In Jim Cook's Archive


Just outside Tonopah, Nevada, are two of the largest silver deposits in North America. The companies that own them continue drilling in search of more silver, but they never mine them. The low price of silver means they can’t make any money extracting the ore. It’s expensive to build a mine. It will take much higher prices for this silver to come out of the ground.

Another massive silver deposit exists in the Yukon. The company that owned this deposit, Alexco Resources, kept finding more and more silver and appeared to be successful. The idea was to start mining it, but they ran out of money. The stock price collapsed from over $2 down to a few pennies. Their assets were taken over by another mining company. Large deposits, like those mentioned here, are sprinkled all over the world, but low prices keep this silver from being mined. It’s one reason a silver shortage is inevitable.

There are also silver resource companies that exclusively mine silver. They are marginally profitable or lose money most years. They seldom experience growth, and they stay small. You would think these mining companies would complain to the Commodity Futures Trading Commission to get some regulatory relief from the low silver price. Hopefully their day is coming.

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