Posted on 01/26/2012 9:10:53 AM PST by appeal2
Bob, "The International Forecaster" and I sat down for a brief chat about the economy, gold, silver and the mining shares. Bob explains that frugal management, especially in the early years, is extremely important. Management should be involved to make profits from the eventual success of the project, rather than cashing in on high salaries and other compensations; share structure is also quite important. When companies have hundreds of millions of shares outstanding, before producing one ounce, this will greatly lessen the potential future share appreciation.
Focus is also extremely important; concentration on a few or even just one project is very important for a junior minor. This will assure management makes the most of every opportunity. But in the final analysis, the price of gold and silver is going to be the main factor. And here Bob is emphatic it's going no where but up. 2012 could very well be the most important year in the history of modern finance. As we were talking, gold went up over $30 per ounce on news that the Fed would keep its foot on the monetary gas pedal. Subsequently, the outlook for the economy was diminished. It is these kinds of economic fundamentals that have shown Bob to be right far more than he's been wrong.
I got lucky and made a trade early yesterday. I was surprised to see the price of gold jump more the 4 percent later in the day.
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