Seasonal Historic Activity Supports Autumn Gold Rally and Exceptional Risk Reward Scenario in Metanor Resources (TSX-V:MTO)

Metals & Minerals Digest has published a review of the last seven years historical seasonal/cyclical gold price action; the results suggest gold is nearing summer lows prior to rallying strongly into autumn. The digest has also published an upside valuation/summary on Metanor Resources Inc. (TSX-V: MTO) (Pink Sheets: MEAOF) as North America's newest gold producer - identified as an exceptional risk reward scenario for investors.

An abridged copy of the report may be viewed free of charge at: http://metalsandminerals.net/report0808.htm

Excerpts from Investment Advisory regarding Metanor: Upside Valuation/Summary: It is not often a new gold mine comes online in a stable jurisdiction, especially offering as much near term operational value and future potential as Metanor Resources wraps up bulk sampling and commences commercial production at it's 1,200TPD (upgradeable capacity) Bachelor Lake Gold Mill. The current market cap of MTO.V is approximately half the replacement value of their infrastructure alone, ignoring the ~1M oz gold resource, significant exploration potential and substantial revenue projections. Jay Taylor, mining expert, has made MTO.V his top pick in 2008 saying "This is a story of production, exploration, and building ounces". Production in 2008/09 should conservatively come in at 25K - 35K oz gold and ramp up from there to 55K - 65k oz in 2009/10. The mill is configured to produce dore bars of gold, with a small component of silver. MTO.V has ~1,000,000 oz of Gold (NI-43-101 measured and indicated) available from their three properties and the ongoing exploration drill program at their ever expanding Barry deposit is just one of many venues to expand the resource base that is exceeding expectations (new drill results expected soon). Metanor Resources' gold milling facility and infrastructure has a replacement value of ~$140M and sits geographically as the only mill located within 200 km in a gold rich district that possesses additional resources exceeding 1.5M oz. Metanor is also amassing properties within this area, near their Bachelor Lake Gold Mine & Mill, and will play a central role mining the resources in this region for decades. Their forward projected EPS will likely be very significant as a debt free unhedged gold producer and the current market cap relative to expected revenues is disproportionate (analyst report pegs $3+ per share price and no need for dilution). With approximately 73M shares outstanding and currently trading under CDN$1/share, the present valuation of MTO.V provides exceptional opportunity for investors. Over 50% of Metanor's outstanding shares are held by institutional interests, amongst them Dynamic Mutual Funds (managed by Goodman & Co.).

Special Mining Sector Advisory: Yale Resources Ltd. TSX-V: YLL

Advisory Dated June 20/08: Investors would do well to consider they are solidly long Yale Resources Ltd. (TSX-V:YLL)(US Listing:YRLLF)(Frankfurt:YAB) as the Company advances towards a production decision on their La Verde project. On June 19, 2008 Yale provided news of affirming results (See "Yale Samples 13.3 Vertical Metres of 1.04 % Cu, 36.9 g/t Ag, and 0.61 % Zn within La Verde Grande Mine, Sonora, Mexico"), these results have significance that Metals & Minerals Digest will examine herein below as we attempt to better understand the potential value that exists at La Verde.

- Shares Outstanding: 39,381,879 (as of May 23/08)
- Recent Trading Price: $0.18/share (as of Jun 20/08)

Background: Yale's 100% owned La Verde project is host to six known historical deposits of copper, silver, zinc and gold that have seen limited production. The largest and most advanced deposit is the La Verde Grande Mine where a 2007 geological mapping and sampling program has shown the deposit to be larger than historic data indicated. The La Verde Project, located 1 hour drive from Hermosillo Mexico, possesses exceptional infrastructure, as there is a paved highway to the property, a power grid over the property and water. Yale acquired this project in 2007 at a cost of US $1.6M plus 2% NSR. The 2007 work program on the La Verde project has defined skarn mineralization at La Verde Grande with strike length of greater than 250 meters and has shown via geophysics that mineralization to open in a north/south direction. Over 600 meters of tunnles and shafts were sampled. Some sections of the skarn deposit contain exceptional grades; of particular note were 11 samples that averaged 3.04% copper and 190 g/t silver over 50 metre length of the working. La Verde Grande's historic production (see diagrammatic at bottom of this page) resulted in numerous shafts and tunnels on seven levels, these were mined the early 1900's (from Hermosillo Copper Company).

Full article: http://metalsandminerals.net/report0608yll.htm

One of the real differences of what Yale is pursuing at La Verde is that they are not trying to find something – the fact is Yale has a deposit. Now the question is “What size is it and what’s the average grade?”

It is apparent from the crude mining techniques used at the historic local workings at La Verde Grande Mine that the former miners had gone into the deposit and taken out what was high grade mineralization at the easily accessible parts by following the mineralization on a horizontal basis. As an example, in the north-east extension, there are workings that have gone down 20 meters through mineralization that is high in zinc and low in silver and moderate copper grades, and then at the bottom they reach 3% copper. Then the former miners worked on the lower level of the north-east extension which has better grades - so the vertical shafts to the trained eye appear more expository. Horizontal levels are where they have encountered higher grade mineralization, however still to be discovered is the orientation of these workings and why they didn't extend any further.

These vertical shafts are essentially drill holes that are 2 meters in diameter…
The June 19, 2008 news of Yale testing the vertical shafts leads us to think logically about a bigger picture with regard to how the whole deposit might fit together. The sampling has proven that there is mineralization between the horizontal tunnelling thus giving a three dimensional deposit.

The Math…
If you just deal with the copper, the rest of the math takes care of itself. If you use the average of 1.5% copper sampled from the horizontal workings and then use a weighted average of 0.65% copper from the sampling of the vertical shafts (calculated by us) we have a combined grade of 2.15% copper. Now assuming that the deposit is 50/50 high and low grade we have an average copper grade of 1.1% over a possible resource 1.22 million (250m x 50m x30m x 3.25 tonnes per m3) tonnes pre-drilling. It is this formula that we have applied to the other metals in the mine shown on the table. When we put just those numbers into a rock value calculator (like the one located here) you come up with some very significant numbers for the value per tonne for the mineralization.

By inputting “conservative” values in our calculations the writer easily derives $100 per tonne rock (significantly below values that would reflect market price for commodities). If we apply complete high-end processing costs and mining costs of $50 a tonne, that would leave $50 per tonne net … if you have say 1.5 million tonnes – the math gets very exciting in Yale’s case. Why is it important to play with these numbers? It gives everyone the encouragement to move forward and prove the numbers. If Yale can prove these numbers, the math states that it is an economic deposit.

Yale cannot, as a publicly trading company, say "the rock is worth $X a tonne and they have X million tonnes of it" - because in order to properly define the deposit, they have to do a definition drill program. This will give a much better idea as to the dimensions of the deposit and the distribution of mineralization, to better determine average grade, allowing for a rough resource model which combined with metallurgy will be able to talk about dollar value with the Company..

When planning mines we have to assume less than stellar commodity price forecasts; if this deposit is economic at nominal commodity prices of $2 copper, $0.60 zinc, $12 silver, and $500 gold – that is a good sign. It’s an esoteric concept because Yale is still in the early stages – if we can understand the significance of the results – then that goes a long way to show that Yale has a significant deposit.

Mexico, the land of the small scale production…
One advantage of producing precious metal in Mexico is that Mexico is “the land of the small scale production”; it is possible to build an operating 200TPD plant for $500,000. If Yale proves up 1.5M tonnes, and is economic, a 500TPD there is 7.5 years of production at Le Verde. When Yale is able to show the full nature of the asset at La Verde then Yale will always have a base value plus much more exploration and potential … There seems to be a major conceptual problem in the investing public from the perspective that “It has to be big to be economic” – the bottom line is that "small is low cost to put into production" and therefore the economics are even more favorable. The mill/operation cash flow from an initial mine operation would cash flow the other deposits and things would build from there without further dilution.

A good way to look at Yale Resouces’ La Verde project is to look at "blocks of mineralization" in the half million tonnes and think of those as a "unit" because there are four other known deposits on the property. – what happens if Yale’s La Tescalama for example is the same size as La Verde? Then Yale would have a 1000TPD operation for 7.5 years – everything on top of that starts multiplying; Let’s say the potential is greater than 3 units at La Verde Grande - What happens if La Cobiza has one unit and Tescalama has two units and Picacho has one unit? – All of these can be processed through a central plant and they all add to the underlying value of Yale Resources.

Yale Resources Ltd. is proceeding according to plan. With exceptional properties, management and prospects, Yale's future as small low cost producer seems to have moved closer toward fruition. The Company has stated in it's June 19, 2008 release "The Company's goal is to have a resource estimate completed before the end of the year." YLL.V presents an exceptional risk reward scenario and appears in line for upside price adjustment.

Full article: http://metalsandminerals.net/report0608yll.htm

Gold Bullion Rises above $1000 for the First Time Last Week - What is the Future?

Gold bullion reached the $1000 mark for the first time ever. Following recent predictions that they gold sector would continue rising, the markets followed suit. While the rest of the stock market continues to fumble, the precious metals markets are seeing some of the best day’s in history.

The biggest link for the rise is due to the failing economic systems and the movement towards the considered ‘stable’ investment of gold. Gold is not as easily created as a Euro or a printed dollar, creating a sense of comfort among many world investors. The dollar falling below the value of the Euro this week has also contributed to the success of the precious metals markets.

So far, gold has gained nearly 20% in value in 2008. It is thought that in the coming weeks, that there may be a correction as investors seek to capture some of their short term profits. If this occurs, the market is expected to dip slightly below the $1000 mark, but over the mid term, is expected to see pricing above $1005. Some economists are now suggesting that pricing could hit as high as $1020 or $1030 by mid year.

With further and continued speculation of additional US interest rates and the continuing decline of the dollar, the gold market and precious metals markets as a whole are considered a prime buying opportunity. Investors and speculators are both bullish on this market segment and the sector should continue to see a high volume of trading activity.

The markets are not the only sector seeing an increase in activity; the gold jewelry sector is also on the rise with many consumers looking to profit on the rise in gold value around the world.

The rise in gold within the US markets is causing markets around the world to also experience steady and in some cases, sharp rises in value. Another effect that is causing the prices of gold to rise around the world it the rising cost of oil. Hitting a record price this week, oil is spurring the economy and investors to purchase additional commodities across all markets and all market segments.

Many economists and analysts had predicted in 2007 that the price of gold would rise in 2008 to over $1000; yet many do not have predictions long term now that the price has been achieved. Most still believe that there is a bull market, yet there continues to be the lingering concern of a short term correction.

Many investors are concerned with cash flow and investment loss with the uncertainty of the US economy. This uncertainty has the potential to create an ‘irrational exuberance’ type of investment behavior among investors, especially among those that are investing into the gold market for the first time.

If that is the case, emotional investors are likely to pull their profits early, nervous about the potential for long term gains and the security of their capital. If this irrational behavior becomes a widespread trend, the short term correction expected within the gold market could be longer than currently anticipated.

Even if a short term gold market correction is on the horizon, it is unlikely to have much impact on the year’s positive predictions for the prices as a whole.

Rate Cuts, Stimulus Package Article and Market Summary For the Week Ending Feb 15/08

-- Weekly Market Summary --
Gold
$903.10 Close Feb 15, 2008
-$4.20 Gain/Loss
-1.64% On Week

Silver
$17.105 Close Feb 15, 2008
-$0.095 Gain/Loss
-0.03% On Week

XAU
177.32 Close Feb 15, 2008
+0.25% Gain/Loss
-2.17% On Week

HUI
435.06 Close Feb 15, 2008
+0.18% Gain/Loss
-1.94% On Week

GDM
1305.33 Close Feb 15, 2008
-0.04% Gain/Loss
-2.55% On Week

JSE Gold
2267.66 Close Feb 15, 2008
-12.51 Gain/Loss
-5.26% On Week

USD
76.04 Close Feb 15, 2008
-0.11 Gain/Loss
-0.76% On Week

Euro
146.68 Close Feb 15, 2008
+0.27 Gain/Loss
+1.07% On Week

Yen
92.90 Close Feb 15, 2008
+0.30 Gain/Loss
-0.25% On Week

Oil
$96.50 Close Feb 15, 2008
+$0.04 Gain/Loss
+5.15% On Week

10-Year
3.780% Close Feb 15, 2008
-0.038 Gain/Loss
+3.45% On Week

Bond
117.00 Close Feb 15, 2008
+0.59375 Gain/Loss
-1.45% On Week

Dow
12348.21 Close Feb 15, 2008
-0.23% Gain/Loss
+1.36% On Week

Nasdaq
2321.80 Close Feb 15, 2008
-0.46% Gain/Loss
+0.74% On Week

S&P
1349.99 Close Feb 15, 2008
+0.08% Gain/Loss
+1.40% On Week

Feature Article: Are the Rate Cuts and the Economic Stimulus Packages Enough to Save the US economy from a Recession?

So far, 2008 has been full of disappointing news and commentary on the state of the U.S. economy. Economic news is pointing to a recession, there is a national mortgage crisis and there are many pessimistic views about the economy’s short term future. This week has been a busy week aimed at stimulating the U.S. economy, with a $170 billion economic stimulus package signed by President Bush, a mortgage aid package and an economic hearing before the Senate Banking Committee. The events follow the two recent U.S. Federal interest rate cuts last month of three-quarters percentage points, followed by another half a point 8 days later. Current reports suggest that the Fed is ready to cut rates again.

These economic stimulus attempts by the US government, coupled with the economic discussions from the current campaigns for President, have stirred up a lot of attention focused on the state of the U.S. economy. The question still remains; will this be enough to keep the U.S. economy out of a recession?

According to the Federal Reserve Chairman Ben Bernanke and Treasury Secretary Henry Paulson who convened Thursday before the Senate Banking Committee; the nation will avoid failing into a recession. Both men did acknowledge that there are problems in the U.S. economy, but they feel that the recent steps taken by the government are enough to keep the economy moving forward.

While onlookers hoped that the stock market would respond favorably to responses in the Senate Banking Committee, the markets did not respond. The DOW closed Thursday (-175.26), down -1.4% and the NASDAQ closed (-41.39), down 1.74% from the previous day. While the S&P closed on a down note, the gold market closed on a positive note at 913.40, up 0.29% from the previous day.

There has been a lot of debate about whether the $170 billion economic stimulus package will make a big enough impact on the economy to avoid a recession. The main premise for the stimulus package is to stimulate consumer spending across the nation. Most individuals will receive a $600 tax relief check and couples will receive a $1200 check. Bush signed the bill this Wednesday, so estimates are suggesting that Americans will receive their checks sometime this summer.
There is some debate as to whether this stimulus package will actually stimulate the economy past the short term. The thought is that short term cuts will equal short term impacts. Some economic commentators also believe that consumers won’t change their spending habits for a one time, short term relief package. There is also some debate about whether the stimulus package will help to create new jobs, as many believe that employers will not add new retail jobs in anticipation of sales that are only going to be $600 per person.

The Fed is currently predicting a 1.8% growth for this year, a more conservative investment than the Council of Economic Advisors estimated growth of 2.7% for 2008. While the U.S. economy has been growing over the past 6 years, the 4th quarter of 2007 experienced minimal growth across most sectors, stimulating a great amount of concern across the entire country.

Another large concern for the U.S. economy is the widespread mortgage crisis. Foreclosures are on the rise and the real estate market has slowed across most of the country. Many economists believe that a primary reason for the recent U.S. stock market’s decline is due to the bad investments and troubles within the sub prime mortgage sector. The recent mortgage aid package is designed to freeze mortgage rates for families who are in trouble. “Project Lifeline”, which is backed by the U.S. government would pause foreclosure proceedings for home owners who are 90 days in arrears in their mortgage payments. The program’s intention is to help determine whether an alternative payment arrangement can be made with the Borrowers to help them keep their homes. The 6 mortgage lenders who are participating in this program are Bank of America, JPMorgan Chase & Co, Citigroup, Countrywide Financial, Washington Mutual and Wells Fargo.

This week has been eventful in attempt to stimulate the U.S. economy and to evade a looming recession this year. People around the world are wondering whether it will be enough.

Weekly Market Summary Feb 8/08 & Will a US Recession Lower Oil Prices?

Gold
$918.20 close Feb 8/08
+$11.80 Gain/Loss
+1.13% On the week

Silver
$17.11 close Feb 8/08
+$0.37 Gain/Loss
+1.91% On the week

XAU
181.25 close Feb 8/08
+3.64% Gain/Loss
-1.82% On the week

HUI
443.66 close Feb 8/08
+3.55% Gain/Loss
-1.75% On the week

GDM
1339.50 close Feb 8/08
+3.52% Gain/Loss
-1.64% On the week

JSE Gold
2393.65 close Feb 8/08
-58.23 Gain/Loss
-4.19% On the week

USD
76.62 close Feb 8/08
-0.16 Gain/Loss
+1.51% On the week

Euro
145.12 close Feb 8/08
+0.49 Gain/Loss
-2.05% On the week

Yen
93.13 close Feb 8/08
+0.16 Gain/Loss
-0.90% On the week

Oil
$91.77 close Feb 8/08
+$3.66 Gain/Loss
+3.10% On the week

10-Year
3.654% close Feb 8/08
-0.082 Gain/Loss
+1.50% On the week

Bond
118.71875 close Feb 8/08
+0.90625 Gain/Loss
-0.89% On the week

Dow
12182.13 close Feb 8/08
-0.53% Gain/Loss
-4.40% On the week

Nasdaq
2304.85 close Feb 8/08
+0.52% Gain/Loss
-4.50% On the week

S&P
1331.29 close Feb 8/08
-0.42% Gain/Loss
-4.60% On the week

Will a US Recession Lower Oil Prices?:
The U.S. currently comprises only 5% of the total world population, yet consumes over 25% of the total fossil fuel based energy. The country imports the majority of its needed resources, creating a dependency on other world suppliers. This dependency on oil and foreign suppliers creates an economy that is greatly affected by either an increase in price or a decrease in supply. With the current political debates focusing in on the failing U.S. economy, the current mortgage crisis, the widespread debt crisis and the weakening of the U.S. dollar, what is in store for the overall economy in the upcoming months and how will this affect the price of oil?

The value of oil is measured over several different indexes and is based on multiple factors. Crude Oil prices measure the spot prices of oil barrels, typically from the West Texas area. The Brent Blend is a combination of oil from 15 different oil fields from the North Sea. The OPEC basket price is an average of oil prices from Algeria, Indonesia, Nigeria, Saudi Arabia, Dubai, Venezuela and Mexico. OPEC prices are most commonly considered when evaluating the health of the world’s oil economy.

Recent crude oil prices have tumbled about 12% from an all time high in January 2008, with the fear that the U.S. economy is slipping into a recession. NYMEX petroleum prices closed February 7th at 88.66 and Crude futures closed February 7th at 89.250. While oil prices have taken a temporary decline in value from their $100 per barrel price at the first of the year, U.S. citizens are more concerned about a potential repeat spike in oil prices would affect them at home. With many American families struggling financially, specifically the middle class, changes in oil prices have become a large concern for many.

Consumers feel the spike in oil prices mostly in the prices of their gasoline, and since U.S. consumers are largely dependent on their personal vehicles, a sharp rise in oil prices is often devastating to their disposable income. While natural gas and other heating sources utilize oil to provide homes with heat throughout the winter, the rising prices don’t have nearly the effect on the consumer pocketbooks as that of gasoline.

The Fed has made 2 recent attempts to cut interest rates in hopes to stimulate the U.S economy, and there is current legislation being discussed within Congress about passing a short term economic stimulus package. Americans are hoping that this trend will last until they receive assistance from the government’s potential financial relief later this spring or early this summer.

While consumers are hoping that oil prices remain steady or even decrease, oil companies are hoping for a different scenario. The other factor for the economy to take into consideration is how the value of the USD will affect oil prices and the overall economy. The U.S. dollar has been experiencing sharp declines over the past year and most economists are not predicting a rise in the near future. There is often much speculation and debate about how the dollar value and the price of oil affect one another. One economic question to ask is whether the weakening dollar will drive oil prices up or whether rising oil prices create the weakening of the dollar?

Economists are wondering about whether these recent oil price dips are temporary or an indication of the expected recession. In a recession, there is the possibility of a decrease in the demand for oil. Consumers would potentially cut back on their gasoline consumption and businesses could cut down on all un-necessary air travel. While these could lead to a short term decrease in the demand for oil, many economists are arguing that it may not cause a decrease in overall energy prices for consumers. Energy prices are expected to hold steady and even increase throughout the end of the year. It is expected that oil prices will average $80 a barrel for the year which would be $8 ahead of last year, and nearly double the value from 2004.

Commodities in a Volatile Market

1) Instability and Resistance in Commodities

Instability in the US Dollar and fear of a continued slump in the US market has investors still on the worry track. The treadmill continues as investors keep looking for stability of hard assets such as gold, copper, platinum and silver during these volatile times. It is debatable whether the Fed’s will be able to rescue the economy by cutting interest rates another half percentage point which keeps investors on the worry treadmill.

Gold has enjoyed a 10% price surge in the first part of 2008 compared to a 32% gain in all of 2007 and 23% in 2006. As gold is continuing its climb to record and near record highs of around $940 other commodities are rallying as well. Before the Fed’s announcement last week gold and platinum both rose quickly in anticipation of the expected Federal Reserve rate cut. After the Wednesday January 30th half percentage point rate cut by the Federal Reserve gold, platinum, copper and silver all rose to near resistance.

Resistance seems to be more of a psychological glass ceiling rather than an overall market resistance. Gold and silver are both still in the not-over bought category according to the relative strength index. With silver showing some resistance even if only psychological at around the $16.70 mark.

This remains to be uncharted territory for gold investors as gold’s rise continues on the shirt tails of oil’s sudden surge in price. At the same time silver is enjoying a continued up swing, with only slight downward movement when oil prices tumbled then had a nice rebound when oil prices bounced up.

2) Commodities Supply Shortages

China and India as growing markets are continuing to see supply shortages in the metals market. Over the next two decades gold and other precious metal prices are likely to see a prices climb to un-heard of levels.

In recent months the rolling blackouts in South Africa due to a short power supply have caused mine production to suffer a steep decline. At the same time as the decline the demand for gold and other metals commodities are continuing to see a rise. Officials in South Africa have called the rolling black outs a national emergency.

The major mines Harmony Gold Mining, AngloGold Ashanti and Gold Fields are all in need of steady power. The mines need power to ventilate the shafts and to pump water out of mine shafts that can reach up to four kilometers deep. The recent shut down of mines has caused lost revenue to be estimated between $12 million per day to $250 million per day. Government officials in South Africa have been able to ration enough power to get the mines operational again and up to almost 90% efficiency.

3) Rising Demand for Metals Commodities

Rising income levels in India and Asia as these areas begin to industrialize and wealth grows is causing a foreseeable demand in gold. The tight supplies for mines and the build up of metal Exchange Trade Funds as well as increased operational costs to the mining industry are bringing the line of support for gold and other commodities to higher levels.

Holidays during the seven months ranging from August to February have coupled with interest rate cuts to bring the seasonal demand for gold up. Jewelry sales which equate to approximately 70% of the gold demand see an increase each year as Ramadan which occurs sometime between August and November kicks off the holiday season. The Jewish New Year in September, Diwali celebrated in India in November, Christmas during December in the west, and the Chinese New Year in February all combine to see an increase in gold demand and prices.

How is the 2nd U.S. Fed rate cut in 9 days going to affect the metals markets?

The upcoming U.S. Presidential election in November has sparked international interest into the state of the U.S. economy. Leading economic commentators are pointing to a looming recession, and some are even suggesting that we are already there. The price of gold has been a leading economic indicator for the international economy for decades. The prices of gold are known to reflect the monetary, political and economic stability within its respective countries. In particular, the rising cost of gold per ounce within the U.S., points to a troubling economy and the potential lack of confidence in the U.S. dollar among the American citizens. When investors lose faith in the currency of the country or if they are just unsure, they often turn to gold or other metals as solid investment alternatives.

In a 9-1 decision today, the U.S. Fed made their 2nd interest rate cut within 9 days. This half point rate deduction lowered interest rates to 3%. Although the Dow jumped temporarily following the rate cut announcement by over 200 points, it ended the day down 37.47. While the rate cut was encouraging to some investors, the Fed’s commentary about the overall health of the economy was dismal. More rate cuts can be expected at the next scheduled meeting of the Fed in March.

The Fed’s decision lowered the U.S. dollar against every major currency that it is benchmarked against. In fact, over the past 5 months, the U.S. rates have gone from the 4th highest among developing countries, to the 4th lowest demonstrating the dramatically weakening state of the economy.

While the weakening U.S. dollar and failing economy are damaging for some, the inverse relationship to the price of gold is a great sign for gold investors and gold miners. Decreasing interest rates and the weakening of the U.S. dollar in global economies creates bullish signs for the gold economy.

Following the decrease in rates, the gold futures market hit a new all time high during trading, of 942.20 on Wednesday. Spot gold prices closed today at 921 per ounce, down 4.50 from the day before. Gold trading remained mostly negative throughout the day in anticipation of the Fed decision regarding rate cuts. Gold markets were up across the world as well, creating the need for a boost in gold production to meet the demand. With the increased confidence in the precious metals sector, we can expect to see a surge of investment dollars and possibly new investors into this market over the next few months. The rate cuts and the weakening dollar are positive signs for all the precious metal markets worldwide.

While gold has made most of the headlines this year so far, silver has been holding its own ground. Silver’s use within the economy has deviated from the once popular photography uses into areas such as: superconductor components, water purification agents, plasma televisions and into the medical field as a bacterial reduction agent. These recent additions of silver use within the global marketplace have made this metal more attractive to international investors. Silver generally trades in line with gold, at 50-60x the dollar value amount per ounce. With the Fed rate cut announcement today, silver had a volatile day, but holding at 16.750. With the markets still open, it is possible to see it rise even higher. Most experts are bullish on the silver market for the rest of the year, and some are suggesting that it may even become more attractive to investors than gold.

Investors who are active in the metals markets are anticipating a surge in prices in the months to come. They are watching with anticipation in particular to the U.S. economy and its overall health to gauge where the prices are likely to head in all metal markets.

What if gold becomes the next “buzz” word?

Before getting to today's article "What if gold becomes the next “buzz” word?" I have a Special Mining Sector Advisory: Near Zero Downside Risk and Large Upside Probability on MTO.V

Advisory Dated Jan 26/08: Investors would do well to ensure they are solidly long MTO.V as word of North America's newest gold producer gets around to the investment community and the valuation deal that exists sinks in. At the Vancouver Resource Conference this last week management of Metanor Resources (MTO.V) said they are heading back to their newly refurbished mill to pour their first gold bar this coming week. Production on Metanor's Bachelor Lake Mill is from their nearby Barry gold deposit, where a conservative estimated 35,000 oz gold will be poured in 2008 - of which the first bar will be poured this week. Metanor will ramp up its milling facilities from it’s present 500tpd to 1000tpd and is expected to produce in excess of 60,000 oz gold next year. Currently trading at less than CDN$0.85 cents, no debt, over $6Million in the bank and a market cap of less that the value of their milling facilities. There is relatively zero downside risk considering the aforementioned and the fact there exists large readily expandable resource base that Metanor possesses, also forward projected revenue will be very large when the production is ramped up to 60,000 ounces/yr at an estimated cost of only $300/ oz ... the metrics scream for a higher share price with less than 70K shares outstanding.
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Article: What if gold becomes the next “buzz” word?
This week the U.S. Fed announced a rate cut higher than expected at 75bps and while the U.S. dollar took a plunge, the price of gold has shot up above $900 and the pressure is on for us to hit a new all time high yet again. The current weakening of the U.S dollar worldwide coupled with the current mortgage and debt crisis within the country, has captivated the attention of investors and economic commentators from across the world. One of the strongest economic indicators of the world’s gold value is the fluctuation of the U.S. Federal interest rates and when these interest rates decline, the gold prices incline. The rate cuts, unemployment rates and the overall U.S. economy’s downturn should keep the gold market stable in the short term, and the gold market’s perspective bullish for the long term.

If gold were to react in the same fashion as it did during early 1980, it is possible that on a “tempered” inflation adjusted bases gold could reach a price well over $3,000 per ounce (“untempered” inflation adjusted from January 1980 to 2008 and we are talking closer to $5000). (See historical charts for that time period at the following URL: http://www.kitco.com/charts/historicalgold.html online). While this sounds preposterous, remember back to the technology stock boom of the 1990’s. There were numerous critics who were very vocal when the technology and internet stock revolution began. Critics said that it was unlikely or impossible for investors to see value in a business that was not “brick and mortar”, like the old standby stock: GE, Wal-Mart and American Express. How could an internet company with no hard assets be worth anything? Who would buy that stock? Look what happened to those technology stocks between the early 1990’s and the end of that decade. Technology became a buzz word and the stocks were regularly discussed at the dinner table and at social functions all over the world. Those that took a leap of faith and who got in the game (and who got out at the right time), became instantly wealthy. What if that same phenomenon spread into the gold market?

While the trend for gold has been on the rise, hitting an all time high in value, the “buzz” around gold remains remarkably low. People are not researching this commodity in waves, there has been little increase in the news on the subject and it is not a household topic of conversation. Despite the near 300% rise in the price of gold since 2003, the gold market has been relatively unchanged in popularity. Those who are heavily involved in the gold market are experienced. Some investors dabble with limited interest, but most mainstream investors still stick to blue chip stocks. Why don’t people get excited about gold? Ignorance on the concept of hedging ones portfolio, complacency, and the fact physical gold does not yield a divided are good starters. Maybe it is not considered “sexy” to invest in gold like it was to invest in technology. Investors seem to be much more concerned with the mortgage crisis, the debt crisis, the potential approaching recession and the weakening U.S. dollar, than the price of gold. It may still be too early to expect frenzies like what we saw during the technology boom, but for those that get into the gold market on the upswing, are almost certain to capitalize. ##

Mining industry expert David Bond interviewed regarding site visit to Soltera Mining’s Argentina El Torno gold project

Metals & Minerals Digest is pleased to bring to your attention what appears to be an extremely undervalued advanced stage development and exploration company; Soltera Mining Corp. (OTCBB: SLTA) is an exploration stage company primarily focused on the exploration of its El Torno project in the province of Jujuy, Argentina. Soltera’s El Torno Project has a gold-rich quartz vein up to 14 km long and 14 m wide where highly qualified opinion (non 43-101) backed by historic exploration is that characteristics for 2M ounces exists in just one small section of the vein.

We have had the good fortune to interview mining expert, Mr. David Bond, who has recently returned from a tour of Soltera Mining Corp.’s El Torno project. David is an award winning journalist, he is a regular contributor to Kitco, is an expert in the gold and silver mining industry, and he publishes a web site "Silver Valley Mining Journal" which can be found at silverminers.com.

Of Special Note: David recently went to press for the benefit of his readership at the Wallace Street Journal about his site visit to Soltera’s El Torno gold project. A copy of his article is available at the following URL:

http://www.silverminers.com/publications/showpub.aspx?id=7931

Interview with David Bond
Metals & Minerals Digest: David you were recently in Argentina and had a chance to meet the people directly involved in Soltera’s Mining’s El Torno project, perhaps you can tell us what makes it such a compelling story.

David Bond, Mining Expert: Well it’s compelling for two reasons; number one, it’s a good exploration play, also it’s a very good production play. The mine has historic (non NI43-101) numbers, … Peñoles drilled the thing out ten years ago, they found at minimum a half a million ounces of gold – projecting strike and the depth of the vein there – you’re probably looking at a world class deposit. For a company with a market cap like $20 Million you just can’t lose.

Metals & Minerals Digest: Parts of El Torno was mined in spots by the Incas, Spanish, and the Jesuits back centuries ago using highly primitive means. It has only been recently that Puma and Peñoles went in and used modern exploration methods, they pulled out extremely good drill results, results that if replicated and enhanced upon would certainly warrant mine production.

David Bond, Mining Expert: You know they produced good drill results right from the surface and what company President, Dr Montanari is envisioning is a ramp down a little bit to follow the decline in the vein. If they do that - and again this is free gold, its combined with quartz, you have to crush the quartz to float the gold out of it, but it’s a very off the shelf conventional one – there is nothing exotic about it but our requirements very well - It’s a no-brainer.

Metals & Minerals Digest: Infrastructure there, what was apparent from what you had seen?

David Bond, Mining Expert: I was surprised at the quality of the roads, the power lines are close by – they are not right up in line with it; but can be brought in very inexpensively – they’re generating electricity with diesel right now but they can bring power lines through. The Province and the Federal Government are very very supportive of mining and so is the population.

Metals & Minerals Digest: In some photos we have seen, one photo specifically, you were walking through the stock work I guess, through the tunnels that were built, what were your observations through there?

David Bond, Mining Expert: What impressed me was what confident ground it was. This is very solid ground, it very good ground, the air is good, in other words its not going to be a hassle to mine – you get into some places where you have water issues, you have ratty rock confidence – that’s not the case here.

Metals & Minerals Digest: With the technical leadership that Soltera has, Company President Dr. Fabio Montanari is the Geologist, I understand he’s located near to the property and is conducting preliminary exploration. You had a chance to meet with Dr. Montanari, any comments from him that might be of interest to our listeners (readers)?

David Bond, Mining Expert: Well he’s written most of the economic geology text books, they are required reading if you study geology in Europe. He’s one of the brightest guys out here, he knows the country, and best of all he has a good relationship … He loves what he does. This guy – I wish we had him up here in Idaho, he’s a bright guy.

Metals & Minerals Digest: From what we know about the recent drilling by Puma and Peñoles; Impressive historic numbers were recorded by Puma minerals back in I believe it was the late 90s and their gold values from the main vein were between 5 g/t and 37 g/t and the stockwork system showed up to 23 g/t gold accompanied by silver in the ratio of 1:1. Subsequently Peñoles re-interpreted the Puma Minerals drill data and after further aforementioned work estimated (non 43-101 compliant) that a 1.3 km length of the vein would have the potential for more than 500,000 ounces of gold to a depth of 100 m and that a 2 to 2.5 km length to a depth of 400 m would have potential for more than 2 million ounces (assuming a grade of 10 g/t). I understand the current titleholder had also within the last year mined parts of the upper 2 to 3 m of parts of the El Torno vein and an alluvial deposit near to the vein … now I read “the gold was recovered as particles and micro-nuggets”, can you explain that to us?

David Bond, Mining Expert: Well micro particles would be detached from the quartz, it’s a free gold cyst, which means the gold is imbedded in the quartz, you have to brush up the quartz – you have to crush it and then float it to get the gold out. Not a difficult thing metallurgic, but you pick up a flight rock you don’t realize what you’re holding might be gosh … quarter ounce of gold … you just don’t know. The preliminary work done by Peñoles and by the others, you have to remember was done at a cut off rate based on 2001 prices and gold was $300 - $280 an ounce.

Metals & Minerals Digest: And today we are talking $850+ an ounce.

David Bond, Mining Expert: These guys did good geological work, they didn’t abandon the project because they thought it was a bum deal, they just neglected to make a deal with the properties.

Metals & Minerals Digest: Very good. Anyone mining in that neighbourhood, any recognizable names that are close by that you are aware of?

David Bonds, Mining Expert: Yes, Cardero Resources Corp. (TSX:CDU)(AMEX:CDY), Peñoles, … all those guys are in the neighbourhood, and remember were just 3 KM from Bolivia where Apex Silver Mines Limited (AMEX:SIL) and Coeur d'Alene Mines Corp. (NYSE:CDE)(TSX:CDM) are - were into the majors.

Metals & Minerals Digest: Very interesting. And Yamana Gold Inc. (NYSE:AUY)(TSX:YRI) I understand is just south of the El Torno project as well.

David Bond, Mining Expert: Yes I believe you are right; they’re in elephant country – no question.

Metals & Minerals Digest: Can you tell us David, anything about the culture of mining in the government of Argentina from your experience?

David Bond, Mining Expert: Well, yes I can. I am citing from quotable sources, CIA handbook, other people; Argentina is a remarkable country. They have the highest literacy rate in South America, their GDP has rivalled China since the 2001 currency debacle down there where they had to disentangle themselves from the US dollar. It’s labour laws are friendly, its tax laws are very very friendly to mining companies. It’s a good place to do business, they have a constitutional history going back to the 1870s, 1880s, that secures the property rights of mining owners and gosh if I were going to put a mine some place in South America that’s where I would like be.

Metals & Minerals Digest: Again one of the photos we’re looking at there is a gravity concentration plant, did you have an opportunity to look at that plant?

David Bond, Mining Expert: Yes I did, that is a plant that appends to a neighbouring project where they are just refining gold on one chute, just out of flotation getting huge results.

Metals & Minerals Digest:. Is there anything else that you might be inclined to tell us that would be of interest to our listeners?

David Bond, Mining Expert: Well, sit down with your home calculator and figure $20 Million market cap and a potential 3 million ounces of gold, do the division.

Metals & Minerals Digest: With the calibre of Soltera’s management and property it certainly seems it would be a rather attractive opportunity for those looking to invest in early stage gold exploration companies.

David Bond, Mining Expert: Yes, and at 50 cents what have you got to lose. ###

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