The long-term driver of fiat currency debasement remains firmly in force, and will continue to propel the gold price higher regardless of any short-term setbacks engendered by geopolitical events, asserts junior mining expert Brien Lundin, editor of Gold Newsletter.
Meanwhile, the junior mining sector is on fire. Yes, the charts seem to indicate that the equities are ahead of themselves on a short-term basis. However, prices remain near long-term lows and that the sector is only beginning to respond to higher gold and silver prices.
More from Brien Lundin: A Precious Trio from Brien Lundin
If this bull run resembles anything like that of the early 2000s — and I think it will because of the fundamental monetary issues at play — then we’re seeing only the start of truly extraordinary gains ahead. The stocks we’re currently following have lots of room to run still; here's a look at two silver-focused mining firms.
Endeavour Silver (EXK) has been following up on the Veta Colorada vein structure at its Parral project in Chihuahua State. Grupo Mexico owned this past-producing mine operation, but closed it in 1991 due to low silver prices. The area includes the Sierra Plata mine, where Endeavour is currently testing a 600-meter by 500-meter area adjacent to old workings.
Highlights from the latest batch of assays come from both surface and underground drilling. The surface program turned up 346 g/t silver over 9.6 meters (Hole VCS-02), and the best underground hole of the batch returned 332 g/t silver over 13.1 meters (Hole VCU-05).
Combined with underground channel samples grading 1,705 g/t silver over 0.55 meters and 1,480 g/t silver over 0.95 meters, it’s easy to see why the company has already applied for a mining permit for Parral. At those grades, it could easily set up a toll mining operation in the area.
Endeavour’s share price has bounced back along with the silver market this summer, but I think we’re still in early days here for the precious metals boom, and particularly for silver. Endeavour has a strong track record of performance when silver prices head north, making it a continued buy at current levels.
New Pacific Metals (Vancouver: NUAG) (OTC: NUPMF) — a silver exploration firm — released more assays earlier this week from its ongoing drilling program on its Silver Sand project in Bolivia. This latest batch of 20 holes come from an infill program designed to confirm the continuity of areas outlined in 2018.
The drills continue to turn up long intersections of high-grade silver, as evidenced by the 165.5 meters of 204 g/t silver generated by Hole DSS522506. That intersection included 45.0 meters running an amazing 641 g/t silver.
The results included additional highlights such as 75.8 meters of 128 g/t silver from Hole DSS427501 and 140.7 meters of 109 g/t silver cut by Hole DSS4408. Those hole numbers are a mouthful, but they reflect the massive size of this project. The company has added a fourth drill to the project, in pursuit of a maiden resource estimate by the end of the year.
See also: Hershey: A Sweet Idea
It’s clear that Rui Feng and team are onto something big here, and coincidentally building large-scale, high-grade resources just when silver is kicking into high gear.
Even current elevated levels are but a taste of what’s to come as long as the company continues to put out high-grade results into a rising silver market. New Pacific remains a buy at current levels and a strong buy on any short-term weakness.
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