOAF.PK stock at these prices.
CDE (COEUR D'ALENE) http://www.coeur.com coeurir@coeur.com(208) 769-8155 or (800) 624-2824 213 mil shares (Issued 32 mil new shares late Oct. 2003) @ $4.33/share $922 mil MC cash $38 mil (I think this is an outdated cash figure) San Bartolome (Bolivia) reserves 146 mil silver Silver Valley Silver reserves 32 mil silver Rochester reserves 43 mil silver Cerro Bayo reserves 3.7 mil silver Total: 224.7 mil silver (to Produce 14.6 mil oz. silver in 2003) $922 mil MC / 225 mil oz = $4.10/oz. You get "approx" 1.39 ounces in the ground for 1 oz. silver's worth of stock.
The first week of January, CDE announced a deal for $160 million in convertable bonds! Beware of debt!
CDE continued to lose money in third quarter 2003, a loss of 10 cents/share, and they realized low prices for silver sales, $4.77. I believe they have hedged their gold production at low prices.
CDE looks like they owe both gold and dollars. A double debt warning for CDE investors!
Again, their listing of ounces is in the "reserves" category (more certain) not the "resources" category, which is less certain. They may have "resources" but like HL and Industrias Penoles, they give no estimates.
I expect silver bullion to continue to outperform CDE stock at these prices.
SIL (APEX SILVER) http://www.apexsilver.com/ information@apexsilver.com (303) 839-5060 45,023,760 ordinary shares outstanding. (Jan 30th press release) @ $15.95/share $718 mil MC cash on hand: $350 million after Jan 30th share offering, and March 16th convertable debenture. San Cristobal (Bolivia) (proven & probably reserves) 454 mil silver (forecast capital costs for construction to total approximately $435 million) (Produced zero silver in 2002) 7.8 billion pounds of zinc, and 2.9 billion pounds of lead $718 mil MC / 454 mil oz = $1.58/oz. You get "approx" 3.61 ounces in the ground for 1 oz. silver's worth of stock.
Additional comments: Apex may also have up to 35-50 exploration properties.
March 16th, Apex raises $144 million in a convertable debenture deal to help finance the development of San Cristobal. They now have 350/435, or 80.4% of the capital costs needed for construction. Raising the last bit should now be very easy to do. If, while raising money, they held their cash in the form of silver bullion, they would probably not need to raise any more cash at this point, since silver has moved up over 50%.
Apex is now the most cash rich silver stock on the list. About $350 million! Amazing. Their plan, as they have stated all along, is to wait until higher silver and zinc prices to develop their deposit. I wonder if they will be smart, and hold their "cash" in the form of silver bullion while they wait for silver bullion to go up in price? Seems so basic even a child could understand it. One key problem standing in the wayis that there are position limits on paper longs, and thus, APEX could not probably not buy that much silver bullion even if they wanted to. Ironic, isn't it? It is the most natural and sensical thing for Apex to buy silver while they wait for higher silver prices, and doing so would push up the price, but they likely will not act, and almost cannot act due to the problem of scales of size. This, to me, is so bizzare, I cannnot fathom it. I think I understand a lot, but this.... it is simply mind boggling. It's the result of a system so out of balance, it's insane, and the rational mind has no answer for the bizzare things we see today.
Look, COMEX is the last place on earth to buy silver now, in any really big size. Reports are coming in from all over that there is no bullion in significant size for sale available anywhere.
My advice to Apex would be to buy every bit of silver they can get. Even hold out a sign, put up a website, hire people to take the orders, and start buying silver, in all forms, at 10% and even 15% above the spot price. Just make yourself become the "market maker" and start buying silver from all over like a sponge soaking up water. Let the silver find you! In the long run, a 10-15% commission is nothing when the trade is this good. There may be position limits at the COMEX, but it's not illegal to offer to pay what you are willing to pay to the free market. Forget the COMEX, and make your own market!
Apex silver primarily has institutional investors.
Apex has a lot of zinc. That's an added bonus that is not factored in to my method of valuation.Zinc prices have been heading up soon, so that's another bonus. Plenty of zinc is especially good if zinc is moving up in price. Zinc hit a recent high of $.51/lb., from a low of about $.35/lb., currently at $.47. For zinc prices, see http://www.metalprices.com
And, they are not mining now, but are waiting for higher silver prices. That's also a plus. The management also seems to understand that silver will move upwards a lot. Another plus. Finally, George Soros, Billionaire, owns a bit of this one, just under 10% I read recently. That's another plus, in general, for the silver market if Billionaires are paying attention to it. There are several other zinc / silver plays on this list that investors might also consider: Canadian Zinc, Expatriate, or Metalline (I own Metalline, but not SIL.)
I do not have an idea on whether or not SIL will out perform silver bullion or not. It's hard to say, because of that huge zinc bonus. I expect most of the other stocks on this list to outperform or significantly outperform silver bullion in the long run from today's prices. GRS GAM.TO (GAMMON LAKE) http://www.gammonlake.com/ gammonl@sprint.ca (902) 468-0614 62 mil shares Fully Diluted: (Feb 27th, 2004) @ $5.80/share $360 mil MC Total Ocampo Inferred: 1,124,000 oz. gold, 50,438,000 oz. silver Silver equiv = 11.24 mil oz. + 50.44 mil oz. = 62 mil oz. Total Ocampo Measured & Indicated 2,207,800 oz. gold, 108,438,000 oz. silver Silver equiv = 22 mil oz. + 108 mil oz. = 130 mil oz. Total Ocampo Measured & Indicated plus Inferred = 182 mil oz. Gammon owns 26.3% of Mexgold, MGR Since Mexgold owns 185 mil oz. of "target exploration potential", 26.3% of that is 48.6 mil oz. 182 + 49 = 231 mil oz. $360 mil MC / 231 mil oz.= $1.55/oz. You get "approx" 3.67 ounces in the ground for 1 oz. silver's worth of stock. **Note** most of Mexgold's oz. that are added in are an "exploration target" not yet "inferred resources".
Additional comments: Drill results released Jan 7th: http://biz.yahoo.com/cnw/040107/gammon_lk_drill_rslts_1.html At current prices of a 64:1 silver:gold ratio at $425/oz gold and $6.60/oz silver, the resources are worth $1048 million of silver, and $1411 million worth of gold. Cash cost is $85/oz. Life of mine is 7 years.
Clifton has a complex JV agreement with Dumont Nickel. In sum, here is what Keith Moeller VP, Clifton Mining Company wrote to me: "If Dumont produces a positive feasibility study on an individual property piece, then they gain a 50% interest in that piece alone, not in the rest of the property. If they spend more than 5 million dollars (US) on any one piece and they produce a positive feasibility study on that piece, then they will gain a 60% interest in that one piece of property, not in the rest. If they stop at any time or fail to produce a positive feasibility, then they will gain no interest in any of our property. Right now we have around 7 different pieces of the property that have "Stand Alone" mine potential. If Dumont stakes or purchases any property within five miles of the joint venture property, then we automatically receive a 50% interest in that property."
My problem is how to quantify that. First, there is the range of potential silver resources. Second, there is the range of potential ownership, which is highly variable, and not subject to the entire property, nor necessarily subject to spending by Dumont, but subject mostly to Dumont doing a positive feasibility study on each of many properties . At the extreme ranges, the values are: 40% to 100% of 105 = 42 - 105 million oz. 40% to 100% of 1000 = 400 - 1000 mil oz. "exploration potential" $55 mil MC / 42 mil oz. = $1.31/oz. $55 mil MC / 1000 mil oz. = $.055/oz. You get "approx" 4.36 ounces in the ground for 1 oz. silver. Exploration Potential: 104
Additional comments: Note the "exploration potential" is very large.
For more info on what's going on with Clifton, see http://www.dumontnickel.com , JV partner. One man suggested buying both Clifton and Dumont to ease the difficulty in trying to figure out their JV agreement.
Clifton has 25% ownership of a biotech firm that makes a colloidal silver. The biotech firm has a patent on a "super" colloidal silver solution made with 10,000 volts that adds oxygen that gives it more powerful antibacterial properties, and is safer since it uses less silver, which would prevent "blue skin" argyria. Normal colloidal silver that you can make at home with 30 volts works to kill bacteria by disrupting the oxygen metabolism of the cell wall, killing bacteria with oxygen. The market for safe antibiotics is in the multi Billions of dollars.
ABL signs a contract with GNC. (April) Clifton's biofirm's colloidal silver product will be on the shelves of this mass market health food and fitness stores, GNC. Congradulations to Clifton! FSR.TO FSLVF.PK (FIRST SILVER) http://www.firstsilver.com/ info@firstsilver.com (604) 602-9973 or (888) 377-6676 38.6 mil shares fully diluted (Jan 2004) @ $1.84/share Cdn x .72 US/Cdn = $1.32 US $51 mil MC From the Company's main page at their url: "As at December 31, 2001, First Silver's mineable reserves were 12 million ounces of silver and inferred resources totaled 30 million ounces of silver. The mine is developing a 1000 plus meter exploration drift to upgrade currently identified inferred resources to mineable ore reserves and to discover new reserves." 12 + 30 = 42 mil oz. $51 mil MC / 42 mil oz. = $1.22/oz. You get "approx" 4.69 ounces in the ground for 1 oz. silver's worth of stock.
Additional comments: This is a high grade, producing miner. The high grades, about 300g/ton, are a plus. They are also actively exploring, another plus.
3rd quarter, 2003, FSR.TO produced 389,154 oz. silver, and 604 oz. gold. and revenue was $2.09 million for the 3rd quarter. They produced at a loss, (a penny per share). They are unhedged, and remain committed to remaining unhedged.
Additional Comments: Pan American of Canada buys Morococha silver mine in Peru for US$35 million This $35 million acquisition is a great deal for PAAS, and a minor help for PAAS shareholders. According to the press release above, the silver mine produced 3.5 million ounces of silver a year, at a cash cost of $3/oz., which is great! At $6.50/oz, that's $3.5 x 3.5 mil oz. = $12.25 million per year profit after cash costs! That gives the acquisition a P/E ratio for the mine's acquisiton cost of under 3! What a deal!
Unfortunately, PAAS shareholders are paying way above that when they buy the stock today. After this acquisition, PAAS should have a "2004 silver production forecast to 13 million ounces from 10.1 million ounces and will reduce forecast cash costs to below $ 3.50/oz, bringing anticipated total costs to less than $4/oz for the year." Now, at $6.50/oz, that's $2.5 x 13 mil oz. = $32.5 million per year profit, after cash costs. That gives a P/E ratio for PAAS of about $1000 / $32 = 31. Therefore, considering the two P/E ratios, 31 compared to under 3, PAAS stock is over ten times overvalued compared to other silver mining opportunities that exist in the market, such as the property they just purchased.
I believe PAAS is one of two silver companies on the list today that is significantly in debt (the other is CDE).
What if your silver company decides to lock in silver prices at $8, and hedge years of production to "protect the shareholders and provide exposure to the high $8/oz. price," only to watch silver prices head past $25 and past $50/oz? Your stock could get wiped out in bankruptcy, and your investment could go to zero value! This is the danger of stocks! Your investment is subject to the whims of management!
WARNING: PAAS says at their website that they will hedge silver, in order to finance mine construction. http://panamericansilver.com/s/CorporateProfile.asp "Pan American is loath to give away the upside on any of its silver production, especially at current low metal prices, and will do so only to the minimum extent required as a condition of prudent mine financing."
My opinion is that it is NEVER prudent to go into debt, or lock in silver prices to finance a mine. If PAAS cannot raise capital on the markets by issuing shares, then they should not be financing new mine construction. If the market will not support new mine construction, then the market does not need more silver. PAAS and CDE should learn to trust the free market process, and avoid debt.
Last week, I quoted some comments made by Ross Beaty about Ted Butler. This week, Ted Butler responds. See
or http://www.butlerresearch.com/ Bottom line is that if shareholders don't like the actions or inaction of their company's CEOs with regard to silver, investors need to contact the CEOs and let them know. I feel a silver company should hold paper cash in the form of silver until it is needed for drilling, acquisition, or development.
Also this week, Ross Beaty stepped down from his role as CEO, and is now only the Chariman. See Pan American Silver splits roles of Chairman and CEO athttp://biz.yahoo.com/prnews/040511/to030_1.html Furthermore, the press release notes that the new CEO, Mr Geoff Burns, "brings to the role very strong executive and financial management skills, which are so necessary during our current phase of very rapid growth."
This is potentially outstanding! The issue of holding silver bullion in preference to paper cash is, indeed, a "financial management skill". Hopefully, this means that the board of PAAS is taking steps to remove Mr. Ross Beaty from getting in the way of PASS using silver as money.
Now is the best time to contact the new CEO of PAAS, to urge him to use silver as money!
MFN MFL.TO (MINEFINDERS) http://www.minefinders.com/ 34.1 mil Shares Fully Diluted (Late 2003?) @ $6.00/share $205 mil MC Cash on hand, Fully Diluted: C$34 million "over 3.5 mil ounces of gold resource and 160 mil ounces of silver" --Dec. '03 silver conversion = 3.5 x 10 = 35 mil + 160 mil oz. silver = 195 mil oz. silver At 70:1 ratio, 3.5 x 70 = 245 "silver equiv" of gold, and 160 mil of silver = 405. 245/405 = 61% of the mineral value is in the gold, 39% silver. At 10:1 ratio, 35/195 = 18% of the mineral value is in the gold, 82% silver. "In addition to the resources already drilled, Minefinders controls a strong portfolio of properties in Nevada, Arizona, and Mexico which have the potential to host new multi-million ounce discoveries over the next few years." $205 mil MC / 195 mil oz. = $1.05/oz. You get "approx" 5.44 ounces in the ground for 1 oz. silver.
Additional Comments: At 70:1 silver to gold ratio, over half of MFN is in gold, so consider this a significant gold bonus. MFN also now lists their resource figures on their website's main page. I'm sure investors appreciate this. I do.
A one property company. The Carmen gold-silver deposit on their Monterde property in the Sierra Madre belt of Chihuahua State, Mexico. Significant exploration potential.
It was reported by a press release that 16%-17% of KBR.V is owned by silver bull Jim Puplava of http://www.financialsense.com, which I think is a rather solid endorsement of the company.
MGR.V MGRSF.PK (MEXGOLD RSCS) http://www.mexgold.com/ 52.5 mil fully diluted (spring 2004) @ $4.25/share Cdn x .72 US/Cdn = $3.06 US $161 mil MC inferred resource: 45 mil oz. silver + 1 mil oz gold. 1 mil oz. gold = + 10 mil oz. silver equiv "The estimate does not address significant additional mineralized structures known to be present on the property, or the potential for large strike extensions of known high-grade zones." February Financing was for the El Cubo Gold-Silver Mine is located in the Guanajuato gold-silver district in the Republic of Mexico. Historical reports cite district production at 1.2 billion ounces of silver and over 4 million ounces of gold. With capital spending and upgrades, and expect to produce up to 100,000 oz. gold equiv/year at $190/oz. At $400/oz, that may mean $210/oz. net profit, or $21 million positive cash flow/year, and yet, the purchase price was $21.5 million. Seems like they bought a mine, at a price, with a profit potential, of a P/E ratio of 1. Target to expand the El Cubo project resource to over 2 million ounces of gold equivalent. Given that historic production was 300 oz. of silver for each 1 oz. of gold, I think it's odd that they speak in terms of "gold equivalent". Why not emphasize the silver??? Converting their target of gold back to silver, at their ratio of 65:1, gives 130 mil oz. "silver equivalent". 55 + 130 = 185 "exploration potential" $161 mil MC / 185 mil oz. = $.87/oz. You have an "exploration potential target" of 6.57 ounces in the ground for 1 oz. silver's worth of stock.
Additional comments: Gammon Lake is a large shareholder, 26.3%.
Mexgold announced bonanza grade discovery on Jan 13th, 11 kilos per ton silver, over 2 meters. Part of a section of "25.5-metres grading 1.16 grams per tonne gold and 961 grams per tonne silver." WTZ WTC.TO (WESTERN SILVER) (formerly western copper) http://www.westernsilvercorp.com info@westernsilvercorp.com Jay Oness Toll Free: 1-888-456-1112 43.3 mil fully diluted (April 2004) @ $5.66/share $245 mil MC (not actively mining) $14 million Cdn in cash in the till (2 mil + 12 mil financing) no debt From the "SNC Lavalin Resource Calculation" March, 2003. Indicated 158.8 mil oz. silver Inferred 54.6 mil oz. silver Total 213.4 oz. silver. Total 1.94 oz. gold x 10 (at 10:1) = 19.4 silver equiv. The capital cost to get the mine going is estimated to be US $148 million Western Silver Completes Pre-Feasibility Study on Chile Colorado Zone at Penasquito New info: 267 mil oz. silver at a grade of just over 1 oz. per tonne. (an increase of 54 mil oz. over previous est.) Brechia zone will double the numbers, and infilling inferred to indicated: probably in Jan will have 500 mil oz. silver, 5 mil oz gold. Exploration potential: 500 mil oz. silver, 5 mil oz. gold, from http://www.mips1.net/mgn03.nsf/UNID/SBAY-5SUBN6 Plus, they have two other zones that could each duplicate the success of each of the other two. So up to a Billion... oz. of silver as "exploration potential"! Feasibility: 2006-7 production timeline. $245 mil MC / 287 oz. = $.85/oz. $245 mil MC / 1000 oz. = $.25/oz. --exploration potential You get "approx" 6.72 ounces in the ground for 1 oz. silver's worth of stock. Exploration Potential = 23
Additional comments: Western Silver was formerly Western Copper... Copper now at $1.35/lb!
Note the capital cost to get the mining started: $148 million dollars. WTZ also has the following other metal resources: 3.73 billion pounds of zinc x .50/lb = $1865 million 673 million pounds of copper x $1.30/lb = $874 million 1.3 billion pounds of lead x .40/lb = $520 million
* TM.V TUMIF.OB (TUMI RSCS) (TUY Frankfurt Exchange) (I own shares) http://www.tumiresources.com nicolaas@attglobal.net Nick Nicolaas IR (604) 657 4058 24 fully diluted shares (Mar. 1, 2004) @ $1.05/share Cdn x .72 US/Cdn = $.76 US $18 mil MC 20 mil oz resource up to 50 million oz. silver potential but needs to be explored and drilled. 500,000 gold resource x 10 = 5 mil oz. silver equiv. Debt free, 2 projects in Mexico. Raised $2.7 million Nov. 14, 2003 $18 mil MC / 25 mil oz. = $.73/oz. ***I'm using this number*** $18 mil MC / 50 mil oz. = $.38/oz. (exploration potential) You get "approx" 7.87 ounces in the ground for 1 oz. silver's worth of stock. Exploration Potential: 16 (likely plus more after bonanza silver discovery late November, 2003.)
Additional comments: Tumi soared in late November, after the company announced a bonanza grade silver discovery after drilling. This should significantly increase the numbers for their "exploration potential", but no word yet on the increase. It takes time for the geologists to estimate all of that, but investors went crazy over it immediately.
Tumi is focused on becoming a "premiere junior silver explorer." It's good to see the focus is in the right metal. Doing active drilling to prove up their projects and increase "resources". Nick Nicolaas really understands the silver story, beliving silver has much greater appreciation potential than gold.
Look at: Tinka TK.V (tumi's sister company) A pretty big gold/copper property in Peru (Tumi owns 30% of it)... That could mean significantly increased assets for Tumi.
I own shares of TM.V.
SSRI SSO.V (SILVER STD RSC) http://www.silver-standard.com/ paull@silverstandard.com (604) 689-3856 or (888) 338-0046 51.7 mil shares fully diluted (May 1, 2004) 57 mil shares fully diluted (could bring in another $45 million) as of May 15, 2004 (not sure if this number is right, could not confirm at the website, but it came in a forwarded email from Paul, and I'll use it, because I'm so bullish on the entire sector.) @ $9.93/share $566 mil MC debt free, cash: $Cdn 60 mil As of May 12: The company has budgeted $8.2 million in 2004 for feasibility and scoping studies and exploration of its 15 projects. With cash of $61 million, and marketable securities of approximately $10 million at March 31, the company decided to invest approximately 20% of its cash and securities in physical silver following the decline in silver prices in April and May. Silver Standard now owns over 1.95 million ounces of silver. This silver is held on an allocated and segregated basis and, consequently, is not available to be loaned. not mining or producing; 15 silver properties measured and indicated resources totaling 403.6 million ounces of silver plus inferred resources totaling 446.4 million ounces of silver = 850 mil oz. 2.2 mil oz. gold. Silver equiv = 22 mil oz. silver. (22 + 850 = 872 mil oz.) $566 mil MC / 872 mil oz. = $.65/oz. You get "approx" 8.80 ounces in the ground for 1 oz. silver's worth of stock.
Additional comments: Congradulations to SSRI for converting some of their cash, 20%, to silver bullion! I wish it was more, but it is certainly a great start! I received plenty of letters about this action, and I was watching the share price like a hawk on Thursday morning, but surprisingly, the share price hardly moved on Thursday morning.
Congradulations also, for now having more resources than PAAS. I'd expect your market cap to soon exceed PAAS which is at $839 million, especially given PAAS management's lack of understanding that silver is money, and can be used as money. If your market cap does exceed that of PAAS soon, it could mean a share price boost of about 48%
SSRI continues to add resources through drilling and acquisition.
SSRI really is the "silver standard". SSRI has the largest market cap this far down the list, which makes it a more attractive target for people with larger amounts of money to invest.
SSRI continues to add to reserves, either through exploring, or through acquisitions. This company seems to really understand the silver story, and helped to educate me as an investor.
I attended a two hour SSRI presentation after the Gold show in SF in late November. For the most part, their properties are very well drilled, and they have a fairly solid idea on how much silver oz. in the ground they have. They started their plan to acquire silver properties and become a "silver company" in about 1993, which explains why they have such a large market cap, and so many good properties with so many ounces of silver.
Some investors like SSRI because of the diversification --SSRI owns many silver properties. I say you can get a similar kind of diversification by owning stock in many silver companies.
ORM.V OREXF.PK (OREMEX RES) http://www.oremex.com/s/Home.asp info@oremex.com 24.2 mil shares Fully Diluted (April 1, 2004) @ $.89/share x .72 US/Cdn = $.64 US $16 mil MC Have $5 million cash in the bank as of Dec. 2003. holds the right to acquire a 100% interest in six mineral properties in Mexico. Oremex will focus on the exploration and development of the Tejamen Silver Property and the San Lucas Silver Property. They are hoping to explore for up to 100 mil oz. silver by drilling over the next year. --Experienced team of geologists and management that have put other properties into production: Anthony R. Harvey, Chariman, has put 14 properties into production in his 40 year career. http://www.oremex.com/s/TejamenSilver.asp?ReportID=68653 for an inferred resource of 8.4 million metric tons at a grade of 89 g/t Silver (2.86 opt) and 0.2g/t Gold (0.006 opt). 2.86 x 8.4 = 24 mil oz. silver at Tejamen (one of six properties) $16 mil MC / 24 mil oz. = $.64/oz. $16 mil MC / 100 mil oz. = $.155/oz. --exploration potential You get "approx" 8.92 ounces in the ground for 1 oz. silver's worth of stock. Exploration Potential: 37
Additional comments: Last week, I made a math error on Oremex. I reported the market cap as about 20% higher than it should have been. Sorrry for the mistake.
SRLM.PK ( STERLING MINING) http://www.sterlingmining.com/ RDemotte@aol.com Ray DeMotte 208/676-0599 16.6 mil shares fully diluted (Apr 2004) @ $5.95/share $98.8 mil MC ~185 mil oz. reserves + resource, Sunshine alone Quote from: http://www.sterlingmining.com/jun112003.html "The prior operator last estimated the mine reserves at 26.75 million ounces of silver, 10.36 million pounds of copper and 7.05 million pounds of lead (or approximately 28.85 million ounces of silver-equivalent), as well as an additional resource of 159.66 million ounces of silver. " ~100 mil oz. other properties: the 10 sq. miles around the 1/2 sq mile of the Sunshine (rough guess--needs to be explored) even though--these extra 100 mil oz. are in the "explorer" category. They need to be drilled and found, although I've heard of estimates as high as 400 mil oz. total for SRLM.PK $98.8 mil MC / 185 mil oz. = $.53/oz. $98.8 mil MC / 500 mil oz. = $.20/oz. (exploration potential) You get "approx" 10.77 ounces in the ground for 1 oz. silver's worth of stock. (Exploration potential is 29.)
Additional comments: I wrote an article on SRLM in late Dec. See: Sterling Mining
Ray DeMotte really, really understands the silver story, and has been aggressively acquiring silver properties. Sterling continues to consolidate its land position around the Sunshine mine.
Sterling Mining acquired the Sunshine mine. Sunshine was one of the big three: Hecla, Couer, & Sunshine. Sunshine went bankrupt. Sterling got the property a few months ago cheap, because they were quick & willing to pay cash. Other buyers wanted to do a full study before making an offer. This company's share price went ballistic as a result. But the company is still way undervalued. Just do the math, people. There were a few great articles written lately for SRLM. See the company web site, above. The best factors, I feel, are as follows: 1. The Sunshine mine is an existing mine that was mining at a profit. The company went bankrupt, not the mine. So there will be no great capital costs for start up, only minimal costs. 2. The Sunshine sits on 1/2 sq. mile, and was never fully explored. Sterling Mining owns 10 square miles of property surrounding the Sunshine, right in the heart of silver country, the location of CDE and HL, the other two big companies at the top of this list. 3. The management of Sunshine understands the silver story. They are on a mission to acquire distressed silver properties at today's cheap prices. See also: December 14, 2003: "In light of the continued low silver price, Sterling has this year begun holding back into inventory a portion of this year's silver coins minted."
CHD.V CHDSF.PK (CHARIOT RSCS) http://www.chariotresources.com/ 45 mil shares fully diluted October 2003 @ $.445/share Cdn x .72 US/Cdn = $.32 US $14.4 mil MC Cello Ccasa (1 project of 4) Resource Estimate - August 2002 31.4 mil oz. silver, 134,000 oz. gold. (x 10 = 1.3) 32.7 mil oz. (Still much exploration work to do.) $14.4 mil MC / 32.7 mil oz. = $.44/oz. You get "approx" 12.95 ounces in the ground for 1 oz. silver's worth of stock.
CZN.TO CZICF.PK (CDN ZINC) http://www.canadianzinc.com/ czn@canadianzinc.com 1-866-688-2001 67.3 mil shares fully diluted as of Dec., 2003 (as stated in the proxy, p.8) 80.2 fully diluted shares as of Feb 2, 2004 @ $.52/share Cdn x .72 US/Cdn = $.37 US $30 mil MC $13.5 million cash, Cdn, no debt. not mining ($20 mil needed to finish & start the mine) ($100 mil worth of mining infrastructure in place!) ~70 mil oz. (IN ZONE 3 only!! of 12 zones! This company seems to be greatly under-reporting their silver reserves. Their 18 year mine plan consists of zone 3 only, but there are 12 mineralized zones on the property.) Really, perhaps well over 100 mil oz. silver. $30 mil MC / 70 mil oz. = $.43/oz. You get "approx" 13.32 ounces in the ground for 1 oz. silver's worth of stock.
Additional comments: The additional cash from the recent private placements means that CZN will now be able to drill and explore more of their property. CZN likely has much more silver in the ground, and has good profit potential.
To get the mine up and running, they might be able to pay back such debt within 2 years, but I would hope they would avoid debt, and raise the capital in additional financings.
I note several very, very positive things about this company.
1. This was the mining operation set up by the Hunt brothers, the major silver investors in the silver spike to $50/oz. in 1980 who were bankrupted by their own debts and margin calls as a result of the COMEX rule changes and silver short sale manipulation. The Hunts spent $50 million building infrastructure to build the mine. They were 90% complete when bankruptcy hit. The value of those buildings is now $100 million, and the mine only needs about $20 million (CAN) ($15 mil US) to get the mine up and running. That's much cheaper than other cost estimates of other operations. 2. The 70 million oz. of silver estimate is for zone 3 only. But there are 12 zones on the property. The zone 3 estimate is for a 10 year mine plan that involves mining zone 3 at current metals prices. 3. High Grade ores: 12% zinc/ton; = 240 lbs. zinc/ton x 50 cents/lb. = $120/ton for the zinc. 10.1% lead/ton = 202 lbs. lead/ton x 40 cents/lb. = $80/ton for the lead. 6 oz. silver/ton x $6.95/oz. = $42/ton for the silver. 0.4% copper/ton = 8 lbs. copper/ton x 1.30 cents/lb. = $10/ton for the copper. Total: $249/ton! Prices accurate as of Mid Feb., 2004 4. My method of valuation: I'm really counting only the silver, not the base metals in my "oz in the ground" valuation. So consider a significant "zinc bonus", and "lead bonus". 5. Zinc and base metals prices headed up? Currently, 45 cents/lb. for zinc! Check http://www.metalprices.com/ for updates.
GGC.V GGCRF.PK (GENCO RESOURCES) http://www.gencoresources.com/ IR: Rob Blankstein: 604-682-2205, or info@gencoresources.com 20+ mil shares fully diluted (April, 2004) @ $1.10/share x .72 US/Cdn = $.79 $16 mil MC --Producer in Mexico. http://www.gencoresources.com/reserves.html 484 x .03215 = (15.5 oz) x 2.3 mil t = 35.8 mil oz. silver 2.00 x .03215 = 148,000 oz. gold x 10 = 1.5 mil oz. silver 385 x .03215 = ... x 95k = 1.2 mil oz silver 40+ mil oz. silver equiv. resources 2002 production, 500,000 oz. silver, 9000 oz. gold $16 mil MC / 40 mil oz. silver = $.40/oz. You get "approx" 14.42 ounces in the ground for 1 oz. silver's worth of stock.
Additional Comments: As of April, 2004, Genco is producing 35,000 oz/month of silver, earning $100,000 Cdn/month, and expects to earn $1,000,000 Cdn/month by year's end by doubling both the tonnage and the grade. Genco is also aggressivly planning on making property acquisitions.
RDV.TO RDFVF.PK (REDCORP VENTURE) http://www.redcorp-ventures.com/ http://www.redfern.bc.ca/index.html 52.7 mil shares fully diluted (March 2004) @ $.36/share Cdn x .72 US/Cdn = $.26 $13.6 mil MC http://www.redfern.bc.ca/projects/tulsequah/exploration_resources.html#results 9 mil tonnes indicated and inferred at 107.5 g/t x .03215 = 31 mil ounces silver (3.4 oz/ton low grade silver, with other minerals) (also have significant gold ($30/ton at $400/oz.) and zinc $60/ton at $.46/lb.) 728,000 oz of Gold x 10 = 7.3 mil "silver equiv" = 38.3 mil oz. silver equiv. $13.6 mil MC / 38.3 mil oz = $.36/oz. You get "approx" 16.00 ounces in the ground for 1 oz. silver's worth of stock.
Additional comments: RDV has a "gold bonus". At $409/ gold, and $6.50/oz. silver, it's about $300 million worth of gold, and $200 million worth of silver, or about 60% of the value is in the gold. Since my method really undercounts the gold, this means there is a significant "gold bonus" here. Redcorp Ventures Ltd.: Brokered Private Placement Financing Closed ($3 million)
ADB.V ADBRF.PK (ADMIRAL BAY RSCS) http://www.admiralbay.com/ info@admiralbay.com 604 628 5642 -- Curt Huber-- Business Development 33.3 mil shares fully dilluted. (March, 2004) @ $1.14/share Cdn x .72 US/Cdn = $.82 US $27 mil MC They have $6 million cash. --owns an option to earn 70% interest in "Miera San Jorge's Monte del Favor property in Mexico" "An historical resource estimate based on underground sampling at Monte Del Favor is reported at 17 million tonnes grading 0.85 g/t gold and 224 g/t silver for a contained 123 million ounces of silver and 460,000 ounces of gold." "While this resource estimate is not fully 43-101 compliant, the Company considers that it provides a conceptual indication of the potential of the property." 460,000 x 10 = 4.6 mil "silver equiv". 127.6 mil oz. x 70% interest = 89.3 mil oz. $27 mil MC / 89.3 mil oz. = $.31/oz. You get "approx" 18.65 ounces in the ground for 1 oz. silver's worth of stock.
Additional comments: Prior grades hit 2-5 kilos silver/ ton. (2000-5000g/ton. 70-176 oz. ton) Very high grades. The project was never properly drilled with modern methods.
Admiral Bay acquired this option to own a 70% interest in this silver property in June, 2003, and the acquisition did not impact their stock price at that time at all. Previously, they were a gas company, and they still have this other gas project, which may be more than half the intrinsic value of the company according to Curt Huber, who understands the silver story as expressed by Ted Butler and David Morgan.
My valuation method, obviously, does not give any value for their gas projects, which therefore needs to be factored in as a significant "bonus". Company goals for gas production are 2.5 million cubic feet/day by mid 2004, which at $5 would be $12,500/day gross, and target is 7.5 million cubic feet/day by the end of the year, again, at $5 would be $35,000/day gross, or $12.8 mil/year gross.
They are actively digging, drilling, and releasing results in press releases.
FAN.TO FRLLF.PK ( FARALLON RSCS) http://www.farallonresources.com/fan/Home.asp (604) 684-6365 Erick Bertsch 77.5 mil shares fully diluted as of April 1, 2004 @ $.54/share Cdn x .72 US/Cdn = $.39 US $30 mil MC Exploration and development in Mexico. Run by hdgold.com (Hunter-Dickinson) On 4 sulphide deposits out of 16, 29 mil ton grading 89 grams silver/t and 1.57 g gold/t. Conversion: 89 grams x .0353 oz/gram = 3.14 oz. RE: those 29 mil tons, they "anticipate increasing resources to 50 mil tonne range..." 3.14 oz. x 29 mil tons = 91 mil oz. silver 1.6 mil oz. gold x 10 = 16 mil oz "silver equiv". Total: 107 mil oz. silver equiv. (Exploration potential = x 1.7 = 181) $30 mil MC / 107 mil oz. silver equiv. = $.28/oz. $30 mil MC / 181 mil oz. silver equiv. = $.17/oz. --exploration potential You get "approx" 20.27 ounces in the ground for 1 oz. silver's worth of stock. Exploration potential = 34
Additional comments: Nothing done or drilled on the property since 1999. Why not? Because of low zinc prices: 46% of the price of the metals was in the zinc before prices crashed... The largest componant today is gold, which was surprising to Eric, the IR guy I spoke with. About 1/3 is in silver now.
At today's low metals prices: 2% x 2000 lb = 40 lbs zinc x $.42/lb = $16.8 for the zinc (.37 to .50 lb zinc.) 3.14 oz. x $5.15 = $16 for the silver. .055421 oz. x $385/oz. = $21 for the gold (Assuming 100% metals recovery--which is not likely to be the case. It may range from 60% to a higher percentage, depending on extraction methods used and the particular mineral targeted, which constantly change with technology advancements, and price changes in the metals. By the time a mine like this gets running, perhaps in 5 years or so, things may change to allow even greater metal recovery.)
Speaking with FAN.TO guys, they think reserves of ore could be 50 mil tonnes OR MORE, but that they really don't know, and want to issue conservative estimates.
PLE.V (PLEXMAR RES INC) http://www.paradox-pr.ca/image/plexmarnov2003.pdf 62 mil fully diluted (March 2004) @ $.225/share Cdn x .72 US/Cdn = $.16 US $10 mil MC --just acquired 2 silver mines in Peru Total: 1.09 mil gold oz., 28.4 mil oz. silver Total silver equiv: 38.4 mil oz. $10 mil MC / 38.4 mil oz. = .26/oz. You get "approx" 21.83 ounces in the ground for 1 oz. silver's worth of stock.
HDA.V (HUSIF pink sheets symbol?) (HULDRA SILVER) no website Phone: Magnus 1 (604) 261-6040 6.924 million shares out (fully diluted) (Nov or Dec '03?) @ $.35/share x .72 US/Cdn = US $.25 $1.7 mil MC no debt HDA's proven and probable reserves stand at 161,000 tons of ore grading an average 25.6 ounces per ton silver, and 10 percent combined lead/zinc -- 4.12 mil oz silver, not including the zinc & lead. According to Magnus, the indicated and inferred reserves total about 180,000 tons at about the same grading -- in other words, a further 4 million ounces of silver. ~8 mil oz. silver $1.7 mil MC / 8 mil oz. silver = $.22/oz. You get "approx" 26.27 ounces in the ground for 1 oz. silver's worth of stock.
Additional comments: There is a significant lead/zinc bonus. "The property could be put into production at a capital cost of Cdn $3.5 million -- with payback of capital (when equity financed) within two years."
* MGN (MINES MGMT) (I own shares) http://www.minesmanagement.com/ info@minesmanagement.com (509) 838 6050 Doug Dobbs 12.4 mil shares fully diluted (April 2004) @ $4.50/share $56 mil MC 261 mil oz. silver resources. Previous drilling spent over $100 million drilling the property. $56 mil MC / 261 mil = $.21/oz. You get "approx" 26.70 ounces in the ground for 1 oz. silver's worth of stock.
Additional comments: As copper moves up 5 cents/lb., it adds $100 million to the value of the deposit. As silver moves up $.50/oz., it adds $130 million to the value of the deposit.
Mines Management owned 10% of the rights to their property in Montana. The other 90% owner, Noranda, simply gave up on the property and walked away from their mining claim due to "perpetually" low silver prices and political concerns. That explains the rocketing share price. So, the MNMM group got 90% of the rest of the property FOR FREE!--the value of which, and the nature of this transaction has just barely begun to be understood by the market, given the low relative price.
Their property also has about 60% of the value (at current prices) in copper (copper at $1.24/lb.), 2 Billion pounds of copper, and 261 mil oz. of silver. Doing the math: 261 mil oz. silver x $5.70/oz. = $1.487 Billion. 2 Billion lbs copper x $1.24/lb.. = $2.5 Billion. Total value of mineralization before costs to extract, $4.0 billion. It was a high of: $4.8 Billion. This number increased from around $3 Billion just a few months ago!
They do not have an active working mine--which is a minus. They will need to raise capital to get a mine going. Noranda had several estimates for the cost to build a mine and mill, around $250 million. But it could be less depending on how economic they decide to do things. They are working on a feasibility study, and avoiding excessive dilution, which is a plus.
Regarding environmental concerns: Noranda had a fully approved Environmental Impact Statement (EIS) that led to successful project permitting, so environmental concerns were not a factor in Noranda's departure of the project in 2002.
EXR.V EXPTF.PK ( EXPATRIATE RECS) http://www.expatriateresources.com/ info@expatriateresources.com 1-877-682-5474 Dr. Harlan D. Meade, President and CEO 88 mil shares fully dulted March, 2004 @ $.20/share Cdn x .72 US/Cdn = $.14 $13 mil MC $1.2 mil CAN capital in the til no debt. Mostly a base metals company: Zinc. Also has some silver & gold. Total metal content of the six projects with resources... "Using current metal prices, the gross metal value of Expatriate's interest in the base metals in the properties is approximately US$1.56 billion as compared to US$540 million for its share of the silver and gold." Metal: Expatriate share of the project: Zinc 2.67 billion lbs. Copper 385 million lbs. Lead 202 million lbs. Silver 63.1 million oz. Gold 426,700 million oz. Gold x 10 = 4.3 mil "silver equiv". $13 mil MC / 67.4 oz. silver = $.19 You get "approx" 30.37 ounces in the ground for 1 oz. silver's worth of stock.
Significant zinc bonus, about 3 times the silver value. Smelter credits are estimated at about 60% zinc, 25% silver, 10% gold and copper, and the rest, other minerals. My method of valuation puts a value on the silver only, not the rest, so this is a significantly better value than my number shows.
Call Dr. Harlan D. Meade, President and CEO 1-877-682-5474, and ask him to send you an information packet on EXR.V. It contains a good report on why he is bullish on zinc.
* SVL.V STVZF.PK (SILVRCRST MINES) (I own shares) http://www.silvercrestmines.com/ info@silvercrestmines.com (604) 691-1730 25.9 million fully diluted March, 2004 @ $.87/share Cdn x .72 US/Cdn = $.63 US $16 mil MC $3 mil cash in the til. Now the Honduras and El Salvador "Resource" totals 43 million plus the exploration potential of 40 - 100 million in Honduras plus Mexico, --see news release from last month, plus drill programs to start in Mexico and El Salvador plus Guatemala another unknown but geologically similar to main property in Honduras and El Salvadore all three are within 25 miles from each other. Silvercrest added 14.3 million oz. of resources at El Zapote, 4-6-04 The range of exploration potential is between 89 - 149 million oz. $16 mil MC / 89 = $.18/oz. $16 mil MC / 149 = $.11/oz. You get "approx" 31.7 ounces in the ground for 1 oz. silver's worth of stock. (Exploration potential = 52++ oz.)
Additional comments: April 6th: SilverCrest Reports El Zapote Resource Estimates http://biz.yahoo.com/bw/040406/65883_1.html --Silvercrest added about 14 million oz. of silver resources in the April 6th press release.
The project in El Salvador is only 20 km from the property in Honduras, and the property in Guatemala is 15km away, so only one mill will be needed for the three when a production decision is made.
Silvercrest has been and will be acquiring more silver properties with the money raised in the late November 2003 private placement, which I think is an outstanding way to spend the money.
I own shaers of SVL.V
ASM.V ASGMF.PK (AVINO SILV GOLD) http://www.avino.com/ shares@avino.com 604 682-3701 -- David Wolfin 10.9 mil shares fully diluted, Nov. 2003 (with the 4 mil new shares from PP) (proposed PP in late Oct 2 mil units at $1.27 (unit = 1 share + 1 warrant at 1.58) @ $1.18/share Cdn x .72 US/Cdn = $.85 US $9.3 mil MC from: http://www.avino.com/other/goldstock100197.html --in 1997 "How Much Silver Does Avino Have?" "Operations at Avino's silver mine in Mexico are both open-pit and underground. I examined the reserves and interpolated the tonnage into silver ounces as follows: 28-million ounces proven; 50-million ounces probable and 27 million ounces possible." (Not all are 43101 compliant reserves & resources.--that is an old, third party report.) --focus is on being silver company. A plus. They actually have over five silver properties/projects. I'm only have numbers to count for one, the "Avino mine". = 28 + 50 + 27 = 105 Avino owns 49% of that, or 51.5 mil oz. -"not considered reserves under the new Canadian National Policy 43-101" $9.3 mil MC / 51.5 mil oz. = $.18/oz. You get "approx" 31.75 ounces in the ground for 1 oz. silver's worth of stock.
Additional notes: There are 4 additional silver properties that I don't have numbers for. Consider this a "silver bonus"!!!
Mexican mining law once stated that a controlling interest had to be owned by Mexicans, which explains why they only have a 49% interest. That they don't have a controlling interest is a minus. This law has changed. The mine was operational until the mine went into temporary closure in November 2001. So there is in place an existing mine, with working infrastructure, which is a bonus. There is a need for drilling in order to test the potential that was stated in the feasibility study.
ABI.V ABMBF.PK (Abcourt Mines Inc.) no website Jeff Tremblay (IR) (418) 575-1169 26 mil shares fully diluted (May, 2004) @ $.18 share Cdn x .72 US/Cdn = $.13 $3.4 mil MC no debt., North of Montreal., 8 mil shares family owned. proven reserves... not ready to be opened, re-opened perhaps in mid 2005? --Past producer, so there's existing infrastructure. --Resource: 18.1M oz silver, 120,000 oz. gold, 303,000 tons zinc, 2,308 tons copper $273 million worth of zinc at .45/lb, $108 million worth of silver at $6/oz, $45.6 mil worth of gold at $380 $3.4 mil MC / 19 mil oz. = $.18/oz. You get "approx" 32.19 ounces in the ground for 1 oz. silver's worth of stock.
Additional comments: looking to raise $5 mil to reopen the gold mine. needs $5 mil to reopen the silver mine. (drilling the silver mine planned for summer, 2004) needs $5 mil for the zinc project.
UNCN.OB ( UNICO INC) http://www.uncn.net/ Ray Brown, 530-873-4394 70 mil shares @ $.074/share $5 mil MC Three main properties: Bromide-- 372,000 ounces of gold? Silver Bell--15 mil oz silver? Deer Trail --287,000 ounces of gold and 27 million ounces of silver... but the lease on the Deer Trail will expire June 1 2004, so they need to raise significant money in about 3 months. 49 mil oz. total. $5 mil MC / 49 mil oz. = $.10/oz. You have an expiring lease on "approx" 54 ounces in the ground for 1 oz. silver's worth of stock.
Additional comments: They need $4 million to exercise their option to buy the "Deer Trail" property. They are considering various options on how to do that. Ray Brown has been in this business a long time, and is excited that he's got a bunch of younger guys working on the property now, and he's encouraged by the upward direction of the price of precious metals.
Explorers deserve their own category, since they cannot be valued by my method of looking at reserves and resources of ounces of silver in the ground. We do not know how many oz. they might have. They are exploring for that. A few explorers may also be producers.
This list, although at the bottom, in no way indicates that these companies are more highly valued than companies listed above. It is also difficult to categorize a company as an explorer, since all silver companies always hold more silver properties that need to be explored.
(The order is by largest market cap first, not by "comparative value".)
I removed Imperial Metals because I could NOT see that they were a significant silver miner with significant silver resources.
HL (HECLA MINING CO) http://hecla-mining.com/ hmc-info@hecla-mining.com (208) 769-4100 115 mil shares @ $5.42/share $623 million Market Cap (MC) near zero debt, cash: $123 mil (Feb., 2004) (est. 2003 production 9 mil oz. silver) (the La Camorra gold mine, 412,000 oz gold.) ... (x 350/5 = 28 mil silver equivalent oz.) San Sebastian silver mine, (proven & probably reserves) 8.7 mil (produced 3 mil) the Greens Creek silver mine (proven & probably reserves) 31 mil (produced 3 mil) Hecla owns just under 30% of it! the Lucky Friday mine (proven & probably reserves) 14 mil. (produced 2 mil) Total silver = 32 million oz. Plus 412,000 oz. gold x 10 = 4.1 mil oz silver equiv. Total silver equiv. reserves = 36 mil oz. $623 mil MC / 36 mil "oz." = $17.31/oz. You get "approx" .33 ounces in the ground for 1 oz. silver's worth of stock.
Additional comments: HL has more oz. than listed in the "proven & probable" category used in this calculation. Vein mining makes reserve calculations difficult, and HL has rarely had more than about a 3-4 year picture of reserves ahead of them in 100 years of production.
Hecla has a net income of $6.2 million for the first quarter of this year. Annualized, that's $24.8 million for the year, which gives a P/E ratio of 25, which indicates to me that HL is still too expensive of a stock to buy.
Hecla is the most expensive company on the list in terms of cost per oz. of silver in the ground.
I expect silver bullion to continue to outperform HL stock at these prices. EZM.V EZMCF.PK (EUROZINC MINING) http://www.eurozinc.com/ 224 million shares Fully Diluted @ $.50/share Cdn x .72 US/Cdn = $.36 $81 mil MC
SPM.V SMNPF.PK (SCORPIO MINING) http://www.scorpiomining.com 52.2 mil shares fully diluted April 2004 (after recent $16 million Cdn private placement) @ $2.02/share Cdn x .72 US/Cdn = $1.45 US $76 mil MC
*IMR.V IMXPF.OB (IMA EXPL) (I own shares) http://www.imaexploration.com 43.4 mil Fully Diluted shares (May 1, 2003) @ $2.02/share Cdn x .72 US/Cdn = $1.45 U.S $63 mil MC Exploring in Argentina. $4.5 million cash
Additional comments: As of late April, 2004, IMA expects to release a resource calculation, based on their latest drilling results, within about 3 weeks.
CDU.V CUEAF.PK (CARDERO RSCS) http://www.cardero.com/ Henk Van Alphen -- President (604) 408-7488 32 million shares fully diluted Dec. 11th , 2003 @ $2.25/share Cdn x .72 US/Cdn = $1.62 US $52 mil MC ($10 million Cdn cash in the till after $5.9 mil private placement closed on Dec. 11th) Speculated resources, or "exploration potential": Providencia -- high grades, could have 100-250 mil oz. Chingolo -- Will finish drilling by secnod week in November -- Henk says, "may have 400-600 mil oz. "exploration potential" in 200-300 mil tons of rock." They got 30-40 grams (1.23 oz.) on the first drill hole, but hope to find 2-3 ounces silver/ton. Please note, "exploration potential" is a non quantifiable, non-regulated, unauthorized type of estimate. It is not 43-101 compliant. Trading decisions should probably not be made on these kinds of shaky estimates, which may be only hype and hope. An investor who wants to be protected by US regulations should wait for geologists to pour over the drill results and produce numbers that comply with 43-101 regulations, that may one day appear in a company press release. (Also, the first time Cardero issued drilling results earlier this year, the stock price was cut almost in half due to lower than expected results. The stock price has since recovered.) Nevertheless, here's how those "exploration potential" numbers work out if you do the math: $52 mil MC / 500 mil oz exploration potential = $.10/oz. $52 mil MC / 850 mil oz exploration potential = $.06/oz. Exploration potential: you might get about 57 - 93 oz. silver for one oz. silver worth of stock.
Cardero has three properties in Argentina; actively working on two: Chingolo and Providencia. Chingolo was just measured as twice as large as previously thought. They are trying to prove up these properties.
Providencia also has potentially high grades in several very large conglomerate deposits that can be mined at a profit today. Their property at Providencia was an active mine, but only a few tons/day. But they hope to make a large open pit project out of the main deposit, processing perhaps a few thousand tons/day.
High grades are very important in today's environment, especially if you can buy them cheaply.
They are also acquiring more silver properties, which is another bonus. This is an aggressive silver company. More properties help to alleviate the risk of an explorer.
AOT.V ASOLF.PK (ASCOT RSCS) http://www.bmts.bc.ca/aot/ 1 604 684 8950 39.7 fully diluted. (Nov 2003) @ $.325/share Cdn x .72 US/Cdn = .23 $9.28 mil MC (US) ---- Additional comments: They own 5.82 million shares and 388,000 warrants of Cardero at $.35, which usually is a greater asset value than their market cap. Ascot's share price is typically around 80% of the value of their Cardero Stock.)
(I'm listing this one out of order, not by market cap, and next to Cardero, because of their position in Cardero.)
MCAJF.PK (MACMIN LTD) http://www.macmin.com.au/ 450 mil shares and options (Feb., 04) @ $.12/share $54 mil MC "Total Inferred Resource is 34.5 million ozs silver but the district is unexplored for epithermal silver and exploration to date suggests a district potential of 50 to 100m ozs Ag or perhaps much more." --"Macmin is a silver focussed company" The Texas Silver Project has in-ground resources of 44.5Moz of silver equivalent. (They own some Malichite, MAR.AX) Also, significant gold projects, perhaps several multi-million oz. potential projects.
* FCO.TO FCACF.PK (FORMATION CAPTL) (I own shares) http://www.formcap.com/frhome.htm inform@formcap.com 604-682-6229 165 mil fully diluted, March 2004 @ $.39/share x .72 US/Cdn = $.28 $46 mil MC (Recently completed $10 million financing) Very large cobolt property: 1-3 million tons of 0.60% cobalt equivalent Cobalt prices are racing ahead, up to $25- $33/lb. see http://www.wmc-cobalt.com/prices.asp 2000 lbs/ton x 0.6% = 12 lbs/ton x $29.50 /lb. = $354/ton (rich ore) Cobolt is $29.50/lb. recently, up from $9/lb. Formation Capital owns the Sunshine Silver Refinery (near Sterling Mining), worth $50 million. Break even cost $5-6/lb cobolt. The Idaho Cobalt Project is projected to produce 1,500 tonnes of cobalt per annum. = 3,000,000 lbs. production x about $ 20/lb profit? = about $60 mil profit/year??? FCO.TO also owns a few minor silver projects. The cobolt project needs more drilling, and with recent financing, things look bright. Formation capital will be re-starting the Sunshine Silver Refinery--expected in early June.
I own shares of FCO.TO
* MMGG.OB (METALLINE MINE) (I own shares) http://www.metalin.com/site_map.html metalin@attglobal.net Merlin Bingham 208-665-2002 21.6 mil shares fully diluted (April, 2004) (only 2 mil options and warrants) @ $2.10/share US $45 mil MC $8 million cash in the til.
Metalline's Sierra Mojada Project Status Report Wednesday May 5 Zinc & Silver in Mexico: Sierra Mojada. Sierra Mojada is a Silver District! Silver: Historic production was 10 mil tons of high grade ore... historic silver production went right "direct shiped" to the smelter, non-milled. It contained 500-1000 grams silver/ton, or 17.65 to 35 oz. ton. This means 170-353 million ounces of historic "high grading," non-milled, production. (Who knows how much silver is left?) That's the question with an explorer.
Zinc: Very high grades: 11.8% zinc. Potentially the lowest production cost in the entire zinc industry due to new "oxide deposit" chemical extraction process as revolutionary as "heap leaching". Exploring for up to 4 Billion pounds zinc.
Project ownership: MMGG terminated the buy-in agreement with Penoles, who went into default, so MMGG now owns 100% of the project! See http://biz.yahoo.com/bw/031203/35526_1.html
I believe this is very good for MMGG, since the Penoles agreement made it more difficult to quantify the value the company. Now, it is easier to value the company, and the existing shareholders will own more of the project and profits. It is important to note thatMMGG took the initiative to terminate the agreement. Penoles did not issue a statement indicating any intent to walk away. Penoles' delay or indecision caused them to lose the rights to their buy-in option agreement. Just like if you have an "in the money" option, it's a mistake to let it expire.
(Merlin of MMGG.OB, and Harlan of EXR.V (friends, actually) both have reports that will educate you on the bullish story for Zinc.)
I own shares of MMGG.OB
TVI.TO TVIPF.PK (TVI PACIFIC) http://www.tvipacific.com Dianne (IR) Phone: (403) 265-4356 378 mil shares fully diluted (April 2004) @ $.16/share Cdn x .72 US/Cdn = $.11 US $43 mil MC "The company has a policy of not hedging or entering into forward sales contracts." Cash flow positive. !!! --> + 2.5 % royalty on "Rapu Rapu" that should be worth about $1 million per year starting within 9-12 months. (a cash source for an explorer is a big plus) 14 projects in the Philippines. Producing a dore bar of 96% silver and 4% gold from Canatuan project with the following: Total silver = 7.1 mil oz silver Total gold = 182,000 oz. gold x 10 (@10:1) = 1.8 mil oz silver equiv. Total silver equiv (Canatuan) = 8.9 mil oz. + they own a drilling company with 20 rigs. + they have a "foot in the door" in China. + many other promising exploration properties in the Asian Pacific.
Additional comments: This company exploded in price from 16 cents to 23.5 cents when they announced that they would be mining in China: "TVI Pacific Inc. Receives Landmark Approval for Wholly Foreign-Owned Enterprise (WFOE) Status From Chinese Government". see http://tinyurl.com/vwbw
They are primarily a silver explorer. The bonus is they are a producer, and are cash flow positive, which are both extremely rare for an explorer. In fact, the other producers mostly all lose money!
* OTMN.PK (O.T. MINING) (I own shares) http://www.otmining.com/ info@otmining.com Jim Hess Tel: 514-935-2445 12.8 mil fully diluted (May 15, 2004) @ $3.25/share $42 mil MC Montana Historic silver production for the Butte district, from 1880 to 2000 was 714,643,005 oz. silver. They think their deposit may be bigger than "the richest hill on earth", which is located near their property, in the Butte district. The exploration potential for this company is astounding, if they are right.
Additional comments: The other benefit of FR.V is that the company is keen on acquiring new properties. This is where the best money is made for a company in today's bull market in silver, in my opinion. From the home page of the website:
"First Majestic recently announced the acquisition of Le Parrilla Silver Mine, Mexico, which is anticipated to be the first of several acquisitions over the coming months."
I own shares of FR.V
* NPG.V NVPGF.PK (NEVADA PAC GOLD) (I own shares) http://www.nevadapacificgold.com/ dhottman@nevadapacificgold.com (604) 646-0188 David Hottman 47.4 mil shares fully diluted (April 2004) @ $1.01/share Cdn x .72 US/Cdn = $.73 US $35 mil MC $2.8 million cash (April 2004) Amador Canyon Silver Project: 50-250 mil tonnes silver grades average 4 oz. sil/ ton in the deposit = 200 to 1000 mil oz. silver????? --very speculative at this point. Drilling needs to be done. $34 mil MC / 200 mil oz. = $.17/oz. $34 mil MC / 1000 mil oz. = $.035/oz. The inverse: you "might" get 33 - 168 ounces in the ground for 1 oz. silver.
Additional comments April 2: Nevada Pacific Gold to Initiate 25,000 Feet of Drilling on Keystone, Amador Canyon and Limousine Butte The 200 to 1000 mil oz. of silver exploration potential estimate for the Amador Canyon project is based on the size of the area, which may provide between 50 and 250 million tonnes of ore, times a low grade of 4-6 ounce per ton. 50 mil tonnes x 4 oz/tonne = 200 mil oz., the low end of the target range. 250 million tonnes x 4 oz/tonne = 1000 mil oz., the high end of the range. That target range is the expectation that the geologists are hoping the drilling will prove up. It will likely take several rounds of drilling and analysis of drill results to get a proper resource calculation, and plenty of time.
NPG.V has 10 gold projects, and one silver-but it may be big. The Chariman, David Hottman, says that 90% of the value of the company is in gold, NOT silver, and yet, I'm buying this company for the silver project of Amador Canyon only, and as if the gold componant was worth nothing. (The gold projects are a free bonus, in my book, and help to alleviate the risk of this explorer.)
Explorer in Nevada. They do not really know how much silver they might they have in the Amador Canyon project. They just did a $2.5 million private placement, and another $10 million private placement in late November. On the website, for David Hottman's bio, it says he was a founding member of Eldorado gold. "During his tenure, Eldorado's market capitalization grew from Cdn $7 million in 1992 to a peak of Cdn $781 million in 1996." Please note, exploration is risky, and costly.
Now that they are well-capitalized with over $10 million dollars, this company will likely do very well as they drill and prove up the deposits across all their properties.
I own shares of NPG.V
MAG.V MSLRF.PK (MAG SILVER) http://www.magsilver.com 28 mil fully diluted shares (Nov. 19, 2003) @ $1.26/share Cdn x .72 US/Cdn = US $.91 $25 mil MC
--"MAG Silver Corporation enters the silver market as a powerful force. MAG combines a seasoned management team with two drill-ready geological extensions of high-grade world class producing districts. MAG controls 100% of the Juanicipio property adjacent to the Fresnillo District in central Mexico, currently producing over 12% of the world's silver from high grade underground vein structures."
The geologist, Peter K.M Megaw, is also working with EXN.V, another high grade silver project. Peter's philosophy was that it makes sense to go after very high grade silver projects that will be profitable regardless of the silver price.
IAU.V ITDXF.PK (INTREPID MINRLS) http://www.intrepidminerals.com/ scoates@intrepidminerals.com Stephen Coates, Investor Relations (416) 368-4525 51 mil fully diluted (April, 2004) @ $.82/share Cdn x .72 US/Cdn = .59 US $30 mil MC $3.2 million cash from Dec. 9 financing. Company's exposure is about half to gold, half to silver in several projects. Joint Venture with BHP Billiton focused on "Cannington" style silver deposits using proprietary BHP Billiton data. (all figures are "exploration potential") El Salvador - 38.5 mil oz. Argentina - 6 mil oz. Total: 44 mil oz. silver Total gold: ~690k oz. x 10 (10:1 ratio) = ~ 6.9 mil oz. "silver equiv" Total: 53 mil oz. "silver equiv". (exploration potential or indicated or inferred, not reserves)
The stock price exploded, nearly doubling, in response to the news of the above drilling results.
Since this company is about half gold and half silver, the 10:1 ratio really cuts down the "silver equiv" numbers, so keep in mind the "gold bonus" factor here. But it's like that with a lot of the companies on this list, so keep that in mind, and do your own math if you want to use the 70:1 ratio.
ECU.V ECUXF.PK (ECU SILVER MINI) http://www.ecu.qc.ca/indexen.html ecu@ecu.qc.ca (819) 797-1210 103.3 mil fully diluted shares = (6 January 2003) @ $.28/share Cdn x .72 US/Cdn = $.20 $21 mil MC The shares of ECU.V recently stopped trading recently. The exchange wanted them to update their website, particularly their listing of resources and reserves. See ECU Silver Mining Inc. Clarifies and Retracts Previous Disclosure A new resource calculation is expected soon. ECU.V is also exploring other gold properties.
MMM.TO MMAXF.PK (MINCO MINING) http://www.mincomining.com/ investor-info@mincomining.ca 1-888-288-8288 23 mil Fully Diluted @ $1.40/share x .72 US/Cdn = $1.01 $23 mil MC Located in China 2 gold projects and 1 silver (42% owned). Explorer
MAI.V MNEAF.OB (MINERA ANDES) http://minandes.com/ ircanada@minandes.com (604) 689-7017 Art Johnson 90 mil shares fully diluted (April, 2004) @ $.44/share Cdn x .72 US/Cdn = $.32 US $28.5 mil MC Raised $6.6 mil in recent financing. owns 49% of the resource: "55 mil silver equiv. oz. resource" back in 2001. AT 60:1 silver:gold when gold was about $300/oz., about half/half silver and gold. Estimated: 16.7 mil oz "silver equiv" 15 mil oz. silver + 1.7 mil oz. "silver equiv" of 170,000 oz. of gold. They will be exploring for more: (The resources may be only 10% of the property.) 2.2 km stretch, open another 2.7, plus 3 other vein systems. significant high grade silver exploration potential. 7000 meters of diamond drilling. Plus a copper project, billion ton ore deposit. $28.5 mil MC
Additional comments: Minera Andes plans to "fast track" to production. Expecting $.17-$.18/share Cdn earnings/year, as of April, 2004
About half is gold value, half is silver value at 60:1. Minera Andes has several significant bonuses that my method is not valuing properly. First, I undercount the gold, of course, so consider there is a "gold bonus" at current gold prices. Second, they will be doing significant exploration work to increase their resources, and they have recently raised the money to be able to pay for that exploration work. Third, they have a copper project, and copper prices are rising. I moved MAI.V to the explorers list to be more fair to their valutation.
PXI.V PNXPF.PK (Planet Exploration Inc.) http://www.planetexploration.info/mexico.asp 30.8 mil fully diluted (Jan. 2004) @ .79/share Cdn x .72 US/Cdn = $.57 $17.5 mil MC Planet holds an option to acquire a 100% interest in the high-grade 7,005-hectare Copalquin gold/silver property located in Durango, Mexico. "Resource estimates on the property have not been calculated since the discovery of the high-grade vertical fault zone, its existence may significantly alter Kennecott's and Fransisco Gold's original target potential of one million ounces of gold and 50 million ounces of silver based on their interpretation of a low-grade horizontal quartz breccia formation." $17.5 mil MC / 60 mil = $.29/oz. Exploration potential: 19 oz. of silver per oz of silver's worth of stock.
* CBE.V CBEFF.PK (CABO MINING)(I own shares) http://www.cabo.ca/ jav@cabo.ca (604) 681-8899 John Versfelt, President Fully diluted subtotal, including shares needed to acquire two drilling companies, which is contingent upon a financing.
= 18,880,436 as of February 9th, 2004 (Post-Consolidated) not including recent financing, which still needs approval by the exchange, and when added, will increase the market cap by about $9 million or so?
In the article, I highlight what I feel is Cabo's most imporant asset: control of 60% of the mining camp of Cobalt, Ontario. The "silver capital of Canada" produced historically, over 500 million ounces of silver.
Cabo has exposure to silver, cobolt, nickel, gold, diamonds, and drilling companies.
Regarding the contracts to acquire two drilling companies in Canada: With all the money raised lately by so many companies to do exploration work now that precious metals prices have increased, drilling companies are now in extremely high demand. Many explorers are saying they are having difficulty finding any drillers available!
To learn more about the mining camp town of Cobalt, there is a fascinating article detailing the history of the silver camp at http://www.cobalt.ca/cobalt/history.htm
I own shares of CBE.V
QTA.V QURAF.PK (QUATERRA RES) http://www.quaterraresources.com/ Jay Oness Toll Free: 1-888-456-1112 60.6 mil shares fully diluted @ $.36/share Cdn x .72 US/Cdn = $.26 US $16 mil MC
Additional Comments: three main properties in North America. The main exploration project is the Nieves, near the massive Fresnillo silver mine, owned by Penoles.
QTA.V is a Sister Company to Western Silver, WTZ above. See also Bravo Venture, BVG.V, another sister company, with 34.5 mil fully diluted shares (April, 2004)
* EDR.V EDRGF.PK (ENDEAVOUR GOLD) (I own shares) http://www.edrgold.com/ Hugh Clarke, Investor Relations 1-877-685-9775 23.7 mil shares fully diluted (April, 2004) @ $1.15/share Cdn x .72 US/Cdn = $.83 $20 mil MC http://www.edrgold.com/s/SantaCruzMine.asp --currently producing 600,000 oz. silver/yr. --expect to increase production to 4,000,000 oz. silver/yr
DNI.V DMNKF.PK (DUMONT NICKEL) http://www.dumontnickel.com info@dumontnickel.com (416) 595-1195 60 mil shares outstanding (April 15, 2004) does not include options and warrants. @ $.23/share x .72 US/Cdn = $.17 $10 mil MC Dumont still needs to raise and pay several million to clifton for 50%-60% of each property, and there are many properties. (See Clifton for more specifics on the JV agreement.)
Additional comments: Clifton's JV partner, doing active drilling work right now. And recent property acquisitions. I moved Dumont to the explorer category, because I really don't have any idea what percent of Clifton's property they may acquire, which depends on Dumont completing a feasibility study on each property.
There seems to be significant disagreement between Clifton's shareholders and Dumont's shareholders on which company has the better value. On the one hand, Dumont is the aggressive partner, since they are the one doing the acquiring. On the other hand, Clifton is the holder of most of the properties, and Dumont has to pay several million to acquire each of the many properties. This is a very complex deal.
I do not like JV agreements due to the complexity of trying to determine ownership which is contingent upon many unknown factors that might change in the future. One man recently offered me an interesting suggestion. He simply said, "Why not buy both companies?".
EXN.V EXLLF.PK (EXCELLON RSCS) http://www.excellonresources.com 87 mil shares fully diluted (Jan 9, 2004 press release) @ $.15/share Cdn x .72 US/Cdn = $.11 US $9 mil MC From http://www.smartstox.com/reports/excellon.html indicated = 63,400 t x 2738 g/t x .03215oz./g = 5.6 mil oz. silver inferred = 2100 t x 1,433 g/t x .03215oz./g = .1 mil oz. silver "gross in-situ value of mineralization is $31.4 million." EXN to own 51% of the project. Apex is the joint partner. 51% x 6.2 mil oz. = 3.16 mil oz. (Company expects 114 mil shares fully diluted after takover of Destorbelle, needed to bring project ownership up to 51%) $9 mil MC
Additional comments: "Excellon ...is exploring and developing".... "a Bonanza grade Silver deposit in Mexico." The geologist, Peter K.M Megaw, is also working with MAG.V. From J. Taylor's write up on 2002: "After subtracting capital cost of US $1.8 million, custom milling charges and operating costs, management believes this underground development mine can, over the next two years, generate US $15.8 million or nearly $8 million for EXN's 51% share." That was when silver prices were under $5/oz.! The company plans to use these proceeds to further drill and explore the property. They believe the property may contain significantly more silver, as if what's known is only the "tail of the tiger"; furthermore, they believe they can fund exploration by mining the high-grade silver deposit that has been partly drilled.
BCM.V BCEKF.PK (BEAR CRK MINING) http://www.bearcreekmining.com/s/Home.asp 39.2 million shares fully diluted @ $.45/share Cdn x .72 US/Cdn = $.32 US $13 mil MC --About 6 properties in Peru
NJMC.OB (NEW JERSEY MIN) http://www.newjerseymining.com/ Fred or Grant Brackebusch minesystems@usamedia.tv 23.9 fully diluted Apr, '04 @ $.51/share US $12 mil MC New Jersey Mining Company (NJMC) is engaged in exploring for and developing gold, silver and base metal ore reserves in the Coeur d'Alene Mining District of northern Idaho also known as the Silver Valley - one of the world's richest silver districts.
CMA.V CRMXF.OB (Cream Minerals Ltd) http://www.creamminerals.com/cream/main.htm http://www.langmining.com/cream-mx/ = 34.8 mil shares fully diluted (March 31, 2004) @ $.40/share x .76 Cdn/US = $.30 US $11 mil MC from: http://www.langmining.com/cream-mx/companyProjects_Summary.html Project B: Potential Target: 400m x 500m x 150m x 2.5 t/m3 = 75,000,000 tonnes Say at: Au 0.480 g/t Ag 149.33 g/t Silver only, that's (1 gram = .03215 troy oz.) 4.8 oz./t x 75 million tonnes = 360 million oz. "exploration potential" in a low-grade deposit. $11 mil MC / 360 mil oz. = $.029/oz. (exploration potential) --not a "resource"!!! You may get 194 oz. of silver, per oz. of silver's worth of stock. (Compare to NPG.V)
Additional comments: Another silver property is the Kaslo. "The Kaslo Silver Property encompasses the Keen Creek Silver Belt and is comprised of nine former high grade silver mines"...
* KG.V KDKGF.PK (KLONDIKE GOLD) (I own shares) http://www.klondikegoldcorp.com/ 70 mil fully diluted (Nov. 2003) @ $.19/share Cdn x .72 US/Cdn = $.14 US 5 year high .30 $10 mil MC
This company has many silver and gold properties. Dennis Fong is also involved with GNG.V, Golden Goliath.
Klondike has one silver property that could be producing within weeks.
(I own shares of KG.V)
SML.V SMLZF.PK (STEALTH MNRLS) http://www.stealthminerals.com Email-Bill@McWilliam.com 604-306-0391 Bill McWilliam, Chief Executive Officer 48 mil shares (August 31- 02) @ $.37/share Cdn x .72 US/Cdn = $.30 $15 mil MC
NBG.V NBULF.PK (NEW BULLET GP) http://www.newbulletgroup.com/index.htm 50 mil shares fully diluted (including 15 mil new PP) http://www.newbulletgroup.com/financial.htm @ $.22/share Cdn x .72 US/Cdn = $.16 US $8 mil MC NBG.V has a gold deposit in Brazil that's bigger than the silver project in Mexico. http://www.newbulletgroup.com/mexico.htm " If the deposit extends to considerable depth, as do many of the silver deposits in the region, it is reasonable to assume a deposit of 300 million ounces of silver." Stroud Resources, JV partner, lists the deposit at 150-300 million oz. http://www.newbulletgroup.com/April1820022.pdf NBG.V partners with SDR.V NBG.V to get a 50-70% interest. 50% x 150 mil oz.= 75 mil oz., 70% x 300 mil oz. = 210 mil oz. $8 mil MC / 75 mil oz. = .11 oz. $8 mil MC / 210 mil oz. = .04 oz. Exploration potential = 54 - 150 oz. per oz. worth of shares.
SDR.V SDURF.PK (STROUD RSCS) (There is no PK symbol as yet) http://www.stroudresourcesltd.com/projects-santo.html gcoburn@stroudresourcesltd.com Mr. George E. Coburn, President Tel: 416-362-4126 87.4 mil fully diluted shares (April, 2004) @ $.145/share Cdn x .72 US/Cdn = $.11 $9 mil MC JV partner with NBG.V on Santo Domingo Silver Project in Mexico. 150 to 300 mil oz. exploration potential of the deposit. ownership is between 30-50%, so... 30% of 150 mil oz.= 45 mil oz., and 50% of 300 mil oz. = 150 mil oz. $9 mil MC / 45 mil oz. = $9 mil MC /150 mil oz. =
ATN.TO ATNAF.PK (Atna Resources Ltd.) http://www.atna.com/s/Home.asp 37.1 mil shares fully diluted (Spring, 2004) @ $.32/share Cdn x .72 US/Cdn = $.23 8.5 mil MC The company holds a diverse portfolio of gold, silver, zinc and copper properties in the United States, Canada, Mexico, and Chile. From http://www.capitalstool.com/forums/index.php?showtopic=4996 (Wolverine) 40% of 2300 Mg Ag = 30 Moz Ag + (Marg) 67% of 340 Mg Ag = 7,5 Moz Ag + (Wolf) 67% of 340 Mg Ag = 7,5 Moz Ag + (Nevada explorations) 40% of ? + (Ecstall) 140 Mg Ag = 4,7 Moz Ag The Wolverine Project is a joint venture between Atna (40%) and Expatriate Resources Ltd. (60%).
CHMN.PK (CHESTER MINING) http://www.chestermining.com/ Bill Hoyt, 785-383-9246 " 2.3 million shares outstanding, positive working capital and no debt " @ $4.00/share US $9.2 mil MC http://biz.yahoo.com/bw/031121/215141_1.html Historic estimate: "defined Conjecture mineral reserves of 706,000 tons grading 11.8 ounces per ton (oz/t) silver" -- the Conjecture Mine, with a lease-option agreement signed with Shoshone Silver Mining Company = 8.3 million ounces of silver (leased out) Since Chester will be receiving royalties, it makes it harder for me to value this company.
EPZ.V ESPZF.PK (ESPERANZA SILVR) http://www.esperanzasilver.com/s/Home.asp 20 million shares fully diluted @ $.54/share Cdn x .72 US/Cdn = US $.39 $7.7 mil MC "Esperanza Silver Corporation is solely dedicated to the identification, acquisition and exploration of new silver projects." Looking for high grades.
GNG.V GGTHF.PK (GOLDEN GOLIATH) http://www.goldengoliath.com/ 604-682-2950 32.4 mil shares fully diluted @ $.26/share Cdn x .72 US/Cdn = $.19 $6 mil MC
Additional comments: Silver Explorer in Mexico in the the Sierra Madre mountains: Uruachic. Doing active drilling on their silver property, Las Bolas, "in a month" (as of Oct. 7th). They hope to take a collection of old silver mines and make them open pittable. They have some very high grades from chip samples from the tunnels, ranging from 100g to 500g all the way up to around and over 1000g/ton of silver.
GPR.V GPRLF.PK (GREAT PANTHER RES) http://www.greatpanther.com Robert Archer, President, & Kaare Foy CFO: 604 608 1766 25.4 mil shares fully diluted April 23, 2004 @ $.44/share Cdn x .72 US/Cdn = $.32 $8 mil MC
MMG.V MMEEF.PK (MCMILLAN GOLD) http://www.macmillangold.com/ 25.6 mil shares outstanding (3q 2003 report June, 2003) @ $.36/share Cdn x .72 US/Cdn = $.26 $6.6 mil MC
SHSH.PK (SHOSHONE SILVER) http://www.shoshone-mining.com Bill Hoyt, 785-383-9246 12 mil shares @ $.50 US $6 mil MC In Cour d'Alene, near CDE, HL, & SRLM.PK
* KRE.V KREKF.PK (KENRICH ESKAY) (I own shares) http://www.kenrich-eskay.com/ Toll-free 1-888-805-3940 or (604) 682-0557 16 mil shares outstanding. Use "fully diluted" to be safe. @ $.47/share Cdn x .72 US/Cdn = .34 $5.4 mil MC Adjacent to Barrick's silver property, Eskay Creek, which is "the fifth largest silver producer in the world". 70% of the rights to The Property was once almost bought by Homestake (which was acquired by Barrick) for $35 million in 1996, and Homestake was going to fund all exploration and development. The buy out ended when metals prices collapsed, and Bre-X hit, and when the majors cut back on exploration budgets to stay alive. This means the market cap of KRE.V may be worth 100% / 70% x $35 million, or $50 million, plus exploration and development costs, to a major mining company, and likely worth much more today, due to inflation of the dollar, and the rise in the price of silver!
I own shares of KRE.V
EGD.V EGDMF.PK (ENERGOLD MINING) http://www.energold.com/s/Default.asp Fred Davidson President (604) 681-9501 info@energold.com 16.8 million Fully Diluted (June 30, 2002) @ $.58/share Cdn x .72 US/Cdn = $.42 $7 mil MC
PCM.V PAOCF.PK (PAC COMOX RES) http://www.pacificcomox.com/ 66 mil fully diluted Jan, 2004 (From Dec 11, 2003 press release and 2002 report) @ $.07/share Cdn x .72 US/Cdn = $.05 $3.3 mil MC
LEG.V LEGCF.PK (LATEEGRA RSCS) http://www.lateegra.com Michael Townsend, President Toll Free: 1-866-669-9377 Richard one of the IR guys. 38.7 fully diluted? (Jan 7, 2004) @ $.135/share Cdn x .72 US/Cdn = $.10 US $3.7 mil MC see also Teuton Resources Corp (TUO.V)
Additional Comments: --Bonanza grades. Newmont called them, noticed the property. Flew out a guy. El Tigre in Mexico: gold/silver bonanza style mineralization. Top grades: 62g/T gold 15,500g/T silver historic production, from trenching and surface sampling in late 90's. Cash on hand: $500,000 CAN
BGS.V BLDGF.PK (BALLAD GLD SLVR) http://www.balladnet.com 16.3 mil shares outstanding (fully diluted?) @ $.26/share Cdn x .72 US/Cdn = $.19 US $3.2 mil MC Bonanza grade "grab samples" in southern Argentina near IMA. 32 oz./T gold and 22 oz./T silver grab samples.
* AUN.V AUNFF.PK (Aurcana Corp) (I own shares) http://www.aurcana.com/ CEO Ken Booth 604-331-9333 kbooth@aurcana.com 45 million shares (fully diluted) (March 2004) @ $.13/share Cdn x .72 US/Cdn = $.09 US $4 mil MC Drilling to commence on high-grade, gold-silver targets. (in Mexico)
ASLM.PK (AMER SILVER MINI) 2.75 million shares issued @ $.88/share $2.4 mil MC Claim between CDE and the old Sunshine mine. JV with CDE subsidiary until 2017. ASLM to receive 20% net royalty, & if silver prices reach $16.50 an ounce or above, the profit sharing goes to 40%. Coeur d' Alene, Idaho
BBR.V BBRRF.PK (BRETT RES) http://www.bmts.bc.ca/bbr/ 17.2 fully diluted @ $.25/share Cdn x .72 US/Cdn = $.18 $3 mil MC Silver projects: Yukon --grab sample of 611 g/t Ag Argentina --samples from 31 to 5640 g/t Ag
ROK.V ROCAF.PK (ROCA MINES INC) http://www.rocamines.com 14.3 mil fully diluted (July 15, 2003) @ $.25/share Cdn x .72 US/Cdn = $.18 $2.6 mil MC
LSM.V LASCF.PK (Langis Silver & Cobalt Mining Co Ltd) no website Patrick Sheridan Jr. President and Secretary-Treasurer Phone: (416) 628-5936 Langis has 11,565,890 issued and outstanding common shares. (not fully diluted) @ $.20/share = $.144 $1.8 mil MC
CBP.V CPBMF.PK (CONS PAC BAY MIN) http://www.pacific-bay.com/ Guilford Brett, IR (604) 682-2421 9.2 mil shares outstanding @ $.14/share Cdn x .72 US/Cdn = $.10 $.9 mil MC
--CBP.V is the smallest market cap silver stock that I know of. It is truly a "penny stock".
----------------------------------------------------------------- ----------------------------------------------------------------- Final Category: Silver stocks FOR YOU and I TO RESEARCH further:
I strongly recommend you try to "get ahead of me," and research these stocks to see if I left out any great values. I probably did. I simply did not have time, or could not yet find information (without using the telephone) on all the two key figures needed to get the "price per oz." in the ground. You need: 1. The number of shares fully diluted x share price to get the market cap. Then, 2., you need an estimate of the oz. in the ground. Usually, I've been finding the oz. in the ground resource estimates right off the company webpages, and I get the number of shares by looking for it burried in the financial statements like the quarterlies or annual reports, which are also usually right on the company webpages. Have fun researching for silver companies, and let me know if you find any good ones, and I'll add them to this list. TBLC.PK (TIMBERLINE RES)
Grand Central Silver Mines Inc (GSLM.PK) Legend Mining LEG.AX LGDMF.PK http://www.legmin.com.au/ specialising in exploration and production of silver. Silver at the Munni Munni Joint Venture in the West Pilbara region of Western Australia Email to me said: "Legend Mining just bought a 70,000 ounces per year gold mine in Western Australia."
Mascot Silver Lead Mines MSLM.PK http://www.mascotsilver.com/ Coeur d' Alene, Idaho "Though we have reserves and could conceivably mine them, it frankly makes no sense to do so at current prices. ... The end of the silver bear will bring a number of the now-dormant small companies back to life..."
Silver Buckle Mines Inc (SBUM.PK) Coeur d' Alene, Idaho
Merger Mines Corp (MERG.PK) Coeur d' Alene, Idaho
Mineral Mountain Coeur d' Alene, Idaho
Metropolitan Coeur d' Alene, Idaho
Independence Lead Coeur d' Alene, Idaho
Silver Bowl http://www.silver-bowl.com/ Coeur d' Alene, Idaho --working to get a new stock transfer company http://www.oxusgold.co.uk/ 216,559,942 Fully Diluted shares oxus will spin off: Khandiza is a high-grade zinc, silver, copper and lead deposit located in the Sariasia region of southeast Uzbekistan. Silver Mountain Lead Mines Inc (SMLM.PK)
Silver Verde May Mining Co (SIVE.PK)
Metropolitain Mines Ltd (MEMLA.PK)
Silver Surprize Inc (SLSR.PK)
Standard Silver Corp (SDSI.PK)
Horn Silver Mines Co (HRNS.PK) (801)-281-5656
Andean American Mining Corp AAG.V ANMCF.PK http://www.andeanamerican.com/ --concentrates solely in Peru Peru currently stands as the largest gold producer and second largest copper producer in Latin America as well as the second largest silver producer in the world.
Here are a few more stocks to look up. I don't even know if some of these are silve miners.
Lfex - Lucky Friday Extention Kcpm - King of pine creek Vins - vindicator silver,
Osburn Wallace Silver Valley Resources United Mines APNE ALS Royal Silver Mines (RSMI) Bunker Hill ? Nabob New Era Sidney Signal
Articles like this one, that present opportunities like these, can tend to move the markets in these stocks. So, be careful when buying. If you place any market orders at the open for any of these small stocks, you might end up buying at prices that are significantly higher than you intended. Limit orders might be better, but then, you run the risk of your order not being filled if the stock price exceeds your limit. And bid / ask spreads such as 15% on small cap silver stocks are not unusual. Markets can especially be moved given the wide readership on the internet. I've seen markets moved even by small private newsletters such as lemetropolecafe.com and silver-investor.com (I subscribe to both). Some of these stocks can move up 15%, 30%, 50% or even over 100% in a single day. Thus, valuations can change very, very quickly. So, be careful, and re-check the numbers if the prices move up. Do your own math.
Also note, the majority of these companies have an emphasis on silver. Most silver is produced as a by product of other mining, like lead or zinc or copper mining. Those companies that primarily produce other minerals are not featured in this report. This also helps to explain and prove, that silver is undervalued. If silver miners cannot mine silver profitably, and this report shows that to be true, then something is wrong with the silver price. It must go higher.
This report, and my method of valuing silver companies, depends on a much higher price for silver than exists today to be most accurate and most successful. If silver prices go up significantly, my picks will do well. If silver prices remain flat, then many of my picks should not do well.
Several people have told me that they don't get information this good even when they sign up for annual newsletter subscriptions from others that cost from $100 - $300.
The beauty of the internet is that it is helping knowledge to increase, and it is a form of communication that those who commit crimes of monetary fraud upon us cannot control. Please make the most of it, and please forward this on to others.
You can help to make sure you can keep getting this weekly report for free if you sign up at GoldIsMoney.com
Final Disclaimer: I have not received any compensation from any public silver stock company for writing up my weekly report on "Silver Stocks--Comparative Valuations". I own shares of the following 17 silver stocks: CMA.V, PLE.V, PDO.V,AUN.V, EDR.V, IMR.V, KG.V, MGN, CBE.V, NPG.V, SVL.V, MMGG.OB, TM.V, OTMN.PK, FCO.TO, KRE.V, FR.V. These are required disclaimers by the SEC: whether I've been paid, and what I own. I believe the SEC intended this to be a cautionary note that I own these shares, not as a recommendation or endorsement. I reserve the right to buy or sell any stock at any time. I believe the SEC does not require a disclosure regarding finder's fees. Nevertheless, I have begun to receive "finder's fees" from a few companies.
-- Posted 15 May, 2004 | |
Last Three Articles by Jason Hommel, Gold Is Money
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