Silver has a major underlying base, that’s a lot of pessimism, what will hold its value, inflation and deflation, plus highest level in history!
That’s A Lot Of Pessimism
September 28 (King World News) – The Daily Shot: Speculative accounts have been hedging their stock portfolios with index futures, especially the Nasdaq 100. (See chart below).
NASDAQ Speculative Short/Hedge Positions Hit Highest Level In History!
Inflation And Deflation
Liz Ann Sonders, Chief Investment Strategist at Charles Schwab: Inflation is rising for things we want & falling for less-popular items … demand driving price action, given effects of COVID19 virus (see chart below).
Peter Brandt: I do not view buying SLV or physical Silver as a trade — in the same way as my typical swing trades. Rather, I view it as transferring a portion of net wealth from corruptible U.S. Dollars into something tangible. SLV has major underlying chart base (see chart below).
Silver Has Major Underlying Base
What Will Hold Its Value?
Peter Brandt: “The underlying question is this: What do you expect will hold its value best over the years ahead — the US Dollar or precious metals?”…
Legendary investors are buying share of a company very few people know about. To find out which company CLICK HERE OR ON THE IMAGE BELOW.
Biggest Monetary Experiment In History Continues
Holger Zschaepitz: Biggest experiment in monetary history is being continued. What we are looking for is the point at which confidence in the central banks collapses because they have printed too much money. SNB’s balance sheet now accounts for over 150% of Switzerland’s GDP, BoJ’s at almost 140%. (See chart below).
When Will Confidence In Central Banks Collapse?
In case you missed it…
Silver One of The Strongest Asset Classes Globally
Chris Ritchie, SilverCrest Metals: Silver has been one of the strongest asset classes globally in the last few months. Silver had a $14 handle in March and it nearly doubled before the recent pullback. This was a very healthy pullback. Profits needed to be taken and this move needs to be consolidated in order to prepare for another leg higher. The same goes for our stock. We raised money in the spring at $7.50 Canadian and we spent a fair bit of time in the $13 – $14 range. Shareholders were allowed to trim positions and take profits. Any time you have that strong of a move, it takes time for people to right size their positions.
Massive Free Cash Flow
I’m very comfortable that our stock cleaned itself up fairly well before this last leg down in the market so hopefully we have a strong base to build from here with an audience that is looking at adding at these levels instead of trimming. As it relates to our peers, our potential cost structure is definitely worth mentioning. Our last economic study referenced an “all in sustaining cost” of under $5.00 / oz of Silver for the first 4 years of production. If we execute on that, we’d be comfortably in the lowest 10th percentile of producers which means that our margins and potential free cash flow are far more resilient than the higher cost producers. So the lower silver goes, we should look more and more attractive relative to our peers on a valuation basis.
We are just as happy about the dips as the spikes, Eric. Every time the stock rolls over, new buyers that were waiting for an opportunity to buy stock have stepped in aggressively. The same goes for the spikes. Long term shareholders need to trim sometimes and this allows them to continue to participate in a healthy way going forward. We are very happy with the quality of our share register and dips like we’re seeing now are what get me excited for new buyers of the stock.
Hard Assets Haven’t Been This Cheap In Over 100 Years
Hard assets and commodities haven’t been this cheap relative to the broader market in over 100 years. Take a look at the Goldman Sachs Commodity Index relative to the Dow or S&P over that time frame and you’ll see the deep value scenario that’s set up. I wouldn’t be surprised if Buffet was looking at charts like this when deciding to buy gold recently. But commodities are volatile and this sector is capitally intensive which adds another level or risk that needs to be highlighted. That said, our high grades allow for potentially very strong margins at very low metals prices. So you have an extremely cheap sector and a very resilient business model in SilverCrest. That’s a really nice dynamic when thinking about the ways in which we can continue to grow. We’ve added approximately $9 of value to the stock for every $1 that we’ve spent.
We Are Going To Double The Amount Of Drilling
Our next economic study will only include 20 of a known 43 veins on the property and does not include the deeper zones we are starting to drill nor does it include the new property that we just purchased. Depending on our future success rate with our drilling, we hope to double the amount of metres drilled since we started the company in late 2015 from now until the end of 2022 which is when we hope to be cash flowing. We know the property much better now and if we’re half as successful as we’ve been to date, I will be ecstatic.
Extremely Low Cost Expansion
We also have the potential to increase the size of our mill and production profile if and when we find more tonnes. We are designing our mill to allow for extremely low cost expansion. Additional tonnes and ounces can allow for optimized sequencing of our mine plan and hopefully additional throughput. We are also just getting to the size and liquidity where the larger asset managers can consider buying us and when they do, they need a lot of stock in order to move the needle. So there are lots of ways in which we can provide upside potential all while providing really strong downside protection.
We have 8 drill rigs turning and we are focused on 2 high impact targets. We have 5 rigs on Babi Vista now and if you recall, we recently had a hit there at over 73kg/t at 1.3m of true width. We will only have ~800m of a potential 2km strike length vein included in the upcoming feasibility study so we hope that’s low hanging high grade fruit. We also have 3 rigs on El Muerto which is our first time focusing on deeper targets. If successful we may be looking at a parallel zone below some or all of the 43 veins we have on the property. That’s enormous scale potential. We will also have our feasibility study out by the end of the year, hope to finalize our financing solution for construction and the team is already pushing ahead with site preparation work for construction. SilverCrest Metals, symbol SIL in Canada and SILV in the US. To hear Chris Ritchie discuss the remarkable opportunity for new investors in SilverCrest Metals CLICK HERE.
***To listen to the incredibly powerful audio interview with Danielle DiMartino Booth that is a must listen for anyone who wants to understand the big picture as she covers everything from the need for investors to aggressively buy the current dip in gold prices to the stock market hitting the biggest bubble level in history and much more. To listen to this incredibly powerful interview click here or on the image below.
Gold Now In Backwardation, Ominous Sign For US Dollar
***ALSO JUST RELEASED: CONTRARIAN GOLD ALERT: Gold Now In Backwardation, Ominous Sign For US Dollar, Plus A Bonus Interview CLICK HERE.
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