[Much of the world’s silver comes as a byproduct or co-product of other metals (lead, zinc, copper, and gold). That means the world’s silver supply is dependent on base metal production. Only about 30 percent of total silver-mine output is from primary production — that is from mines that are primarily silver producers — where mine exploration, development, and production decisions depend on the metal’s own price.]
By Sean Brodrick
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| Sean Brodrick, Natural Resource Analyst |
And with gold breaking record high after record high, those positions are absolutely soaring now ... with gains of 36% ... 37% ... and 93% ... in just a few months! (See the table for a complete track record.)
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| From 06-11-10 (reco date) through 10-09-10* *Past Performance is not indicative to future results, Gains do not include commissions, fees, nor the varying prices subscribers may have received. | ||||||||||||||||||||||||||||
First ...
My Broad Gold Forecast: The Yellow Metal Is Going to at Least $2,435 an Ounce.
My next target on gold is $1,450 an ounce, but I don’t think we’re stopping there. In fact, the next big phase of gold’s bull run could bring us to $2,435 an ounce. That would be equal to gold’s old, 1980 high of $873 an ounce adjusted for inflation.
That goal is easily achievable. But the world has changed since 1980, and there are forces in play that could send gold much, much higher. Just to name three ...
#1) Central Banks Have Switched from Net Sellers to Net Buyers of Gold. The latest info from GFMS says central banks could be net buyers of gold by about 15 tonnes of bullion this year. That hasn’t happened in decades.
#2) Mining Costs Are Rising. The average gold production cash cost was $558 per ounce in the second quarter of 2010. That’s up from $544 the previous quarter and $453 an ounce a year before that. Rising costs put upward pressure on prices.
#3) Gold ETFs Are Buying Hand Over Fist. In 2010 alone, GLD, the largest of the gold ETFs, has added $7 BILLION worth of the yellow metal to its holdings. This is an enormous and growing new force on the market.
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My Broad Silver Forecast: It Will Test $50 an Ounce.
That’s right, I think silver will more than DOUBLE in price, to its old high of $49.50 set in January, 1980. From recent prices, that would be like gold going to $3,064 an ounce!
Why?
Here are just three of the forces I’m watching in silver ...
#1) Surging industrial demand. Silver is not only a monetary metal, it is an industrial metal. It is used for small electronics, flat-screen TVs, mirrors and more. Approximately 700 tons of silver are in chemical reactions to produce plastics. And demand for silver from the industrial growth engine of the world — China — is soaring. Net imports of silver into China quadrupled in the first seven months of 2010.
#2) Limited supply. Much of the world’s silver comes as a byproduct or co-product of other metals (lead, zinc, copper, and gold). That means the world’s silver supply is dependent on base metal production.
Only about 30 percent of total silver-mine output is from primary production — that is from mines that are primarily silver producers — where mine exploration, development, and production decisions depend on the metal’s own price.
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That means the price of silver has little influence on mine economics and decisions to invest in exploration and development.
#3) Above-ground stockpiles shrink while demand picks up. The world consumes about 888 million ounces of silver annually through industrial products and processes, but only produces 680 million of that from mines. The rest comes from scrap and government sales. And demand has accelerated while mine supply remains mostly stable. This has put a perilous downward trend in the number of months that above-ground bullion can cover ...
Much of the above-ground inventory is in silver ETFs. While that inventory CAN be sold, it’s not likely to be sold unless investors run for the exits — an unlikely event when silver prices are marching higher.
Put it all together and I think silver is going back to its 1980 high — and possibly much higher.
And if you think the rise we've seen in gold and silver is big, just wait till next year! By 2011, we could see an all-out feeding frenzy. And smart investors like you who see that crunch coming, pick the right stocks, and invest in them prudently, should profit immensely.
The key is separating the dusty gems from the polished turds.
That's why I fly around the world to meet with industry movers and shakers ... the behind-the-scenes types who would rather stay in the shadows ... CEOs and engineers of some great little companies ... and guys with mud still on their boots.
And it’s also why I’m putting out a NEW silver and gold report highlighting 10 ADDITIONAL ways to play precious metals.
There are 2 important differences between my last report and the new report ...
- My June gold and silver report focused on mostly larger companies. My new precious metals report shifts its focus to the most powerfully leveraged, smaller-cap gold and silver companies that I could find.
- My June report had more gold picks than silver picks. Now, I think we’re entering the stage of the market where silver could outperform. So the balance of my new picks are in silver.
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You know that I cannot guarantee results and that losses are also possible. But if you think the gains in my 10 larger-cap picks are impressive, wait till you see the potential gains on the 10 smaller-cap picks in my second report!
Here are the details on my new recommendations ...
Pick #1:
An Australian Small-Cap Gold Miner with World-Class Potential
This miner has been busy Down Under, developing a world-class gold deposit. Its earnings more than doubled in the most recent quarter as revenues jumped over 50%. Gold production is surging and costs are dropping. And it keeps finding higher-grade mineralized zones beyond where it is already digging!
This company’s known gold reserves are selling for 50 cents on the dollar, and I think those reserves are going to grow and grow.
Pick #2:
African Gold for 13 Cents on the Dollar!
This miner has multiple gold projects in Africa and just made a new precious find. Going forward, its production is expected to increase rapidly, and earnings estimates are already blasting off.
Your cost to buy into its gold resource: About 13 cents on the dollar.
Pick #3:
Developing a HUGE Gold Resource in South America!
This small company is developing a giant copper/gold/silver deposit in Chile. It is in a belt of rich properties that have already been developed by bigger miners, making it a perfect candidate for a takeover. All told, it has more than 30 million gold equivalent ounces — and you can buy them for 11 cents on the dollar.
Pick #4:
Dishing Up Bonanza-Grade Results
This small explorer is finding rich, rich deposits of silver and gold in a remote area far off the radar of Wall Street, even as it pushes forward on developing its project full steam ahead. When its next drill results come in, you’ll want to be onboard. And you can buy a stake at the effective cost of just pennies on the dollar.
Pick #5:
The Greatest Silver Story Never Told
I had to pinch myself to believe this one when I found it. This miner is hidden away in Peru, where it is developing hefty deposits of silver, lead and zinc. The company recently made a new gold-silver discovery and has put that in the development pipeline as well. It’s sitting on more than 250 million ounces of silver and has gold as well.
Pick #6:
Ramping Up Production at a Furious Pace
This rapidly growing miner has two high-grade silver/gold mines in Mexico. It has increased its silver output SEVEN-FOLD in the first four years of production, driving costs lower. And it is adding to its resource base at a furious pace. Now, you can buy its resource base for 15 cents on the dollar.
Pick #7:
A Pipeline of Projects Around the World
This stealth miner of silver, gold and base metals has projects in the pipeline in Argentina, Australia, Canada, Chile, Mexico and Peru, yet its flagship mine just went into full production this year. Its production and profit potential are only going to grow and grow ... and you can buy it now dirt-cheap!
Pick #8:
A Market Dog That’s Ready to Run with the Wolves
This miner had problems for years, but it’s finally dug itself out of a hole. Silver production is ramping up, costs are falling, and it has a new gold mine as well. This stock has tons of gold and silver that you can pick up for pennies on the dollar. Do it now!
Pick #9:
Soaring Production and Profits in China
My final silver pick is a miner that is building an extraordinary portfolio of working mines in China. Production, revenues and earnings are all up, up and away. And yet you can buy this miner’s resource base for 27 cents on the dollar!
Pick #10:
The ‘Secret’ Precious Metal That Wall Street Is Ignoring
Wall Street is finally waking up from its slumber and noticing gold and silver ... and sending the prices of those metals soaring. And yet, there is another metal that is in very tight supply, yet Wall Street is ignoring the brewing crisis in its supply line. When this supply squeeze finally grabs headlines, this metal could BLAST right off the launch pad! This “secret” precious metal could outperform silver AND gold going forward — and I’ll tell you the best way to buy it both in hand and in the stock market.
Now, Here’s EXACTLY What to Do to Harness the
Massive Profit Potential of These Ten Stocks as
Well as Continued Upside in Gold and Silver!
I just completed my new gold and silver report on Friday, and it will not only tell you everything you need to know about the ten stocks above, but also very specific trading instructions. Exactly what to buy, at what price, how much ... and why.Massive Profit Potential of These Ten Stocks as
Well as Continued Upside in Gold and Silver!
Plus, I’m planning on sending out regular follow-ups on each and every one of the picks — four follow-up reports in all.
After all, many analysts think they've done their job when they get you INTO an investment, but then they don't stick around to help you get OUT.
That's not my way. My philosophy of investing is that you're in this game to take out hard cash for yourself. And never in my lifetime have I seen a better or clearer opportunity to do just that!
Look, the market for gold and silver is heating up ... soon, it will be glowing white-hot. Gold is up 370% in the past 10 years ... and silver is up 316% at the same time. But this is only a taste of what’s to come.
The big companies have enjoyed the lion’s share of the gains. But that was because the precious metals bull market was in its early stages. Now, the smaller companies — miners that were marginally profitable at $10 silver — are VERY profitable at $20 silver, and will be ENORMOUSLY profitable at $25 silver ... even more so at $30 silver and higher.
The small companies are a different breed. They're in the vanguard of this boom. They're the ones in the forefront of exploration and development. They're the companies that the big behemoths are hunting down for potential buy-outs.
But many of these stocks are so small ... so packed with potential ... and sometimes so thinly traded, I must limit the distribution of my report to a small group of elite subscribers who have an appetite for big profits.
All indicators are telling me that these new gold and silver recommendations are going to shine even brighter than my last batch. So I sincerely hope you get in on the fun!
More on the report please click here.
