Small Penis

Much attention has been given to the rise in the price of gold in recent weeks, leading investors to wonder, what are the current factors driving gold?  The easy answer to that question is –fear. We have already witnessed an eight year bull run in gold, but many believe that it’s bull run is far from over.  What is gold’s role in the credit crisis? Is buying the metal a better investment than investing in gold mining companies?  Is it too late to cash in on the growth?

Before we can answer these questions, let us first review what role a gold investment might play in your portfolio.  Investors buy gold for a number of reasons, including:  

To hedge against inflation. To hedge against a declining dollar. As a safe haven in times of geopolitical and financial market instability. As a store of value. As a portfolio diversifier.

Falling under the precious metals asset class, gold is a monetary metal whose price is determined by various factors.  Among these factors are: inflation, fluctuations in the dollar and U.S. stocks, currency-related crises, interest rate volatility, global geopolitical tensions and increases or decreases in the prices of other commodities.

In the credit crunch of deflation, gold and currencies are hoarded and the purchasing power of both rises.  But, gold also thrives in inflationary environments.  That is because of gold’s unique property with a dual role as both money and a commodity.  Think of gold as money, and money is hoarded in deflation so gold naturally tends to go up.  The point here is

that gold does well during extreme economic environments.  Let’s dissect some of the benefits of owning gold in the paragraphs that follow.

Inflation

As inflation goes up, the price of gold goes up.  Since the end of World War II, the five years in which U.S. Inflation was at its highest were 1946, 1974, 1975, 1979, and 1980. During those five years, the average real return on stocks, as measured by the Dow, was -12.33%; the average real return on gold was 130.4%. The environment in the 1970′s was not unlike the

environment today.  The common denominators in both periods are huge budget deficits, loose monetary policy, soaring oil prices (2008) and the open-ended costs of war (Vietnam vs. Iraq/Afghanistan).

Store of Value

According to the World Gold Council, gold has maintained its value in terms of real purchasing power in the very long run in the US, Britain, France, Germany and Japan. Despite price fluctuations gold has consistently reverted to its historic purchasing power parity with other commodities and intermediate products.  Gold is tangible, it’s a physical asset that

brings a sense of comfort when intangible assets, like stocks, are evaporating. But, while they do maintain a store of value, it is worth noting that gold, like stocks and other investments, is also subject to price fluctuations.

Safe Haven

Many investors are diversifying away from traditional equities and into gold because of the continued uncertainty surrounding the financial markets.  Gold has long been considered a safe haven, or “crisis commodity”.  Of course, as investors flock to safety investors the price of gold is pushed even higher.  Historically, as people begin to distrust their paper assets (ie. Currency), this positively influences the price of gold too, as we’ll discuss in the next paragraph.

Currency Hedge

Not all citizens have full faith in their local currency, at times, this might even include the U.S. Dollar.   So, what do they do?  They buy hard assets like gold (a tangible and physical item or object of worth).  Although it’s no secret that U.S. Dollar is world’s reserve currency and the main medium for global trade, the U.S. Dollar, like the Euro, Yen or other global currency,

is really nothing more than paper, or fiat money.  Fiat money is money that is intrinsically useless and is used only as a medium of exchange.  There is no physical asset that backs the U.S. Dollar today (or other global currencies for that matter) since its gold backing was stripped in 1971. But since gold is purchased using your local currency, in this case the dollar, then any decline in the value of the dollar causes the price of gold to rise.

Diversification

While all the other rationales for owning gold are viable, perhaps the most important reason to consider gold in your portfolio is for its diversification benefits.  Gold, like many other commodities, typically has an inverse relationship to the market.  Assets with perfect negative correlation to other assets in a portfolio help investors hedge away their risks, in effect

they reduce volatility while enhancing performance.  Gold and other tangible assets have historically had a very low correlation to stocks and bonds.  Because the price of gold increases in response to events that erode the value of traditional paper investments like stocks and bonds, it’s worth considering a fair allocation to this asset as part of a

diversified plan.  The “right” allocation will depend upon your specific circumstances and risk tolerance, but a good gauge might be between 3% to 8%.

Owning Gold

The gold market is highly liquid and there are many ways that investors can own gold.  The most traditional way of owning gold is via gold bullion like gold bars and coins.  When buying the physical asset, many people buy gold coins, considering the potentially higher storage costs or risks associated with owning gold bars.  Gold coins can be easily purchased directly from the U.S. Mint or from authorized dealers and precious metals firms.  Depending on where you purchase the coins and the current demand levels, you may have to pay a premium (above the current spot price of gold) to acquire the coins.  

Another way to access gold is through futures contracts or products like gold ETF’s (ie. Ticker: GLD) which offer investors a relatively cost efficient and secure way to access the gold market. A Gold ETF is an exchange traded fund with gold being the principle and only commodity being traded.  Gold ETFs are listed and traded on the stock exchange and investors get units for their holding in the gold ETF. The returns on gold ETFs are more or less same as that of the spot price of physical gold. It’s worth noting that the IRS treats gold as a collectible for long-term capital gains tax purposes, therefore, gains recognized by individuals from the sale of gold ETF’s are subject to a capital gains rate of 28% if held for more than a year.

Finally, investors can also consider having gold exposure through gold mining stocks and funds.  Some argue that this is more tax and cost effective, in that, there are no storage fees, theft concerns and gold mining stocks also benefit from lower capital gains rates.  On the flip side, owning stocks in a mining company is really not the same as owning the actual gold.  

In closing, gold’s recent rise is really no surprise given the recent financial uncertainty in the global markets.  As fear and investor trepidation permeate the markets, investors look to physical assets to help them preserve their wealth.  Times of crisis help fuel the demand for gold and, arguably, the easy access allotted by gold funds or ETF’s has further pushed up

gold’s price in recent years. To a certain extent, the demand for gold, mostly by investment funds, is feeding on itself.   

While some analysts suggest that the price of gold is being inflated by a flood of new investment money (implying it might be overvalued), others predict even further price growth down the road.  Either way, the argument can be made that gold offers sufficient benefits (inflation protection, currency hedge, portfolio diversifier) to warrant at least some representation in your collection of assets.

gold metal detectors

In today’s world of global uncertainty, one thing remains certain: gold coins. Gold bullion coins continue to outperform traditional vehicles the same way gold coins and bars outperformed everything under the sun during the 1970′s. By holding gold coins in one’s portfolio, you dramatically reduce the overall risk of your portfolio. Just by having some gold coins as part of your strategy, you also allow the price of gold, as it increases, to bring up the value of your portfolio.

It is much easier to buy gold today than it was 30 years ago. Gold bullion coins are easily bought and sold with the click of a mouse. Not only is it easier to buy gold, but gold investments are exploding onto the investment scene like never before. In fact, gold coin sales by the U.S. mint in recent months have outpaced the gold coin sales of the prosperous-for-gold 1970′s. Despite this recent fact, the gold price is just beginning its increase.

As gold coins become more scarce, quite naturally, investors covet the yellow shiny metal at an ever increasing rate. The type of gold coins sought after by investors who follow the price of gold are American Gold Eagles, Canadian Gold Maple Leafs, South African Gold Kruggerands, Australian Gold Kangaroos, Chinese Gold Pandas, and Austrian Gold Philharmonics. These are the most popular gold coins available to investors who want profit potential and protection. The benefit to owning these gold bullion coins is four-fold.

1. You get immediate liquidity. This means you can sell your gold bullion coins at or near the gold price at any time, anywhere in the world.

2. You are in control. A strong gold investment is an investment in certainty. Knowing you have gold coins in your possession that you can rely on makes a world of difference to one’s sense of financial well-being.

3. There is tremendous profit potential with gold bullion coins, more so than just about every other vehicle out there. It matters not whether you hold American Eagles, Canadian Maple Leafs, South African Kruugerands, or any other type of these gold bullion coins, they will provide a well positioned investment portfolio an increased probability of profitability.

4. Last but not least, gold bullion coins provide economic safety and stability in a world increasingly plagued with uncertainty and dangers.

Those are some of the “pros” of owning gold bullion coins. There is more that a first-time purchaser of gold coins should be aware of; the “other side of the coin,” so to speak. If you own American Eagles, Canadian maple leafs, South African Kruugerands, Austrian Philharmonics, Chinese Pandas, or Australian Kangaroos, they are subject to confiscation by the federal government. In 1933 Franklin Roosevelt issued an executive order which required U.S. citizens to turn in all gold bullion coins produced by the U.S. mint, as well as any gold coins and bars produced by foreign governments. Our country, in that period was in the peak of a crisis: the dollar was in trouble, smart investors were getting out of stocks and bonds, and unemployment was on the rise. This period was the great depression. The consequence of not turning in your gold bullion coins or gold bullion bars was a huge fine and jail. If you buy gold bullion coins today, like the American Eagle, the U.S. mint prints a $50 denomination on the back of the coin. Why? Because if the government were to confiscate gold bullion coins like they did in the 1930′s, you would only receive the $50 denomination value, despite the current price of gold in the market, whether that price be $500, $1000, or even $2000. The chance of such Federal government confiscation is universally deemed as unlikely.

Also gold bullion transactions are reportable to the IRS. We will also cover in detail the type of gold transactions that are not reportable, private gold, momentarily.

Also important to recognize is that as the price of gold fluctuates, so does the value of gold bullion coins.

Nevertheless, despite these contingencies, asset managers all over the country are recommending allocating at least some portion of an investment portfolio to gold. Prices are on the rise, in what analysts have termed a long-running bull market which is just in its beginning stages

PRIVATE AND NON-CONFISCATEABLE GOLD COINS

Investors naturally gravitate to gold investment vehicles where they can expect the greatest return with the smallest amount of risk. In the physical gold market certified gold coins reign supreme. Certified gold coins are the gold coins minted by the US Mint befor the year 1933. $20 Saint Gaudens, $20 Liberty, $10 Indian, $10 Liberty, $5 Indian, $5 Liberty and $2.5 Liberty gold coins are all examples of the most profitable gold coins an investor can acquire for several reasons.

1. Certified gold coins have a limited mintage. The government can not go back and mint any more of these gold coins. You want to own gold coins that continue to go up because of this fact year after year regardless of what the gold price does. Because of their limited availability these gold coins can surpass the gains seen by gold bullion 2 to 5 times.

2. Certified gold coins are also one of the last legally private assets the government allows you to acquire. World Financial and goldcoinsgain.com are not required to ask for a social security number when you buy gold coins or when you sell gold coins.

3. Non-confiscatable. Certified gold coins are exempt from confiscation. Certified gold coins are exempt from confiscation if the government decided to confiscate gold like they did in between 1933 and the early 1970s. You were in a world of hurt during those almost 40 years of you were holding the wrong kind of gold coins. So you can rest assured your certified gold will do what its supposed to do under the most strenuous conditions — protect your money.

4. Immediate liquidity. World Financial is a major market maker in certified gold coins and will assist in converting your gold coins back into cash on a moments notice.

In addition to the advantages listed above, certified gold coins are also more stable than bullion gold coins. The value of a certified coin is not solely determined by what the spot price of gold does. In fact, certified gold provides more stability than the stock market, bond market, or just leaving your money in cash. So if you are tired of having to worry about the current economic environment you may want to consider diversifying out of riskier vehicles into an asset that has stood the test of time.

Portability is also something you should keep in mind when selecting which type of gold coins are right for you. To put things in perspective, you could carry one million dollars worth of certified gold coins in an attaché case. This should give you a sense of comfort knowing that you have acquired an asset that is completely portable and discreetly portable.

IRA AND 401′s BACKED BY GOLD COINS

Gold Coins backing your IRA or 401k rollover makes the perfect diversification asset in today’s uncertain economic environment. Gold coins can be added to your retirement strategy in just a few easy steps.

Step 1. Determine what portion of your retirement account you would like to convert over into gold coins.

Step 2. Print out the one page Gold Coin IRA Setup Form and fill out to the best of your ability. Fax the form into our retirement account department at (818) 506-6597.

Step 3. A Gold Coin Customer Service representative will contact you in a very short amount of time to confirm and guarantee the availability of your gold coins. We then work with your existing custodian to get the appropriate funds transferred over into your new self-directed IRA, backed by physical gold coins.

American eagle bullion gold coins are one of the most popular gold coins allowed by the IRS for your precious metal IRA. American eagle bullion gold coins come in 1 ounce, 1/2 ounce, 1/4 ounce, and 1/10 ounce denominations. These gold bullion coins are guaranteed by the US Mint for purity, weight and size. The Gold American Eagle bears the “W” mint mark reflecting the gold coin was struck at the US Mint at West Point. The obverse of the American eagle bullion gold coin features Augustus Saint-Gaudens’ full-length figure of Liberty with flowing hair, holding a torch in her hand and an olive branch in her other hand. On the other side of the gold coin a male eagle carries an olive branch as he flies above a nest containing a female eagle and her eaglets. Each gold coin is encapsulated in plastic and comes with a custom designated Certificate of Authenticity.

American Eagle Proof gold coins are also available. The proof gold coins are more desired because each year they are produced by the US Mint in a limited quantity. Each proof gold coin is struck several times with a special die to create a more lustrous finish. Because of the limited quantity, investors will typically prefer these gold coins for their retirement accounts. Weather we are talking about gold coins or widgets whenever there is a limited amount naturally prices increase faster and become more valuable. The American Eagle Proof gold coins are also exempt from confiscation. A lot of investors like knowing they have the type of gold coins backing their retirement account that are not subject to confiscation by the Federal government.

gold detectors

“ …It is, in short, the only unquestioned and generally acceptable means of payment among nations, as dollars are the only unquestioned and generally acceptable means of payment among Americans, francs among Frenchmen, sterling among the British, and so on.”

Peter Bernstein, ‘A Primer on Money, Banking and Gold.’

Peter Bernstein is no gold bug. Rather, he is one of the world’s foremost authorities on capital markets and economics. A Primer on Money, Banking and Gold was first written in 1965, when gold was still the international currency. It is our contention that in the years ahead, gold will once again resume that role.

Prior to 1971, gold was effectively the commodity with which international payments were made. The flow of gold into and out of countries said more about a nations’ economic health than anything else. Indeed, the outflow of gold from the US in the late 1960s ultimately triggered President Nixon’s decision to suspend gold convertibility. In a fateful decision, the global financial system’s link to sound money was broken.

Ever since, the world has been on a US dollar standard, a monetary system where only one country has the benefit of borrowing and repaying debt in its own currency. In order for this system to prosper, the true international currency, gold, needs to be discredited. We believe gold has been held down for many years in order to allow the US dollar based international financial system to survive. But the official grip on the gold price is beginning to weaken, perhaps this time for good.

The smart money knows this and is beginning to move into gold. There is a silent gold rush taking place all around the world. Investors who understand gold’s role as an international currency are selling their surplus paper dollars and buying the yellow metal. This has led to unprecedented demand for bullion and coin dealers everywhere are struggling to meet this demand.

The Australian newspaper reported over the weekend that the Perth Mint is not taking any more orders for gold until January. Our guess is that the Mint does not want to expose itself to higher future prices given that it does not have the inventory to meet the demand for bullion. In a recent report, The World Gold Council said investment demand for the September quarter was $10.7 billion, double last year’s quarterly total.

Yet the price of gold in US dollars has been under pressure and gold producers have little incentive to increase output at these price levels. Even in Australian dollars, the price of gold is not high enough to encourage increased production. According to Bloomberg, Australian gold production was down 8% in the third quarter.

Strong demand and weak supply should be creating much higher prices. One explanation as to why this is not happening relates to the short term impact of hedge funds selling gold to meet investor redemptions. However, we do not see this as a major cause. Hedge funds are more likely to deal in gold futures rather than physical gold. We will discuss the futures market in a moment.  

More ominously, we believe central banks and bullion banks (basically large international banks) are attempting to keep the price of gold down to reflect the ‘strength’ of the US dollar monetary system the world has operated under since 1971. This theory has been convincingly argued for many years by the Gold Anti-Trust Action Committee (GATA) in the US.

In summary, the argument is that central banks loan or lease gold to the bullion banks, who then sell the gold on the spot market and invest the proceeds in higher yielding treasury securities, earning a positive spread and easy money. In this way, central bank gold holdings are monetised and the proceeds are reinvested back into US government debt. More importantly, the additional supply of gold coming onto the market from the vaults of the central banks helps keep the price down.

Central bank officials certainly deny that they lease gold in order to keep the price low. Their explanation is that they simply lease gold to earn a small return on an asset that does not pay interest.

This is an ingenuous argument. Gold is an insurance policy – a wealth protector not a wealth generator. The benefit of earning a tiny return is more than offset by the risk of losing control over a country’s gold reserves. This fact will soon become painfully obvious to a number of countries.

The gold leasing and carry trade has in effect created a huge short position in the gold market. That is, the loaned gold must be paid back at some point. So central banks have considerable counter-party risks as they are relying on banks to repay the gold loaned to them.

How much gold is loaned out? That is an impossible question to answer, as there are no requirements for central banks to disclose this information. According to IMF (International Monetary Fund) accounting standards, central banks can include swapped or leased gold as a part of their official reserves, a practice that would lead to double counting of gold. So there is a decent likelihood that some of the world’s official gold reserves are not safely stored away, but have instead been leased and sold on the spot market.

This is certainly the contention of GATA and others. Recent efforts to obtain an updated audit of the US’ official gold reserves, stored mainly in Fort Knox, Kentucky, have been met with silence by the authorities. Despite the gold being the property of the US public, the facility is completely off limits and no official tours are conducted. Conversely, tourists and US citizens alike can see foreign central bank gold held in custody at the New York Federal Reserve in Manhattan.

If the market for physical gold is confusing and opaque, then so is the market for gold futures. The futures market is a way for investors, or more correctly, speculators, to gain exposure to the gold price without owning the physical metal. And futures provide leverage.

For example, the active futures contract at the moment is the December contract. One contract represents 100 ounces of gold. So the buyer of one December contract at US$820/oz will pay the seller US$82,000 in exchange for 100 ounces of gold. In practice though, most contracts are settled with cash rather than delivery of the physical metal.

There are increasing rumours that the COMEX, the exchange that runs the gold futures market, does not have the required physical metal should buyers of the contracts demand bullion as payment instead of cash. This is not surprising, as many of the players on the futures market are hedge funds. Such speculators look to capture leveraged price moves rather than buy contracts to receive physical delivery. 

The ‘open interest’ in the gold futures market reflects the amount of activity in gold futures and since peaking in early 2008, the amount of contracts ‘open’ have declined considerably.

Part of the decline obviously reflects lower participation from the hedge fund players. More importantly though, we believe the decline in open interest represents investor distrust in the exchange to deliver on its promises of gold delivery. If you really want to own bullion, why buy a futures contract? In the past, the gold futures price led the spot gold price. If participation in the futures exchange continues to decline, we wonder how long this will continue. 

Given the anecdotal evidence of physical accumulation around the world, we sense that investors large and small are beginning to wake up to the fact that the days of the US dollar as the world’s sole reserve currency are numbered. The fiat money experiment that began in August 1971 is drawing to a close.

Not that anyone in an official capacity wants to recognise this. In a recent meeting of the House Financial Services Committee in the US, Republican Senator Ron Paul asked Fed Chairman Ben Bernanke whether central bankers ever discussed gold in the context of a new international monetary system. Bernanke’s response was to the effect that they only discuss gold in terms of how much they plan to sell.

If this is true, the trade by central banks has so far been a poor one. Central bank sales (separate from the leasing of gold discussed earlier) have been co-ordinated since the Washington Gold Agreement was signed in 1999.

The agreement was precipitated by Gordon Brown, the country’s then chancellor, selling half of England’s gold reserves in 1999. The fact that Brown inexplicably advertised the government’s move prior to the sales saw the gold price plummet and threaten the gold mining industry, so a formalised gold selling agreement was put into place.

The first agreement, from 1999-2004, stipulated that the 11 member nations of the new euro, plus a few other European nations, limit their gold sales to 400 tonnes per year, or not more than 2000 tonnes over five years. The countries signed a second agreement in September 2005, limiting sales to 500 tonnes per year, or not more than 2500 tonnes in total.

There are a few points to note about these agreements. Firstly, the sales represent supply over and above annual production and the gold price has increased considerably since the agreements began. There is now less than one year left in the second agreement and sales in the first four years have all been under the 500 tonne limit. Evidence to date suggests that sales in the final year will be well down on the proposed limit, as banks decide to hold onto their remaining gold.

The fact that central bank sales have added supply to the market while the gold price has continued to rise over the past 9 years suggests the unfolding bull market is a powerful one. While unelected officials sell their citizens’ gold wealth, individuals are taking matters into their own hands and buying the gold back. We believe this will prove a great trade for the individual, and a poor one for the central banks, with major ramifications.

IMPORTANT: This message, together with the Fat Prophets website and all its contents have been prepared for general information only, and as such, the specific needs, investment objectives or financial situation of any particular user have not been taken into consideration. Individuals should therefore talk with their financial planner or advisor before acting on any information present on this message or the Fat Prophets website. Past performance is not a reliable guide to future performance, and investors should be aware that returns can be negative. For a full explanation of the performance calculation methodology, please visit the Fat Prophets website.               

gold dredge

Its not often one discovers an OTC-listed mining company that has a board of directors and management team with the caliber and pedigree of Little Squaw Gold Mining Company (OTCBB:LITS).

The president, Richard Walters, besides being a certified professional geologist with the American Institute of Professional Geologists and a Qualified Person as defined in National Instrument 43-101, was also a founder, director, president and chief operating officer of Yamana Resources Inc. the forerunner to Yamana Gold Inc., (TSX:YRI) between December 1994 and March 2000. He also serves as a director and executive vice-president of Marifil Mines Ltd. (TSX.V:MFM).

Rodney Blakestad, the vice-president of exploration, has in his thirty years as a geologist worked with Columbia Metals Corp. (TSX.V:COL), Nevada Star (now Pure Nickel – TSX:NIC), and Robex Resources (now Robex Gold – TSX.V:RBX). He is credited in part with the discovery of the 4 million ounce Fort Knox Gold Mine, now owned by Kinross Gold Corporation (TSX:KGC).

Robert Pate, the company’s vice-president of operations, is also a 30 year veteran of mine operation and mineral exploration having served with Yamana Resources, Freeport Copper (a division of Freeport McMoran – NYSE: FCX) , Coeur d’Alene Mines (NYSE:CDE), and Atlas Precious Metals were he was the chief geologist at the Gold Bar Mine in Nevada. At Freeport, he was a senior supervisor of the huge Grassberg Indonesia copper/ gold mine.

In the board of directors, William Schara is the Chairman, and was the chief financial officer of Minera Andes Inc. (TSX:MAI), a Vancouver-based company bringing a new gold and silver mine into production in Argentina. He is currently the CEO of Nevoro (TSX.NVR), and is also an alumni of Yamana Resources.

The rest of the directors have collectively had stints with Kennecott Corporation (now a division of Rio Tinto PLC – NYSE:RTP), Bond International Gold, Copper Range Corp, Newmont Mining (NYSE:NEM), Revett Minerals (TSX:RVM), and Pegasus Gold Corp (now Apollo Gold – AMEX:AGT). The affiliations with professional associations related to mining are simply too numerous to list here.

So the point is, don’t think of Little Squaw as just another OTC-listed mining deal. This is a powerful, been-there, done-that team of seasoned executives who are unlikely to waste their time on anything less than projects with the strong potential to become mines.

Which brings us to their flagship project, the Chandalar mining district. Bear in mind that the past employment of both management and directors is extremely relevant to this property, in that there is a great deal of history spent on the part of this team in the jurisdiction of Chandalar – Alaska.

This 23 square mile property package has above average potential for underground, open pit, and placer mining operations. Little Squaw owns 100% of the ground, and an independent study by Pacific Rim Geological has drawn comparisons in the geology at Chandalar to, among others, the 38 million ounce Sukhoi-Log mine in Russia, the 7.9 million ounce Natalka mine, also in Russia, the Juneau district in Alaska, which produced over 3 million ounces, Cape Nome, Alaska, which produced over 5 million ounces of placer gold, and Treadwell, Alaska, which produced more than 3 million ounces of gold.

The main hard rock deposits in the Chandalar district are the Mikado Lode, Chandalar-Eneveloe Lode, Summit Lode, and the Little Squaw Lode. Other Lode Gold Prospects in the Chandalar Mining District include the Crystal Vein, Big Squaw Claim, Pioneer Prospect, Drumlummon Prospect, Grubstake Vein, Grubstake East Prospect, Prospector East Prospect, Indicate-Tonapah Lode, Chandalar Vein, Jupiter Vein, Bonanza Vein, Pallasgren Claim, St. Marys Prospect, Star Claim Group, Star No. 3 Claim, Duplex-Triplex Vein, Wildcat Prospect, Jackpot Prospect, Woodchuck Claim, Little Kiska Occurrence, Pedro Prospect, and the Grubstake West Claim Group. Most of these prospects are historic discoveries carrying significant gold values that remain as yet unexplored.

This mineral belt includes such famous deposits as Cominco’s Red Dog zinc mine, the largest zinc deposit in the world, and the prolific Ambler volcanogenic massive sulfide (copper & zinc) district, now controlled by Nova Gold. Prospectors discovered the district about 100 years ago, and its recorded production from placer and lode mines is 84,000 ounces. There has been a substantial but unknown amount of unreported and otherwise secret production. Of the recorded production, 76,000 ounces of gold or about 90 percent of the total was recovered from placer deposits.

Trenching last year produced some excellent results including a 20-foot-wide structure that assayed 10.58 grams per tonne. Drilling has intersected good grades and widths such as 6.1 metres grading 4 grams per tonne gold, 9.1 metres grading 4.7 grams per tonne gold, and 29 metres of just under 1 gram per tonne gold, each of these occurring in three different zones.

An underground channel from the 180–metre-long Little Squaw vein assayed an astounding 89 ounces per tonne of gold.

So there’s a lot of potential here, and the company’s exploration program is getting ramped up for a busy summer.

Besides this primary project, Little Squaw also has two other projects in the western hemisphere in prolific gold producing regions that are politically secure. These include the Broken Hills West property, which is 15 miles north of Gabbs in the Walker Lane Trend in Nevada, which has produced over 50 million ounces of gold so far, and the Pedra de Fogo project in Goias State, Brazil in the middle of a prolific gold mining region.

But these will be the subject of future articles, so keep your eyes open for more information on this little known, but outstanding opportunity.

gold mining equipment

Soltera Mining Corp. (OTCBB:SLTA) has been busy acquiring properties during the first quarter of 2008. Unstable markets have been unable to dampen the resolve with which management goes about building shareholder value.

Three weeks ago, Soltera announced it had obtained two new Mexican gold properties through the acquisition of Aztek Mineral, S.A. de CV. One week after that, the vending in of the Eureka Copper-Gold property and joint venture with TNR Gold Corp. (TSX.V:TNR) was announced.

That brings to 4 the number of gold projects under development by Soltera, summarized as follows:

El Torno (Argentina, gold, mining rights 7,863 hectares) is located in the Andean Cordillera near the international border with Bolivia. The property contains a very large gold-bearing quartz vein that extends intermittently for at least 14 km long north-south. The vein is sub-vertical and the gold is concentrated in a 2 meter-thick breccia zone along its western flank.

Historically, El Torno was worked by the Incas and the Spanish over a long period and has more than 1,000 m of underground galleries. There is still a small-scale operation extracting gold from elluvial deposits on the east side of the vein. In 1997, Puma Minerals carried out 2,100 m of drilling on a 1 km length; and in 1999 Penoles Minerals (operators of the world’s richest silver mine and Mexico’s richest and largest gold mines) undertook surface sampling, geological mapping and an IP geophysical survey in the same area. The combined (non NI-43-101 compliant) results of this work showed:

a) El Torno is within a “gold province” that extends several hundred kilometers north-south through Argentina and Bolivia;

b) The strongly mineralized breccia zone on the west side of the vein carries up to 37 gpt gold in the tested area, and has potential for several million ounces along the length of the vein;

c) Samples of stockwork zones some distance from the main vein gave up 23 gpt and in one case 112 gpt gold;

d) There are several IP geophysical anomalies that could indicate mineralization, but have not yet been drilled.

Soltera holds almost all the 14 km length and commenced their exploration in late 2007 with a geochemical stream sediment survey combined with structural mapping designed to target specific parts of the vein and the surrounding area for more detailed investigation.

Soltera will now define drill targets using more detailed geochemical and geophysical surveys. Drilling is scheduled to commence in the second quarter of 2008 and, given success, this will lead immediately to a full feasibility study to commence before year’s end.

Real de Cananea, Mexico

The “Real de Cananea” (Mexico, gold, mining claims 1,030 hectares) is located in Sonora State 26 km from the Cananea copper mine owned by Penoles. It contains a gold-bearing fault zone up to 270 m wide and more than 400m long within Cretaceous volcanic rocks that are intensely altered and carry gold.

There is a small old mine in the center of the property that was probably first worked by the Mayas and certainly by the Spaniards, with several shafts reaching 100 m below surface. The hard wallrock was mined with enormous effort and this, together with the fact that water had to be transported 8 km, indicates the importance of the mineralisation. Gold is widespread on the property, with altered rocks showing up to 65 gpt.

Soltera’s target is a large-scale open-pit and the area is broad enough to accommodate well in excess of 1 million ounces. Geochemical, geological and geophysical surveys will be used to define drill targets and drilling is scheduled for the third quarter of 2008.

Eureka, Argentina

(Argentina, copper-gold, around 10,000 hectares) is located in northern Argentina near the Bolivian border and only 3 km from the El Torno project. The property contains ‘Red Bed’ type strata-bound copper mineralization within sedimentary sandstones, clays and conglomerates. The surface exposures are weathered and contain erratically distributed gold. Alluvial gold has been worked in the area since prior to the time of the Spanish arrival and there is an old mine with over 5 km of underground workings that exploited copper and gold on a small scale until 1987.

The deposit is similar in style to major copper deposits in the Bolivian part of the Tertiary Belt. A geological estimate in the late 1990’s (historic resources estimate which is not NI-43-101 compliant) was 50 to 60 million tons grading 1% copper. Only 70 meters of the 450 m deep formation has been explored to date which leaves extensive upside potential.

TNR Gold Corp. (“TNR”), a Vancouver based mining company listed on the TSX with extensive experience in Argentina, has entered into an option agreement with the option vendor to acquire a 75% interest in the property by spending a total of US$3,000,000 in exploration and option payments before April 20, 2010.

TNR will undertake detailed geological mapping, trenching, geochemical and geophysical surveys, sampling the historic underground workings and drilling. Soltera is not required to incur any expenditure on the project at the present time.

Casita Colorada, the Company’s other project in Mexico, is a large mineralized shear zone worked since the end of the 1800’s for gold. The mineralized zone was at least 400 m long and 150 m wide and there is potential for a substantial gold deposit, but the project is being held in reserve so that the company can concentrate on El Torno and Real de Cananea.

Be sure to keep a close eye on SLTA over the next couple months. Geochemical assay results are due any day now, and there’s plenty of news to be generated by exploration activity on all the properties.

prospecting supplies