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What's Behind The Disconnect Between Bullion And Mining Stocks?

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To me a big part of the picture is that mining companies attract speculators (seeking higher share prices) rather than investors (seeking dividends) due to the dramatic transformations as a small collection of ventures works out or gets wiped out.

Often miners start out as too small for pensions (etc) to be allowed to invest in them. Also they are individually off the radar of most analysts since they are so small in market cap terms.

Starting out on a risky mining venture where the price of the commodities involve dramatic fluctuations (e.g. silver over the last 5 years), do run the risk of embarrassing any analyst who recommends them. For analysts it is a real specialty field involving a different methodology than most of the rest of the equity markets.

Basically: bullion is a safety thing - risk off. Miners are risk fully on. Just now punters are mostly risk off.

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...History has shown us that in a precious bull market you will make a lot more money in silver than you will in gold, but you will make more than twice as much money in selected gold and silver mining stocks as you will in silver. Why? Because they are uniquely leveraged in relation to pure bullion.

...Historically, a development or exploration company that strikes it rich may eventually give you 15 o 20 times as much profit as bullion. That's why I said that mining stocks may be a license to print money!

...There is one caveat: although mining stocks should do well all through the bull market, history tells us they will probably give us the biggest returns nearer to the climatic blow-off. They will require a lot of patience, so buy now, put them away, and hang on for several years.

...Silver mining stocks should be the stars.

Ruff's Little Book of Big Fortunes in Gold and Silver

Chapter 11 Howard Ruff 2006


I have this book, and Mr Ruff shares his valuable experience of the last bull market.

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It's quite clear that we are seeing the beginning of the end of the paper silver/gold market in that graph as well. The bullion has the low risk/almost-one-way-bet priced into the bullion price, whereas the shares are a reflection of (1) the ponzi silver & gold paper market, and (2) the continuing concerns around confiscation (call it nationalisation if you want) of the mines and vault stocks.

There is absolutely no doubt that governments and politicians have become as authoritarian and controlling as Hitler was, and they are now starting to let it show. This is no conspiracy theory, it has gone way beyond that, into the provable sphere. The only unprovable part is who is deliberately following the agenda, and who is a useful idiot. Any open-minded research (rather than sheeple attitude) will show many, many instances (particularly in the USA) of government out of control. They are utterly ignoring any protests or suggestions of any kind, not matter how sensible or justified, if those protests are against the Agenda 21/Common Purpose/NWO agendas. The frogs have reached a temperature just below boiling, and it will only take one more really big shock (manufactured, black swan, false-flag or allowed-to-happen, it won't matter which) for the final big push to quasi-dictatorship, and when that happens, there will be so little downside to their warped little minds, that another confiscation (not of the door-to-door type, but the theft of the supplies in the ground or in the vaults) will be just soooo tempting.

And remember, this is with a bunch of politicians in power who thought nothing of stealing from the public purse via their expenses. The only good thing about this, is that the politicians are such grasping b@stards that they are unlikely to allow privately-held gold to be confiscated, as they want their own stashes untouched, too.

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  • 439 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?

      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%

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