see the last part about cash burn rate and funding. SFMI has a mill which could become cash flow positive in 2012, and we have a LOC as a backup plan for funding. We're in better shape than many other juniors imo.
This will ultimately be good for gold and silver. More importantly, to me, the gold and silver stocks are not expensive relative to the price of gold and silver. Some of the juniors are cheap relative to gold and silver and this situation will not last.
If the market doesn’t step up, meaning individual and institutional investors, to buy the better gold and silver stocks, it won’t matter because the industry will take them over. That will absolutely happen (takeovers). Either the market improves or the market goes away because the industry takes over the better juniors.
It is very important, to understand that out of the 4,000 or 5,000 juniors that are exploring, all or approximately all of the up-move will be constrained to the best 20% of the issuers. And most of the moves will happen with the best 5% of the issuers. So, let’s say there’s 5,000 names worldwide, perhaps 250 of those names will generate almost all of the value creation.
One final note, KWN readers need to pay attention to cash balances and burn rates on juniors they hold in their portfolios to make sure they are well funded going into 2012. This is absolutely critical that your readers do this. It is as important as the people involved and the properties themselves.”
