I took one look at my portfolio today and I saw a field of red. I watch 30 stocks and they were all down, half of them by over 10%. So I turned off my computer and went out and spent the day with my very good friend Karen and we had a great time enjoying a perfect Edmonton afternoon.
Part of the deal in investing in PM stocks is the volatility. Today was one of those days and we shall no doubt see more on the road ahead. Some no doubt that will make today look like a little blip.
My point today is to remind all that the reason we are in this, is a belief in higher silver prices. We should see a lot of bumps along the path but the destination should always be kept first and foremost and that destination is silver valued in reality rather then in some manipulated distortion. Hang tight, stand firm and keep your eyes on the prize.

The Bolivian Government announced yesterday they were nationalizing oil and gas and the VP said there would be higher taxes for miners.
Bolivia is the poorest country in South America. They are creating a tighter control to make some money off their natural resources. This was known ahead of time about oil and gas. But as to mining, there was no word as to higher taxes until yesterday. This news is positive for silver but Bolivian silver stocks may not perform as well with an impending threat of higher taxes as the silver price soars.
Apogee was my #3 pick. Today I take Apogee off my list. I learned a lesson today. In a silver bull market there is no need to gamble on unstable political situations when there is already so many stable silver plays out there. Apogee may do quite well and the risk reward is definitely higher then most but I think this Government threat will hang over this one for quite awhile until we see some stability happening down there.

Great Panther just put out a news release Monday April 24th announcing the acquisition of another property. We have seen the stock move up in the past couple of days. This company is becoming perfectly positioned to be a forerunner in the silver market. They are already producing silver and own, bar none, one of the hottest 4.2 km’s of silver vein out there. Should be a stellar year with lots of news to come.
I expect this to be a market darling in the silver sector.
Most silver companies you hold your breath as news comes out but with Great Panther you just know it will be good.

Great Panther is my #1 pick and also my largest holding amongst silver stocks.

When I was about 10 years old my mother would receive dividend cheques from United Keno Hill Mines. I remember she was always happy with this investment of hers and it was the only one I ever remember her having. Alexco now owns the United Keno Hill Properties and the veins that run through this property are nowhere near depleted. A handful of companies tried to get this property and Alexco was the winner. This is a well proven resource of very high grade silver.

Lion Mines
1975 price $.07 / 1980 price $380

Bankeno
1975 price $1.25 / 1980 price $430

Wharf Resources
1975 price $.40 / 1980 price $560

Steep Rock
1975 price $.93 / 1980 price $440

Mineral Resources
1975 price $.60 / 1980 price $415

Azure Resources
1975 price $.05 / 1980 price $109

These are a handful of mining stocks that participated in the last gold and silver bull market. $1,000 invested in 1975 could of turned into early retirement.

Today we are once again looking at a similar scenario starting to shape up, but this time I believe we could see an even longer and stronger bull market then before, especially in the silver sector. For the past 20 years silver has been next to impossible to mine for a profit so a lot of companies let go of properties in search of other ways in which to earn an income. Many of these silver mines could produce profitable silver if only the price went and stayed above $7 an ounce. So when silver was languishing in its depths a handful of wise people started to buy up these older properties for next to nothing with the idea that the silver price would rise in the future. Today silver traded above $12 an ounce and a lot of these properties are suddenly worth something as their stock prices are starting to reflect. Most of these junior silver plays have very small market caps and a limited number of shares. The reality is is that there are only so many primary silver mines out there. Silver unlike gold has its highest grades near the surface and the deeper you dig the less you find, a lot of the worlds really big primary silver mines have already been used up. As time goes on it becomes harder and harder to find primary silver deposits.

So what we have here is a limited number of companies with small market caps holding most of the world’s known silver deposits. For example there is a company called OREMEX ORM.V which has a market cap of $20 million with a proven reserve of 40 million ounces of silver in a high grade per ton that could be open pit mined for about $5 or less per ounce. Let’s say they could mine the silver for a profit of $5/ounce. We’re looking at a company with 200 million dollars of silver proven in the ground trading for 10% of that value on the market.

If and when a lot of investment money begins to pour into this sector we may see market caps begin to match and outdo the actual value of silver these companies hold. During the dotcom bubble we saw gigantic market caps for companies that had nothing but an idea. The difference between the dotcom bubble and the emerging silver bubble would be that you can’t make silver mines up out of thin air like internet companies. So these silver juniors that have positioned themselves well in advance will be where all the investment money has to flow into and trying to put $50 billion into this sector at present would be like trying to put a baby elephant in a phone booth, sooner or later it might begin to fit but there would be certainly no room for his mother to move in.

Lately picking the right silver stocks is truly like shooting fish in a barrel and if we see the price of silver continue its march upward the barrel will just get smaller as the fish grow bigger. And the time to sell is when everyone at the office is talking about the new hottest silver stock out there.

Position yourself early, hold on for a bit of a bumpy ride and then see what the future holds.