Video: West Red Lake Gold works to restart Madsen mine
The company is optimistic about the potential of its Red Lake assets in the storied gold district of northern Ontario.
The Attraction of Gold and Silver
Very often we look at gold and use it as our main object of attention. Yet historically there has been a continuing relationship between gold and silver. The two metals are together regarded as alternatives to paper currency. Silver is often referred to as gold’s poor cousin.
Silver’s Industrial Uses and Demand
Although gold has certain industrial and commercial uses, it is always regarded more as a measure of value. Silver on the other hand has far more industrial and commercial uses. Silver for decades had a main value in photography, and in developing pictures. The advent of digital photography led many to believe that silver’s value days were numbered.
The opposite has proven to be true. Silver uses have multiplied and demand is ever growing. The vastly increasing amount of industrialization worldwide has led to ever increasing demand for silver.
The Price of Silver
Look at the price of silver. It rested around $5.00 for so many years, and now it exceeds $23.00 and has a very bullish chart pattern. As people believe the price of gold will rise, people believe the price of silver will rise more.
Some of the Reason for Silver Demand
The world is on the verge of electrification and silver is a key component. Several critical infrastructure components are in development that requires silver. For several decades to come, the world must electrify. Silver is a critical component in the grid and in transportation of electrical current.
Transportation will require nuclear energy, and advanced battery technology and silver is a critical component. China has now become the world’s largest producer and consumer of hybrid and electric vehicles. In September passenger car sales jumped 84%.
As important as is industrial demand, the world of investing has also changed, and quite dramatically. Metals used to have their major demand coming from users. Now demand comes from new ETF’s that actual buy and store the metal. More and more metal is disappearing into vaults to support trading in the ETFs, leading to less metal being available for other purposes.
Even jewelry demand is increasing as the world’s population becomes more prosperous.
The Balance Between Supply and Demand is About to go Out of Balance
New demands are being made on existing supply and a critical shortage is looming.
A quote from Tom Patton, of Quaterra Resources “We are seeing inelastic supply curves for both silver and gold mine production. I think we will look back and probably say 2010 was about the year we saw the total supply of silver and gold just about reach their high points. We’re seeing very few discoveries of (major new mines for) both metals.”
Conclusion
Don’t ignore silver when it comes to investing. We apply the same principles as we do to gold investing. In previous blogs, we listed some excellent silver companies. We suggest they be put on your radar screen.
What To Buy
For these reasons and others, the Cymorfund has recommended buying juniors that have potential to prove large deposits of silver. We believe that the real opportunity to multiply your wealth is to search out those under-priced juniors that have deposits that could be enormously expanded and proven, or have the potential with their existing property to take indicated reserves and make them proven while at the same time have large land positions that allow for large expansion of reserves on their existing land.
A few of these companies are listed below. We caution that we may have positions in each of these companies and that probably causes us to view these companies in a positive light. On the other hand, we receive no compensation for mentioning a company and our only motive is to convince you that our opinions are good opinions.
The companies being mentioned today are all in Mexico, which we think is an excellent jurisdiction in which to operate.
SOLTORO LTD. (SOL) is a pure exploration company mainly active in south-western Mexico focused on adding value through discovery in known historic mining districts. Soltoro has acquired, mainly through staking, 6 significant district scale land positions in Jalisco State, Mexico
Orko Silver Corp. (OK) is developing one of the world’s largest primary silver deposits, La Preciosa, located near the city of Durango, in Durango State, Mexico.
Arco Resources Corp. (ARR) is a dynamic junior mining company. Arco’s strategic focus is on exploration and development of Gold, Silver and Polymetallic properties in southwestern Mexico
