Lots of reasons why EDRGF is a bargain. First, silver in general:
* Less refined silver above ground than gold. (~7/8 oz gold per person and maybe slightly over 1/2 oz silver)
* The well-known 15:1 or 16:1 silver/gold ratio derived from how much of each metal was found at/near the surface, but it turns out that silver tends to mineralize nearer the surface than gold. For both metals, the easy pickings on the surface got picked up long ago, and the deeper you go the more the ratio swings toward scarcity of silver.
* As of 2003/2004, the US stockpile of silver was exhausted. Supply and demand can now begin to operate. Note that the market (and Warren Buffet!) actually anticipated this price increase by a few years: goldinfo.net
* The 3 points above explain why silver is cheap... So cheap that 10 or 12 thousand dollars worth can give you a hernia. So cheap that the two most well known silver miners (CDE and HL) are operating at a loss. So cheap that the price per share of silver mining stocks has suffered. So cheap that any investment related to silver automatically accomplishes the first half of "buy low, sell high."
So why EDRGF in particular? Well...
* First off, it's on the pinksheets where the characterization "stinkie pinkie" is common because 99.X% of pinkies turn out to be frauds, shams, or at best no more than somebody's optimistic fantasy. The extent to which the "stinkie pinky" label scares off investors is automatically (and 99% of the time justifiably) reflected in the current price level of any pinksheet stock, including this one. The trick here is to identify the rare exceptions to the rule: companies that aren't frauds or shams, companies that are actually doing something and have a plan in place to do more.
* Unlike most silver stocks other than CDE and HL, this one isn't a hopeful explorer out there somewhere trying to identify, acquire, and prove up their silver resources. Instead, these guys are mining silver and have a plan in place to mine a lot more of it.
* The more you dig into EDRGF, the more you see that it's real and not a pinksheet fantasy.
I'll provide some data for DD in next post. Meanwhile, my thought is that if silver is a smart investment, if even a small fraction of investment dollars begins to flow toward precious metals, then a silver "pinkie" that's real has the potential to bring tears to the eyes of those who cash out when it's only a ten-bagger.
Gordon |
