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Ted Butler: Investors have eyes wide shut about silver
By Ted Butler
Thursday, June 9, 2022
Paul Krugman, the economist whose work you either love or hate, had a compelling editorial this week in the New York Times titled, "From the Big Short to the Big Scam," in which he compared the real estate bubble of 2006 and subsequent crash to cryptocurrencies today.
Because the article was behind a subscription paywall, I'll not link it here, and my purpose today is not to agree or disagree with Krugman's connection of the real estate bubble/bust to crypto's but to bring out a most astute observation he made.
... Dispatch continues below ...
... ADVERTISEMENT ...
Prime Mining Intercepts 62 gpt Gold and 978 gpt Silver over 3.6 Meters
in Step-Out Drilling at Guadalupe East Deposit in Mexico
Wednesday, June 1, 2022
VANCOUVER, British Columbia, Canada -- Prime Mining Corp. (TSX-V: PRYM, OTCQB: PRMNF, Frankfurt: 04V3) announces additional Phase 2 drill results from 12 step-out drill holes at the Guadalupe East deposit in Mexico. Guadalupe East is one of eight known gold-silver deposits that comprise the current resource at Los Reyes.
22GE-53 has four intercepts:
-- 61.99 grams per tonne gold and 977.6 gpt silver over 3.6 meters estimated true width and 9.67 gpt gold and 314.0 gpt silver over 1.1 m estimated true width.
-- 9.67 gpt gold and 314.0 gpt silver over 1.1 meters etw.
-- 3.01 gpt gold and 220.0 gpt silver over 1.0 meter etw.
-- 5.90 gpt gold and 341.0 gpt silver over 0.7 meters etw. ...
Chief Executive Officer, Daniel Kunz commented: "The high-grade drill results reported today will continue to expand the resource potential at Guadalupe East considerably. We are encouraged by multiple intercepts of high-grade gold-silver mineralization being encountered in individual drill holes on the west end of this area. We await assay results from more step-out drill holes and expect to report these results as soon as they become available.
Ongoing drilling has now defined the Guadalupe East vein group length over 420 meters and the total strike length of the Guadalupe East vein system now over 1,000 metres.” ...
... For the remainder of the announcement:
Krugman made the compelling case that what enabled a relative handful of market participants to recognize and act upon the extreme mispricing of real estate into the 2006 bubble peak and sell short subprime mortgage derivatives contracts was the belief among the majority of market participants that real estate would not collapse.
His term to describe the widespread belief at the time that real estate prices would continue to climb was the "incredulity factor," and, to use Krugman's own words, therein was the problem, namely:
"... the sheer scale of the mispricing that the skeptics claimed to see. Even though there was clear evidence that housing prices were out of line, it was hard to believe they were that far out of line -- that $6 trillion in real estate wealth would evaporate, that investors in mortgage-backed securities would lose around $1 trillion. It just didn't seem plausible that markets, and the conventional wisdom saying that markets were OK, could be that wrong. But they were."
If you get a chance to read the entire article, I'll leave it up to you to decide if Krugman made the case between the real estate boom/bust of 2006 and crypto's today. Instead, the lightbulb that went off in my head when reading his piece concerned -- what else? -- silver. ...
... For the remainder of the analysis:
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