The Best Silver Miner in the World

Before our vision of the best silver miner in the world need a little background information. First, the reader should ask why invest in mining at all? The answer to us is covered invest in our third line of silver below.

This third rule of Silver Investing can be found in the global-investor book of Investing Rules.

This rule is one that many silver investors know very well and the joy of watching you to outperform the rise in gold prices by a factor of two or more 3-1 mining stock is exciting. However, leverage works both ways, and when the price of the precious metals fall back the mining shares fall back hard. This is normal market behavior and should be anticipated by the smart investor metal.

Again, mining shares analysis is difficult and almost impossible in the speculative area. Due to this fact, it is important to do your own homework. You can also subscribe to a service that provides insight in this area. We do our best to diversify and to give clear signals to the environment that we merit think. But we are only human and have made mistakes in the past. It is the nature of investing that you are not 100% accurate, although our report had nothing but winners. For the first two years Those days are over and in today's market it is more important that ever to be careful and use proper money management.

If you do not want to put in the time and effort needed to succeed in this area of ​​investment, we recommend you to consider a gold fund. Even with professional management companies are not all winners, but with the right distribution results reflect the overall gold stock market. Unfortunately, there is not a silver investment at this time. This is a question often asked.

The Ten Rules of Silver Investing was only available to paying subscribers, but we have decided to make available free to everyone who made our free email list joins ...

Requirements of a well-run mining company

Best Silver Miner in the world should not only anticipate the future, but also contains as much cost as possible. This can be done in varying degrees, but fixed costs are major expenses and variable costs are becoming more "variable" by the minute. The cost of electricity, water and labor seem to be increasing without end.

The infrastructure should be examined for roads, electricity, water and the environment. The political climate is a key factor in determining the value of a project, especially in the current global environment.

Of course, the geology of the utmost importance. An accurate geological model must be developed that data from boreholes, test pit sampling, quality and grade analysis, and which may include additional drilling needed. Sufficient data must be checked for a Canadian company to National Instrument 43-101 compliant.

A preliminary financial analysis includes the expected cost of capital and what is expected for the prices of minerals for the future. Wrong guess here and your whole project can be compromised.

So now you know most of the risks and would like our opinion the best Silver Miner in the world. It's just Berkshire Hathaway Warren Buffet yes sir may prove to be the best silver miner of all time!

Why should we consider Berkshire to be? The best in the world

1. No environmental impact statement is required for this mine.

2. No explanation was necessary 43-101

3. All geological data is redundant

4. Low overhead - very few employees

5. Political problems significantly reduced

6. Fix known cost - price of silver at the time of purchase

7. Variable costs (known?) Storage Costs

Why Berkshire is the best miner? Profit, yes profit, even adjusted for inflation Berkshire has a gain in silver, this is not the case for almost the entire silver mining. Some may argue this is not a miner at all, and of course that point is clear, what is not so obvious is how smart it is to let mine silver at a loss, and then pick up the end fungible product at a cost lower than others those of them.

Ted Butler had a nice article about Buffett buying silver. What is so fascinating is that Buffett mined silver right off the exchange at a cost lower than what most miners can do. In fact, like last year, not a primary silver miner showed a profit for the full year. A few quarters of profits, yes, but not on an annual basis! This will change for the fiscal year 2005 in our eyes and one of these companies is now in our speculative list for some time. Please note that we speak of the total costs, non-cash items that miners are so fond of talking about the neglect of the actual costs associated with the extraction of ore.

However, the point to be made is that a synthetic mining is exactly what the market needs right now. The synthetic silver miner takes just under the actual (total cost) one of the production and the shops. This would entail a silver purchase program dealing with real silver obtained under strict requirements that should yield positive returns for investors.

At present, the preparatory work has been carried to such a synthetic mining begin. The initial conditions require that institutional investors are only allowed to participate, but once established, another may be available to the general public to invest are. But this plan silver version should be corrected at the current price of inflation. If silver shoots up from here, then the proposal would simply not as effective. In other words, Buffett is a lock or duplicate someone else remains to be determined. A free market approach of the proposed Silver ETF may be something the market needs at this time.

In fact, the proposed Silver ETF some very interesting points, for example, we find:

The Official Sector

Unlike gold, there are no official statistics published by the International Monetary Fund, Bank for International Settlements, or national banks on silver holdings by national governments. The main reason for this is that silver is generally not considered as a reserve active. Consequently, there are very limited silver reserves of the state. According to GFMS Limited World Silver Survey 2005, at the end of 2004, the government held silver bullion stocks total 164 Moz. Silver holdings held by central banks and governments to match only 10 weeks up while gold is estimated that governments hold about the equivalent of 10 to 12 years of supply. Recently, countries like Russia, China and India reduced their holdings of silver.

What is also interesting is what the proposed Silver ETF to say about the U.S. dollar.

Between 2002 and 2004, the price of silver rose as a result of several factors. Among these factors are the decline of the U.S. dollar against other currencies, the poor performance of the major stock markets U.S. and other, an increase in demand for investment in commodities as an asset class generally, strength in manufacturing demand, and low level of forward selling by mining companies.

Sounds bullish for you? It certainly does for us.

The most important fact that very few outside of the precious metals community even consider what Ibbitson Associates 2 stated in their conclusion on portfolio diversification with gold, silver and platinum.

Quoting: Of the seven asset classes, precious metals asset class is the only one with a negative average correlation with other asset classes. Excluding cash, precious metals is the only asset class with a positive correlation coefficient with inflation. Precious metals provide a significant hedge against inflation and a positive return when they were most needed. End of quote.

Later in the conclusion section of this report, investors may be in conservative, moderate and aggressive asset allocations improve the reward-to-risk ratio by including precious metals with allocations of 7.1%, 12.5% ​​and 15.7 %.

Because many financial planners basically use a "cookie-cutter" approach to the preparation of pension plans Ibbitson this study will certainly any astute in that industry that keep learning upset. What would a CFP say to a customer who had paid only later found our that there is no exposure to the precious metals was given? For proper diversification Especially if this client knew the precious metals is the only asset with a negative average correlation with other asset classes.

We have proposed that will start to move in the precious metals as well. To the sector and many private investors during the second stage of this great bull market that more institutions will move Now Certified Financial Planners have a tool and knowledge to move into real physical metal can have an impact.

Returning to Berkshire Hathaway, a special report on Buffett and silver was written several years ago and is free to our paid subscribers, but one of the most profound aspects of his purchase is that it was less than two percent of Berkshire's and by the time. If Buffett would be to provide to Berkshire's conservative seven percent as measured by Ibbitson Associates it would be more than twice the amount of silver present on the Comex necessary at this time.

Certainly there is much more to the story than silver supply and demand, in fact one of the main points is a good spread of the portfolio.

The Silver Investor

The official site for the Serious Metals Investor

October 20, 2005

1 Total costs include keeping all direct and indirect operating cash costs directly related to the physical activities of producing metals, including mining, processing and other plant costs, refining interests and marketing costs, on-site general and administrative costs, royalties and mining production taxes, net of by-product revenues earned from all metals other than the primary metal produced at each unit. These costs vary as quality, labor and energy, transportation, and other third party costs rise.

2 Ibbotson Associates 225 North Michigan Avenue Suite 700, Chicago, Il 60601 Professor Roger G. Ibbotson, founder and chairman, pioneer used in asset allocation and to quantify the benefits of diversification. In collecting the necessary data The company continues to provide investment and financing problems for a diverse set of market solutions. Ibbotson / Associates fills a growing need in the financial sector as a single-source provider of investment knowledge, expertise and technology.

David Morgan has a BS in Engineering and a Masters in Business (finance and international business). David is a private economist and precious metals analyst for over twenty years. He adheres to the Austrian School of Economics, although his degree is not the Mises Institute.

Mr. Morgan is a contributor to FreeMarketNews.com and has written numerous articles, some of which can be viewed Mr. Morgan also writes Silver-Investor.com newsletter. In the Gold-Eagle His e-mail newsletter is published on a monthly basis and includes economic news, overall financial health of the global economy, currency problems ahead. Mr Morgan pour on almost any metal, economic and financial news and business publication and digests it to his readers to save valuable time and money! Reviews current trends, long-term fundamentals, and specific information necessary for an investor, especially the serious or silver bullion investor.