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Gold/Mining/Energy : Gold and Silver Juniors, Mid-tiers and Producers
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To: loantech who wrote (22732)10/14/2006 1:58:10 PM
From: koan  Read Replies (1) of 78419
 
PART ONE: why the metals stocks will rise many times more than most people think in the new paradigm shift secular bull market, by SI-koan/SH-charles99.

I think the juniors are much more undervalued than peopele understand.

I think the softness in the junior mining stocks is the result of the massive technical damage over the last 60 years or so. For base metals the technical damage has been even longer.

Here is what I mean. The metals have always been cyclical, so one could never really INVEST in them per se. Bob Bishop actually said junior stocks are for trading afer he saw so many massive swings in price over the years he was advising investors. Today people are hesitant to INVEST in mining stocks for this reason, so prices remain undervalued as I hope to show.

Lets look at the milestones: This is all from memory, so if I make a mistake please give me a break-lol.

Going into the second world war the US had 3 billion oz of silver stockpiled. Gold was a set price of $35 an oz. The second world war was the first massive use of metals. Hundreds of millions of oz of silver were used in the second world war.

1960's (1964?) the average price of the first 20 penny silver stocks in alphabetical order on the spokane stock exchange went up 104 times in value. This exchange was prmarily set up as a stock exchange for the great area play of the massive Coeur De Lene silver district.

In 1980 silver went to $52 and gold to $850. This was the result of the Hunt Brothers trying to corner the silver market, but also the inflation/stagflation caused by Johnsons "guns and Butter" policies. The Vietnam war and the great society.

Paul Volker wrung the inflation out by raising interest rates to 21%. The housing market stood still during this time. Mortgages hit about %18!!
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