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Gold/Mining/Energy : Silver prices

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To: Gord who wrote (778)	2/21/1998 1:55:00 PM
From: Tommaso	Read Replies (2) of 8010

I was just looking at my annual report of the Central Fund of Canada (CEF) and find it more interesting than I had remembered in terms of silver. At present prices its silver holdings are more valuable than its gold. The Fund is 99.5% invested in silver and gold bullion, most of which is actual bars in the vaults of the Canadian Imperial Bank of Commerce. In addition, the bars are insured. As of the end of last week, from the Barron's tables today of closed end funds, CEF is selling at almost 7% discount from net asset value. As the report points out, this is the cheapest and most convenient way to own a direct interest in bullion. No sales tax, no bid-ask spreads on coins or bars, no storage expenses. The bullion may not be pledged or optioned in any way. I had a modest position in this for years as catastrophe insurance and have seen nothing to suggest that it is anything other than what it claims to be. It is run by "hard-money" types who believe in a gold standard. A run-up in either silver or gold or both would be immediately reflected in the net asset value and eventually in the stock price. I think I may buy some more, especially if I can get it at that discount. Wonder why Buffet didn't just buy up the fund!

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