The main purpose of the 2006 financing was to provide cash for acquisition of the Summit silver-gold project, which the company acquired in May 2006. The Summit project is now ready to proceed to production, subject only to the arrangement of construction financing. (more)
Why Gold and Why Now?
Do you remember the last time gold sold for over $2,000 an ounce?
Of course you do. Maybe you didn't think of that way. But actually, gold has already sold for more than $2000 per ounce. Let me show you.
First, you have to think for a moment like it's 1971. Gold is selling for $35. This is the year Nixon breaks it from ties to the dollar. Gold prices start climbing. By 1975, it's hit $196. And by 1980, we're talking $850. Sure, you say, that I remember.
But maybe you also remember, back then you could you could also make $27,700 a year and it was a pretty decent living. About as good as making $100,000 per year today.
You could also buy a house for $50,000 then and, just on an inflation basis, it would be worth $250,000 today. (In real estate terms, it might sell now for $500,000 or more).
So you can see, trying to compare yesterday's gold price to today's -- on an even basis -- is like trying to compare apples and armadillos!
Take a look at this chart...
Because you can just read on and see for yourself...
Take a look at these first two side by side...
But none show it better -- and more plainly -- than these two I'm showing you right here, above. The first is our skyrocketing money supply. The second is our plummeting purchasing power. That's about as plain as you need to get.
Because this is the starkest vision you'll ever get of the absolute carnage that's piling up in a "secret war" Washington's fighting right now... and has fought, unsuccessfully, for the last 20 plus years. No, not the war in Iraq. Or Afghanistan. Or even some possible future conflict with Iran.
Suddenly, every dollar you have in the bank is worth less.
Hemingway called it the "first panacea of a mismanaged nation."
Like gold, U.S. dollars have value only to the extent that they are strictly limited in supply. But the U.S. government has a technology, called a printing press (or, today, its electronic equivalent), that allows it to produce as many U.S. dollars as it wishes at essentially no cost... We conclude that, under a paper-money system, a determined government can always generate higher spending and hence positive inflation.
There is no means of avoiding the final collapse of a boom brought about by credit expansion. The alternative is only whether the crisis should come sooner as a result of the voluntary abandonment of further credit expansion, or later as a final and total catastrophe of the currency system involved.
Then, we had a hostage crisis in Iran. It ended. Today, we've got Iraq, Iran, North Korea, Nigeria, Afghanistan... and an unending "war on terror." Plus bin Laden still hiding in caves and Chavez mouthing off in oil-rich Venezuela.
Then, you paid 78 cents for gas. This spring, it hit as high as $3.22. Oil cost $38 per barrel. Today, it's closer to $80. Then, the oil shortage was political. Today, it's physical - supply just can't meet higher demand.
Then, the weak dollar still bought more than the dollar today. And our only real economic competitor was Japan. Now you've got China, India, the euro... and a resurgence in Japan.
Brace yourself. Because while this might spell doom for most Wall Street stocks, it virtually guarantees a global resurgence for resource investments, silver and especially gold. Protect your wealth and grow your riches .................
The recent one you're looking at above first happened on Dec. 28, 2005... and it has remained inverted... on this last occasion, it's basically been upside-down for the last few months. This is bad. How bad?
Think dynamite and a tripwire.
See, normally a yield-curve inversion should be an extremely rare event. Until very recently, it's only happened six times since 1970. And guess what... five out of those six times, a major recession followed within the year .
This is so precise an indicator of recession , in fact, that it has only been wrong once in the past 40 years . One study published by the New York Federal Reserve pegged it as a better measure of what will happen to the U.S. economy than the U.S. stock market or any other general index of other leading indicators .
Translation: When the curve flips, we'd better listen.
On the day of this inversion above - practically at the moment the lines crossed - the Dow plunged 105 points. What happens the next time, when the curve inverts not just for an afternoon, but for a week or more? Or months at a time?
This is like holding back a flood with a cork. The longer the yield curve is out of balance, the bigger the disaster that follows. And there's only one way to stop a yield-curve inversion from happening.
The Fed has to slash short-term rates. Will they?
But he's trapped between a rock and a hard place.
Slashing the rates means an even bigger dollar collapse. And even higher credit debt, at a time when few Americans can afford it. It would also mean less overseas confidence in the U.S. economy. And that alone could spark a whole new wave of disaster.
See, when all those overseas bondholders out there see the United States disintegrating its economic base, that's all she wrote! They'll start dumping the dollar and our debt investments with abandon. I'm sure you're smart enough to see where this is headed...
That kind of unraveling is the perfect recipe for $2,000 gold. Which is why I want to make sure you're in a good strong position before this next radical power move in gold unfolds...