Luke Burgess - Angel Publishing

The Value of Junk Silver Coins

Get ready for a near-term 50% spike in silver prices...

The price of silver just dipped back below $40 an ounce.

But a rapidly widening gap between global supply and demand threatens to lift silver prices to the $60/oz level in the near future.

Interested investors should not hesitate. A surge in demand for silver as a safe haven has boosted premiums for bullion coins and bars...

But in today's Wealth Daily, I'll show you one of the cheapest and easiest ways to own silver right now.

One of the best ways to get the most silver for your dollar right now is to buy junk silver coins.

Junk silver coins are government-minted currency coins that have no numismatic or collectible value except the value of the silver bullion they contain.

Prior to the mid-1960s, governments including the United States and United Kingdom used a percentage of silver in their minted currency coins. These coins contained between 35% and 90% silver.

1964 U.S. Washington Quarter — 0.18 oz. of silver

The most commonly owned junk silver coins today are pre-1965 U.S. coins.

Although these coins are not technically considered bullion, all U.S. quarters, dimes, and half dollars struck before 1965 contained 90% silver; the remaining 10% is copper, which helped harden the coins.

These coins differ from silver bullion coins. Precious metal bullion coins are measured in standard troy ounces and are .999 fine or 99.9% pure silver.

Current Value of U.S. Junk Silver Coins
Year	Coin	Silver Purity	Silver Weight (oz.)	Face Value	Silver Value*
1942-1945	War Nickel	35%	0.05626	$0.05	$2.25
1916-1945	Mercury Dime	90%	0.07234	$0.10	$2.89
1946-1964	Roosevelt Dime	90%	0.07234	$0.10	$2.89
1932-1964	Washington Quarter	90%	0.18084	$0.25	$7.23
1916-1947	Walking Liberty Half	90%	0.36169	$0.50	$14.47
1948-1963	Franklin Half	90%	0.36169	$0.50	$14.47
1964	Kennedy Half	90%	0.36169	$0.50	$14.47
1965-1970	Kennedy Half	40%	0.14790	$0.50	$5.92
1878-1921	Morgan Dollar	90%	0.77344	$1.00	$30.94
1921-1935	Peace Dollar	90%	0.77344	$1.00	$30.94
1971-1976	Eisenhower Dollar	40%	0.31610	$1.00	$12.64
*based on $40 silver

Junk silver coins have become quite popular as a way to own silver affordably, and this has inspired many to go treasure hunting in coffee cans and car ashtrays.

Bullion dealers sometimes sell junk silver coins in bulk bags called “silver bags.” The silver bags are sold to investors with a specific face value, but they are priced based on the total weight of the bag's silver content.

A bag of 90% silver coins with a face value of $500, for example, contains about 358 ounces of pure silver. So a dealer would sell a $500 bag of junk silver coins based on the spot price of 358 ounces of silver, plus his cut.

Silver Bag Face Value	Silver Purity	Silver Weight
$100	90%	72 ounces
$250	90%	179 ounces
$500	90%	358 ounces
$1,000	90%	715 ounces

You don't have to buy a whole bag of these coins; you can buy them individually from most coin dealers.

In fact I just went to my neighborhood coin shop yesterday morning and picked up a handful to show you what they look like:

I find it interesting that these coins are called “junk,” because they contain silver, a metal known as a store of value and wealth since the dawn of humanity. Today's currency coins are mainly copper and nickel, base metals of significantly lower value. It seems to me they are the real junk.

Hundreds of millions of dollars of U.S. 90% silver coins were officially melted down by the government decades ago. The surviving American silver coins are becoming more sought after with each passing day.

Advantages of Investing in Junk Silver Coins

Junk silver coins have been recently intriguing investors for a number of reasons:

Low Premiums

The premium on junk silver coins has increased a bit over the past few years. But junk silver still commands a much smaller premium compared to .999 bullion coins.

In past precious metals bull markets, silver bags have tacked on premiums of up to $1.50 after only a few months. At times, however, premiums can rise to ridiculously high levels...

In 1999, silver bags carried a 50% premium because of the Y2K scare. After Y2K became a non-event, the market was flooded with junk silver coins, and thousands of bags were melted down, which means there are even fewer junk silver coins available today.

Divisibility and Liquidity

Junk silver coins can be more easily spent or traded in very small amounts. In contrast, minted silver bullion coins are rarely smaller than a troy ounce.

Meanwhile, minted gold bullion (and other precious metals) is highly valued in even small amounts. A 1/10 ounce American Gold Eagle coin, for example, is currently valued at nearly $200.

Legal Tender Status

Government-minted junk silver coins retain their legal tender status. And because the coins are official legal tender coins, they are widely-recognized and less likely to have their value disputed than silver rounds or bars.

For these reasons, junk silver coins have become popular among survivalists.

In the event of a currency collapse, silver coins like these will no doubt provide a good, viable alternative as a store of value.

Junk silver coins are ideal in a post-currency bartering economy.

While fiat currencies have consistently been destroyed by inflation throughout history, silver will always have intrinsic value — and can act as a medium of financial exchange when paper money is obsolete.

With low premiums, good liquidity, and recognition, junk silver coins are an excellent choice for first-time buyers and seasoned silver investors alike.

Good investing,

Luke Burgess
Analyst, Wealth Daily
Investment Director, Hard Money Millionaire and Underground Profits

P.S. Most U.S. junk silver coins have been taken out of circulation. But every once in a while, you can find one... Here's a great tip on finding junk silver coins among the rest: Instead of looking at the face of each and every coin for the year, look at the coin's rim. The metal on the rim of the copper-plated coins rubs off quite easily, and you can see the copper shining through.

Here's what I mean:

Old U.S coins contained copper only as a hardener, so the rims of junk silver coins will be pure silver:

Many times, a junk silver coin will stick out like a sore thumb among the rest...

Happy hunting.

The World's Only Pure Gold ETF

Don't think that it's too late to invest in gold...

It's not. The gold bull market still has plenty of fuel in the tank.

And there are still several easy ways for well-informed investors to yield serious gains.

There's no doubt gold bullion prices have already experienced stellar gains over the past several years. Since 2001, the price of physical gold is up some 500% to over $1,600 an ounce.

And while I think it's unlikely we will see another 500% gain from current bullion prices in the near term, we can find even bigger gains from the right gold mining stocks.

In today's Wealth Daily, I'll tell you about one of the purest gold equity assets on the market that may serve as a good guide to finding those stocks.

Gold Fever Spreads

Despite record-breaking prices, investors continue to flee to gold as a hedge against the sovereign debt crisis (and now, new global security fears).

Data from the U.S. Mint continues to show a surge in sales of both gold and silver bullion. Meanwhile, the World Gold Council reports record holdings in gold ETFs. Gold ETFs now have collective holdings of 2,155 tonnes of gold, worth over $100 billion.

Largest Gold Holders	Tonnes	click to enlarge
1. United States	8,134
2. Germany	3,402
3. IMF	2,847
4. Italy	2,452
5. France	2,435
6. ETFs	2,155
7. China	1,054
8. Switzerland	1,040
9. Russia	775
10. Japan	765

The main appeal of both physical gold bullion and ETFs is pure exposure to the price of the underlying metal itself. And the appeal of gold stocks is, of course, the potential for a much higher investment return.

Not to worry, though; you can have the best of both worlds...

In last Friday's issue of Wealth Daily, I introduced you to a few “pure” silver stocks as a way to best leverage rising silver prices.

You'll recall that silver is most often mined as a by-product of other metals; gold, however, is a different story.

Unlike silver, gold is quite often the primary revenue-generating product of a mine. So there are many public gold companies on the market that are considered general pure plays.

But if you're looking for an easy way to get broad exposure to pure gold stocks, Global X Funds has you covered.

The recently introduced Pure Gold Miners ETF (NYSE: GGGG) tracks an index of 30 global mining companies that are leveraged almost completely to gold.

Global X Funds restricts components of GGGG's index to companies that generate at least 95% of their total revenue from the production and sale of gold.

Here are the index's current top ten constituents:

Company	Exchange: Symbol	% of Net Asset
Allied Nevada Gold	NYSE: ANV	5.51
Randgold Resources	NASDAQ: GOLD	5.48
Eldorado Gold	NYSE: EGO	5.45
Kinross Gold	NYSE: KGC	5.41
Centerra Gold	TSX: CG	5.28
Osisko Mining	TSX: OSK	4.98
Harmony Gold	NYSE: HMY	4.78
AngloGold Ashanti	NYSE: AU	4.46
Gold Fields	NYSE: GFI	4.32
Alacer Gold	TSX: ASR	4.31

The GGGG ETF is in competition with Van Eck Global's Gold Miners ETF (NYSE: GDX) and Junior Gold Miners ETF (NYSE: GDXJ). Many of the companies listed in GGGG's index are also tracked by GDX and GDXJ.

However, due to GGGG's pure gold guideline, some major gold production don't make the cut — including Barrick Gold (NYSE: ABX), Newmont Mining (NYSE: NEM), and Yamana Gold (NYSE: AUY).

Barrick Gold, for instance, is the largest gold-producing company in the world by volume, but the company actually generates about 15% of its revenue from copper.

The GGGG ETF is a niche product in the precious metals sector. But if you're really looking to invest in pure gold stocks, I would recommend choosing two or three individual stocks from those listed on the GGGG index.

Piggybacking again on last Friday's Wealth Daily, I believe the best alternative to pure precious metals stocks is the physical metal itself. There's nothing purer than holding .9999 bullion in your hand...

Other good alternatives to pure gold stocks include gold royalty and streaming companies, like Royal Gold (NASDAQ: RGLD) or Franco-Nevada (TSX: FNV).

Good investing,

Luke Burgess
Analyst, Wealth Daily
Investment Director, Hard Money Millionaire and Underground Profits

Top 3 Pure Silver Stocks for the Rest of 2011

**Editor's Note: Wealth Daily has just released a more up-to-date and extensive resource oage on silver stocks for your reading pleasure.

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The price of gold reached an all-time high of nearly $1,610 an ounce this week as new buyers continue to stream into the market, seeking safe haven from the U.S. dollar and a shaky global economy.

Data from the U.S. Commodity Futures Trading Commission (CFTC) continues to show a surge in gold buying from large financial institutions and money managers, despite record prices.

But while gold continues to shine in the limelight, silver has been the real moneymaker...

The price of silver has surged over 50% since the beginning of the year, making it the single best performing major commodity of 2011 so far.

Metals	Year-to-Date Performance	Other Commodities	Year-to-Date Performance
Gold	+12.58%	Crude Oil	+9.24%
Silver	+50.82%	Natural Gas	+8.47%
Copper	-0.25%	U.S. Dollar Index	-5.20%
Platinum	+0.51%	Corn	+20.53%
Palladium	-0.50%	Cotton	-21.31%

Silver has been the top-performing commodity, virtually blowing everything else out of the water...

So it may come as a surprise that some silver stocks have lagged.

Take look at the Global X Silver Miners ETF (NYSE: SIL), which lists 25 of the world's top silver mining companies. For the year, SIL is virtually flat.

Despite a 50% gain in silver bullion prices, the world's top 25 silver miners (as per their listing in SIL) haven't moved but only slightly higher.

There's a reason for this: The majority of silver that is mined around the world is produced as a by-product of another metal or group of metals. These frequently include gold, copper, lead, and zinc. Only about 20% of the world's silver comes from mines where silver is the primary metal, which means producers are often subject to price volatility among others metals.

Sometimes, this can be beneficial for the company; other times, it is not. And while the price of gold has been steadily increasing over the past few months, base metal prices remain relatively flat, dragging down on producers a bit.

There are other types of silver producers that we refer to as “primary” silver companies. A primary silver company is one that generates more than 50% of its revenue from the production and sale of silver.

With silver outperforming all other metals, primary silver companies have been leading the pack in stock gains over the past several weeks.

Take First Majestic Silver (NYSE: AG), for example...

First Majestic Silver is one of the purest silver plays on the market. The company owns and operates three primary silver mines in Mexico: La Parrilla, San Martin, and La Encantada.

Shares of AG have risen more than 60% for the year.

First Majestic generates 85% of its revenue through the production and sale of silver. The rest of the company's revenue is generated through gold, lead, and zinc.

First Majestic expects to increase total silver output from its operations to 7.5 million ounces of silver in 2011, and up to 16.0 million ounces by 2014.

Here are two more primary silver companies that should be set to continue doing very well with rising silver prices...

Pan American Silver (NASDAQ: PAAS) is one of the world's largest primary silver producers.

Revenue by Metal

Pan American has seven operating mines in Mexico, Peru, Argentina, and Bolivia. Last year was the company's fifteenth consecutive year of silver production growth, with a record 24.3 million ounces of silver produced.

In 2011, Pan American expects to produce 24.0 million ounces of silver and 78,000 ounces of gold.

Silver Standard (NASDAQ: SSRI) has the largest in-ground silver resource of any publicly-traded primary silver company, with a pipeline of 15 projects ranging from grassroots exploration to production in Argentina, Peru, Mexico, Canada, Chile, the United States, and Australia.

Revenue by Metal

Silver Standard expects to produce a total of 8.5 million ounces of silver in 2011.

Alternatives to Primary Silver Stocks

The obvious (and best) alternative to investing in primary silver stocks is to invest in the physical metal itself.

Owning physical silver is easy and affordable. Investors can choose among a wide variety of physical bullion options from both private and government minters.

Other good alternatives to investing in primary silver stocks include silver ETFs like the iShares Silver Trust Fund (NYSE: SLV). Silver royalty and streaming companies, like Silver Wheaton Corp (NYSE: SLW), also make good alternatives to silver mining stocks.

Good investing,

Luke Burgess
Analyst, Wealth Daily
Investment Director, Hard Money Millionaire and Underground Profits

Silver is Now Rarer than Gold

Most investors assume that because silver is almost 50 times cheaper than gold, it's more abundant.

They're wrong.

The amount of available silver is far less than the amount of available gold.

This fact is often overlooked by even the most seasoned silver investors. And it's this lack of silver stockpiles that has become one of the most critical factors in what could jolt prices, lifting silver into an entirely different asset class all together.

So forget $100 silver — $100 is now considered a timid prediction. Some experts are now calling for silver prices on par with gold.

Let me quickly explain how we got here. Global silver mining has increased significantly over the past two decades.

Silver output has more than doubled since the early 1990s in places like Mexico, Australia, and Peru. Other countries have seen even more dramatic production spikes. In China, a relatively new major supplier of the metal, silver mining has scaled up from less than 10 million ounces in 1991 to more than 100 million ounces today.

Overall, the world's total silver mining production has increased from 400 million ounces in the early 1990s to about 700 million ounces today.


click to enlarge source: CPM Group

But despite a sharp increase to supplies, the global demand for silver is far outpacing global production.

In fact global silver production has been unable to meet global demand for more than fifteen years.

The world's silver mines are simply not producing enough silver to meet demand.

In 2010, global silver demand exceed 1.05 billion ounces; but as you saw in the chart above, global mining has only provided about 700 million ounces.

So how has the market been filling this deficit?

Over the last two generations, major government stockpiles of silver have been sold off to supply the industry. The United States government alone has dumped nearly 5 billion ounces of silver into the market since WWII.

Of course, any government's well of silver reserves are finite. And over the past few years, government supplies of silver have been drying up. Data from the Silver Institute shows net government sales of silver falling drastically in the past decade.

	2001	2002	2003	2004	2005	2006	2007	2008	2009	2010
Net Government Sales (million ounces)	63.0	59.2	88.7	61.9	65.9	78.5	42.5	28.9	15.5	44.8

This is one of the major reasons it is critical to act now.

Without government stockpiles to feed it, the market only has few other places to buy its silver.

Scrap metal is one option for the market, and will continue to help supply rising demand in the near term. But this well will also quickly run dry — and that will create a real problem for consumers who need silver...

Silver is Actually Rarer than Gold

Silver is 17.5 times more abundant in the Earth's crust than gold. But the amount of above-ground gold available far exceeds that of silver.

In 1950, there were 10 billion ounces of available silver above ground. By 1980, that number shrank to 3.5 billion. And today, no significant government stockpiles of silver exist anywhere in the world.

The USGS actually lists the U.S. government's current stockpile of silver simply as: “None.”

The exact opposite is true of gold.

In 1950, there were an estimated 1 billion ounces of above-ground gold. Today, there are nearly 5.8 billion ounces across the globe.

The world currently produces about 700 million ounces of silver per year. Where does it all go?

Believe it or not, most of it winds up as garbage. We literally throw billions of dollars' worth of silver in trash bins every year.

Silver is required in the production of thousands of products: CDs, cell phone batteries, calculators, printed circuit boards, hearing aids, electronic switches, TV screens, catalytic converters, inks, computer monitors, RFID chips, etc.

Once any of these items has served its purpose, it generally gets tossed. And it's simply more expensive to recycle the silver from these products than it is to dig more out of the ground.

Tiny bits of silver in electronics are thrown away every day.

I expect that the world's dumps will be a precious source of resources like silver in the future.

The difference between the metals is that gold is produced, but it's not consumed. While gold is a highly-desired item, it's not an industrial commodity. In other words, gold is desired, but silver is needed.

All of the gold that has ever been mined is basically still around. Studies suggest 98% of all gold mined throughout history is still available in the form of coins, bars, artifacts, and jewelry. But silver is different.

From 1990 to 2000 alone, over two billion ounces of silver disappeared from the market to consumption.

Despite the lack of global stockpiles, new technology will continue to discover more industrial applications for silver, putting a further strain on world supplies. Consider the new photovoltaic industry as an example...

In China, the production of photovoltaic solar panels has doubled every single year since 2003. The demand for silver from the global photovoltaic industry has soared in the past few years, and global demand is expected to reach 150 million ounces per year by 2015 — just to satisfy the photovoltaic industry.

Silver Demand from the Photovoltaic Industry

click to enlarge

But to widen the supply deficit even more, the Silver Institute forecasts industrial uses of silver will rise sharply over the next five years. The organization estimates that by 2015, the demand for silver from industry will increase 36%.

At the same time, the demand for silver for jewelry and investment is reaching record levels. A survey of 340 retail jewelers representing ~4,000 individual stores recently showed silver jewelry sales hitting record highs. The survey found:

87% of jewelry retailers said their silver jewelry sales increased in 2010
52% said their silver jewelry sales increased between 11% and 25%; 28% saw an increase over 25%
Retailers rated the following categories as giving them the “best” maintained margin:
- Silver jewelry 57%
- Diamond jewelry 20%
- Bridal jewelry 15%
- Gold jewelry 4%
- Platinum jewelry 4%

The UK's Royal Mint, which makes the Britannia silver bullion coins and other collector silver coins, reported silver coin production in the first half of this year has doubled.

In the meantime, American Eagle Silver bullion coins continue to move at a record-setting sales pace. The latest sales figures indicate the U.S. Mint sold over total of 3.4 million Silver Eagles in June. This figure earned the title as the "Best Ever June," and ranked seventh place in all-time monthly sales.

This is all very much in line with reports from other mints around the world that are seeing a surge in silver coin sales over the same period.

There's no doubt the silver market will have to face a serious deficit. And in order to balance the deficit, silver will have to come from somewhere...

I believe the majority of this silver will come from investors. And for investors to sell, we'll need to see higher prices.

The world has been drawing down its above-ground supply of silver for decades, diminishing the only source of what is available for investment. Only now have we begun to collectively recognize silver as a solid investment.

This is the perfect market for silver prices to appreciate.

Global supply deficits continue to be ignored year after year by investors. This is slowly changing, but owning silver has not gone mainstream yet...

Even as premiums rise and available retail supply dwindles, there is still time. The opportunity in silver is huge.

I maintain that the very best form of silver you can own is physical — and in your personal possession.

Good investing,

Luke Burgess
Analyst, Wealth Daily
Investment Director, Hard Money Millionaire and Underground Profits

Why Are Gold Stocks Underperforming Gold?

Gold mining companies have always outperformed the physical bullion in the market. By some estimates, gold stock investors beat spot prices by a 3-to-1 ratio.

The price of gold has rallied over in the past twelve months. But despite a solid increase, gold stocks have had difficulty keeping up.

Now, the question is: Can gold mining companies regain their footing in the market to return for a rally?

In the past 18 months, the spot price of gold has increased over 35%, as measured by the SPDR Gold Shares ETF (NYSE: GLD).

Yet the Market Vectors Gold Miners ETF (NYSE: GDX), a composite of 31 senior gold mining companies, has underperformed, gaining only 25% in that time.

This is hardly the 3-to-1 payout ratio suggested by analysts...

Meanwhile, the Market Vectors Gold Junior Miners ETF (NYSE: GDXJ) — a similar ETF to GDX consisting of 73 small-cap mining companies — is also performing just below GLD. Take a look for yourself:

GLD vs. GDX

click to enlarge

GLD vs. GDXJ

click to enlarge

Other precious metal stock indexes are underperforming gold as well. The Amex Gold BUGS Index (AMEX: HUI) and Philadelphia Gold and Silver Index (PHLX: XAU), which both track many of the same companies listed in GLD, are only up 30% in 18 months.

As you can see in the charts above, the underperformance has been concentrated in the last few weeks, beginning with a significant sell-off at the beginning of May.

John Bridges of J.P. Morgan’s North America Equity Research wrote earlier this week:

After climbing 1,400% since their 2000 lows compared with the S&P500’s 11% fall, gold equities are now failing in investors' “what have you done for me recently” category.

Part of the reason gold stocks have been underperforming bullion this year is the same troubling issue that's been facing the mining industry for years: rising production costs.

Rising Production Costs Weigh Down Gold Miners

Mining for gold is often romanticized as an adventurous way to profit a little extra. But as a business, it's very difficult to make a profit.

Gold production is incredibly energy- and labor-intensive. Over the past few years, rising crude oil prices and increasing demand for higher wages have forced global gold production costs to increase quite dramatically.

Rising production costs have narrowed profit margins for gold mining companies. And recently, many large investors have exited their gold equities (in the green) over fears continued increases in gold production costs could further thin revenue. They may have good reason for concern...

A new report from ABN Amro Bank, VM Group, and Haliburton Mineral Services reveals a +50% spike in global gold production costs over just the past three years.

*Cash costs include direct mining and processing expenses, other onsite charges, third-party smelting and refining charges, and royalties and taxes net of by-product credits.

The report is based on cash costs* per ounce of production from 111 gold mining companies operating a total of 274 mines around the world.

During the first quarter of 2011, the worldwide average cash cost of gold production increased to $620 an ounce, an increase of 12.5% year-on-year.

Rising production costs has been a trend in the gold mining industry over the past few years. Since 2007, the cash cost to produce gold has increased a whopping 57.4%, according to data from VM Group/Haliburton Mineral Services.

Global Gold Production Cash Costs

The key factor in rising cash costs has been the weakness of the U.S. dollar (in which gold is priced), due to the vast amounts of excess liquidity generated by QE1 and QE2.

ABN Amro Bank, VM Group, and Haliburton Mineral Services report increasing cash costs in connection with a weakening dollar is “evident in regional cost breakdowns, where U.S. production costs have significantly lagged increases elsewhere.”

Another key instrument in bringing up production costs has been the rising price for labor and raw materials. Inflationary pressure from the recent flood of various government stimulus packages has sent worldwide wages and energy prices skyward.

Even in South Africa — where gold production costs are highest — it seems likely that cash costs will rise even more. Power supply shortages, labor disputes, and geological issues in the region have contributed additionally to rising gold production costs.

Wage negotiations in South Africa have begun between the miners’ union and three producers: AngloGold Ashanti (NYSE: AU), Gold Fields (NYSE: GFI), and Harmony Gold Mining (NYSE: HMY). But South Africa's mining union is seeking a pay hike of more than 14%, and has already turned down a counter offer of 4%.

Gold Production Cash Costs Around the World

Highest

Lowest

Average cash costs of gold production by region
(U.S. dollars per ounce)

Source: VM Group/Haliburton Mineral Services

Click here to learn more about mining in Latin America

South Africa
Avg: $869/oz
South Africa is the most expensive place to mine gold. The average cash cost for miners rose to $869/oz during 1Q 2011. Many miners pay more. About 10% of South Africa's gold was produced above $1,200/oz. The highest cost operation in the region was $2,134/oz at Newcrest Mining's (ASX: NCM) Bonikro mine in the Ivory Coast.

Latin America
Avg: $496/oz
Latin America remains the most competitive region in terms of gold production costs. Gold miners in the region paid an average $496/oz in cash costs. The lowest cost producer in Latin America was Barrick Gold’s (NYSE: ABX) Lagunas Norte mine in Peru, which produced 192,000 oz of gold in 1Q 2011 at total cash costs of $282/oz.

Despite rising production costs, I remain bullish on gold stocks in general, and I consider this year's underperformance a substantial opportunity to buy quality, gold mining stocks for many reasons.

Among these reasons: Rising gold production cash costs will be offset by rising metal prices.

Despite rising cash costs, gold producer margins increased approximately 1.2% during the first quarter of 2011 compared to the previous quarter, and rose by 37.5% year-on-year. Data from ABN Amro Bank, VM Group, and Haliburton Mineral Services shows this is part of a continuing trend.

Average Gold Miner Producer Profit Margin

Comparing production of 250,000 ounces of gold in the first quarter of 2009 and the first quarter of 2011, miners’ margins are $79 million better. And I'm confident higher bullion prices will bring bigger profits.

We've seen these types of setbacks from gold stocks in the past. The fact is these pullbacks are common, but temporary.

J.P. Morgan equity research analyst John Bridges states:

A review of the data shows that gold equities have underperformed gold in previous periods of market weakness in 2000 and 2008. We are encouraged by gold’s recent strength at a time in the year when it’s common for the metal to lag, and we feel this is encouraging for further strength in H2. Once investors feel that the risk of another leg down in general markets passes, or after a downswing in the markets, we feel the gold equities will do some catching up.

As for specific gold stocks, Bridges noted that his firm is targeting “growth gold equities where increasing production helps balance cost increases.” He highlighted Goldcorp (NYSE: GG), Kinross Gold (NYSE: KGC), and Newmont Mining (NYSE: NEM) — all components of the GDX.

The lag in gold stocks has carved out a perfect buying opportunity for investors to take a position at historically low prices compared to bullion.

Gold shares are very cheap. Regardless of the volatility we may see in the short term, I expected a sustained recovery in the performance of gold stocks relative to the physical bullion.

Good investing,

Luke Burgess
Analyst, Wealth Daily

How to Buy Rare Earth Bullion

It's virtually alchemy.

Recent breakthroughs have just let scientists and researchers tap into the hidden powers of 17 unique elements.

The science to discover the true potential of these dynamic elements is only in its infancy. But already, it's becoming the driving force behind a brand new technical revolution.

Some consider these elements to be a whole new investment class. Others call it a fad.

But, temporary mania or not, prices of these technology metals are soaring. And investors are just now starting to see real profits.

The elements I'm talking about are the rare earth elements.

Neodymium magnets are the strongest, most widely-used type of permanent rare-earth magnet today.

It's seldom you hear about them in the mainstream financial media. But rare earth elements (REEs) are a vital component in most of the technology we use every single day.

They're required for the production of everything from cell phones, computers and rechargeable batteries... to iPods, GPS units, televisions, speakers, magnets, fluorescent lighting, and much more...

The automobile industry alone uses tens of thousands of tons of rare earth elements each year in the manufacturing of catalytic converters.

Meanwhile, the U.S. government has recently become very interested in REEs for advanced military technologies such as missile guidence systems.

As the demand for newer, faster, and better technologies will no doubt continue to rise in the future, so too will demand for the raw rare earth materials needed to create them.

What is really "rare" about rare earths?
Despite the name, most rare earth elements are relatively plentiful in the Earth's crust. In fact, cerium is as abundant as copper. The true rarity of these elements is our ability to economically mine them. Locations where REEs are in high enough concentrations to feasibly mine really are very rare.

But there's a slight problem. And it isn't that these elements are necessarily "rare".

The trouble is, approximately 95% of the global supply of rare earth elements comes from just one country: China.

And because the country needs these vital metals to maintain its positon as the world's leading exporter, China might be preparing to stop exporting these strategic elements altogether.

Over the last eight years, China has reduced the amount of rare earths available for export by nearly 50%. Some suggest they'll simply cut off all supply by 2012.

Back in January 2010, London-based newspaper The Independent helped bring the rare earth story to the mainstream with a report stating:

Industry sources have told The Independent that China could halt shipments of at least two metals as early as next year, and that by 2012 it is likely to be producing only enough REE ore to satisfy its own booming domestic demand, creating a potential crisis as Western countries rush to find alternative supplies, and companies open new mines in locations from South Africa to Greenland to satisfy international demand.

China pulled back global rare earth exports by 72% during the second half of last year. And in the first six months of 2011, rare earth elements from China have dropped another 35%.

These cutbacks have sent rare earth element prices soaring higher.

The price of europium oxide – used in florescent light bulbs, TVs, and smartphones – has nearly tripled from $35 an ounce to $96 an ounce in the past three weeks alone.

Meanwhile, dysprosium oxide – used in magnets, wind turbines, and computer hard drives – has more than doubled from $20 to $42 an ounce.

Rapidly rising prices have boosted share prices of the few public companies that have mineable rare earth projects outside of China. Take Molycorp (NYSE: MCP), for example...

Molycorp owns the world’s largest, most fully-developed rare earth project outside of China. Shares of MCP have run up over 300% since the company went public in August 2010.

Meanwhile, companies with rare earth exploration projects like Quest Rare Minerals (AMEX: QRM) have shared gains of nearly 200% with investors over 12 months. Take a look:

While companies with rare earth assets continue to perform well and draw new investment attention, there's a new way to invest in rare earth elements that has everyone talking: Rare Earth Bullion.

How to Buy Rare Earth Bullion

After doing a bit a research, I've found two companies that sell rare earth bullion to the retail market.

The first one, Metallium, Inc. (www.elementsales.com), is geared more to collectors, schools and universities, researchers, and jewelers. However, London-based Rare Earth Bullion (www.rareearthbullion.com) is targeting investors.

Rare Earth Bullion is a brand new company that offers certified .999 pure metal rare earth bullion bars. The company doesn't sell all 17 elements, but rather focuses on investments in eight of the “heavy” rare earth elements, a subcategory of the rare earths that are in highest demand.

Rare Earth Bullion's selection and approximate current prices in US dollars per ounce are listed below:

Metal	Current Price*	Bullion Examples
Dysprosium	~$290/oz	100 gram bar of Dysprosium 1 kilo bar of Holmium
Erbium	~$180/oz
Holmium	~$140/oz
Lutetium	~$510/oz
Terbium	~$500/oz
Thulium	~$620/oz
Ytterbium	~$130/oz
Yttrium	~$90/oz
*including taxes and based on Rare Earth Bullion's current price for 100 gram bars. Buying larger bars is cheaper overall. Metal prices change daily, as do conversion rates between the British Pound and US Dollar. The prices listed above are simply to give US investors an idea of rare earth prices compared to current gold and silver prices, which are $1,525/oz and $35.25/oz respectively.

Rare Earth Bullion says:

We firmly believe rare earth metals will outperform precious metals going forward. They have the same benefits as precious metals being that they are a physical commodity with finite supply. Unlike gold and silver they do not have monetary status. Much like precious metals they will rise in price with inflation (like most commodities) and also appreciate in value as the US Dollar weakens.

I'm not so sure I agree the rare earth elements will outperform gold and silver. But there is one thing I am absolutely sure of...

Before you go off betting the farm on ytterbium, dysprosium, or any of the other impossibly pronounced metals, there's one major factor to consider: Liquidity.

The rare earth element market is as illiquid as the market for Pat Boone vinyl records. It's dry. Buying rare earth bullion is as easy as ordering anything else over the Internet. But finding another interested investor to sell it to when it comes time to turn a profit is another thing entirely.

In fact, unlike most precious metal bullion dealers, even Rare Earth Bullion won't buy your metal back. The company says it has plans to develop a buy-back mechanism in the future. However, at present, you'd have to find another private investor to sell your rare earth bullion to.

So, if you're going to invest in a physical metal, I still recommend going with gold or silver for now.

But that doesn't mean you can't – or shouldn't – take advantage of soaring REE prices.

Perhaps a Better Way to Invest in Rare Earth Elements

You've already seen rare earth equities like MolyCorp return a 300% gain and Quest Rare Minerals yield a 200% profit in under 12 months. But if you're looking for an easy way to get general exposure to rare earth elements, there's an ETF.

The Market Vectors Rare Earth/Strategic Metals ETF (NYSE: REMX) is a composite of 28 international rare earth companies. This ETF has performed okay, returning 28% since its inception in late October 2010, although not as well as individual stocks like MCP or QRM.

With global supplies dwindling from continued reduction in Chinese exports, rare earth elements offer quite an attractive risk/reward potential. But I recommend investors to shy away from investing in physical rare earth metals at this point. Investing in rare earth stocks is way easier, and often way more profitable in the end anyway.

Good investing,

Luke Burgess
Analyst, Wealth Daily
Investment Director, Hard Money Millionaire and Underground Profits

Nickel Prices to Drop

For all you out there who were looking for a more compelling reason to start worrying about the status of the global economy, your wait is finally over.

It may not be as glaring as real estate prices or as headline-grabbing as the stock market collapse of 2008, but this most recent sign cuts to the very core of what industrialize society needs to run.

The symptom I'm talking about is best summarized in a Bloomberg article from last week:

At a time of scarcity in everything from crude oil to copper to corn, nickel is heading for the biggest glut in four years, driving prices lower into 2012.

Underwhelmed yet? You really shouldn't be.

The smart money will be keeping its eye on this story more so than just about every other out there...

Major nickel production regions include Sudbury, Canada, Western Australia, and Norilsk, Russia.

You see, nickel holds a very special place in our modern world.

That's because most corrosion-resistant metals rely either on nickel, chromium, or a combination of the two to fight off the effects of oxidization. The vast majority of stainless steel alloys simply wouldn't be possible without it.

In fact over 60% of nickel mined on an annual basis (about a million tons) goes straight toward production of heavy-duty stainless steel alloys.

It goes into our cars, into aircraft bodies, and into the steel frames of modern high-rise buildings.

The remaining 40% is consumed by other essential modern applications such as nickel-copper alloys used in wiring and electronics, heat-resistant alloys used in internal combustion engines, jet and rocket engines, as well as other high-tech uses including batteries and conductors.

In 2010, total global nickel demand stood at 1.51 million tons, with a total value of about $33 billion.

Between now and next year, however, this demand is scheduled to slow considerably, with China — the world's biggest market for the crucial alloy metal — slowing its appetite by up to 75% from 2010 growth levels.

According to Vladimir Strzhalkovsky, CEO of the Russia's OAO GMK Norilsk Nickel: “If there is a glitch in the global economy, demand for industrial metals will go down. It’s dangerous to depend on nickel.”

Norilsk Nickel

U.S. Symbol:	NILSY
Share Price:	~$24.75
Market Cap:	~$47 billion

But the relative softness of that remark needs to be taken with a grain of salt.

As the figurehead of the world's #1 nickel producer and one of Russia's biggest corporations, Strzhalkovsky cannot be expected to voice his full views on this global market phenomenon.

His subtle warning must be viewed as nothing short of a red flag.

Given China's current annual economic growth rate of 9.8% — and given the rate at which they've been developing and expanding their urban areas — a drop-off in something as essential to this process as nickel simply does not hold up to logic.

If nickel demand is to do in the next 18 months what it's been predicted to do, the world's fastest-growing economic powerhouse should be expected to experience a general pullback within that same time frame...

Not good for the Chinese — and even worse for the rest of us living in nations already past this key growth-spurt stage enjoyed by China in recent years.

U.S. Federal Reserve Chairman Ben Bernanke summed up his views on the matter earlier this month when he remarked, “Nickel supplies are increasing at a time when economic growth is showing signs of weakening.”

But just how bad is it?

Ian Henderson, who manages about $10 billion of natural-resource assets at JPMorgan Chase & Co. in London, states: “I don’t think there is a commercial logic for the price where it is today. A nickel price of $15,000 is entirely possible.”

That's down almost over 53% from today's price of $32,300/ton, and a staggering 71% down from a 2007 high of $52,000/ton.

This new outlook is especially grim to Chinese producers who, unable to sustain production at these prices, are looking at massive shutdowns by the end of this year.

But viewing at this from the perspective of nickel alone provides a very limited picture of what is happening.

Remember, nickel isn't just a funny metal which gained fame from its onetime prominent use in coin production... Simply put, nickel is a universally essential industrial element.

This fact alone makes the nickel market a sort of barometer for the economy on a global scale: Weaker nickel demand means fewer skyscrapers built, fewer cars produced, fewer jets in the air, fewer feet of wiring spun, and fewer batteries sold.

It's a recipe for a slow and gradual slide into general stagnation.

Scariest of all is that this trend has gradually been developing under our noses, while we reeled from all the other tell-tale signs of an impending global recession.

But let's step back from all the doom and gloom for just a second.

There's little we can personally do about a worldwide economic slowdown. What we can do is use the information we have to make the right moves to protect our personal property from the effects of such a slowdown.

Remember, the problem isn't in the nickel; it's in everything else. Nickel's slow collapse is just a sign of what's coming... which means your investments — no matter how removed from nickel they may be — are all in jeopardy now.

It leaves you with only one real move to make.

The upside is that this one move is so perfectly geared to take advantage of this macro-trend, the gains are virtually guaranteed.

You can short the market, of course, but I prefer a more direct, more focused strategy that gets right to the heart of the matter.

And that strategy is the ETFS Short Nickel ETF (LSE: SNIK).

ETFS Short Nickel ETF

Exchange: Symbol	London: SNIK
Price:	~$30.00

A nickel short ETF that's easy to buy and easy to sell, it tracks the decline of nickel prices, putting dollars back in your pocket while everything else suffers the consequences.

If nickel takes the 25% loss by year's end (as it has been anticipated by sources most biased toward the success of the nickel market), the value of your investment will increase by 25%.

If the nickel market goes down even further — which, by all accounts from more objective sources, it will — your investment will rise accordingly.

Of course, I wish I could have written you today about an investment that will signal the revival of the global economy. Unfortunately, writing fairy tales isn't in my job description.

Do the best you can with what your given today. Bet against nickel.

Good investing,

Luke Burgess
Analyst, Wealth Daily
Investment Director, Hard Money Millionaire and Underground Profits

P.S. Despite the global outlook, there is one commodity out there today which will continue to appreciate, although less because of growing demand and more so due to market manipulation. For the last 20 years, the Chinese have been slowly building a monopoly in this crucial class of industrial metals. With 97% of production in their hands as of last year, the next step in their master plan included export cuts and price control... What they didn't count on was a massive discovery in the place hardly touched by modern industry. Find out what this $273 billion mining treasure trove will mean to the world's high-tech industry — and the name of the company which will own it all.

Four Key Drivers in China's Gold Future

As the world's top gold producer and second largest consumer, China is the single most important player in the global gold arena.

Last year, Chinese gold demand grew by 32% — reaching nearly 25,000,000 ounces for the first time in history. Yet despite the country's seemingly insatiable appetite for the yellow metal today, world leaders are concerned the demand for gold could get out of hand...

More than doubling again in less than ten years!

The demand for gold in China has swelled intensely since deregulation of the market in 2001, growing by an average 14% per year.

China Gold Demand Per Capita

Jewelry is the principal sector of the Chinese gold market, accounting for almost 64% of all gold domestic demand in 2010. As rapid economic expansion recently boosted domestic disposable income, the demand for gold jewelry in China has more than doubled in the last seven years.

Meanwhile, the demand for gold as an investment has increased exponentially over the past 10 years, with the new era of the Shanghai Gold Exchange.

In 2010, gold demand for investment in China increased 71% over the previous year. This growth continued in the first quarter of this year.

China was the largest physical bar and coin investment market during 1Q 2011.

Quarterly China Gold Jewelry and Investment Demand

With ongoing global economic and financial uncertainty, gold’s roles as monetary asset, universal currency, and risk diversifier make it an extremely attractive asset class for all investors.

But I believe the following four factors will be particular drivers in the development of the Chinese gold market over the next ten years...

#1 The Rise of the Middle Class and Disposable Incomes

Two decades of economic expansion has created a new market and birthed a rapidly growing domestic middle class, which continues to expand today.

According to China Consumer Daily, it is estimated there will be 75 million households with annual income of more than US$4,300 by 2015, compared to just 15 million in 2005. Similarly, household savings are also expected to triple during the same period.

The Chinese are natural savers. Economists estimate China's savings rates (the percentage of savings in a person's disposable income) is nearly 40%. In the United States, we have a negative savings rate of 0.5%.

The combination of the burgeoning middle class and high savings rate could easily translate into a massive demand for gold in the near future.

The Chinese have been using gold as a monetary asset and wealth preserver for centuries. Excluding the last few decades, gold was really the only form of savings that was practical for Chinese citizens. Bullion is acquired continuously over the years as money is saved and available, often over generations.

The potential increase in gold demand from a the growing Chinese middle class is substantial and should not be overlooked.

#2 Hedging Against Rising and Uncontrollable Inflation

Over the past several years, there has been a rush of capital investment into emerging markets, particularly in China. These inflows have contributed widely to inflation.

The inflation rate in China was last reported at 5.4% in May. From 1994 until 2010, the average inflation rate in China was 4.3%.

China's government has said that taming inflation to a rate around 4% is one of its key economic goals for the next five years.

As part of those efforts, the People's Bank of China has raised interest rates four times since October and hiked the amount of reserves it requires banks to hold. However, efforts to stem rising inflation have not been largely successful.

Fears of continued rising domestic inflation will likely be one of the key drivers in Chinese gold demand in the near term.

#3 The People's Bank of China Needs Gold

Despite being the sixth-largest official holder of bullion, the gold held by the People’s Bank of China (PBOC) accounts for only 1.6% of the nation's total foreign reserves — low by international standards.

By comparison, the U.S. Federal Reserve reports America's gold holdings represent 73.9% of the national forex reserves.

In its latest report entitled “2010 International Financial Market Report”, the PBOC expressed interest in expanding the country's gold reserves. Leading financial and economic experts including Li Yining, one of China’s most prominent architects of reform, and Xia Bin, an advisor to the PBOC, have recently called for an increase in China’s gold reserves to hedge depreciation of foreign exchange reserves.

#4 Increased Interest in Gold from Chinese Financial Institutions

There is a growing appetite among large Chinese financial institutions to increase their asset allocation to gold investment.

Since February 2010, China Investment Corp. — a sovereign wealth fund incorporated in Hong Kong — has acquired a $157 million stake in SPDR Gold Shares (NYSE: GLD), the world’s largest gold ETF.

On January 13, 2011, China's Lion Fund launched a new gold ETF aimed directly at Chinese consumers. As of March 2011, the fund has accumulated assets of nearly $400 million.

Evidence suggests institutions are buying gold for its ability to outperform other domestic financial asset classes during crises, and for its effectiveness as a hedge against macro economic factors and currency fluctuations.

These institutions, along with the People's Bank of China, have very deep pockets. They could be extremely large purchasers of gold bullion for wealth preservation in the near future.

Conclusion

In March 2010, the World Gold Council (WGC) reported Chinese gold demand could double within the next decade.

But given the recent momentum in Chinese gold demand, the WGC revised this, saying in its global gold market review of the first quarter of 2011: “We would not be surprised to see this result achieved in a shorter time frame.”

Inflationary concerns and rising income levels are likely to be the main drivers of China's gold demand in the near term, especially given the fact that Chinese consumers are high savers, and are looking to gold to protect their wealth.

The long-term story for Chinese gold demand is also quite compelling.

Given the increasing prosperity in the world’s most populous country, all signs point to increasing gold demand in China.

Good investing,

Luke Burgess
Analyst, Wealth Daily
Investment Director, Hard Money Millionaire and Underground Profits

A Golden Age for Money

Picture this...

You're at your local hardware store, picking up some potting soil for your early summer gardening.

There's a guy in front of you with a pruning saw in one hand and a bird feeder kit in the other.

He steps up to the cashier, gets his items scanned, and when the total is read off, drops a single shiny silver coin on the counter. He gets his change in quarters and dimes, says 'thank you', and walks off.

Sounds strange — but the fact is, scenes just like this may be on their way to retailers across the country... including your local stores.

In fact for the first time in decades, the use of bullion-coins is actually being supported by a state government. And at $38/ounce, the one ounce silver coin used in the example above would serve as a popular alternative to paper cash.

It's a radical change that comes to us courtesy of Utah's Legal Tender Act of 2011, passed this March on the back of strong Tea Party support for a precious metals-backed dollar.

Utah is the first state to pass such legislation, but other states — Minnesota, Idaho, and Georgia among them — are currently taking steps to follow suit.

To many, scenarios such as this smack of political conspiracies, radical conservatism, and alarmist propaganda. But the sad fact of the matter is that as reactionary as a new precious-metals-based economy may sound, it's becoming more and more practical in a world where gold and silver are just about the only forms of currencies gaining value instead of losing it.

This, of course, is not news...

With gold rallying more than 60% in the last two years and more than doubling since just September of last year, the precious metals market has caught the attention of investors worldwide.

Here is what is new, however, and what can — and most likely will — push both gold and silver prices even higher in the near future...

Utah's Legal Tender Act of 2011 is a major (albeit symbolic) move toward creating a currency market for both gold and silver.

And it's not the only one...

Earlier this year, the European Union's Committee on Economic and Monetary Affairs decided to put to a vote to the European Market Infrastructure Relation. If passed, this law will allow gold to be used by central counter-parties as collateral in business transactions.

This is a first for precious metals, and it confirms a deeper and more universal transformation of these commodities to a currency status.

Again, a largely symbolic and convenient law, it will also put a strain on international gold and silver supply as these metals are monetized for use in business. Inevitably, this added demand will drive prices up further and further as supply fails to keep up.

Let's back up a little bit here, though. Are these policies sustainable on a global scale? Hardly.

The U.S. dollar was among the first to abandon the gold reserve system 40 years ago, as part of a series of economic mandates that came to be known as the "Nixon Shock". Since then, every other major world currency has done the same.

With national economies now running on the fiat capital system, in which money is conjured into existence by governmental decree, there is simply not enough of any precious metal to back up all financial transactions everywhere.

But will this stop minor forays back into a gold/silver-backed system?

Clearly not. Remember, it is not so much what the predominating trend is, or even what is legally mandated, that's important to bull markets...

As common perception starts to reevaluate gold and silver as currencies rather than commodities, everyone from market makers to amateur investors will do what they always do during times of adversity: They will diversify heavily into this once-fringe market.

New demand will drive up prices, and increasing media coverage of inflating currencies will continue to feed the market.

New production will work overtime to feed demand, sending mining and exploration stocks flying.

But with investors hoarding the metals, there will likely still never be enough available to ever back any major national currency again.

So while planning for a global economic reversal to the gold standard is at best premature and at worst, delusional, the prognosis for this market is pretty clear...

Expect gold and silver to not slow down anytime soon. Another 50%-100% growth is possible over the next 12-18 months. And expect any company involved in exploration, mining, and production to see banner years for at least 2011 and 2012.

For my latest plan on how to leverage the precious metals bull market into quick gains that outpace increases in bullion prices by factors of 2, 3 — even 5 or more — read my new report.

Good investing,

Luke Burgess
Analyst, Wealth Daily
Investment Director, Hard Money Millionaire

The New Fort Knox

If you think the recent, highly-publicized gold-buying mania is merely the result of a handful of panicking investors, urged along by a couple contrarian billionaire types... think again.

Today, it's no longer just private individuals buying up the yellow metal.

For the first time in decades, gold has become a nearly universal investment strategy... something that literally any class of investor must own to be considered well-hedged.

It's so important, in fact, that the world's biggest and fastest growing national economies are in the midst of an historic push to build up their stores of the precious metal.

Most of it will end up in places like this:

Not since the late 1980s has investment demand for this metal been as high as it is today.

In fact it has been 22 years since central bank and investment buying of the yellow metal outstripped industrial and ornamental demand.

Today, the biggest buyers of gold aren't private citizens or hedge-funds. Instead, nations like China, India, and Russia have moved forward to grab up every loose ounce of the metal...

In 2010, Russia's central bank bought up an astounding 2/3 of the country's entire national production.
That same year, India purchased close to 750 tons, breaking the record of the previous year by almost 40%.
China — the biggest gold market of them all — has stated an intention to raise their national reserves by 849%, or 10,000 tons, worth an estimated half a trillion U.S. dollars, by the end of the decade.
In the first two months of 2011, China boosted their national holdings by 200 tons.

If this trend continues, it will almost certainly reshuffle the world order as far as government-owned gold holdings go.

Currently, the United States occupies the number one spot with 8,133 tons of gold. However, if China's acquisition plans come to fruition, they will supplant the U.S. for the first time in history.

Similarly, India and Russia are working overtime to do the same to Germany and France — Europe's number one and two biggest gold owners.

While these facts may be shocking to people used to living in a world where Fort Knox was the single biggest concentration of gold in existence, the reasoning behind these developments is as clear as day...

Dollar's Demise: When Gold Trumps Green

In a highly-publicized media event last week, the United States hit its federally mandated debt limit of $14.3 trillion.

Although this milestone wasn't a surprise (and in itself didn't symbolize any actual additional dilution of the dollar's value), it was the next and perhaps the biggest in a series of confidence-destroying events for the world's embattled reserve currency.

Far-sighted private citizens have been hedging against this for years, and, as we've seen from the price growth of the last 18-24 months, have been driving up the prices.

But it's the entry of cash-rich nations such as the big three I've been mentioning that promises to put gold into a period of change unseen before at any point in history.

The scary fact is these nations — as powerful as they're becoming, thanks to exploding industrial and natural resource wealth — are in the exact same boat as private citizens such as yourself.

Despite their growing influence and power, they are still subject to a global economic system which evaluates performance and transacts its business using the greenback... which makes their reason to hedge the same as your reason to hedge.

And the result of this unprecedented bull market is exactly what you see today.

Unfortunately, this trend isn't something that's going to screech to a halt based on one report from Jim Cramer or a well-placed article in The New York Times...

What we're seeing now is no longer manic buying or group think.

Today's gold market is the result of a calculated, determined, and ongoing campaign by the world's fastest growing economies to ensure their survival in the years and decades to come.

A couple years ago, I would have advocated buying gold to balance out a portfolio.

Today — with the gold rush on its way to becoming a permanent financial strategy for banks and cash-rich nations alike — I'm insisting on it as a tool of survival.

Good Investing,

Luke Burgess
Editor, Wealth Daily
Investment Director, Hard Money Millionaire and Underground Profits

Top Silver Stocks Part II

**Editor's Note: Wealth Daily has just released a more up-to-date and extensive resource page on silver stocks for your reading pleasure.

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Today's Wealth Daily is the second part of my report on silver companies that are increasing mine production and revenue this year and beyond.

If you missed the first half of this report and want to check it out, you can find it here.

If you've already enjoyed the first half, read on...

Minefinders
Company	Minefinders
Exchange	AMEX and TSX
Symbol	MFN and MFL
Current Share Price	$14.05
Market Cap	$1.09 billion
Avg. Daily Volume	850,000
Shares Outstanding	80.7 million
Fully Diluted	95.2 million
Website	www.minefinders.com

Headquartered in Vancouver, Minefinders owns and operates the multi-million-ounce Dolores silver and gold mine, located in Northern Mexico.

In 2010, Minefinders produced 1.3 million ounces of silver, only slightly higher than the 1.2 million ounces the company produced in 2009... But this year, Minefinders expects to more than double silver production to between 3.3 and 3.5 million ounces of silver.

The company also produced 77,000 ounces of gold in 2010 and expects production of the yellow metal to slightly drop to between 65,000 to 70,000 ounces.

In addition to current production, opportunities for Minefinders' continued growth are driven by a pipeline of advanced and grass-roots exploration properties. According to the latest official estimates of the firm's Dolores and La Bolsa project, Minefinders has access to:

131.1 million ounces of proven and probable silver reserves
2.8 million ounces of proven and probable gold reserves
161.0 million ounces of measured and indicated silver resources
3.7 million ounces of measured and indicated gold resources

Coeur d'Alene Mines
Company	Coeur d'Alene Mines
Exchange	NYSE and TSX
Symbol	CDE and CDM
Current Share Price	$27.15
Market Cap	$2.16 billion
Avg. Daily Volume	4.2 million
Shares Outstanding	89.3 million
Fully Diluted	unable to locate*
Website	www.coeur.com
* Coeur d'Alene has made it very difficult for investors to find this information. In fact when I contacted the company, they got back to me with the number of shares outstanding, though I'm sure I asked for the number of shares fully diluted... Since the company is apparently trying to hide this number, I can only assume it's outrageously high.

Idaho-based Coeur d’Alene Mines is the world's second largest primary silver producer and a growing gold producer.

The company has three new, large precious metals mines. And in 2011, Coeur will realize the first full year of production and cash flow from all three of these 100%-owned mines.

In 2010, the company produced 16.8 million ounces of silver. This year, Coeur d’Alene expects to boost 19.0% silver production to 20.0 million ounces. They also expect to boost gold production to 250,000 ounces this year — a 59.2% increase from Coeur's 2010 gold production of 157,000 ounces.

These production increases are expected to lead to $800 million in metal sales and $400 million of operating cash flow in 2011.

In addition to the company's currently operating mines, Coeur also owns a non-operating interest, a low-cost mine in Australia, and conducts ongoing exploration activities near its operations in Argentina, Mexico, and Alaska.

According to the company's 2010 estimates, Coeur d’Alene Mines controls:

227.1 million ounces of proven and probable silver reserves
2.5 million ounces of proven and probable gold reserves
206.2 million ounces of measured and indicated silver resources
1.4 million ounces of measured and indicated silver resources
53.9 million ounces of inferred silver resources
816,000 ounces of inferred gold resources

SilverCrest Mines
Company	SilverCrest Mines
Exchange	TSX Venture
Symbol	SVL
Current Share Price	$1.46
Market Cap	$97.7 million
Avg. Daily Volume	300,000
Shares Outstanding	67.0 million
Fully Diluted	77.0 million
Website	www.silvercrestmines.com

SilverCrest Mines is an emerging gold and silver producer based in Vancouver. The company is focused on three precious metal projects in Mexico.

Their 100%-owned flagship Santa Elena Mine, located 150km northeast of Hermosillo, is one of Mexico's newest high-grade, open-pit gold and silver producer. In September 2010, SilverCrest successfully completed its first metals pour of gold and silver dore at the Santa Elena Mine.

SilverCrest anticipates the 2,500-tonnes-per-day facility will produce an average of approximately 800,000 ounces of silver and 30,000 ounces of gold per full production year from the open-pit heap leach operation.

Going forward, the company expects to increase production up to 3.0 million ounces of silver-equivalent in the next three or four years.

Across SilverCrest's Cruz de Mayo and Santa Elena projects, the company's projects contain:

11.9 million ounces of probable silver reserves
340,000 ounces of probable gold reserves
50.5 million ounces of indicated and inferred silver resources
350,000 ounces of indicated and inferred gold resources

The Myth of the Pure Silver Mine

One important factor to consider when buying silver stocks is what the company is actually mining.

You see, most of the world's silver is produced as a by-product of mining other minerals. In fact, approximately 75% of the world's silver is produced as a by-product of copper, gold, lead, and zinc.

So the majority of the time when you're buying a “silver stock”, you're actually buying what is a “mostly silver stock”.

Take, for example, Fortuna Silver (TSX: FVI)...

For all intents and purposes, Fortuna is a silver mining company. But they only get 60% of their revenue from the silver they mine; the remaining 40% comes from lead and zinc production.

And that means you're exposed to price volatility in whatever other metals are being mined by the company. (Recently, this has actually hurt Fortuna's bottom line a bit recently as both lead and zinc prices have been falling for the past several weeks.)

There are other companies, however, that we refer to as “primary silver companies”. You've read about a few primary silver companies in this report.

But even a primary silver company isn't necessarily a pure silver company...

When a particular company or mine is defined as a primary silver producer, it is done so on the basis of the revenue produced by mining operations, not the quantity of the metal produced.

That's because each metal has vastly divergent prices. And classifying companies based upon the ounces produced of the particular metals would produce grossly misleading labels. It's easier and better this way.

Primary Silver vs. By-Product Silver

Since we know that silver will continue to outperform gold, our best bet is to invest in the purest silver assets we can get our hands on.

That means investors looking to leverage rising silver prices should own physical silver bullion, silver ETFs, silver royalty companies, or primary silver companies.

But for the most bang for our buck, investors will look to primary mining stocks — and more specifically, primary silver exploration and development stocks. A good example of a primary silver development company is Orko Silver (TSX-V: OK).

In 2004, Orko Silver used their extensive experience in mineral exploration and discovery to identify and acquire the La Preciosa property, an early-stage silver project in Durango, Mexico, that they believed had huge exploration potential.

When they originally acquired La Preciosa, it only had about 3 million ounces silver resources. But after 5 years of development using modern exploration techniques, the company increased the resource estimate at La Preciosa by over 4,700% to 146 million ounces of silver.

Orko's stock subsequently increased some 6,280% from $0.05 to nearly $3.20 last year. It was a real rags-to-riches story.

In April 2009, Orko partnered with Pan American Silver (NASDAQ: PAAS), one of the world's largest primary silver producers, to further develop the La Preciosa property and bring the project into production.

Now that the project is on cruise control, the same guys from Orko Silver who had to foresight to see the potential in La Preciosa have formed a new primary silver exploration company with another early-stage project.

This project is located just 60 miles north of La Preciosa. But this new project is bigger than La Preciosa and has more mineral veins, so the company is already targeting a +100-million-ounce resource... And everyone is excited about it.

It took 4 years and 120,000 meters of drilling for Orko to get Pan American Silver interested in the project. But without drilling a single hole, this small $26 million company already has had six joint venture offers.

Right now, share prices of this tiny firm are trading at just about $0.80. But now that the La Preciosa project is being developed, the guys from Orko can focus on their new project. They just began a new exploration program at this new project. And once drill results start coming in, I expect to see share prices explode — which makes right now the time to be a buyer.

I've spent the past several weeks investigating the company. And I'm just about to make my buy recommendation in Underground Profits.

My report and recommendation on this company is not yet complete. But I will be finished with it soon, and I will be sending the new recommendation to subscribers within less than the next two weeks.

That means you still have time to become a member of Underground Profits and finally get in on a ground-floor investment.

Again, I will soon be recommending a brand-new primary silver exploration stock to members of Underground Profits. I urge you to strongly consider this investment, as I believe we could be pocketing a 60% gain within just eight weeks. After that, I'm confident that we'll be sitting on a triple-digit gain by the end of summer.

I urge you to join today.

Good Investing,

Luke Burgess
Editor, Wealth Daily
Investment Director, Hard Money Millionaire and Underground Profits

Top Silver Companies Increasing Production in 2011

**Editor's Note: Wealth Daily has just released a more up-to-date and extensive resource oage on silver stocks for your reading pleasure.

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During precious metal bull markets, gold gets all the glory. And rightfully so.

After all, the yellow metal has been the ultimate symbol of power and wealth for more than five millennia.

But the fact is gold isn't the best way to profit from precious metals...

Throughout history, silver has consistently and reliably outperformed gold — doubling, tripling, even quadrupling the price of the yellow metal.

In the last 12 months alone, gold prices have gained 29%. Meanwhile, the price of silver has jumped 178% — and investors are being heavily rewarded.

Back in September 2009, I published a report in Wealth Daily detailing my top five silver companies that were increasing mine production. Since that time, these silver stocks have gained an average of 110.7%.

I've updated and expanded this report for you today. Enjoy.

Great Panther Silver
Company	Great Panther Silver
Exchange	TSX and AMEX
Symbol	GPR and GPL
Share price in my 9/09 Report	$0.90
Current Share Price	$3.09
Gain	↑243.3%
Market Cap	$406.7 million
Avg. Daily Volume	2.2 million
Shares Outstanding	131.6 million
Fully Diluted	139.3 million
Website	www.greatpanther.com

Boasting an internationally recognized board of directors, Great Panther Silver is a rapidly growing primary silver firm with strong leverage to future increases in silver prices.

The company owns and operates two mines in Mexico and employs over 900 people. Silver production from Great Panther's Guanajuato and Topia mines has been growing for four consecutive years. The company has steadily increased its total output from 600,000 ounces of silver-equivalent in 2006 to 2.3 million ounces of silver-equivalent last year, yielding an annual net income of $5 million for 2010.

In 2011, Great Panther hopes to ramp up production to 2.9 million ounces of silver-equivalent, with earnings from mining operation expected to approach $25 million.

This year marks the second in a three-year organic growth strategy that the company initiated in 2010. When all is said and done, Great Panther believes they'll be able to boost production to approximately 3.8 million ounces of silver-equivalent, increase resources through exploration to 40 million ounces of silver-equivalent, and delineate a 10-year mine life for both operations.

According to the company's latest estimates, Great Panther's mineral resources include:

Guanajuato

4.4 million ounces of ounces of proven and probable silver-equivalent reserves
5.5 million ounces of measures and indicated silver-equivalent resources
2.7 million ounces of inferred silver-equivalent resources

Topia

7.4 million ounces of measures and indicated silver-equivalent resources
11.9 million ounces of inferred silver-equivalent resources

Silver Standard Resources
Company	Silver Standard Resources
Exchange	NASDAQ
Symbol	SSRI
Share price in my 9/09 Report	$22.00
Current Share Price	$29.34
Gain	↑33.4%
Market Cap	$2.33 billion
Avg. Daily Volume	1.5 million
Shares Outstanding	79.9 million
Fully Diluted	84.4 million
Website	www.silverstandard.com

Headquartered in Vancouver, Silver Standard Resources is generating shareholder value from its ownership of the third-largest primary silver mine in Mexico, as well as a substantial portfolio of geopolitically-diverse projects.

Ranging from grassroots exploration to production, the company's pipeline of 14 projects are spread across Argentina, Peru, Mexico, Canada, Chile, the United States, and Australia. Silver Standard's projects include:

Advanced Exploration	Development	Production
San Agustin, Mexico Berenguela, Peru Challacollo, Chile	San Luis, Peru Pirarrilla, Mexico Diablillos, Argentina	Pirquitas, Argentina

The company's first major mining operation and flagship Pirquitas mine achieved commercial production in December 2009. Since that time, Pirquitas has become the third-largest primary silver mine in Mexico — and the 12^th largest in the world.

At full production, Pirquitas will rank among the top ten largest open-pit primary silver mines in the world.

In 2010, Silver Standard mined 6.3 million ounces of silver from Pirquitas. This year, the company expects to increase output by 35% to 8.5 million ounces.

Silver Standard also boasts the largest in-ground silver resource of any publicly-traded primary silver company. According to the latest official estimates, the company has access to:

285.5 million ounces of proven and probable silver reserves
993.3 million ounces of measures and indicated silver resources
403.6 million ounces of inferred silver resources

Fortuna Silver Mines
Company	Fortuna Silver Mines
Exchange	TSX
Symbol	FVI
Share price in my 9/09 Report	$1.50
Current Share Price	$4.79
Gain	↑219.3%
Market Cap	$586.8 million
Avg. Daily Volume	900,000
Shares Outstanding	122.5 million
Fully Diluted	127.1 million
Website	www.fortunasilver.com

Fortuna Silver Mines is a growth-oriented silver and base metal producer focused on mining opportunities with two main assets in Latin America: the Caylloma silver/lead/zinc mine in Peru and the San Jose silver/gold project.

The company's 100%-owned Caylloma Mine was reopened by Fortuna in October of 2006 following a significant upgrade and modernization of the processing plant.

Since that time, the company has ramped up silver production to over 1.9 million ounces. In 2011, Fortuna plans to maintain output levels at Caylloma. But the company is on schedule and within budget for completion and commissioning of a new operation mine at San Jose in the third quarter of this year. This will triple the company's silver-equivalent production when it opens.

Once the mill reaches its design capacity of processing 1,500 tonnes of ore per day, the San Jose Mine will extract 5 million silver-equivalent ounces annually. Management is planning to achieve full production capacity within 24 months of the start of operations.

According to 2010 estimates, Fortuna Silver's projects contain:

Caylloma Mine

43.4 million ounces of proven and probable silver-equivalent reserves
13.8 million ounces of measured and indicated silver-equivalent resources
27.3 million ounces of inferred silver-equivalent resources

San Jose Project

35.9 million ounces of proven and probable silver-equivalent reserves
44.2 million ounces of indicated silver-equivalent resources
32.6 million ounces of inferred silver-equivalent resources

Endeavor Silver
Company	Endeavor Silver
Exchange	NYSE and TSX
Symbol	EXK and EDR
Share price in my 9/09 Report	$2.75
Current Share Price	$8.62
Gain	↑213.5%
Market Cap	$1.76 billion
Avg. Daily Volume	1.5 million
Shares Outstanding	79.9 million
Fully Diluted	84.4 million
Website	www.edrsilver.com

As a mid-cap silver mining company, Endeavour Silver is one of the fastest-growing silver companies focused on production and the development of new resources in Mexico.

Since its start in 2004, the company has posted six consecutive years of aggressive silver production and resource growth. Endeavour currently has two producing operations in Mexico: the Guanacevi Mine in Durango and the Guanajuato mines in Guanajuato.

In 2010, these mines produced 3.3 million ounces of silver and 17,000 ounces of gold at a cash cost of $5.71 per ounce, net of by-product gold credits. Production is forecast to rise again in 2011 to 3.7 million ounces of silver and 19,000 ounces of gold, and the company expects to continue to drive cash costs lower — down to $5.50 per ounce.

Organic expansion programs are now underway at Endeavour's two operating silver mines. And by 2012, the company expects to boost production to 4.4 million ounces of silver...

In addition, the company plans additional growth by exploration and development of its existing portfolio of exploration properties — which will undergo exploration and drilling in 2011 — and is actively looking for acquisitions with existing or near-term silver output.

According to the company's latest estimates, Endeavour's mineral resources include:

13.4 million ounces of proven and probable silver reserves
27.3 million ounces of indicated silver resources
29.8 million ounces of inferred silver resources

First Majestic Silver
Company	First Majestic Silver
Exchange	NYSE and TSX
Symbol	AG and FR
Share price in my 9/09 Report	$2.60
Current Share Price	$16.83
Gain	↑547.3%
Market Cap	$1.73 billion
Avg. Daily Volume	1.8 million
Shares Outstanding	103.3 million
Fully Diluted	109.1 million
Website	www.firstmajestic.com

Billed as “the world's purest silver company”, First Majestic Silver is building a senior silver producing mining firm based on an aggressive development and acquisition plan with a focus on Mexico.

The company presently owns and operates three producing silver mines and two development projects...

First Majestic's largest operation, the La Encantada Silver Mine, was expanded several times since 2006 to reach the current capacity of 3,750 tonnes per day.

Production reached close to 3.8 million ounces of silver in 2010, and is anticipated to reach approximately 4.5 million ounces of silver in the form of dore bars in 2011.

First Majestic's three mines produced a total of 7.0 million ounces of silver last year. The company's mines are expected to increase output to 8.0 million ounces of silver.

Going forward, a major expansion is currently underway to double the capacity at La Parrilla for 2012. This is expected to help boost production further to approximately 10.0 million ounces of silver.

By 2014, silver production is anticipated to increase further to approximately 16.0 million ounces of silver.

In addition, management is determined to expand First Majestic's asset base and thus continues to investigate other interesting advanced stage silver projects in Mexico. According to the company's latest estimates, First Majestic has:

46.3 million ounces of proven and probable silver reserves
164.3 million ounces of measured and indicated silver resources
160.1 million ounces of inferred silver resources

Continued...

Until then,

Luke Burgess
Editor, Wealth Daily
Investment Director, Hard Money Millionaire and Underground Profits

How to Buy Yukon Gold Stocks

The first true gold rush of the 21st century is unfolding right before our very eyes.

After more than a century, the legendary gold history and wealth of Canada’s Yukon Territory is again making the region one of the industry's most intriguing areas for exploration.

But there's a bit of a catch...

The exploration season for gold hunters is quite short in the Yukon.

The region's northern latitude means exploration teams can only work from about April until September before sub-freezing temperatures chase them out.

Explorers can't penetrate frozen ground with their drills; and with no exploration progress, companies working in the Yukon tend to sag during the winter months.

But once the drills start turning, things change...

And with brand-new gold discoveries made during summers of 2009 and 2010, the appetite for quality Yukon gold stocks is near veracious right now.

The Wall Street Journal recently wrote:

The Stakes Are Real in the Yukon as a Modern Gold Rush Is On
April 28, 2011

In recent years, companies have been registering about 15,000 claims a year, according to a spokesman for the Yukon government. Almost none of those were made in the winter, he said. Last month alone, however, companies made 18,472 claims — bringing the total for the January-March period to 34,022.

In a typical year, only about $20 million is spent exploring for gold in the Yukon. Now that the price of gold is breaking record highs, about $100 million is spent in an average year.

But in 2011, the Yukon Geological Survey estimates almost $350 million will be spent for work programs and drilling this summer in the Yukon.

In the past month alone, tens of millions of dollars have been raised at the last minute to finance exploration projects in the Yukon.

Selwyn Resources (TSX-V: SWN) announced an equity financing of up to $15.0 million, and Colorado Resources (TSX-V: CXO) increased their bought deal financing to $12.3 million.

And they're not wasting any time getting started. A few companies have already started their summer exploration programs.

Last week, Kaminak Gold (TSX-V: KAM) announced its 2011 drill program has begun on the company’s 100%-owned Coffee Gold Project, located in the White Gold District, Yukon Territory.

Kaminak's exploration program is budgeted at $15 million and includes 40,000 meters of exploration drilling, geophysics, and the collection of 10,000 new soil samples in previous unexplored regions of the property. With this work, the company hopes to expand and the size of eight gold zones that were discovered last year.

Meanwhile, one company already has drill results.

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We've arranged a way for you to get ahead of the curve and receive special pricing on this nearly-flawless silver coin, 2x as thick as a standard silver dollar!

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Last Tuesday, Golden Predator (TSX: GPD) announce final assay results from its winter 2011 diamond drilling campaign, which was designed to expand the recently discovered Bohemian Zone at the company’s Brewery Creek project.

The best drill results include 74 meters of grading 7.08 g/t of gold in hole BC11-198.

Despite that this was not the initial discovery of gold at Golden Predator's Bohemian Zone, share prices still jumped 33% after the news — and the stock traded ten times its average daily volume:

Is There Still Time to Buy Yukon Gold Stocks?

I've been receiving many an e-mail asking what will happen next month as we now deal with the “Sell in May, Go Away” mentality that's just kicking off.

The summer months are typically quiet for junior gold exploration stocks. But while this has been the general scenario for the market overall, we need to remember good companies that deliver results will always perform well — no matter what time of year it is.

I expect it will be another typical summer for the overall junior mining stock market.

But I believe Yukon gold stocks will buck the trend and surprise everyone with much higher share prices.

Exploration drilling

In addition, we have the seasonal situation that has developed up in the Yukon, which I think will also buck the trend this summer as a massive amount of exploration work shortly gets underway.

With so much exploration going on, someone will no doubt find gold...

As the exploration camps open and the crews hit the ground running, I think we are going to see what a modern gold rush looks like.

Word of this is going to spread fast particularly if a big, new discovery hits the market. This could bring in a whole new group of investors who have not been in our market before.

Success in the Yukon this summer could make the entire junior mining sector a very hot market indeed as we move into the fall.

And shareholders of exploration companies that are looking to discover the world's most important metals — gold, silver, uranium, copper, etc. — will likely be handsomely rewarded.

Good Investing,

Luke Burgess
Analyst, Wealth Daily
Investment Director, Underground Profits

The Nuclear Renaissance Lives

Leaking radioactive material from the Fukushima I Nuclear Power Plant has poisoned the entire global uranium market.

Every nuclear- and uranium-related asset on the market has suffered drastic devaluations.

The price of uranium oxide (U3O8) — the most commonly-traded physical form of the nuclear fuel — fell some 32% from $74 to nearly $50/pound in the spot market immediately following Tōhoku earthquake.

Since that time, however, uranium prices have recovered a little bit. But the price of U3O8 remains 24% lower than it was right before the Fukushima disaster.

Uranium stocks have fared no better.

Companies involved in all aspects of the uranium industry — from exploration to production and processing — have also suffered serious market losses. In the past six weeks alone:

Cameco (NYSE: CCJ) has fallen 37%
Denison Mines (AMEX: DNN) is down 44%
Uranerz Energy (AMEX: URZ) dropped 36%
Uranium One (TSX: UUU) has lost 39%
USEC (NYSE: USU) is off 33%
Uranium Resources (NASDAQ: URRE) has slumped 38%
Ur-Energy (AMEX: URG) fell 42%

For a broader look, the Global X Uranium ETF (NYSE: URA) — which tracks 23 of the largest uranium companies — plummeted 31% on the day of the earthquake and is still some 28% below pre-crisis levels.

Fearful investors have hurried to sell off their uranium assets, fearing the Fukushima disaster will force governments to tighten industry restrictions or worse, abandon their pursuit of nuclear power as an alternative energy source all together.

But the knee-jerk reaction in the uranium market has been grossly overdone.

You see, uranium has only been a publicly-traded commodity for only a few years...

In May 2007, the NYMEX began trading uranium futures in monthly contracts. This introduced a much higher degree of speculation into the uranium market as trading became available to investors outside of the mining industry.

And it was these very emotional speculators who oversold the uranium market following the Fukushima disaster.

But it's only a matter of time until investors snap back to reality and the uranium market begins to rapidly recover.

It's at this point that investors recognize the truth: The Fukushima disaster does not fundamentally alter the global demand for uranium oxide.

The Nuclear Renaissance Will Continue to Power Forward

There are still over 440 nuclear power plants around the world that will continue demanding the energy fuel. Each year, these plants require approximately 79,000 tonnes of U3O8; but current mine production is only able to supply 60,000 tonnes of U3O8 annually.

The near 20,000-tonne supply deficit has been covered by secondary sources, including stockpiled uranium held by governments and utilities. But it's well-known that many civil uranium stockpiles — including those from the once-massive stockpiles of ex-Soviet warheads — have been largely depleted.

And with over 50 new nuclear power plants under construction right now (and 200 more planned in spite of the Fukushima disaster), global demand for uranium will soon begin to greatly exceed available supplies.

There's no doubt in my mind that nuclear industry will soon rapidly recover.

You know as well as I do that people have very short memories. Call to mind the following recent examples:

Massey Energy (NYSE: MEE) didn't stop mining coal after a massive explosion killed 29 miners at the company's Upper Big Branch in April 2010.
Chile only briefly halted mine production following a cave-in that left 33 miners trapped 2,000 feet vertically underground at the Copiapo copper/gold mine in August.
British Petroleum (NYSE: BP) didn't stop producing oil from the Gulf of Mexico after the oil spill last summer.

And those are just recent examples that are specific to natural resource industry. The Fukushima disaster is the same sort of situation.

Global nuclear energy interests will spearhead cleanup efforts in Japan and continue to promote new technologies. Governments will mandate new safety inspections, and they'll write laws to include more frequent safety reviews and stricter standards for new nuclear power plants.

These moves should help alleviate most of the mainstream fears and quiet any loud, uninformed voices...

Then the industry can go back to business as usual.

China has already announced it will resume nuclear plans in just a few months. Here's the latest from MarketWatch:

China’s Nuclear Plans Could Resume by Summer
April 22, 2011
By Chris Oliver

HONG KONG (MarketWatch) — China’s plan to build more nuclear power stations to meet the nation’s growing energy needs could soon be back on track after a safety review is set to completed this summer, according to a mainland news report Friday.

The central government will assess the report and decide if safety improvements are needed, though Chinese experts believe Beijing will resume its nuclear-power ambitions, perhaps with some minor changes, the China Daily reported.

The report cited former industry regulator and Nuclear Power Technology Corp’s senior official Lin Chengge as saying the pace and scale of China’s building will be adjusted, but dramatic changes are unlikely.

The Chinese government has laid plans to increase the country's nuclear capacity from the current 10 gigawatts (GwE) to 80 GwE in the next nine years. And the country is clearly moving its nuclear sector forward as it needs to, despite the Fukushima disaster.

Besides, it's foolish to think that other world governments, major financial institutions, and corporations (all of which have billions tied up in the nuclear industry) are not going to let the nuclear sector fall without a decent fight...

There's just too much money at stake.

The Diagnosis is Worse than the Ailment

There's no doubt that the radiation leaking from Fukushima has created serious risks.

But the hard truth is, there is no current form of energy production that is without risk: Mining for coal is dangerous, oil rigs and pipelines can explode, and hydroelectric dams can be breached.

In the end, the market's overreaction to the Fukushima disaster may be worse than the accident itself if it delays the nuclear renaissance.

With all the wars, uprisings, and general violence in the region, the need to reduce our dependence on Middle Eastern oil has never been greater. With oil prices rising past $120 and $130 per barrel, uranium investments will once again be seen as a hedge against the Middle East...

And today's investors will be rewarded from a power rebound in the market as the majority of the heavy selling seems to be drying up.

Remember, it's still expected there will be some 700 nuclear reactors operating worldwide within the next few years. These reactors will nearly double the demand for global uranium supplies.

If you can think ahead a bit, it's not difficult to see how panic in the uranium market right now is making for an incredible buying opportunity.

Fear has created a frenzy in the uranium market; we've seen investors irrationally sell off their assets without considering market fundamentals or intrinsic value. And everything we know from history tells us that the market will eventually recover to come back stronger than ever.

It's a no-brainer. And all investors need to do now is step up to the plate and take a swing at a slow, easy pitch.

Right this very second, the uranium market is panicking. As you know, uranium companies have seen their market valuations nearly cut in half!

There's still a lot of fear sloshing around in the market. But this sell-off has naturally created an unprecedented opportunity for us as investors.

That's why for the past three weeks, I've been scrambling to put together a new report...

My #1 Uranium Stock for 2011

A veteran geologist recently told me about a rapidly developing uranium district in Argentina's Rio Negro Province, where property was being snapped up by major names in the mining industry.

Experts recently discovered this region is geologically similar to other regions known to host world-class uranium deposits. That means there could be billions of dollars in untapped uranium reserves waiting to be discovered...

And since the whole story has been kept such a secret, a small handful of companies have staked most of the prime exploration land.

In fact one small exploration company was able to get its hands on a massive 1.2 million acres of prime uranium property. This 25-cent stock was worth over $1.00 before the Fukushima disaster; once the fanaticism dies down, I expect share prices to strongly rebound.

That's why, for the past three weeks, I've raced to put together a new video report that details this small uranium exploration company. In this video, I give you the whole story — including more details on the Argentinean uranium region and exactly why I'm so excited about this opportunity.

The tragedy in Japan and subsequent fear in the market have presented us with an incredible opportunity to take a position in the uranium market.

The Wall Street investment houses and financial institutions are still under pressure not to own uranium assets; but growth prospects for nuclear power continue to remain strong, as do the prospects for its yellow cake fuel.

The uranium market will survive the Fukushima catastrophe. And once the fear and emotion settle down, I expect uranium prices to rebound from their current lows to their pre-Japan crisis highs of over $70 per pound.

Sooner or later, the money that was taken out of uranium stocks will be put back in.

And that makes right now one of the single best times to invest in uranium.

There are plenty of great opportunities in the market now for investors to buy uranium stocks. But some are better than others...

Be sure to check out my #1 uranium stock of 2011.

Good Investing,

Luke Burgess
Editor, Wealth Daily
Investment Director, Hard Money Millionaire and Underground Profits

Don't Buy the Hype, Buy Uranium

A veteran geologist just told me one of his biggest and most recent industry secrets.

He tipped me off to a specific area in South America, where some of the world's top mining insiders were aggressively (but very quietly) staking and buying uranium exploration property.

It's an all-but-forgotten area in the dry deserts of Argentina's Rio Negro Province. And it's here where new exploration technology is revealing what some geologists believe could be the single largest uranium discovery in history.

But who cares about uranium right now?

I do... more than ever, in fact.

That's because, even in the wake of the Fukushima nuclear accidents — which have smothered uranium prices and related stocks — the ever-widening gap between global uranium supplies and demand will continue to influence the market. And despite bearish overkill in the market, uranium prices will rebound and the nuclear industry will recover.

That means, for level-headed and well-informed investors, this could be the single best opportunity to enter the uranium investment space in the past 10 years...

For the moment, the radiation leaking from Fukushima has poisoned the uranium market.

The price of uranium oxide (U3O8), the most commonly traded form of the energy metal, plummeted over 30% to ~$50/pound in the spot market immediately following the Tōhoku earthquake and tsunami.

Since then, the spot price has recovered a bit; but it still remains 21% lower than it was right before the Fukushima disaster.

As a result, uranium companies involved in all aspects of the industry — from exploration to production and processing — have suffered serious market devaluations.

In just the past six weeks:

Cameco (NYSE: CCJ) has fallen 37%
Denison Mines (AMEX: DNN) is down 44%
Uranerz Energy (AMEX: URZ) dropped 36%
Uranium One (TSX: UUU) has lost 39%
USEC (NYSE: USU) is off 33%
Ur-Energy (AMEX: URG) fell 42%
Uranium Resources (NASDAQ: URRE) has slumped 38%

Investors rapidly sold off their positions out of fear that the Fukushima disaster will force governments to tighten industry restrictions, or worse, abandon their pursuit of nuclear power as an alternative energy source all together...

But the knee-jerk reaction in the uranium market has been grossly overdone.

The truth is the Fukushima disaster does not fundamentally alter the global demand for uranium oxide.

There are still over 440 nuclear power generating facilities around the world that will continue to be just as hungry for the nuclear fuel as ever.

Moreover, it is foolish to think that the world's governments, financial institutions, and major corporations — all of which have trillions of dollars sunk into the nuclear sector — would let the industry fall so easily.

So there's no doubt in my mind that nuclear industry will soon rapidly recover.

You know as well as I do that people have very short memories... BP didn't stop producing oil from the Gulf of Mexico after the oil spill last summer. In fact, it only took a few weeks before the government issued new drilling permits.

The Fukushima disaster is the same sort of situation.

Global nuclear energy interests will spearhead cleanup efforts in Japan and continue to promote their new technologies. Governments will mandate new safety inspections, and they'll write laws to include more frequent safety reviews and stricter standards for new nuclear power plants.

These moves should help alleviate most of the mainstream fears and quiet any loud, uninformed voices. Then the masses can go back to paying attention to Charlie Sheen or whoever the "Sheen-of-the-week" is.

The bottom line is this: The uranium market will survive the Fukushima catastrophe. And once the fear and emotion settles down, I expect uranium prices to rebound from their current lows to their pre-Japan crisis highs of over $70 per pound.

What is Uranium Oxide?

Uranium oxide (commonly referred to as U3O8 or yellowcake) is a mixed concentrated powder, containing ~80% uranium oxide.

U3O8 is produced from uranium ore during the milling process. This is the material that is bought and sold by traders and nuclear facilities.

U3O8 is eventually transformed into uranium hexafluoride (UF6), which used to during the enrichment process to produce fuel for nuclear reactors.

As for uranium stocks, current share prices are completely divorced from underlying fundamentals.

Once the noise in the market created by the Japanese catastrophe is gone, shares of uranium companies will rapidly play catch-up.

That's why, for the past six weeks, I've been scrambling to position my portfolios to take advantage to of a rebound in the market. I've put some of my money into the large uranium production stocks like Cameco (NYSE: CCJ) and Uranerz Energy (AMEX: URZ). I expect these companies to return a decent profit.

But I'm also placing a very large stake in one very interesting high-yield junior exploration stock. I've already started to tell you the story...

My #1 Uranium Stock for 2011

As I mentioned earlier, a veteran geologist recently told me about a rapidly developing uranium district in Argentina's Rio Negro Province, where property was being snapped up by major names in the mining industry.

It turns out experts recently discovered this region is geologically similar to other regions known to host world-class uranium deposits. That means there could be billions of dollars in untapped uranium reserves waiting to be discovered...

And since the whole story has been kept such a secret, most of the prime exploration land has staked by just a small handful of companies.

In fact, one small exploration company was able to get their hands on a massive 1.2 million acres of prime uranium property. This $0.25 stock was worth over $1.00 before the Fukushima disaster; once the fanaticism dies down, I expect share prices to strongly rebound.

That's why, for the past six weeks, I've raced to put together a new video report that details this small uranium exploration company. In this video, I give you the whole story, including more details on the Argentinean uranium region and exactly why I'm so excited about this opportunity.

The tragedy in Japan — and subsequent fear in the market — has presented us with an incredible opportunity to take a position in the uranium market.

The Wall Street investment houses and financial institutions are still under pressure not to own uranium assets. But the growth prospects for nuclear power continue to remain strong, as do the prospects for its yellow cake fuel...

Sooner or later, the money that was taken out of the uranium industry will be put back in.

That makes right now one of the single best times to invest in uranium.

There are plenty of great opportunities in the market now for investors to buy uranium stocks. But some are better than others.

Be sure to check out my #1 uranium stock of 2011.

Good Investing,

Luke Burgess
Editor, Wealth Daily
Investment Director, Hard Money Millionaire and Underground Profits

Gold and Silver Mining in Mexico

As the bull market for gold and silver continues to power forward, I have been spending more and more time looking at mineral companies working in the mining-friendly country of Mexico.

While there are many areas around the world that get attention when it comes to finding a significant economic deposit of precious metals, Mexico is, in my opinion, simply one of the best places for investors to put their money.

And today I'll explain why.

A Millennium of Tradition Meets the 21st Century

The mining history in Mexico dates back thousands of years to the Mayans and Aztecs who built complex civilizations. These civilizations used a variety of metals in their culture, including gold and silver.

Gold and silver figure of an Aztec Warrior c. 14th century

During Spanish rule that lasted from 1521 to 1821, exploration and mining in Mexico advanced to the commercial level.

Today, as explorers use the modern technology of geochemistry, geophysics, and airborne magnetic surveys in the old Spanish mining areas, the country's mineral industry is stronger than ever.

Mexico now accounts for nearly 20% of the world’s silver production, making it the world's leading producer.

Over 10 billion ounces of silver have been produced to date, with Mexico producing over 100 million ounces per year.

The principal mining districts in Mexico are Chihuahua, Sonora, Coahuila, Baja California Sur, San Luis Potosi, Durango, and Guanajuato.

Major Mexican Gold and Silver Mining States

While Mexico is known for its silver, I believe that some very large gold deposits will also be discovered in Mexico over the next 5 years. Just consider Newmont Mining’s (NYSE: NEM) La Herradura mine...

La Herradura — Newmont's lowest cost gold producer — started out as a three million ounce deposit. It's now six million ounces — and growing.

I think we are going to see other major discoveries of this type in Mexico as rising gold prices prompt miners to expand their exploration budgets.

Mexican Mining in the 21^st Century

Due to its stable political climate and a government that encourages development of the resource industry, more and more junior exploration companies are finding Mexico a highly desirable place to do business.

Drilling can be performed year round, and there is an ample supply of experienced mining people in most areas.

Meanwhile, permitting times can be a fraction of what it takes in most other jurisdictions.

Most of the Mexican mines that have gone into production in the past few years have done so at significantly lower costs than you see elsewhere around the world, and that makes Mexico a great place to do business from a cost standpoint.

Administratively, working in Mexico is much easier for mining executives that headquarter out of Canada and or the United States. Mexico is relatively close for these executives compared with projects in China, Africa, or South America; it's also easy to access most mine sites from a major Mexican city.

As I evaluate junior mining companies worldwide, I find myself continually asking the same question...

When you have a great situation right in your backyard — like Mexico, Nevada, British Columbia, or the Yukon — why go elsewhere and take on the additional risks?

These areas provide the best opportunities for investing in junior mining stocks and should represent the biggest part of our portfolio.

That’s not to say that I won’t recommend a company in China or some other place; but I always do so on a very selective basis.

For this reason, I will be looking to find new recommendations in these key areas that I believe will deliver the most value to investors in the U.S. and Canada.

I will have several new companies for you in the next couple of months, so keep your powder dry to purchase during the slow spring and summer months.

Good Investing,

Luke Burgess
Editor, Wealth Daily
Investment Director, Hard Money Millionaire and Underground Profits

$100 Uranium on the Horizon

Despite $100 oil, the biggest energy investment gains may be found in this year's uranium sector as raging Chinese demand for the energy metal sends prices screaming higher.

The price of uranium has already climbed 75% in past six months as China snapped up the energy metal ahead of a future supply deficit.

But the Chinese aren't through securing their uranium resources just yet...

And in just one minute, you'll learn how China may force prices even higher as they continue to buy yellowcake to fuel the more than 50 new nuclear power plants that will soon be built.

Lofty uranium prices will mean rising uranium stocks for retail investors in 2011.

In today's Wealth Daily, I'll also review my top three uranium stocks.

The Red Dragon hunts for yellowcake

In the next ten years alone, over one hundred new nuclear power plants will be designed, constructed, and brought online.

Half of those reactors — including some of the world's most advanced — will be built in China.

According to China’s National Energy Administration, the country will increase its nuclear capacity by more than tenfold to 80 gigawatts (GWe) by 2020.

Click to enlarge

China expects to ramp up its nuclear power capacity to 80 GWe by 2020. After that, the country anticipates domestic nuclear capacity to continue rising to as much as 500 GWe by 2050.

At that point, the World Nuclear Association says China’s demand for uranium will reach 44 million pounds annually. But domestic supply will have only reached 5 million pounds by that time, leaving a sharp deficit in fuel resources.

This isn't news to the Chinese...

Concerned of a future supply deficit, China has been aggressively securing long-term uranium contracts.

In fact, most industry experts believe that China is largely responsible for driving uranium prices from $40 per pound in the summer of 2010 to over $70/lb today.

But even at $70/lb, China will continue to be an aggressive uranium buyer.

You see, the total cost of the uranium fuel required to run a nuclear reactor represents between 40% and 50% of operating at one of today's existing plants.

But new technologies have made nuclear power generation much cheaper and more efficient. And the fuel cost to operate a new state-of-the-art reactor represents only about 20%-25% of the total cost of power generation.

Given the efficiency of the new nuclear power plants being built in the country right now, it's unlikely that Chinese planners are concern by the recent increase in price...

Uranium prices could more than double from current levels before the China stops buying — especially given their history of aggression in acquiring other strategic resources like gold, oil, and rare earth metals.

What is yellowcake?

Yellowcake (commonly referred to as U3O8) is a mix ed concentrated powder, containing ~80% uranium oxide. U3O8 is produced from uranium ore during the milling process. This is the material that is bought and sold by traders and nuclear facilities.

U3O8 is eventually transformed into uranium hexafluoride (UF6), which used to during the enrichment process to produce fuel for nuclear reactors.

The Chinese will go to any measure to secure the long-term supply of uranium they need.

And inevitably, countries that also have a growing demand for uranium — like India and Russia — will be forced into a bidding war to get their share of supply as well, driving prices much higher.

Back in 2007, the price of uranium jumped to $140 a pound, helped by speculators. With the looming supply shortage in China and elsewhere, speculators may help push the price of uranium back over $100 a pound this year.

Rising uranium prices means increasing shares prices for uranium mining and exploration companies... and several opportunities for investors to cash in on the booming market.

Back in August, I wrote to you in a free report that included my top three uranium stocks at the time. Since then, all three stocks have returned triple-digit gains for Wealth Daily readers.

Here's what they've returned so far:

Uranerz Energy Corp. (AMEX: URZ) Recommended: $1.18 Today: $5.02 Gain: 325.4%
Uranium Energy Corp. (AMEX: UEC) Recommended: $2.57 Today: $6.08 Gain: 136.6%
Ur-Energy Inc. (TSX: URE) Recommended: $0.83 Today: $2.58 Gain: 210.8%

Here are a few other uranium stocks that have done well as prices increased over the past six months:

Cameco Corp. (TSX: CCO) – ↑86%
Crosshair Exploration & Mining Corp. (AMEX: CZX) – ↑437%
Denison Mines Corp. (AMEX: DNN) – ↑258%
Uranium Participation Corp. (TSX: U) – ↑62%
Uranium Resources Inc. (NASDAQ: URRE) – ↑627%

Many of these uranium stocks have outperformed gold and silver stocks, despite record-setting prices. But even they have nothing on my newest uranium recommendation...

Industry consultants expect the global uranium market to grow from about 190 million pounds today to 247 million pounds by 2020.

By the same time, secondary sources (like governments’ conversion of weapon-grade uranium to electricity-grade uranium) are expected to be cut in half from 48 million pounds today to 24 million pounds.

It's already well known that existing supply from the uranium mines in production today will not be able to meet the anticipated demand, and analysts estimate that nearly a quarter of total supply will have to come from brand-new resources.

That means the junior exploration companies that discover new resources and those with large high-quality uranium projects will receive heavy investment interest as the market needs new supply from new mines.

And there's no larger uranium project than the one owned by a tiny junior uranium outfit that's still trading under the radar...

This new company just put together a massive land package that covers over 1 million acres in an area that many believe could hold one the world's last giant uranium resources.

Next week, I'll send you a brand-new report detailing this small company and their amazing project.

Plus, I'll show you how this unassuming piece of field equipment could be your key to quadruple-digit investment gains:

Until then,

Luke Burgess
Editor, Wealth Daily
Investment Director, Hard Money Millionaire and Underground Profits

Carlos Slim Continues to Invest in Mining

The world's richest man says he will continue to sink millions into a brand-new mining venture in Mexico.

And now his new mining company is buying up precious and base metal assets in one particular central Mexican state.

In today's issue of Wealth Daily, we'll discuss a few junior mining stocks with assets nearby that could juice your investment portfolio.

Three weeks ago, I wrote to you to discuss a brand-new, publicly-traded mining company that will be financed and controlled by telecommunications tycoon Carlos Slim.

To recap: Slim spun off a new mining company called Minera Frisco, S.A.B. de C.V. from his main holding conglomerate at the beginning of the year.

Minera Frisco was already producing both gold and silver when the Mexican billionaire took the company public.

Last year, Frisco produced 200,000 ounces of gold and 5.5 million ounces of silver. In 2011, the company says it will spent nearly $750 million to more than double its gold production to 440,000 ounces, and nearly quadruple silver production to 19.1 million ounces.

And while I mentioned Minera Frisco's stock may not be an ideal for the general retail market, I briefly detailed a few noteworthy Mexican pure play gold and silver companies as alternative investments.

However, there are still many other public companies with quality mineral assets in the immediate region that may also benefit from the resources and capital being ponied up by the world's top billionaire...

And new developments from Minera Frisco may point us just in the right direction.

Slim expands mining operations in Zacatecas

Last week, Minera Frisco reported it will nearly double its stake in a small precious and base mining company called Minera Tayahua S.A.B. de C.V.

Frisco plans to nearly double its stake to up to 91% in Minera Tayahua, which has operations in the small central Mexican state of Zacatecas.

A part of Slim's mining expansion plan in Mexico, Minera Tayahua says it will produce 2.3 million ounces of silver, 29,500 ounces of gold, 45,900 tonnes of copper, and 33,480 tonnes of zinc by 2012.

Minera Tayahua's flagship asset is the Tayahua Mine, located in the Concepcion del Oro District of Zacatecas, Mexico.

The Zacatecas Silver District — located in Central Mexico — is one of the largest and historic silver districts in the world.

Zacatecas has more than fifteen mining districts which yield silver, lead, zinc, gold, phosphorite, wollastonite, fluorite, and barium.

The Zacatecas region hosts the Fresnillo and Zacatecas silver mines, which combined have produced over 1.5 billion ounces of silver to date. As a matter of fact, thanks to Zacatecas, Mexico is the largest producer of silver in the world — contributing almost 20% of the world's total output.

There are a few publicly-traded junior mining companies with a focus on precious metal projects in Zacatecas. These companies may see rising share prices as Minera Frisco invests in the region.

Better yet, companies with mineral assets in areas near major mining and processing operations stand a better chance of being bought out after proving a resource base.

With that in mind, here are a few public junior mineral companies with assets in Zacatecas...

2015: The Year of the Silver Bull Market

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It contains full details the best way to play the surge of silver in 2015.

Impact Silver (TSX-V: IPT) is a profitable silver-focused mining and exploration company that holds a large portfolio of advanced silver projects throughout Mexico, including a 100% interest in 12 mineral concessions in Zacatecas.

These holdings represent potential ore feed for the 200 ton per day mill.

Outside of Zacatecas, Impact produces silver from multiple mines and a 500 tonnes per day processing plant at the Royal Mines of Zacualpan.

Xtierra (TSX-V: XAG) is a Toronto-based mineral exploration and development company focused on the development of precious and base metal projects in the states of San Luis Potosi and Zacatecas.

The company plans to become a mid-tier producer of precious and base metals through the development of its Bilbao silver-zinc-lead-copper deposit.

In February, 2010 Xtierra published a revised independent resource estimate for the Bilbao deposit which showed over 50 million ounces of silver-equivalent indicated and inferred resources.

Arian Silver (TSX-V: AGQ) is an emerging producer focused on the acquisition and development of advanced and low-cost silver projects in Zacatecas.

The company owns, has rights, or has optioned 29 mining concessions and is currently focused on its San Jose project.

Located in Zacatecas, San Jose is spread over 6,500 hectares and comprises 11 concessions. The company estimates 500,000 tonnes of production at San Jose to yield about 2.15 million of silver, 1,800 tonnes of lead, and 3,100 tonnes of zinc over the four-year lifespan.

As of September 2009, the company had identified inferred resources of 11.2 million tonnes grading 93.8 grams per tonne (g/t) of silver, 0.39% lead, and 0.83% zinc, and indicated resources of 2.2 million tonne grading 127.7 g/t silver, 0.51% lead, and 0.88% zinc at the property.

Other junior mining companies with precious and base metal assets in Zacatecas include Silver Sun Resources (TSX-V: SSU), Oro Mining (TSX-V: OGR), and Canasil Resources (TSX-V: CLG).

Last Word

Investors with exposure to mineral assets in Zacatecas may benefit from the resources and capital being invested in the state by Carlos Slim and his new mining venture Minera Tayahua.

As always, do your own due diligence.

Good Investing,

Luke Burgess
Editor, Wealth Daily
Investment Director, Hard Money Millionaire and Underground Profits

Carlos Slim Catches Gold Fever

Carlos Slim beat both Warren Buffett and Bill Gates in stock market performance last year.

The reason: a hell-bent plan to start a brand-new gold and silver mining company in Mexico.

Slim’s publicly disclosed holdings jumped 37% to $70 billion in 2010, according to data compiled by Bloomberg. Meanwhile, Buffett helped return a 22% gain for Berkshire Hathaway last year, and Gates' Microsoft fell, hurting his overall annual returns even as he spread his investments into other sectors...

The World's Richest Man catches gold fever

Slim — who made his fortune by building one of the world's biggest telecommunication empires — has recently been making significant investments in gold and silver, particularly with a focus on precious metal mining in Mexico.

Carlos Slim became the world's richest man in 2010 with an estimated net worth of $55 billion.

And a new spin-off mining company may help him widen his lead atop the global wealth list...

Back in August, Slim's holding company, Grupo Carso, S.A.B. de C.V., announced it would spin off a new precious metal mining company that would be focused on gold and silver mining in Mexico.

The news added billions to Slim's already ridiculous fortune as the plan to spin off the new company sent shares of Grupo Carso soaring in 2010, making it his best-performing asset last year.

The new company (called Minera Frisco) produced nearly 200,000 ounces of gold and 5.5 million ounces of silver from its Mexican projects in 2010.

Frisco recently reported plans to spend nearly $750 million this year to ramp up gold and silver production. The company estimates production from new mines in Mexico will more than double the company's gold production to 440,000 ounces and nearly quadruple its silver production to 19.1 million ounces in 2011.

Shares of Minera Frisco began trading Mexican Stock Exchange at the beginning of this year. But Slim and his family received nearly 80% of the new shares of Minera Frisco, and the stock is very thinly traded.

Most analysts and investors will most likely avoid covering or owning this stock... However, there are many suitable alternative companies with a focus on gold and silver mining in Mexico.

The largest of Minera Frisco's publicly-traded competitors is the London-based silver major Fresnillo plc (LON: FRES).

Fresnillo plc

Exchange: Symbol	London: FRES	P/E	39.76
Share Price	1,450 GBX	Divided	5.90 GBX
Market Cap	10.41 Billion GBP	Yield	1.12%

Fresnillo is the world's largest primary silver company and Mexico’s second largest gold producer.

The company operates four producing mines, one development project, and five advanced-stage exploration prospects in Mexico.

Last year, Fresnillo produced a record 42.1 million ounces of silver. The company also produced 370,000 ounces of gold in 2010, an increase of 33% the previous year.

In 2011, Fresnillo expects to spend over $250 million in capital expenditures to increase silver production to 44.0 million ounces and gold production to 400,000 ounces.

Smaller gold and silver Mexican pure play mining companies include Capital Gold, Gammon Gold, and Argonaut Gold.

Capital Gold (AMEX: CGC) is junior mining company with a focus on the exploration and development of low-cost gold assets in Mexico.

For the company's fiscal year 2010, Capital Gold produced 54,000 ounces of gold.

The company aims to ramp up gold production this year to 70,000 ounces.

Gammon Gold (NYSE: GRS) is a mid-tier gold and silver producer with properties in Mexico.

Last year, Gammon’s flagship Ocampo mine produced 110,000 ounces of gold and 5 million ounces of silver.

In 2011, Gammon expects to more than double gold production to 230,000 ounces.

Argonaut Gold (TSX: AR) is a new Canadian-based gold producer with a rapidly growing presence in Mexico. The company operates the El Castillo mine and is quickly developing three advanced-stage gold exploration projects.

Argonaut also own 11 exploration properties in the state of Sonora, Mexico.

In 2010, the company produced 51,000 ounces of gold from the El Castillo mine. Argonaut expects to increase gold production up to 75,000 ounces this year.

To sum it up

Continued economic expansion in the U.S. and Canada will inject more money into the development of Mexican gold and silver projects as precious metal prices break records in 2011.

Carlos Slim and other investors with exposure to Mexican gold and silver assets should do quite well this year as a result.

Good Investing,

Luke Burgess
Editor, Wealth Daily
Investment Director, Hard Money Millionaire and Underground Profits

Uranium's Bull Market Pushes Forward

Uranium prices are breaking out.

A pound of U3O8 hit $70 yesterday, up 12% already for the year.

And thanks to increasing demand and tight supply, prices could be headed even higher.

When uranium prices bottomed out last summer, Wealth Daily took notice and started telling you about it...

Back in August, Ian Cooper told readers: “Uranium just became the hottest story of the year — and quite possibly the 'supply-demand' buying opportunity of a lifetime.”

Why we're investing in uranium:

increasing global demand
production shortfalls
mine closings
diminishing secondary supplies
significant price increase
growing speculation

He hit the nail on the head. Since that time, the price of uranium has increased some 60%.

Ian told subscribers, “One company set to benefit significantly is Cameco (NYSE: CCJ), the co-owner of the world's biggest uranium mine.”

Wealth Daily members who bought CCJ on Ian's recommendation have returned a 52% gain so far.

But Ian wasn't the only Wealth Daily editor telling you about uranium...

A few weeks later, Chris DeHaemer wrote: “The downtrend [in uranium prices] has been broken and we'll start to see higher highs as well as higher lows.”

In his article, Chris talked about Uranium One (TSX: UUU) and Denison Mines (AMEX: DNN), which have returned 70% and 119% gains respectively since he wrote the article.

Even Angel Publisher Brian Hicks wrote to you a few months back, calling Uranerz Energy (AMEX: URZ) “the single uranium stock you need to own right now.”

At the time, he urged Wealth Daily subscribers to buy shares of Uranerz Energy at $1.50: “Buy URZ at current levels for triple-digit gains in the coming months.”

Since that time, shares of URZ have more than tripled, paying investors a 267% gain. Shares of uranium miners like Uranerz and the others have been reacting positively to surging commodity prices.

Uranium prices spike 67% in six months

Since bottoming out at $42 in June, the price of uranium-oxide (U3O8) jumped to $70 per pound this week for the first time since April 2008 as demand for the nuclear fuel ramps up.

TradeTech, a leading uranium trading firm, noted approximately 375,000 kilograms of uranium-oxide was traded in the open market last week.

In the term market, TradeTech also reported two transactions that involve the delivery of 900,000 kilograms of U3O8 between now and 2017. The company reported on additional transactions of 1.6 million kilograms to take place through 2021.

With global demand screaming higher, another leading uranium consulting firm, UxC, says traders may be “scared into buying, fearing that if they wait, they would end up paying much higher prices.”

UxC said speculation has helped uranium prices move higher as more buyers — including utilities, producers, traders, and financial entities — enter the market.

At least one utility, Taiwan Power, seems to think uranium prices are headed higher. The state-owned electric power utility was reportedly looking to buy 180,000 kilograms of U3O8 itself by July 31st.

Utilities like Taiwan Power and others are concerned that a future supply deficit in the uranium market may drive prices higher.

Even in today's global uranium market, there is a supply deficit.

Dealing with the global uranium supply deficit

More than half of the uranium-oxide that's produced from mined material comes from Kazakhstan, Canada, and Australia.

Approximately 60 million kilograms of U3O8 are produced from mining annually. But each year, the world's 442 nuclear power plants require approximately 75 million kilograms of U3O8.

The deficit has been supplied by secondary sources, including stockpiled uranium held by governments and utilities.

One major secondary source has been the Megatons to Megawatts program, a non-proliferation agreement between the United States and Russia to convert high-enriched uranium (HEU) taken from dismantled Russian nuclear weapons into low-enriched-uranium (LEU) for nuclear fuel.

This program aimed to recycle 500 metric tons of Russian weapons-grade HEU (the equivalent of 20,000 warheads) into LEU.

Back in September, USEC Inc. (NYSE: USU) — the U.S. government’s executive agent for the Megatons to Megawatts program — announced 400 metric tons of Russian HEU warhead material has been eliminated. And the program is scheduled to end in 2013.

That means other uranium sources will be necessary to meet future demand...

By 2014, annual global demand of U3O8 is projected to approach 96 million kilograms. This is expected to leave a 36 million kilogram deficit, which is likely to result in higher prices both for the metal and for those companies capable of bringing uranium to market.

Companies in the uranium sector could very well deliver spectacular gains for their shareholders.

Uranium should be on every investor's radar.

Wealth Daily analyst Chris DeHaemer been investigating and recommending junior uranium exploration companies in his Crisis and Opportunity investment advisory service.

These junior firms have not caught up with their senior mining competitors, and shares of these junior stocks remain largely overlooked and significantly undervalued for the time being.

Chris just finished putting together a short video to tell subscribers about his latest recommendation: an obscure junior mining stock aiming to prove they are sitting on a piece of a massive uranium-bearing formation in Mongolia that's already estimated to contain up to 23.8 million kilograms of U3O8.

Earlier this week, he was telling me this company is still a tiny $26 million firm. And trading at just $0.50 right now, he thinks share prices have some incredible upside potential...

As you saw earlier, Chris's Wealth Daily uranium recommendations of Uranium One (TSX: UUU) and Denison Mines (AMEX: DNN) have already returned subscribers big gains. To watch the video on Chris's latest junior uranium mining stock, click here.

Good Investing,

Luke Burgess
Editor, Wealth Daily
Investment Director, Hard Money Millionaire and Underground Profits