Wednesday was about the last day that SLI could have announced drill results for this year. The China release was important as a huge number of people will be eager to buy when the drill core figures are released next year, I presume in January. The good news there is that probably (for instance) eight drill cores that will have been analyzed instead of six that are finished at present. The bad news is losing Hog, and I am hopeful he will come back next year. The share price is important to those that want to buy in at this lower level, and the market will quickly determine the next level of the share price when they see the gold concentrations that will be released. At this time the shorters will read their computers and short, not knowing the sheer volume from the world wide awareness that Lori has been working on, and if we have a world class mine the short shares will be in such a minority it will not matter, and they will panic to cover their losses.

There is a lot of talk regarding the price of gold falling. The fundamentals are the same except they get worse in terms of fiat money inflation and worldwide banking debt. The US debt to GDP ratio is about the same as Spain. The coming world situation will be worse than 2008, and a few examples from then show an exchange traded fund (ETF) of banking stocks fell almost 250% from late 2007 to early 2009 and a real estate ETF fell over 150%.! On the other hand the money printing by the US directly caused phenomenal gains in crude oil, gold bullion and silver. One speculative leveraged silver ETF gained 700%!

The world’s banks, including Canada, are especially vulnerable because of their exposure to the Euro. When the domino effect of failure of small European countries begins next year there will be a further flight to gold, and particularly silver. Incidentally the ETF SLV has been downgraded by Weiss as the fund SLV is short of silver bullion, unlike GLD. In these funds, if you purchase an ounce of metal the fund is supposed to buy and hold the amount of metal and you are supposed to get metal, not paper for your purchase.

When doubt and fear step in, as is evident in gold and SLI right now, this is the time when the knowledgeable pros step in and buy. An increase in the gold price next year bodes well for a sale of Tesoro, so I still believe we shareholders have excellent protection for forthcoming inflation and further depression of housing and other non-commodity holdings.

I would like to wish everybody a very Merry Christmas, and especially Hog, a good friend I have never met.