< Return to Bulls pageOwnership of silver
GG retains ownership of 75% of the silver at Penasquito (one of the largest silver mines in the world) and received a nice upfront payment from SLW for the other 25% along with ongoing payments for delivered silver, helping fund the deal. Silver is poised to rise dramatically over the next few years as it is both a safe haven investment and a consumable metal with new uses being announced almost every month. From energy (solar) to medical. The historic ratio between the price of silver and the price of gold is about as low as recent history has seen and even a modest reversion towards the mean will see silver prices rise quit quickly and quite steeply. In 2006 silver was well under $7 an ounce and languishing. Now in 2008 it is approaching $20. Even with that dramatic rise the ratio is still out of whack and silver needs to correct up quite a bit. I will not even comment on any type of perceived silver shortage in the NYMEX arena as it is all speculation.
In conclusion, GG's Q1 results should get a lot of attention due to the one time cash infusion from the sale of the SLW shares and once noticed it will stay in the limelight due to its solid management, low cost production and its outstanding mines. With the price of gold nearing $1000 an ounce and GG able to avg. production costs under $300 per ounce it will be hard for Wall Street to ignore. Expect GG to make new all time highs later this year. 2009 will see even greater growth as mine production ramps up and almost all analysts expect much higher prices for gold and silver for years to come.
