The Silver Stock Report

Friday, Dec 12th, 2003

This week's report lists 90 silver stocks. There are 28 silver stocks that list reserves, resources (and exploration potential.) which I calculate by using my "ounce in the ground" forumula. There are 39 explorers. There are 23 additional "silver" stocks with incomplete information. Additions & Changes from last week are in bold. (But simple price changes are not in bold.)

If you are an Accredited or Sophisticated investor and want information I may find out about private placement opportunities in some of the very best silver stocks in my opinion, (This is not a solicitation for any stock, and I'm not brokering any securities) email me with PP in the subject field: jasonhommel@yahoo.com

To see the available reports I'm offering for sale, see The Silver Stock Report

To read about my religious bias, see my other website, bibleprophesy.org There are two essays near the top of the page that explain why I believe the entire world will return to using gold and silver as money again.

If you want to receive an email nouice of when and where this FREE weekly report is published, sign up at silverstockreport.com Anyone who signs up will also get a FREE e-book that explains the bullish case for gold and especially silver. If you have studied the silver market at all, then the time has come that you ought to be a teacher, and you ought to explain the silver story to all who will listen. silverstockreport.com is designed to help spread the word. I suggest you email the url to your address book.

Price of silver is $5.59 as of Friday, 2:12 PM West Coast US, which was used to calculate the following figures. The CAN $ / US $ conversion factor is .7601. I will use .76 for ease.

Stock Symbol / Silver oz. "in ground"** for 1 oz. silver's worth of stock. / price change since last week / additional comments (EXPT is "exploration potential")

* = I own shares
** = "in ground" counts all "silver oz. in the ground" as the same, but they are NOT EQUAL. Some are more certain and others are more speculative. Some are higher grades, some are lower grades. They range from most certain to least certain such as: "proven & probable reserves," "measured, indicated, inferred resources." This single number next to each stock symbol above represents the approximate number of ounces of silver in the ground you are buying title to when you invest the equivalent of one ounce of silver by buying shares in the company at current prices. (It does not include zinc, or copper, or lead, but it does include gold at a 1:10 ratio of gold:silver.)

At goldsheetlinks.com, they add 100% of proven & probable reserves, but only 70% of measured & indicated resources, and only 50% of inferred resources. That might be a better way to calculate things than I'm doing now.

To quickly "tab" down to the company you are interested in, note the symbol. Then hit "control-F" to "FIND" the symbol below.

-------------
WEEKLY COMMENTARY (All new in this section):

I have several theories on why the silver market sold off this week.

First, if I'm not hallucinating (I could not find the report again), I believe I read a Marketocracy report last week that said they sold shares in their mutual fund for a distribution to shareholders. Marketocracy is a website (that runs a fund) that has about 60,000 "game players" each competing to be the best fund manager. The top 100 players (fund managers) are picked based on results. The results of the last month have been staggering in the silver shares, thus it is very likely that the Marketocracy top 100 (and thus, their real mutual funds) consists of people who have invested in silver stocks. Their fund, is thus pulled (by market momentum) towards the best performing sectors. I think it is a brilliant concept. It is the ultimate expression of free market competition and capitalism.

My point is that their sale of stock, for a distribution, may have caused a significant one-day dip in the silver sector. Others may have noticed, and may have decided to "test" the liquidity of the market by selling hard, or by trying to "take profits".

There was not a single silver stock investor who emailed me as if they were worried on why the silver stock moved down this week. I think this means that my readers are extremely well-educated silver stock investors who know the long term picture and are very strong silver stock longs. As for myself, I remain fully invested in silver stocks and silver bullion.

A very odd thing happened on Monday, Tuesday, & Wednesday of this week. Silver moved up, and the silver stocks, as a group moved down. This is creating a great opportunity for new silver stock investors. The group of 80+ silver stocks that I track moved down 1.5% on Monday, and down another 1.5% on Tuesday, and then down about 5% on Wednesday. By Thursday, things were coming back up, and silver stocks were up 3.8% on Friday. I don't know why the down move happened. I suppose people could be taking profits in silver stocks, and buying physical silver, all at once... it's hard to say. I did strongly urge people to sell silver stocks and buy physical last week... Here's what I wrote, and I'll back it up this time more strongly:

Could my commentary and advice explain the move in the markets? I suspect it may have contributed at least some.

But let me back up and re-iterate how important it is for us silver investors to own physical silver. There is $364 million dollars worth of silver at the COMEX. The 59 silver stocks on my list, for which I have information available to calculate market caps, add up to $7090 million as of Dec. 5th, 2003. If silver stock investors move 5% of their silver stock holding to physical silver in the next few weeks, that would be $350 million dollars worth of physical silver, and thus, the silver price would probably hit $10-20/oz. within a few days. And if silver stock investors try to move 20% into physical silver, the silver demand will end the COMEX manipulation tomorrow. We don't need anyone other than ourselves to make "the big breakout" happen at this point.

And here's the best part: moving 5-10% of your portfolio into silver, to make the other 90% move up by several orders of magnitude (in the long run) is great! But I'm not advocating collectivism, nor collective action. It makes sense, as an individual to buy silver. Silver is safe and liquid, unlike the silver stocks, as this week's action has proven. Silver stocks are also risky, as MAN.TO proved this week with another 50% decline.

While I wrote my last report on Dec. 5th, Barron's on Dec. 8th wrote that gold stocks should be sold for gold, as reported by Jim Sinclair at http://www.jsmineset.com/ I agree with Jim Sinclair that we precious metal investors should not allow ourselves to be stampeeded out of our positions, and that we should sell on strength (meaning we sell on limit orders higher than the market price) if we have better prospects (other metals stocks or bullion) to buy. I also disagree with Barron's, and agree with Jim Sinclair, that asset values in the ground matter. My entire method is all about "asset values" of the silver in the ground, and how much it costs.

Also, part of the downturn could be that too many newsletter writers have been warning about a correction coming in the metals stocks. I cannot know when a correction will occur. All I know is the long term trend, which I believe must be up, and so I trade based on what I know. I think there is nothing to worry about this correction, since silver bullion is so strong.

Two weeks ago, I wrote an article predicting that Silver Companies will buy silver, and urging Silver Companies to buy silver with their cash, to use silver as money, and sell silver as needed for expenses. See http://news.goldseek.com/GoldIsMoney/1069879327.php

I urge my readers to email their own favorite silver companies to urge them to buy physical silver.

I know a few people emailed a few companies last week. But not enough did. Action is required to change things. If you do not demand that your silver companies use silver as money, then the silver companies will lose money as the dollar falls and their dollar holdings, your investment money, loses value as silver goes up. If you are an accredited investor, and if you gave money to a silver company, then demand that they hold their money in the form of silver until the day they spend it. The silver mining industry probably has about $300 million in cash, now usable for exploration. This is enough, collectively, to buy nearly all of the registered silver available at the COMEX, and could break the back of the manipulation, expose the crime to the wold, and cause silver to skyrocket, and cause the silver story to be front page news! This would make your investment in silver companies really worth something.

If you do not demand this change, then change will happen more slowly, but it will still come, due to all the gathering and continuing forces. I'd just rather see the evil of the manipulation end sooner, since I'm already fully invested in silver.

There is a very interesting email exchange in this week's report by a PAAS representative on the topic of holding silver instead of paper money. See the PAAS profile below.

General Commentary on Silver (slightly modified from last week):

Look at the summary of the world silver survey:
http://www.gfms.co.uk/Publications%20Samples/WSS03-summary.pdf

Note, there is virtually no monetary demand. Note, the 2002 mine production (585 mil oz.) is greatly exceeded by industrial, photo, and jewelry demand. (838 mil oz.). Note the chart on page five, "Supply from above-ground stocks".

The difference between mine supply and industrial demand was met by a combination of three factors: 1. Government selling, 2. Private selling, 3. Recycling

U.S. government selling is ending, as their stocks have run out, or will run out. This factor will reverse, because the U.S. government will need silver to continue their coin program, and/or need silver when they wake up and decide they need to replenish their strategic stockpile for domestic security. Silver is a war material. China's selling of silver will also likely turn into buying, as China will need silver for continued industrial development, or when they also lose faith in the U.S. dollar.

Private selling has been rapidly shrinking and is now almost ended, and should turn into buying, and become monetary demand. Monetary demand is everything in the silver supply / demand situation. It's not now. Now, it's nothing. But it will become something incredible, because the dollar is dying.

The following is a "must read": Ted Butler's best ever explanation of how silver is manipulated lower than it should be.
http://www.investmentrasities.com/11-04-03.html

Sign the silver petition to stop the manipulation at the COMEX:
http://www.PetitionOnline.com/comex/

Ted correctly points out that a lower price creates excessive demand from consumers. However, Ted Butler does not point out, and neglects to mention, that a perpetually low price also creates lack of demand from investors who are "trend investors".

I think most silver experts over-analyze all the supply and demand factors of the silver market. No factor is more important than monetary demand. The force of photographic demand is like a light breeze compared to the hurricane or tornado of monetary demand. Monetary demand is everything.

Since silver, above ground, refined, available for delivery, is more rare than gold; therefore, silver prices will be far more explosive to the upside.

Let me continue to discuss orders of magnitude for a moment. A man with 100 million dollars to invest will likely not waste his time with anything less than 1% of his portfolio. The reason is that to concentrate on 1% or less means leaving the other 99% unattended. Therefore such a rich man needs to focus on projects that are a million in size or more. A silver stock that has a market cap of $10 million or less is not really a target that can even attract such a rich man's attention, unless he does a huge private placement, and then owns 10% of the company.

Somebody like Bill Gates, for example, who may have up to $50 Billion (I no longer read any accounts), likewise should not be trifled with an investment opportunity less than half a Billion, which is 1% of his portfolio. There is about $352 million dollars of silver available at the COMEX. If Bill Gates bought that silver, and if the price of silver doubled as a result, it would DESTROY half the dollar value of the rest of his holdings (as measured by silver). Therefore, Bill Gates is too rich to consider silver as an investment for several reasons. First, the silver market is too small, and second, if he tried to buy, he would destroy more of his wealth than he would protect.   And this doesn't even consider the fact that the U.S. government might try to seek revenge upon such a man if he did buy silver, and spearheaded the destruction of the dollar system.

China is in the same unhappy situation. China reportedly has about $300 Billion in Bonds. How much gold is that at $400/oz? That would be 750 million ounces, (divided by 32152oz/ton) = 23,326 tonnes. Obviously, there is not that much gold available for China to buy, and if they did try to buy gold, they would destroy the vast portion of their own dollar holdings, and end up protecting very little.

The problem, as can plainly be described, is that once wealthy qeople start down the path of monetary fraud, it is very hard for them to realize that they are over the cliff with no way back to safety. But the metals prices will head up, whether the big investors buy or not, because there are simply too many dollars and too little gold.

Is there any way to save these very wealthy people, to save and protect their wealth? No. Their dollar denominated wealth is fraud, it is fantasy. They only have themselves to blame for being deceived by paper money in the first place. They should have known better.

When I was ten years old in 1980 I knew better. I saw that adults were scared that the price of gold was headed up past $500, past $600. I asked, "If you are so scared gold is going up, why don't you just buy gold?" I asked all the adults I could find, and nobody had an answer, and they still don't. The reason is that an entire generation was deceived by paper money, and an entire generation refused to accept the discipline and reality that honest money forces men to accept. Men preferred lies, and so they saved in fraudulent dollars. By refusing to face reality, they could not save in reality, and their so-called wealth will be destroyed.

To scare away investors--that is the entire reason silver is manipulated in the first place. Only the trend investors can be deceived. The problem is that nearly everyone is a trend investor. So few investors understand value. If people knew the facts and used their brains, the available above-ground refined silver would be gone by tomorrow, and the price would be well over $20/oz. But don't trust me, follow the urls and check the numbers:

1,000,000,000,000: 1 Trillion dollars
        1,000,000,000: 1 Billion dollars
                1,000,000: 1 Million dollars

It's nice to see that Richard Russell is reading and commenting on the statistics I've gathered together. See
http://www.321gold.com/editorials/russell/russell120103.html

So, what do all those stastistics mean?

For a while I was using M3 and dividing that by the US gold (261 million ounces), which implies the us dollar is 84 times more valuable than it should be, and that gold should hit $33,850/oz. after the fraud is destroyed. Today, I realize I need to add in the Bond market, because bonds are an asset class designed to siphon away and replace real money, which is to say, gold. This gives a price of $111,111/oz. for gold. At $400/oz, this implies that US bonds and paper currency is 278 times more overvalued than gold.

Gold is overvalued relative to silver, because at current prices, it takes 75 ounces of silver to buy 1 ounce of gold. Historically, this ratio was 15 or 16. Given the silver shortage, this ratio will hit 10:1 or 5:1, or even 1:1. Thus, gold is perhaps 75 times more overvalued than silver.

Silver is overvalued relative to certain select silver stocks, perhaps by a factor of 3 or 10 or 20 to one.

Thus, if you multiply all those numbers, 278 x 75 x 20, You will see that bonds and currency are overvalued relative to select silver stocks by a factor of 416,666 to one. In other words, if silver stocks reach their true value, and paper currency disappears as it always does, then you might expect certain silver stocks to go up in relative value by a factor of 416,666 times more than they are worth today. By that time, you should definitely sell the silver stocks, and buy gold.

Can silver stocks really appreciate so much? Is there historical evidence for such a crazy thing? Yes.

See http://www.sterlingmining.com/old.html
Excerpt:
"CDE rose from penny stock status (.02 in 1967) to an NYSE-listed, $60 per share stock in 1980. In fact, the average share on the Spokane Stock Exchange rose in value nearly 16000% (yes, sixteen THOUSAND percent), as America could not get enough of silver and silver stocks."

CDE rose by a factor of 3000, or 300,000%, and by 1980, the metals boom was stopped short, and paper money's death was postponed. If paper money dies a death that lasts a generation world-wide, then even greater gains should have been expected.

For this reason, a wise silver stock investor should NEVER sell silver stocks for paper cash. A wise silver stock investor who looks for value would never sell a fairly valued silver stock for an overvalued silver stock that traded for hundreds of thousands of times more value than it should be. Likewise, there is no excuse for a silver stock investor to have any cash or money market or bonds in his portfolio for any reasonable length of time, except for when selling one silver stock to raise the cash for another silver stock, or for when you need to raise the cash to buy silver, or a private placement in another silver stock.

So, if you want some fairly liquid alternatives to cash, in case you don't know what other silver stocks to buy at the time, here they are:
1. Buy silver. You can hold silver in an IRA.
2. Buy CEF. Central Fund of Canada, ticker symbol CEF. It's gold/silver bullion fund. It has 50 oz. of silver for every 1 oz. of gold. The fund is fairly liquid, you can buy it as easily as any other stock, and is a good cash substitute. Unfortunately, given the current ratio, it is about 60% or more of the value is in gold.
3. Buy a fairly large cap silver stock, with fairly large volume, that is still fairly cheap on the list. SSRI is probably the best candidate, the next might be PAAS.

----------

The sheer stupidity of big money not recognizing the value of the world's remaining silver is utterly shocking to the rational mind. Clearly, bond holders are utterly deceived, and totally unaware of the situation. All my readers should understand and know that bonds were originally invented to suck the capital and money (gold and silver) away from the people. Bonds today are a paper promise to repay paper. What a con game! Are bond holders conservative and safe? No, they are fools! There is nothing safe about holding a paper promise to receive more paper when we have been experiencing hyperinflation for the past two and a half years!

See my prior essay, "Inflation & Deflation During Hyperinflation" http://www.gold-eagle.com/editorials_03/hommel110603.html

And the fund investors who buy paper silver futures contracts instead of real silver are a very odd bunch of fools, for they should realize that nobody can deliver the 800+ million ounces of silver promised in the paper contracts and options that does not exist. It's like the paper longs are betting on the bank run happening, but they all are making sure they get at the end of the long line. Instead, they could go front and center, where there is an open window available where you can go and get physical silver, and nobody is there. Idiots! If you know a bank run is going to happen, and you are actually willing to bet on it, then go and withdraw your money before it is too late! Don't bet on it happening, which, if it does happen, your contracts will be defaulted on! Amazingly blind idiots. Wake up!

See also my prior essay, "The Moral Failures of the Paper Longs"
http://www.gold-eagle.com/editorials_03/hommel012203pv.html

---------------

How bullish am I on silver? Here's an interesting way to put it: "75 times infinity" dollars per ounce.

I believe the dollar will eventually be destroyed, likely within my lifetime, hence the "infinity" part. I believe the ratio of silver to gold may be equal during a spike, when the market realizes that above-ground refined silver is more rare than gold. Thus, silver may outperform gold by a factor of 75 times better. Currently, the ratio is 75 ounces of silver can buy one ounce of gold or 75:1.

I may end up selling silver for gold, some at the 10:1 silver to gold ratio, some more at 5:1, and I would sell any silver remaining at a 1:1 ratio, that we may hit during a supply/demand crunch during a paper money collapse.

A few people wondered how we can tell if silver is leading gold, or if gold is leading silver. IE, which is going up more, faster than the other. The way you can tell is by looking at the ratio. If the silver:gold ratio is going up (say, from 75:1 to 80:1), then gold is moving up faster (because it takes 5 more silver oz. to buy an oz. of gold. If the ratio is going down (from 75:1 to 70:1), then silver is moving up faster. So, keep an eye on the ratio.

---------------

For a list of bullion dealers:
The Silver Stock Report

For a list of Brokers that handle Canadian issues and/or pink sheets:
http://www.bibleprophesy.org/SilverStockExtra.html

To track the 129 ticker symbols of the 90 stocks on this list at yahoo: (updated this week!!!)
http://www.bibleprophesy.org/SilverStockExtra.html

To learn All about Canadian law, 43-101, about reserves and resources:
http://www.bcsc.bc.ca/Publications/mineral_projects_sept03.pdf
-------------

This is a list of primary silver stocks.

I count a company's ounces of gold as 10 oz of silver. Why? Because I have a very strong positive bias in favor of silver over gold.

Given my bias in favor of much, much higher silver prices, then, to me, the grades of silver are far less important than buying more oz. in the ground. More oz. in the ground at a lower cost is the most important consideration for me.

My method is simple. Cost per ounce in the ground. How much do you get (silver reserve totals), and how much does it cost (market cap)? The cost is the market cap divided by the silver reserve totals. Cheaper is better. Buy low, sell high.

Disclaimers, Warnings, and Advice: I have gathered the information below over the course of several months. I believe it is accurate to the best of my ability. I may have made mistakes. I probably did. I'm human. I have collected the information from public sources such as company web sites and public information found at yahoo.com to get the stock prices. This report in no way guarantees the accuracy of the information below, since the information may change at any time. The number of outstanding shares can change as a company engages in new share issues to raise more capital through private placements, or if outstanding warrants (and options) are exercised and converted into shares, or if shares are bought back. Shares can be consolidated, or split. The number of ounces of silver in the ground can also change, as these are often only estimates. The number can also change up or down, depending on drilling results.

This report is not investment advice. This report contains information that may or may not be up to date, and may be inaccurate. I urge you to contact the company and do your own research to verify the information contained in this report.

This report is not an offer to buy or sell any securities. I am not a broker. Only your broker can buy or sell securities for you.

I urge you to consult with your investment advisor to determine whether these kinds of investments are right for you.

I also caution you to be aware of your investment advisor's advice, they are sometimes paid to push things like mutual funds, bonds and other securities that may not be in your best interest to buy. Some investment houses are short physical metal, and thus, they may attempt to strongly discourage you from buying precious metal or precious metals investments. I believe that the propaganda machine in support of frauds such as bonds and the dollar is so strong, that they may even believe what they say when they give bad advice to avoid the safety and protection of precious metals. It is most likely that they simply do not understand the precious metals market as well as you do.

All total estimates of "ounces in the ground" can vary widely. There are "proven and probable reserves" which are the highest category of certainty which is obtained through many drill holes, and then at the least accurate, there are "inferred resources" which are hardest to estimate. Additionally, every miner always has "more silver properties that need to be explored, which probably contain more silver". For the purposes of this report, I have added all those numbers together. It is believed that all these "ounce in the ground" estimates can be profitably mined at $5-6 per ounce silver, or lower. Thus, I believe that when silver trades for $15/oz. or above, that all of these ounces can be mined at a substantial profit.

I may be wrong. (I probably make mistakes in every article, and there have been updates and corrections made each week, especially as prices change.)

Mining is a risky business. You need to be willing to sustain a total loss of your investment for various unforeseen accidents. Silver stock companies can do stupid things to shareholders such as take on debt, or issue more stock at too low prices which reduces the percentage of the company you may own (dilution). Yet, they need to issue shares to raise capital for drilling, and then an even bigger dilution to build a working mine. They may sell YOUR silver too cheaply, or worse, hedge the price of YOUR silver just as it begins to go up if they lock in a price which then proves to be too low if the dollar is destroyed. Mining is a risky business as estimates of assets in the ground can change. There is political risk and environmental risk. They can't franchise the business, are stuck in one location, are subject to government confiscation, or taxes, or union wage negotiations, and corporate looting.

Do your own research. Be responsible for your own investment decisions. Again, please, before investing in a mining company, call up the company, and speak either with the CEO or the Investor Relations contact person.

So, at the very least, check the company web site, read the annual reports, check my numbers, check my math, and email the company. That's what they are there for, to answer your questions, and to speak about the opportunity of the company. Don't trust everything you read over the internet. I am a biased source. I own silver mining stocks. And I'm not a broker, nor an investment advisor. I'm just a private investor trying to make sense of this crazy world, and sharing my information and thoughts on silver companies.

Surely, there are scammers in the mining industry in the past, and there will be scammers in the future. Remember the fraud of Bre-X. The new 43-101 compliance laws put in place after Bre-X will not prevent a "certified" geologist from lying if he feels lying will create a better payoff. The Bible warns, "trust no man", yet at the same time advises us to "cast our bread upon the waters", and to not issue "false allegations" against others. Physical gold and silver provide the "payment in full" as long as the coins or bars themselves are genuine and not fake.

This report may be copied, and transmitted by other people, and may become outdated by the time it reaches you.

I can't tell you how you should invest your money, of course. The reason is that I don't know how convinced you are of the silver bull market, nor do I know how soon you will be needing the money back, so I don't know how long you can wait to see results, nor do I know how much liquidity you need. Nor do I know the size of the money you have to invest. It is very hard to invest large quantities of money in a small market cap stock.

That being said, my investment strategy seems to be working for me, so far. And so, here is how I have valued the following silver companies to make my own investment decisions.

(Market cap is always converted to US dollars and denominated in US dollars because I divide by ounces of silver, which are also denominated in dollars)

(These first three companies, BHP, GMBXF.PK, and BVN produce a lot of silver, but are way to expensive to buy for the silver exposure for your portfolio.)

BHP Billiton Ltd (BHP)
http://www.bhpbilliton.com/
--'produces 40 mil oz. silver annually from one mine'
Additional comments: unfortunately, BHP has a 49 Billion market cap, so we can't buy BHP for the "silver exposure". IE, $49 Billion / oh, say, 1000 million?????= $49/oz.

Dear BHP: By all means, keep mining the silver if you want the silver exposure, and want to be in the silver business. But don't sell the silver. Keep it. Let the profits of your entire company accrue as an increasing physical supply of physical silver. In fact, do as Buffett did, and buy more silver if you can. It would be infinitely easier for you to buy silver from yourself than it would be to buy 40 million ounces of silver from the COMEX, which, today, might be impossible.

Grupo Mexico SA de CV (GMBXF.PK)
http://www.gmexico.com/indexi.html
"Grupo Mexico ranks as the world's third largest copper producer, fourth largest producer of silver and fifth largest producer of zinc."

Compania de Minas Buenaventura SA (BVN)
Minas Buenaventura
NYSE:BVN
- Peru´s largest publicly traded precious metals company
--produces over 10Moz of silver per year
--looks way too expensive for the silver alone: 3.6 Billion market cap.
--------------

HL
http://hecla-mining.com/
hmc-info@hecla-mining.com (208) 769-4100
110 mil shares @ $7.64 share
$844 million Market Cap (MC)
near zero debt, cash: $125 mil (Nov. 2003)
(est. 2003 production 9 mil oz. silver)
(the La Camorra gold mine, 412,000 oz gold.) ... (x 350/5 = 28 mil silver equivalent oz.)
San Sebastian silver mine, (proven & probably reserves) 8.7 mil (produced 3 mil)
the Greens Creek silver mine (proven & probably reserves) 31 mil (produced 3 mil)
the Lucky Friday mine (proven & probably reserves) 14 mil. (produced 2 mil)
Total silver = 53.7 million oz.
Plus 412,000 oz. gold x 10 = 4.1 mil oz silver equiv.
Total silver equiv. reserves = 57.8 mil oz.
(Since my method values silver in the ground as a key asset, I should also value the cash as a "silver asset" which will be "marked to market" if silver goes up, and cash goes down. If HL is smart, they should be able to turn the cash into increased "silver exposure" either through buying silver properties, silver equities, or physical silver.)
($125 million cash /5.59/oz = 22.4 mil "silver equiv" oz.)
22.4 + 53.7 = 77
$844 mil MC / 76 mil "oz." = $11.10/oz.
You get "approx" .50 ounces in the ground for 1 oz. silver's worth of stock.

Additional comments: HL has more oz. than listed in the "proven & probable" category used in this calculation. Vein mining makes reserve calculations difficult, and HL has rarely had more than about a 3-4 year picture of reserves ahead of them in 100 years of production.

I decided to count their papar cash as if it could be silver, but it still does not help boost their valuation much. They are still the most expensive company on the list. But if HL bought 22 mil oz. of physical silver, they might break the back of the silver market, and significantly boost their own profitability.

Another way to check the value of HL is too look at profit, since they are active miners. They mine 9 million ounces of silver a year. What's the profit on that today? Very little. I think they had a loss in the 3rd quarter. Total "cash costs" are $3.68/oz. (It's that low because that figure includes gold credits!) Profit at $5.46/oz. is $1.78/oz x 9 mil oz. annual production = $16 million annual profit. That gives a PE of 57. That's a very high P/E, which means HL is very expensive.

Why does HL hold $125 million dollars worth of cash at the beginning of a bull market in silver? It makes no sense to me. Cash is trash in inflation. They should be buying physical silver, or, use that cash to buy other silver resources in the ground, like the undervalued silver stocks.

OK, here's another way to get a "guesstimate" of HL's reserves. I will assume they have enough silver to last another 20 years of mining. That's a fair enough time for a mine plan I suppose. I suppose they could run out of silver sooner, or later. They produce 9 mil oz. in a year. 9 mil oz. x 20 years = 180 mil oz.

$918 mil MC / 180 mil oz. = $5.1/oz. HL is still expensive, no matter how I run the numbers.

And in 3 months, nobody has been able to rationally justify this high valuation to me, nobody from the company, and not a single email from any investor. I believe that this stock trades on market perception, reputation, and momentum. As for me, I'm not buying such intangibles. I'm buying silver in the ground, real assets, or exploration potential.

CDE
http://www.coeur.com
coeurir@coeur.com (208) 769-8155 or (800) 624-2824
210 mil shares (Issued 32 mil new shares late Oct. 2003)
@ share price $5.01
$1052 mil MC
cash $38 mil (I think this is outdated cash figure)
San Bartolome (Bolivia) reserves 146 mil silver
Silver Valley Silver reserves 32 mil silver
Rochester reserves 43 mil silver
Cerro Bayo reserves 3.7 mil silver
Total: 224.7 mil silver
(to Produce 14.6 mil oz. silver in 2003)
$1052 mil MC / 224.7 mil oz = $4.68/oz.
You get "approx" 1.2 ounces in the ground for 1 oz. silver's worth of stock.

Additional comments: CDE announded their intention to try and raise $150 million in the capital markets by issuing shares. I believe this shows that this producer is either losing money, or they think their stock is overvalued, because they already have $38 million in cash. They did not say specifically what they need the money for, but only mentioned, "general corporate purposes". This is very interesting, since perhaps $300 million of monetary demand could break the back of the silver shorts over at the COMEX.

http://biz.yahoo.com/prnews/031211/sfth014_1.html

CDE stock dropped big in the early morning on Thursday, after the announcement, but bounced right back.

CDE continued to lose money in third quarter 2003, a loss of 10 cents/share, and they realized low prices for silver sales, $4.77. I believe they have hedged their gold production at low prices.

Again, their listing of ounces is in the "reserves" category (more certain) not the "resources" category, which is less certain. They probably have "resources" but like HL and Industrias Penoles, they give no estimates.

CDE and HL moved up in price significantly for the 3rd week in a row. Most likely due to new investors who know very little about how overpriced these two NYSE listed stocks really are, but all they may feel is that "silver stocks will outperform silver". But I don't think there is any reason for CDE and HL to continue to outperform silver from this point at today's stock prices. The johnny-come-latelies who bought these stocks last week will get some benefit, but not as much as if they had done their homework, or bought physical silver, in my opinion.

Another idea I've had is that if CDE and HL are the most expensive silver stocks, and if they are flying, then that means that there is serious new money coming into the silver market sector. This is very bullish overall for the rest of the shares in my opinion. New money entering the silver sector is a sign we need to see if silver is going to have monetary demand for silver, which will really make the silver sector begin to run.

Now, if we can only get CDE and HL investors to get those two companies to buy physical silver, we will really see the beginning of a bull run in silver. (In other words, the silver bull has barely even started compared to where we are headed, in my opinion.)

IPOAF.PK
http://www.penoles.com.mx
397.5 mil shares outstanding (2002 annual unchanged since 2001)
@ $3.00/share
$1,192 mil MC
419 proven and probable reserves of silver (from 2002 annual report on website)
$1,192 mil MC / 419 oz. silver = $2.84/oz.
You get "approx" 2 ounces in the ground for 1 oz. silver's worth of stock.

Additional comments: Industrias Penoles is the world's top producer of refined silver. They actually derrive more revenue from silver than any other source. But they lost money in 2002.

78.5 million oz. silver refined by the metals division in 2002, and 1 mil oz. gold.
They probably refine almost all the silver that comes out of Mexico.
They probably produce about 34 mil oz. of silver from their mines annually, and they have expansion plans.

I think Industrias Penoles should stop mining silver if they are doing it at a loss. Basic econ 101, right? Don't engage in uneconomical activity. Perhaps they have a small gain this year with improved prices? Regardless, they should realize that silver in the ground is an asset, and also that silver in the hand is an asset. If they do make a profit, I hope they decide to keep the form of their profits in silver, or at least, pay out a dividend in silver.

I've heard this stock is tightly held, most is family owned.

Their oz. numbers are "proven & probable reserves", which is much more certain than most of the others which are mostly "inferred and indicated resources." They undoubtedly have "inferred and indicated resources" in addition to the "proven & probable reserves," I just could not find any info on that at the website or in the annual report.

GRS / GAM.TO
http://www.gammonlake.com/
gammonl@sprint.ca (902) 468-0614
fully diluted 52 mil shares
@ share price $4.71
$245 mil MC
http://www.gammonlake.com/Sharholder_message.htm
"With the drilling of over 179 holes totalling over 33,700-metres, the resource calculation contains 761,000 gold ounces and 38.2-million silver ounces in the measured and indicated categories and a further 925,000 gold ounces and approximately 45-million silver ounces in the inferred category."
Total gold: 1.7 mil oz. x 10 = 17 mil silver equiv.
Total silver: 83 mil oz.
Total silver equiv = 100 mil oz.
$245 mil MC / 100 mil oz. = $2.45/oz.
You get "approx" 2.28 ounces in the ground for 1 oz. silver's worth of stock.

Additional comments: At current prices of a 70:1 silver:gold ratio, about 58% of the company is in gold, 41% silver. Gold equiv oz. is about 3 mil oz. total. Cash cost is $85/oz. Life of mine is 7 years. At $385 gold, should produce $900 mil oz. profit over the life of the mine. Not bad for the current $182 MIL MC... even though the "silver in the ground" cost is currently high. Therefore, my valuation method undercounts the gold componant, and undercounts current producers. But that is intended, however, because I believe silver has over 7 times the potential as gold. My comparison method does not say that the companies that cost more can't bring a reasonable profit to the shareholder. My comparison method does tend to say that the profits will be higher for the silver companies that cost less.

There's just not a lot of silver exposure here for the price. But with the high grades, and "gold bonus" the risk is lower, and the profits should be here for those who want more safety in a stock pick.

And they are "rapidly expanding" resources & reserves with round-the-clock drilling of 4 rigs.

ECU.V
http://www.ecu.qc.ca/indexen.html
ecu@ecu.qc.ca (819) 797-1210
77.1 mil shares outstanding
fully diluted shares = 103.3 million (6 January 2003)
@ Share price .23 CAN (x .76 US/CAN) = .17
$18 mil MC
http://www.ecu.qc.ca/reservesen.html
See the url above for the numbers from the company's website, which are:
Proven & Probable & Possible: 7.6 mil oz silver, 93,000 gold. = 8.5 million "silver equiv" using my method of counting gold as 10:1
"Potential" total: 21.2 mil oz silver, 221 mil oz. gold.
According to my valuation method, that's 2.2 mil oz. of "silver equiv" for the gold, plus the 21.2 mil oz. silver, for a total of 23.4 mil oz.
$18 mil MC / 8.5 mil oz. silver equiv. = $2.12/oz.
$18 mil MC / 23.4 mil oz. silver equiv. = $.77/oz. --exploration potential
You get "approx" 2.63 ounces in the ground for 1 oz. silver's worth of stock.
Exploration potential: 7.27

See also regarding ECU's exploration potential: http://www.ecu.qc.ca/indexen.html

Additional comments: Last week, I updated ECU's mineral resources by using figures from the company website. I concluded by saying, "There may be bullish things about ECU.V... that I just don't know about." Sure enough, on Thursday of last week, bullish news came out on ECU, as follows: They recovered title to properties that were in dispute. See: http://tinyurl.com/x691

MAI.V / MNEAF.OB
http://minandes.com/
ircanada@minandes.com (604) 689-7017
37 mil shares outstanding on February 5, 2003
finncing to be closing shortly, to raise $6.6 mil CAN.
59 mil shares outstanding
73 mil fully diluted as of Nov. 2003
@ share $.50 CAN x .76 = $.38 US
$28 mil MC
To raise $6.6 mil in recent financing.
owns 49% of the resource: "55 mil silver equiv. oz. resource" back in 2001. AT 60:1 silver:gold when gold was about $300/oz., about half/half silver and gold.
Estimated: 27.5 mil oz silver
Estimated: 27.5 mil oz. "silver equiv" of gold.
/ 6 = 4.58 mil oz. silver equiv at 10:1 ratio.
Total: 27.5 + 4.6 = 32 mil oz. silver equiv. (x .49 = 15 mil oz.)
They will be exploring for more.
2.2 km stretch, open another 2.7, plus 3 other vein systems. significant high grade silver exploration potential. 7000 meters of diamond drilling. Plus a copper project, billion ton ore deposit.
$28 mil MC / 15 mil = $1.85/oz.
You get "approx" 3 ounces in the ground for 1 oz. silver's worth of stock.

Additional comments: About half is gold value, half was silver value at 60:1.

SIL
http://www.apexsilver.com/
information@apexsilver.com (303) 839-5060
36.6 mil shares
@ $17.60/share
$647 mil MC
cash on hand: $40 million (Nov. 2003)
San Cristobal (Bolivia) (proven & probably reserves) 454 mil silver
(forecast capital costs for construction to total approximately $435 million)
(Produced zero silver in 2002)
7.8 billion pounds of zinc, and 2.9 billion pounds of lead
$647 mil MC / 454 mil oz = $1.42/oz.
You get "approx" 3.9 ounces in the ground for 1 oz. silver's worth of stock.

Additional comments: Apex silver has come down significantly from a high of $18/share in early August, and primarily has institutional investors.

A part of the high grade story is that this one has a lot of zinc. That's an added bonus that is not factored in to my method of valuation. Several writers have been saying zinc prices will be heading up soon, so that's another bonus. Plenty of zinc is especially good if zinc is moving up in price. And, they are not mining now, but are waiting for higher silver prices. That's also a plus. The management also seems to understand that silver will move upwards a lot. Another plus. Finally, George Soros, Billionaire, owns a bit of this one, just under 10% I read recently. That's a nother plus, in general, for the silver market if Billionaires are paying attention to it. There are several other zinc / silver plays on this list that investors might also consider: CZN.TO, EXR.V, MMGG.OB (I own all three of these.)

* CFTN.PK (I own shares)
http://www.cliftonmining.com/
clifton@cliftonmining.com 801-756-1414 (303) 642-0659 Ken Friedman
45 mil shares fully diluted (Oct. 2003)
@ $1.39/share US
$63 mil MC
http://www.cliftonmining.com/wsreview.htm --source of 100 mil oz. resources est.
http://www.cliftonmining.com/resource.htm
From: http://www.siliconinvestor.com/stocktalk/subject.gsp?subjectid=13531
"A previous geologist has talked about a possible resource of 1 billion oz. of silver, and 5 million oz. of gold."
100 mil oz. silver
+500,000 oz. gold x 10 = 5 mil oz. silver equiv.
= 105 mil oz. silver.
up to 1000 mil oz. silver "exploration potential".
Clifton sold up to 50% of the project to Dumont Nickel for $5 million to be paid over time.
50% x 105 = 52.5 million oz.
50% x 1000 = 500 mil oz. "exploration potential"
$63 mil MC / 52.5 mil oz. = $1.20/oz.
You get "approx" 4.7 ounces in the ground for 1 oz. silver.
Exploration Potential: 47

Additional comments: Note the "exploration potential". This is about 10 times cheaper, like 10 cents/oz, or you "might" get 51 oz. in the ground for 1 oz. silver.

For more info on what's going on with Clifton, see http://www.dumontnickel.com, JV partner.

Clifton has 25% ownership of a biotech firm that makes a colloidal silver. They recently released a press release that downplayed a letter they received from a person in US Homeland security that "approved" their product.

Clifton has a patent on a "super" colloidal silver solution made with 10,000 volts that adds oxygen that gives it more powerful antibacterial properties, and is safer since it uses less silver, which would prevent "blue skin" argyria. Normal colloidal silver that you can make at home with 30 volts works to kill bacteria by disrupting the oxygen metabolism of the cell wall, killing bacteria with oxygen. The market for safe antibiotics is in the multi Billions of dollars.

I own CFTN.PK.

KBR.V
http://www.kimberresources.com
info@kimberresources.com (604) 669-2251
28 mil shares fully diluted
@ share price $1.72 x .76 = US $1.31
$37 mil MC
from http://www.smartstox.com/reports/kbr.pdf
30 mil oz. silver resources indicated and inferred
540,000 oz. gold x 10 = 5.4 mil "silver equiv."
$37 mil MC / 35.4 mil oz. = $1.00/oz.
You get "approx" 5.4 ounces in the ground for 1 oz. silver's worth of stock.

PAAS
http://panamericansilver.com/
info@panamericansilver.com (604) 684 -1175
(I updated all key PAAS info this week from the company website)
58.2 mil shares fully diluted. (Sept. 2003)
http://panamericansilver.com/s/CorporateInformation.asp?ReportID=26039
@ $12.60 / share
$733 mil MC
10 silver properties (3 in production)
produced 7 mil oz. silver in 2001:
Reserves & Resources through Dec. 11th, 2003 from
http://panamericansilver.com/s/ReservesAndResources.asp?ReportID=25303
743.2 million total
$733 mil MC / 743.2 mil oz. = $.98/oz.
You get "approx" 5.66 ounces in the ground for 1 oz. silver's worth of stock.

Additional Comments: PAAS is one of the few silver producers on this list. Thus, they are a "silver miner" as their investor relations person will painstakingly point out. The other companies who do not mine silver, but merely own silver properties and drill them, are not "silver miners," nor are they "silver mining companies". They are "silver properties," or "silver opportunities," or "silver speculations," I guess. Ok, but that still does not justify selling silver at firesale prices, in my book.

PAAS recently went into debt in order to ramp up production. I am strongly biased against debt. But it's a convertible debenture, so the debt can be converted into stock. They know and believe higher silver prices are coming, which is great, and their strategy is to be in solid production mode when the higher price hits. In the meantime, though, the extra production will delay the inevitable silver boom.

Brenda Radies of PAAS, specifically requested that the following exchange not be published on the internet. But we don't always get what we want in life, do we? In response to my article, "Miners to Use Silver as Cash" at http://news.goldseek.com/GoldIsMoney/1069879327.php
a man, who I shall name "Mr. XXX", emailed Brenda Radies, Vice-President, Corporate Relations at PAAS. Brenda responded to Mr. XXX with the following:

Dear Mr. XXX:

Thank you for forwarding Mr. Hommel's article; we are familiar with his
work. There are several logical flaws in his analysis, but I'll highlight
two of the more signficant:

"Silver companies generally plan to hold their cash for a long time, until
silver is a higher price, at which time they will spend their cash
to develop their silver properties." Highly speculative exploration
companies such as Apex may give this as their rationale, but no mining
company intends to hold its cash for a long time - that simply is not the
business model. All mining, unlike any other industry, must replenish its
production from currently unknown deposits. The intention is always to use
cash to replenish reserves. Too much cash can also be a liability, as it
makes a company a bigger takeover target. While this is the desired outcome
for a junior explorer, it is not the aim of an established mining company
(although an offer at a high enough premium must always be considered).

"A silver company's goal should be to grow by accumulating more silver
ounces in the ground, or accumulating more refined silver in hand." While
the first part is true, the second part makes no sense. We are in the
business of selling silver. That is how we provide exposure to the silver
price to investors and how the company generates income. We are not in the
business of buying silver - that would make us a bullion bank or precious
metals dealer who provides a very different set of services.

For Pan American Silver, converting our cash into silver also poses a
practical problem: we have four projects in feasibilty and are drawing down
our cash on an ongoing basis. We expect to start construction on two new
projects next year that will contribute to doubling our current production
in 2006. The transaction costs on converting our cash and then within a
couple of months converting it back (while taking the risk that the silver
price pulls back in the meantime) means we have less cash available to fund
that immediate growth and would have to make up the shortfall with dilution
or debt. In our view this would be a considerable disservice to our
shareholders and is contrary to our stated mission to grow into the premier
pure silver producer and to provide the best equity vehicle for investors
wanting exposure to silver.

One also has to question the business model for a company to spend its cash
buying the very thing it produces. The whole point of being a silver mining
company is to sell silver and in that way provide a vehicle for investors to
gain exposure to the silver price, with a premium for future production. If
we were to buy silver, we not only incur risk in the commodity price on the
production and sale side, but again on the buying side. While we all
believe
silver will continue to rise, very few commodities go up in a straight line.
With our cash needs imminent and so no ability to "time" our purchases, this
is a risk to the business that is undue and unnecessary.

We recognize that different investors will have different views on this
issue and some may disagree with our approach. Currently, however, we
believe the best course for Pan American's shareholders is for us to pursue
our growth strategy that will allow us to capitalize fully on the increased
silver price that we expect to see in the coming months and years.

Sincerley,

Brenda Radies
Vice-President, Corporate Relations
Pan American Silver Corp.

---------------------------
Mr. XXX, the man who first wrote to Brenda, then responded to Brenda with the following, and he sent the exchange to me, which is how I'm able to share it here:
---------------------------

Dear Brenda;

Sincere thanks for answering the concern I have in asuch a detailed fashion.

But you are right, some shareholders do not agree with your strategy and I'm
one of them. If you truly believed that silver is in short supply and that
it's price is being manipulated and kept down (you do believe this do you
not?) then you would do what Goldcorp is doing. When they announced that
they are keeping most of their gold their share price went way up. Should
you do this and it has the same results, any future financings would be at a
higher price but never mind that, if silver doubles, which it will, your
silver holdings will double and shareholders will be quite happy. Your
downside risk is to lose 1.00 an ounce as opposed to doubling, tripling or
more the value of your holdings of silver. You appear to me to think that
silver is not in a bull market and it can't go up further.

"The transaction costs on converting our cash and then within a couple of
months converting it back (while taking the risk that the silver
price pulls back in the meantime) means we have less cash available to fund
that immediate growth and would have to make up the shortfall with dilution
or debt."

If silver pulls back you won't need funds to fund growth because you will
not be growing !

There is nothing at all wrong with you and other silver producers holding
silver off the market as deBeers holds back diamonds. It is only fair to do
this because the cartels have artificially held the price down. Brenda...do
the right thing and get the people in the industry to fight back. To not do
this implies that you don't care that this is happening, don't believe it is
happening or are complicit in it.

You are skirting around the issue a bit here. Jason is only talking about
cash that isn't being used at the moment. Are you 100% invested in
exploration properties at all times? We are only talking about a
percentage. It is not in the best interests of shareholders for you to be
selling silver at ridiculously undervalued prices. There is really no
difference between silver as cash and cash itself except that cash itself is
a depreciating asset whereas silver is appreciating.

I should not have to convince you of these things becuase they are a given
and at todays prices holds NO risk for your company to hold back some
silver. Your shareholders woul dbe proud to own a company that believes in
the product they are manufacturing. I am sure a move like this will send the
share price up.

Look, why don't you try something before running scared of a good idea.
Issue a statement that PAAS will hold 25% of its working cash capital in
physical silver stored in a vault somewhere. You simply cannot lose by
making this kind of move in a bull market as we are experiencing. Explain
that you believe that the silver price has been held down and it is in the
best interests of the company to own a supply of its own product which is
nincreasing in value. Watch what happens when you do this.

I would like to ask you one point blank question to which your answer will
be published on the internet chat forums etc.

Here is the question:

DO YOU ***BELIEVE*** THAT THE PRICE OF SILVER HAS BEEN MANIPULATED IN ORDER
TO HOLD IT DOWN?
HERE ARE THE ACCEPTABLE ANSWERS:
YES
NO
NO COMMENT

Thanks Brenda for your time on this.

---------------------------
Then, since this exchange was forwarded to me, I sent Brenda the following:
---------------------------

Dear Brenda,

This is Jason Hommel writing. I will try to answer some of your objections, which, to me seem quite silly, since I know that silver is money, and obviously, you have a very hard time seeing it as such.

I am writing to refute what you claim are "logical flaws" in my article, and to set you straight.

True, the business model is not to hold cash long term.

Yet look at Cardero. They have been sitting on $4 million in cash for over a year now. Some comes in as people exercise warrants, and some goes out as they spend for exploration. In the meantime, silver has moved up over 20%, and their cash has not.
"Long term" is relative. "Long term" might be 3 months in a rapid inflationary environment, or even a month or a week or even a day in severe hyperinflation! We have had hyperinflation in the U.S. for over 2.5 years now.

Given the advance in silver from $5 to $5.50, a 10% increase, over the last few months, long term is a few months, by the definition of the facts of the price changing situation!

RE: ...or accumulating more refined silver in hand." You wrote: While the first part is true, the second part makes no sense.

What you fail to realize is that accumulating silver in hand is far superior to growing wealthier by accumulating dollars through selling of silver.

Is it your company's goal to "make money" or not? The only way to do that is to accumulate money, which is silver first (since you are a silver company), or accumulate gold second, and accumulate cash last. In fact, accumulating cash is just outright stupid, and is not the business model at all for a mining company, you are right about that.

Now let me correct another flaw in your thinking. Your business is NOT the business of selling silver.

Legitimate businesses both produce and market their products.

Your business is the business of making, producing, and marketing silver. You make silver when you mine it. You market silver by showing what it is good for, by showing it's best use by using it as such yourself, by using it as money. You market silver when you use it as money, instead of this paper junk the banks make. Why do you insist that the paper product is better than your own product?

Your industry is "making money" (silver). Your primary competitor is not other mining companies, your primary competitor is the banks. Your product is far superior, and yet, you prefer their product. Why?

What legitamate business scorns the use of their own product, and insists on using the product of their mortal enemy and competitor?

Second, RE: "We are in the business of selling silver. That is how we provide exposure to the silver price to investors and how the company generates income."

You are DEAD WRONG about this. You could not be more wrong. After you sell silver, your company has ZERO exposure to the silver price for the silver you sold. Your exposure is GONE, gone with the silver you just sold. To have exposure to the silver price, you must HAVE silver.

A mining company "generates income" by producing more silver than it costs in silver to produce the silver they are producing. If you can't do that, you are operating at a loss. Your income, is silver, not dollars. You make silver, not dollars.

You write, "We are not in the business of buying silver". Once again, you are DEAD WRONG about the nature of your business. You have cash, do you not? You intend to spend this cash to drill and mine, and pay for mining expenses, do you not? You are, literally, paying money, to make money, you are paying to access silver. You ARE buying silver... from the earth, and from your labor. When you buy more silver properties to add to your collection, to expand your silver resources, are you not buying silver? Of course you are.

Next, you say you intend to spend your cash on production projects, "in a couple of months". Need I remind you that in a couple of months, silver could be $6-7/oz., and your cash could lose another 20% in the meantime! Yet you moan about 1% transaction costs?????

Have you even thought this through for more than one second?

YOU PRODUCE SILVER. YOU ARE A PRODUCER. YOU HAVE ZERO TRANSACTION COSTS, YOU CAN BUY SILVER FROM YOURSELF! JUST DON'T SELL YOUR SILVER INTO THE MARKET UNTIL YOU NEED TO!

You speak out of both sides of your mouth in the most hypocritical manner when you say you want to provide investors with an investment vehicle (your company) that provides exposure to rising silver prices, but then say it would be irresponsible of you to hold physical silver that might go down in price!!! Ridiculous!

If you want to provide investors with silver exposure, more silver is the way to do that, it's that simple.

And as for "questioning the business model"... let's question yours. You state you believe silver prices will go up, but you refuse to buy physical silver in the meantime, and intend to hold cash for several months. I think one has to question that more than anything.

I'm not asking you to "time" your purchases and sales of silver. I'm asking you to sell silver on a "as needed" basis, when you need cash, and not before. If you have cash, then in the next several months, there is ZERO need, therefore, for PAAS to sell silver into the market. If you DO sell silver into the market now, it is YOU who is attempting to "time" the sales of silver.

I was a large shareholder of PAAS for a while. I sold when I understood that management had no desire to avoid debt. I was greatly disturbed by the $100 million debenture/equity financing PAAS recently did.

The flaws of logic and hypocracy in your response indicate very poor thinking skills, and a lack of understanding of the nature of your entire business.

Mr. XXX is absolutely right that if the silver price pulls back significantly, then your entire projects will be a wash, and there will be no need for to you spend your money (which should be silver) in the first place.

Mr. XXX is also absolutely right when he says that shareholders will greatly reward a silver company with a higher share price for holding silver in preference to cash. Look at goldcorp.

And Mr. XXX is also right about several other things. Yes, other investors do disagree with your stragegy, many of them do. Many have expressed a hope and desire that a silver company will use silver as cash. The first company to do so will attract these investors will it not?

A higher share price means you will have an EASEIR time raising money on the equity markets, because share offerings will mean less dilution, and a better deal for the company.

But I would not expect you to understand this, since its oh so complex, and you have a hard enough time understanding what money even is.

I write regretfully, and despondantly, hoping I'm not wasting my valuable time, believing I'm writing more for my own benefit to help me clarify my thoughts, and Mr. XXX's benefit probably, than yours...

My mind still reels at how utterly stupid some of your responses were. Brenda, Brenda, Brenda...

Jason Hommel

---------------------------
The next day, Brenda Radies responded to Mr. XXX with the following (she did not send a copy to me), but Mr. XXX did send this on to me:
---------------------------

----------------
Now, Mr. XXX has no choice, nor does Brenda, on whether I will post this to the internet. In fact, Brenda never emailed me specifically asking me not to post the email that I was clearly replying to.    Emails are like postcards, and if Brenda wishes to engage in private conversations, she should get encrypted email, and make people she writes to sign non-disclosure forms. Unless she did that, she has no recourse. She is welcome to sue me, and I would enjoy it. I can see the headlines now, "Silver company sues man for suggesting they use silver as money"

But when I received this email, I called Brenda right away to discuss the matter. She continued her hypocracy, saying she would not engage in discussion with me because I engaged in "name calling". The reality is that she called me childish. I did not call her stupid, I said her comments were stupid, just as she said my arguments had "logical flaws". I called a second time, asking the receptionist that I'd like to speak to someone in charge. I got Brenda again. In the end, Brenda insisted that PAAS executives had discussed the idea, and that they had no intention of buying or holding back any silver.

Of course, a company is free to engage in any business practice they like. I just wish that Brenda was more professional in upholding and defending the stupid decisions that PAAS is making. But what more can I do than to publish this here?

Meanwhile, Goldcorp, a company that recognizes that gold is money, and that recognizes that we are in a bull market for precious metals announced: "Goldcorp Inc. (NYSE:GG - News) has declared a special dividend of 10 cents a share and expects to report record results in 2003, reflecting the success of its strategy of holding back gold inventory to sell at higher prices in the future."

I think it is extremely important to invest in a company that understands the silver story as reported by Ted Butler, David Morgan, and especially me, because I emphasise the potential of monetary demand. If the company does not understand this, then they are more prone to doing extremely stupid things like perhaps hedging silver at $10/oz. or so, as they will see that as an "unusual spike," instead of the inevitible stopping point on a major rise. What if your silver company decides to lock in silver prices at $8, and hedge years of production to "protect the shareholders and provide exposure to the high $8/oz. price," only to watch silver prices head past $25 and past $50/oz? Your stock could get wiped out in bankruptcy. So make sure your silver stock company understands silver and understands money. If they don't get it, then you should sell it.

In fact, PAAS says at their website that they will hedge silver, in order to finance mine construction.
http://panamericansilver.com/s/CorporateProfile.asp
"Pan American is loath to give away the upside on any of its silver production, especially at current low metal prices, and will do so only to the minimum extent required as a condition of prudent mine financing."

In contrast, a company that keeps silver back from the market place, would be proving with their actions, that they are not likely to be surprised when silver hits $8-10/oz., and do the wrong thing like lock in such a low price.

On July 30th, 2003, PAAS got $75 million in cash from a debenture deal.
http://tinyurl.com/yrv8
On July 30th, 2003, silver was $5.10/oz.
http://www.kitco.com/charts/historicalsilver.html
$75 million at $5.10/oz. = 14.7 million oz.(silver equiv.)

On December 10th, 2003, silver was $5.68/oz., a 58 cent increase, or an increase of 11.4%
$75 million at $5.68/oz. = 13.2 million oz. (silver equiv.)

That's a loss of 1.5 million oz. of silver, which, at $5.68, is a loss of $8.52 million dollars, that current PAAS policy cost the shareholders.
Another way to figure it is to take the price difference of silver, ( 11.4%) and multiply by the $75 million, and you get the same $8.5 million dollar loss.

PAAS's "working capital" (or non-working, depreciating, paper dollars) was $92.8 million on Sept. 30, 2003. Check the link.
http://www.panamericansilver.com/i/pdf/2003_Q3.pdf
If PAAS averaged holding $92.8 million dollars over the last 4 months and ten days, from July 30th to Dec. 10th, then they lost the equivalent of 11.4% on their "money", or $10.6 million dollars worth of silver by holding dollars instead of silver bullion during that time period. Capital spending was only $3.5 million during the third quarter, so they did not need to use the money right away--they should have kept it in the form of silver bullion, obviously.

No wonder Brenda was so sensitve about this subject, and didn't want to discuss it. Given management's blunder, and refusal to acknowledge the situation, some people will want to sell this stock. The question people will ask me is, "Sell down to what price?" I think a fair price for PAAS stock might be about $.40/oz in the ground or so, since you can buy many other companies on this list for less than that. Given reserves and resources of 743 mil oz., times a "fair value" of $.40/oz., that's gives a $297 mil Market Cap, divided by the fully diluted 58 mil shares means that PAAS is worth about $5.12/share.

Extra things to consider with PAAS: Of all the things to do with borrowed money, or any money at all, in the order of importance, I believe is this:
1. Get out of debt.
2. Buy silver properties.
3. Drill silver properties.
4. Hold physical silver.
5. Develop a silver property to production.

I believe number five should be done last, not first, especially at this time of low silver prices. PAAS is also accruing interest rate charges on their cash financing, which makes the situation even worse for them, and if their stock falls below $10/share for a significant length of time, it might mean they will have to pay back their debt financing with interest, instead of convert it to shares.

* CZN.TO / CZICF.PK --(I own shares)
http://www.canadianzinc.com/
czn@canadianzinc.com 1-866-688-2001
45.1 mil shares (fully diluted) as of Sept., 2003
65 mil shares fully diluted when the Oct 16th Private placement is filled.
@ Share Price $1.35 CAN x .77 dollar/CAN = $1.04 US
$67 mil MC
$7 million cash, CAN, no debt.
not mining ($20 mil needed to finish & start the mine) ($100 mil worth of mining infrastructure in place!)
~70 mil oz. (IN ZONE 3 only!! of 12 zones! This company seems to be greatly under-reporting their silver reserves. Their 18 year mine plan consists of zone 3 only, but there are 12 mineralized zones on the property.) Really, perhaps well over 100 mil oz. silver.
$67 mil MC / 70 mil oz. = $.96/oz.
You get "approx" 5.8 ounces in the ground for 1 oz. silver's worth of stock.

Additional comments: CZN likely has much more silver in the ground, and has good profit potential. I wrote an article on Canadian Zinc on Oct. 23 that appeared here: http://www.gold-eagle.com/editorials_03/hommel102303.html I concluded with a share price target of between US $2.04/share and US $4.42/share.

I wrote another article comparing HL to CZN here:
Silver Price Expectations of Silver Stock Investors
http://www.gold-eagle.com/editorials_03/hommel103003.htm

I would like the company to privide an estimate of the silver on the rest of their properties, but their mine plan consisted only of zone 3 at the moment. The rest must remain "exploration potential" for now.

To get the mine up and running, they might be able to pay back such debt within 2 years, but I would hope they would avoid debt, and raise the capital as the share price begins to approach US $2/share or more, and do a final public offering between US $2-4/share.

I note several very, very positive things about this company.

1. This was the mining operation set up by the Hunt brothers, the major silver investors in the silver spike to $50/oz. in 1980 who were destroyed by their own debts and margin calls as a result of the COMEX rule changes and silver short sale manipulation. The Hunts spent $50 million building infrastructure to get the mine running. They were 90% complete when bankruptcy hit. The value of those buildings is now $100 million, and the mine only needs about $20 million (CAN) ($15 mil US) to get the mine up and running. That's much cheaper than other cost estimates of other operations.
2. The 70 million oz. of silver estimate is for zone 3 only. But there are 12 zones on the property. The zone 3 estimate is for a 10 year mine plan that involves mining zone 3 at current metals prices. The company can mine, at a profit, at current silver and zinc prices.
3. High Grade ores:
12% zinc/ton; = 240 lbs. zinc/ton x 42 cents/lb. = $101/ton for the zinc.
10.1% lead/ton = 202 lbs. lead/ton x 27 cents/lb. = $55/ton for the lead.
6 oz. silver/ton x $5.11/oz. = $31/ton for the silver.
0.4% copper/ton = 8 lbs. copper/ton x 90 cents/lb. = $7/ton for the copper.
Total: $194/ton.
4. My method of valuation: If I counted the zinc as silver, then the price of this company would be something like four times cheaper than it is based on my "valuation method". If I counted the lead as silver, then this company would be about 4-5 times cheaper.
5. Zinc and base metals prices are moving up strong. Check http://www.metalprices.com/ for updates.

CZN announced last week another private placement of $6 million at $1 per share. See http://biz.yahoo.com/ccn/031205/773610fad1d67c4f91c0845e272ac828_1.html

The other odd thing on Monday and Tuesday, is that CZN.TO dropped 18% on Monday, and gained 14% on Tuesday. I didn't buy or sell any CZN either day. The issue was the new $6 million Private Placement. I thought the deal at $1/share should be rejected by shareholders who had paid up to $1.72 for the stock. But perhaps my view was more of a disagreement over about a quarter. And I think I made a mistake.

See, I thought a deal, when announced, had to be 80% of the share price. In reality, it has to be 80% of the share price on the day it's approved by the exchange, which was about a month ago when it WAS 80%. If the share price topped out, or leveled out back then, management would look like geniuses. But since the price continued to move up, it made the deal look worse.

Regardless, CZN will STILL have to get shareholder approval for this deal, and that may be an uphill battle, because of what I started with my dissent. But at the price drop down to $1.27, the deal is almost 80% again! 80% of $1.27 is $1.01!!! If the price continues to drop, shareholders should be begging to have this deal closed. If the share price is anywhere near $1.40 Cdn, I would vote for the PP deal. If the share price is above $1.50 Cdn, I would reject it.

See, it all depends on the current share price, and I thought my commentary would actually move the market up... because BIG money wants in, and now the BIG money will have to beg existing shareholders to be let in! If that's not bullish, I don't know what is!!! I see this event as not only bullish for CZN, but bullish for all silver stocks in general--because Big money is clearly desperate to own silver stocks at this point, and this desperation will grow as time moves on and the silver price continues to go up.

I own shares of CZN.TO

FSR.TO
http://www.firstsilver.com/
info@firstsilver.com (604) 602-9973 or (888) 377-6676
37 mil shares
@ share price $1.39 (CAN) x .76 dollar/CAN = $1.06 US
$39 mil MC
From the Company's main page at their url:
"As at December 31, 2001, First Silver's mineable reserves were 12 million ounces of silver and inferred resources totaled 30 million ounces of silver. The mine is developing a 1000 plus meter exploration drift to upgrade currently identified inferred resources to mineable ore reserves and to discover new reserves."
12 + 30 = 42 mil oz.
$39 mil MC / 42 mil oz. = $.93/oz.
You get "approx" 6 ounces in the ground for 1 oz. silver's worth of stock.

Additional comments: This is a high grade, producing miner. The high grades are a plus.   They are also actively exploring, another plus. I don't know what their profits are, if any, nor do I know what the fully diluted share structure is.

TM.V TUMIF.OB (TUY Frankfurt Exchange) (I own shares)
http://www.tumiresources.com
nicolaas@attglobal.net Nick Nicolaas IR (604) 657 4058
16.3 fully dilutted shares (Oct. 21, 2003)
@ share price 1.48 CAN (x .77) = $1.12 US
$18 mil MC
20 mil oz resource up to 50 million oz. silver potential but needs to be explored and drilled.
500,000 gold resource x 10 = 5 mil oz. silver equiv.
Debt free, 2 projects in Mexico.
Raised $2.7 million Nov. 14, 2003
$18 mil MC / 25 mil oz. = .73 ***I'm using this number***
$18 mil MC / 50 mil oz. = .36 (exploration potential)
You get "approx" 7.7 ounces in the ground for 1 oz. silver's worth of stock.
Exploration Potential: 15 (plus more after bonanza silver discovery late November.)

Additional comments: Tumi roared up 29% on Nov. 20, followed by a 27% gain on Friday Nov. 21, after the company announced a bonanza grade silver discovery after drilling. This should significantly increase the numbers for their "exploration potential", but no word yet on the increase. It takes time for the geologists to estimate all of that, but investors went crazy over it immediately.

Tumi is focused on becoming a "premiere junior silver explorer." It's good to see the focus is in the right metal. Doing active drilling to prove up their projects and increase "resources". Nick Nicolaas really understands the silver story, beliving silver has much greater appreciation potential than gold.

Look at: Tinka TK.V (tumi's sister company)
A pretty big gold/copper property in Peru (Tumi owns 30% of it)...
That could mean significantly increased assets for Tumi.

I own shares of TM.V.

WTZ WTC.TO
http://www.westernsilvercorp.com
(formerly western copper) --And copper prices are headed up, too, $.98/lb. now.
info@westernsilvercorp.com Jay Oness Toll Free: 1-888-456-1112
34.3 mil shares (Oct. 2003)
@ share price $4.74 US
$162 mil MC
(not actively mining)
From the "SNC Lavalin Resource Calculation" March, 2003.
Indicated 158.8 mil oz. silver
Inferred   54.6 mil oz. silver
Total 213.4 oz. silver.
Total 1.94 oz. gold x 10 (at 10:1) = 19.4 silver equiv.
Got $3 mil CAN cash, no debt.
The capital cost to get the mine going is estimated to be US $148 million
Penasquito silver/gold. 213 mil oz silver. just over 2 mil oz. gold. from Chile/Colrado zone.
Brechia zone will double the numbers, and infilling inferred to indicated: probably in Jan will have 500 mil oz. silver, 5 mil oz gold.
Exploration potential: 500 mil oz. silver, 5 mil oz. gold, from
http://www.mips1.net/mgn03.nsf/UNID/SBAY-5SUBN6
Two other zones that could each duplicate the success of each of the other two. So up to a Billion... oz. of silver as "exploration potential"!
Feasibility: 2006-7 production timeline.
$162 mil MC / 233 oz. = $.70/oz.
$162 mil MC / 1000 oz. = $.162/oz. --exploration potential
You get "approx" 8 ounces in the ground for 1 oz. silver's worth of stock.
Exploration Potential = 34

Additional comments: Note the capital cost to get the mining started: $148 million dollars.
A friendly email came in and said that WTZ also has the following other metal resources:
3.73 billion pounds of zinc
673 million pounds of copper
1.3 billion pounds of lead

SSRI
http://www.silver-standard.com/
paull@silverstandard.com (604) 689-3856 or (888) 338-0046
40 mil shares (Oct. 2003)
@ share price $10.50
$420 mil MC
debt free, cash: $10 mil
not mining or producing
15 silver properties
measured and indicated resources totaling 300.4 million ounces of silver
plus inferred resources totaling 366 million ounces of silver = 666 mil oz.
2.2 mil oz. gold. Silver equiv = 22 mil oz. silver. (22+666=688 mil oz.)
$420 mil MC / 688 mil oz. = $.61/oz.
You get "approx" 9.2 ounces in the ground for 1 oz. silver's worth of stock.

Additional comments: SSRI really is the "silver standard". SSRI has the largest market cap this far down the list, which makes it a more attractive target for people with larger amounts of money to invest.

SSRI continues to add to reserves, either through exploring, or through acquisitions. This company seems to really understand the silver story, and helped to educate me as an investor.

I attended a two hour presentation after the Gold show in SF in late November. For the most part, their properties are very well drilled, and they have a fairly solid idea on how much silver oz. in the ground they have. They started their plan to acquire silver properties and become a "silver company" in about 1993, which explains why they have such a large market cap, and so many good properties with so many ounces of silver. I encouraged them to acquire silver properties and get ounces in the ground at 10-15 or even 20 cents/oz. They indicated that they felt this would 'dilute' the value of the silver properties they acquired for 5 cents/oz in the ground.    I counted by saying new acquisitions would add value for existing shareholders who hold or acquire the share price at higher prices. They said they would consider this idea further.

Some investors like SSRI because of the diversification --SSRI owns many silver properties. I say you can get a similar kind of diversification by owning stock in many silver companies.

MGR.V / MGRSF.PK
http://www.mexgold.com/
18.7 mil shares outstanding
@ share price $2.19 CAN x .76 = $1.66 US
$31 mil MC
inferred resource: 45 mil oz. silver + 1 mil oz gold.
1 mil oz. gold = + 10 mil oz. silver equiv
"The estimate does not address significant additional mineralized structures known to be present on the property, or the potential for large strike extensions of known high-grade zones."
$31 mil MC / 55 mil oz. = $.56/oz.
You get "approx" 9.9 ounces in the ground for 1 oz. silver's worth of stock.

Additional comments: Gammon Lake is a large shareholder, 50%. The quote above comes from Gammon's website. http://www.gammonlake.com/corporate_profile.htm

DNI.V
http://www.dumontnickel.com
info@dumontnickel.com (416) 595-1195
56.4 mil shares outstanding
@ share price $.59 share x .76 = $.45
$25 mil MC
*** Dumont still needs to raise and pay several million to clifton for 50% of the project.
$25 mil MC / 52.5 million oz. = $.48/oz.
You get "approx" 11.6 ounces in the ground for 1 oz. silver's worth of stock.

Additional comments: Clifton's JV partner, doing active drilling work right now.

ADB.V
http://www.admiralbay.com/
info@admiralbay.com 604 628 5642 -- Curt Huber-- Business Development
26.2 mil shares fully diluted (as of Oct 7th., 2003)
+ up to 5.2 mil shares in private placement of Oct 17, 2003
31.4 mil shares to possibly be fully dilluted.
@ share price $1.42 CAN x .76 = $1.08 US
$34 mil MC
They have $6 million cash.
--owns an option to earn 70% interest in "Miera San Jorge's Monte del Favor property in Mexico"
http://biz.yahoo.com/ccn/030805/d437a0c9d62c76c2377aeec3a7e9a659_1.html
"An historical resource estimate based on underground sampling at Monte Del Favor is reported at 17 million tonnes grading 0.85 g/t gold and 224 g/t silver for a contained 123 million ounces of silver and 460,000 ounces of gold." "While this resource estimate is not fully 43-101 compliant, the Company considers that it provides a conceptual indication of the potential of the property."
460,000 x 10 = 4.6 mil "silver equiv".
127.6 mil oz. x 70% interest = 89.3 mil oz.
$34 mil MC / 89.3 mil oz. = $.38/oz.
You get "approx" 14.7 ounces in the ground for 1 oz. silver's worth of stock.

Additional comments: Prior grades hit 2-5 kilos silver/ ton. (2000-5000g/ton. 70-176 oz. ton) Very high grades. The project was never properly drilled with modern methods.

Admiral Bay acquired this option to own a 70% interest in this silver property in June, 2003, and the acquisition did not impact their stock price at that time at all. Previously, they were a gas company, and they still have this other gas project, which may be more than half the intrinsic value of the company according to Curt Huber, who understands the silver story as expressed by Ted Butler and David Morgan.

My valuation method, obviously, does not give any value for their gas project, which therefore needs to be factored in as a significant "bonus". The company will probably split up the two projects into two companies, so existing shareholders will have shares of each, just as Expatriate spun off their gold projects.

They are actively digging now, building a road and uncovering mineralization areas, and tracing surface veins. They will be drilling before the end of October, spending $500,000 before the end of 2003. They will be releasing drill results soon.

* SVL.V / STVZF.PK (I own shares)
http://www.silvercrestmines.com/
info@silvercrestmines.com (604) 691-1730
15.18 mil shares outstanding oct 31, 2003
22.2 fully diluted oct 31, 2003
(just about closed a PP for a million units, 2 mil more)
24.2 fully diluted Nov. 21, 2003
(pub float: 8.93 mil, the rest is owned by insiders)
@ share price $1.41 CAN x (.76 US/CAN) = $1.07 US
$26 mil MC
Indicated resources of silver 30 mil oz. (SOZ.)
Projects in Honduras. BUT...
*** discovery adds silver*** (perhaps 40-100 mil oz.) see below
http://biz.yahoo.com/ccn/030902/e028426ecfc575e72750ed7fbd6ab220_1.html
new silver totals are projected to be: 70 - 130 mil oz.
$26 mil MC / 70 = $.37/oz.
$26 mil MC / 130 = $.20/oz.
You get "approx" 15 ounces in the ground for 1 oz. silver's worth of stock.
(Exploration potential = 28 oz.)

Additional comments: These additional ounces, beyoned the 30 mil oz. are "exploration potential", and are not 43-101 compliant.

Plus, their reserves are potentially "open pitable" which reduces costs. They will be acquiring more silver properties with the money raised in the late November 2003 private placement, which I think is an outstanding way to spend the money.

I own shaers of SVL.V

* SRLM.PK (I own shares)
http://www.sterlingmining.com/
RDemotte@aol.com Ray DeMotte 208/676-0599
9 mil shares
@ share price $7.50
$67.5 mil MC
Cash on hand: $1.1 million (an increase, reflecting the increased number of shares from 7 to 9 million)
~185 mil oz. reserves + resource, Sunshine alone
Quote from: http://www.sterlingmining.com/jun112003.html
"The prior operator last estimated the mine reserves at 26.75 million ounces of silver, 10.36 million pounds of copper and 7.05 million pounds of lead (or approximately 28.85 million ounces of silver-equivalent), as well as an additional resource of 159.66 million ounces of silver. "
~100 mil oz. other properties: the 10 sq. miles around the 1/2 sq mile of the Sunshine (rough guess--needs to be explored) even though--these extra 100 mil oz. are in the "explorer" category. They need to be drilled and found, although I've heard of estimates as high as 400 mil oz. total for SRLM.PK
$67.5 mil MC / 185 mil oz. = $.364/oz.
$67.5 mil MC / 400 mil oz. = $.17/oz. (exploration potential)
You get "approx" 15.3 ounces in the ground for 1 oz. silver's worth of stock.
(Exploration potential is 33. )

Additional comments: Ray DeMotte really, really understands the silver story, and has been aggressively acquiring silver properties. Sterling continues to consolidate its land position around the Sunshine mine.

Sterling Mining acquired the Sunshine mine. Sunshine was one of the big three: Hecla, Couer, & Sunshine. Sunshine went bankrupt. Sterling got the property a few months ago cheap, because they were quick & willing to pay cash. Other buyers wanted to do a full study before making an offer. This company's share price went ballistic as a result. But the company is still way undervalued. Just do the math, people. I own a substantial share of SRLM.PK There were a few great articles written lately for SRLM. See the company web site, above. The best factors, I feel, are as follows:
1. The Sunshine mine is an existing mine that was mining at a profit. The company went bankrupt, not the mine. So there will be no great capital costs for start up, only minimal costs.
2. The Sunshine sits on 1/2 sq. mile, and was never fully explored. Sterling Mining owns 10 square miles of property surrounding the Sunshine, right in the heart of silver country, the location of CDE and HL, the other two big companies at the top of this list.
3. The management of Sunshine understands the silver story. They are on a mission to acquire distressed silver properties at today's cheap prices.

I own shares of SRLM.PK

MMM.TO
http://www.mincomining.com/
investor-info@mincomining.ca 1-888-288-8288
Fully Diluted Issued & Outstanding 23,133,623
@ $1.60 x .76 = $1.22
$28 mil MC
Located in China
gold and silver. Don't yet know how much of either, but a man who emailed me said 80 mil oz. silver???? I was not able to confirm that at the website.
$28 mil MC / 80 mil = $.35/oz.
You get "approx" 16 ounces in the ground for 1 oz. silver's worth of stock. --I still need to confirm this.

CHD.V CHDSF.PK
http://www.chariotresources.com/
45 mil shares fully diluted October 2003
@ .33 x .76 = .25
$11.3 mil MC
Cello Ccasa (1 project of 4) Resource Estimate - August 2002
31.4 mil oz. silver, 134,000 oz. gold. (x 10 = 1.3) 32.7 mil oz.
(Still much exploration work to do.)
$11.3 mil MC / 32.7 mil oz. = .345/oz.
You get "approx" 16.2 ounces in the ground for 1 oz. silver's worth of stock.

FAN.TO / FRLLF.PK
http://www.farallonresources.com/fan/Home.asp
(604) 684-6365 Erick Bertsch
43.8 mil shares fully diluted (At Aug 31, 2003)
(plus a pp announced on Oct 31 of 15 mil units of 1 share @ .38 1 warrant @ .5 which is 30 mil new shares, to raise $5.7 million)
73.8 mil shares fully diluted as of Oct 31, 2003
@ share price $.65 CAN x .76 = $.49 US
$36 mil MC
Exploration and development in Mexico.
See also hdgold.com (Hunter-Dickinson)
On 4 sulphide deposits out of 16, 29 mil too grading 89 grams silver/t and 1.57 g gold/t.
Conversion: 89 grams x .0353 oz/gram = 3.14 oz.
RE: those 29 mil tons, they "anticipate increasing resources to 50 mil tonne range..."
3.14 oz. x 29 mil tons = 91 mil oz. silver
1.6 mil oz. gold x 10 = 16 mil oz "silver equiv".
Total: 107 mil oz. silver equiv.
(Exploration potential = x 1.7 = 181)
$36 mil MC / 107 mil oz. silver equiv. = $.34/oz.
$36 mil MC / 181 mil oz. silver equiv. = $.20/oz. --exploration potential
You get "appro