➡ Rafi from the Endgame Investor discusses the current lack of interest in gold and silver junior mining stocks, attributing it to misconceptions about the end of the bull market and technical issues. He believes that interest will surge once people realize the value of gold and silver is not decreasing. Rafi also interviews Galen McNamara, CEO of Silver 47, about the volatile silver market and the potential for profit in junior mining companies.
➡ The speaker discusses the recent rise in silver prices, which reached $120 before settling around $80. This price increase has made silver mining companies very profitable. The speaker also mentions the volatility of the market and the potential for a price floor, especially in gold. Silver 47, a U.S. silver and critical mineral exploration and development company, could benefit from these high silver prices, making their exploration projects more valuable and potentially profitable for reprocessing old mine waste.
➡ As gold and silver prices rise, large mining companies benefit first, with their profits and stock prices increasing. This success then trickles down to smaller companies, boosting their value too. A company called Silver 47 is planning significant updates and drilling projects this year, hoping to attract investors and increase its value. Investing in silver and exploration companies can be risky, but it can also be rewarding, especially before a potential crash of the fiat system.

Hey guys, Rafi here from the Endgame Investor. And it’s been a long time since I talked about gold and silver junior mining stocks. I came across a chart a few weeks ago showing the outstanding number of shares in the GDXJ Junior Gold Miners etf which includes also silver miners. But it’s the same thing with SIL, it’s the same thing with GDX. It’s the same thing with all these mining ETFs. The interest in these companies in gold and silver mining is, is at absolute lows. Nobody cares about these stocks because everybody thinks the bull market is over.

Now before I show you this chart of outstanding shares in GDXJ, I had a talk with Galen McNamara, CEO of Silver 47 of which I am an owner. I own a handful of a bunch of gold and silver mining stocks because I do foresee that at the end of this bull market, and we’re not near the end yet, but at the end everyone’s going to be going into it just like everyone was going into those altcoins that made no sense. Shina, IBU and Fartcoin and Butthole Coin. And these are not jokes that I’m making up. These are jokes that other people made up.

And these valuations of these nothings were bid up to hundreds of millions of dollars. Now the reasons that junior gold and silver mining stocks are attracting so little interest is, is a lot of it is technical and stupid. For example, a big mining company will value a junior gold miner at a three year average of the gold price because that’s how the accounting works in those big companies like let’s say Barrick or Newmont, they will take the three year average of the gold price. Then if they acquire these companies, it immediately books a loss on their books and that doesn’t look good for them, so they don’t want to do it.

The other reason is that the capital, the inflows of capital, the paths to the inflow of capital to these companies have become so atrophied as inflation has made these finances bigger and bigger and bigger that they can’t waste time in doing $100 million financing for small companies that need a little bit of capital to realize a minor project for big people, but a major project for them and for shareholders. And these reasons will disintegrate as it becomes obvious that gold and silver are not going to go down secularly anymore until the dollar is finally dead. So here’s a zoom in of the chart of gdxj the outstanding shares.

This is not the share price. This is the outstanding shares of the fund itself. The higher it is, the more interest there is in the fund. The we saw a high here of what is it? Close to 160 million shares. Now we are down to 77 million shares. It says down here 77.737. So the fund has been cut in half in size, about a little. Even more than half in size, maybe 60%, something like that. This is not sustainable. It’s gonna go back up. Interest in this space is going to explode at the point where people realize that it’s not just a little spike in gold and silver prices.

It’s a permanent revaluation higher and it will continue to do. Obviously no one should put all their capital in junior gold and silver mining stocks. But when we get to the mania phase of this gold and silver bull market, I believe the way price is going to move with these types of companies is going to shock a lot of people. Gold and silver bugs included. Now with that I give you Galen McNamara, CEO of Silver 47. This video is sponsored by by them. Thank you so much for your support. And let’s hear what he has to say.

Let’s just say it costs, I don’t know, $25 to produce an ounce of silver. And I’m just throwing a number out there. It’s different for every mine. At $35 you’re making $10 an ounce. But at $85 you’re making over. You’re making $50 now. So your profits go up five times. Foreign. Hey guys, Raf here from the end game investor. And I got Galen McNamara on the line, CEO of Silver 47. And this is quite an interesting silver market to be in when you are the CEO of a junior silver miner. This interview is brought to you by silver 47.

By the way and I am a shareholder. We’re going to talk about silver. We’re going to talk about the art and the background of the Galen studio where he is in Vancouver, Canada. And then we’re going to talk about silver 47. What they’ve been doing since silver exploded to 120 and crash to the horrible zone of 80. That is all making us depressed. Silver at 80. Who thought we would have ever been there? Again, we just can’t take this, this news. I’m being facetious. As you could probably tell. It’s a. It’s a crazy market. And if you are the kind of person who has wanted to dabble in juniors of either gold or silver, whether established or exploration, this is the kind of market that we’ve all been waiting for, for these projects to succeed.

Not all of them succeed. Some of them will. But the. The. The biggest proportion of them will succeed in this type of market. We’re going to talk about that with Galen as things come up. Galen, how are you doing? And the first question I wanted to ask you is, can you explain the Picasso looking sort of art in the background? What are they? Who drew them? And do you have any relationship with the artist? Yeah. Okay. Sounds. Sounds good. Well, Rafi, thanks for having me on the show, but, yeah, I’m a little bit of an art fan.

I’ll buy it. One art, please. But unfortunately, my wife and I have different tastes, so I’m not allowed to hang things like this in the house. So here we are in the office. And the one behind me is Norval Morisot. He’s an Ojibwe artist from Northwestern Ontario here in Canada. And this is, of course, just a reproduction because the original would be. Would be much too expensive to just leave up hanging in the office. But I like it, and I got it in a PDAC charity auction in Toronto a few years ago. And then the one above that, that’s actually a.

Up here, that’s actually a panoramic photograph that’s probably around 100 years old of one of our projects in New Mexico called Maggion that a friend of mine found on the Internet. And I thought it was probably pretty rare, so I quickly bought it and had it shipped. And then this one behind me here, this is. My dad gave that to me. And that’s the bullfighter. And it’s by an artist that’s most famous for doing sad clowns. So he did one. That’s not a sad clown. It’s a bullfighter. It’s a little prouder. And his name is, I think, Bernard Buffet, French artist.

But yeah, yeah, that’s it. I hang them in my office because I’m not allowed to hang stuff like this at home just now. Well, as we say, you know, there’s. There’s a term here called sh vi. Peace in the home. You do what you can to make your wife happy. And this does not seem like a crazy compromise to me. There are much crazier ones. It seems pretty level out there, you know, to keep a good marriage. Exactly. Well, your paintings in your office. Yeah, exactly. Thank you. I was going to say, we used to say happy, happy wife, happy life, but now we have to say happy spouse, happy house.

So that’s what I’m saying. Okay. Well, I’ll stick to the gender term and you can pick whatever you want. Yeah, I’m more conservative in that way. So let’s, let’s, let’s begin the conversation with, you know, when you became the CEO of Silver 47, you decided you were going to go into the silver mining space. Space. Did you expect silver volatility to be this high? What’s your reaction to silver rocketing up from 20 to 120 and then falling back to 80? Is this something that you thought you would live through? Are you expecting worse? Are you expecting more of the same? Are you expecting a calming in the market for a while? And, and how do you feel about this? Yeah, that’s, you know, it’s been a real roller coaster.

So starting with, with when I started, you know, I founded the predecessor company to this Suma Silver and I think the price of silver was touched $18 at that time. And it’s one of those things we always talked about and, and heard about triple digit silver and hey, one day, you know, yeah, that’s, things are going to move up and when they, when they break 50, it’s going to go up real fast. And you know, things, I remember it being the fall, later fall and it started to break through 50 and, and then all of a sudden we, in the conversations I would have with my peers it would be like maybe triple digit silver is coming sooner than we think.

And, and then of course it you know, over New Year’s and, and a little through January blasted through that and you know, got up above you know, 120, which in, in such a short amount of time was, was probably pretty clear that it was ahead of itself a little bit. And now, now I think as we’re talking today it’s, it’s a little over $80. And I mean if you’d have told me that silver was going to be $80 a year ago, yeah, I might have done backflips. Right. Like that’s a great price. And you know, I think that even at $50 silver or $40 silver, a lot of the big silver mining companies are making money hand over fist.

So at $80 silver, you know, maybe, maybe I’ll use the cliche, it’s kind of like a license to print money. And nobody really understands that yet because we haven’t seen any of the earning earnings reports. So I’m really looking forward to that. And then in terms of volatility, you know, there’s what I think’s going to happen and then what I want to Happen. Yeah, I think in bull markets like this, volatility is always going to be a thing. And if we look at what happened in the past, run ups, although I think the fundamentals are different, different now, you know, between 1980 or 2011, if we look at that, there was times when it pulled back similar percentage amounts and then got back on the, on the train and kept rolling.

So you know, it’s, it’s kind of hard. It’s a little bit, a little bit of a white knuckle experience, you know, for all of us investors. But I think that’s the way it’s going to continue to go. Now what I want, you know, I would love to have some stability at around 80. I think that’s a great price and I, I just, I don’t think it’s probably not in the cards. I mean I’ve been looking at the, the open interest numbers in gold. I don’t, I don’t really pay attention so much the interest numbers in silver because such a thin market.

But for one argument in favor of stabilizing around 80, let’s say somewhere between 75 and 90, I don’t know, just loosely because silver is so volatile. The open interest numbers in gold futures, which I think drives the rest of the market primarily is down to 400,000 contracts which we haven’t seen since bear market bottom in 2015 in gold and silver. Right. So it means like the, the speculators have been totally washed out, at least the ones that got in, let’s say at like, you know, $4,400 gold and started just buying and, and pyramiding on top of their pyramiding speculation bets and they just, they just got slaughtered because they came in, came in late to the game.

So we, I think we could see, I think we have a decent chance of seeing a floor here, especially in gold, if not in silver. But we’ll see. Yeah, a floor here would be amazing. You know, it would, that a new paradigm would be very, very well received by all of us, I think. Well, to get into the specifics, what would it mean for silver 47, taking into account your projects, what would an 80 silver price? And, and in the, in the context of that question, just remind me and the, the viewers like what is the primary business model of Silver 47? Are you looking to develop in order to sell off these assets? Are you looking to go into production yourself? What’s, what’s the main goal here? Yeah, so silver 47 is a, is an American, a US focused silver and critical mineral exploration and development company.

We’ve got three projects, one’s in Alaska and in Nevada and in New Mexico that are all high grade, that are, I would say, on the path towards growing towards critical mass. And when I first started the predecessor company to this Summa Silver, we did a merger with Silver 47 a few months ago. For context. You know, I always knew that good silver projects in the United States were very difficult to find. And we started with One, we acquired two, and now the pro forma company, New Silver 47 has three. And I think I can almost count the quality silver development projects that in the United States that aren’t in the hands of a major probably, if not on one hand, then almost on one hand.

What is it? You have six fingers on your right hand. We’re working on three of those. In total. We’ve got approaching 250 million silver equivalent ounces in the ground that if you look at our market cap and relate it back to our enterprise value, we get about 41 cents per ounce of value in the ground. And our peers are getting over two, three dollars. So we think that we’ve got some catch up to do there. But in terms of an $80 silver price and how that affects us, well, it of course makes all of our exploration projects where we have ounces in the ground more valuable, but that’s more of a longer term thing.

In the short term, we also have a tailings deposit at our project in Nevada that host about 2.75 million silver equivalent ounces split between silver and gold. I combine them into silver equivalent just for simplicity that, you know, at $35 silver, our internal work shows that it’s probably a break even operation to, to reprocess those old tailings, which is old mine waste, really, you know, reprocessing stuff that’s already been processed. But at $80 silver, it might look really good. And the size of it, you could probably produce those ounces over, you know, two, three years Once you make a production decision and, and be in production within a year or two.

Once, you know, once you have an idea of, you know, does it make money or not. So that’s something we’re looking at very closely right now. And the other interesting thing, as I digress a little bit about tailings reprocessing, is that you provide a, you can provide a blueprint for other projects and it shows that you can quote unquote, rehabilitate abandoned mineland features in the western US where there’s millions of those around. So something like this could be a nice pilot project for a new source of critical minerals in the US and we, we really, this administration has really highlighted how important domestic supply of these things are.

Probably maybe the as well as any has certainly better than any has in my lifetime. So we’re very, we’re very tuned into that. And, and then moving on to the last part of your question, I think you know, what’s our plan for the future? Well, do we want to sell or do we want to build? Well, I think all of us junior companies and my philosophy is that we’re out here adding value as efficiently as we can. And we’ve discovered silver at 25 cents an ounce so far, lifetime of our company. And our mission is to add as much value and build a company fit for purpose to take the next step, whatever that next step is.

And if and when an opportunity comes that is better for we think could be advantageous for our shareholders or when for our shareholders, well then we consider it very strongly at the time. But we’re aggressively moving forward as efficiently as possible, no matter what the stage. In terms of concrete steps, you know, your detractors would say something like, well, silver has gone up from 20 to 120 and silver 47 has stayed basically even. So I’m not really getting the price appreciation of silver if I invest in silver 47. So before you answer, I just want to preface this by saying that, that Jr.

My, this is just something I just discovered actually a few hours ago that I often look into the amount of shares available of like GLD and SLV to see what the retail interest in those ETFs are to see if the public is getting excited or not. Right. And they both have been pretty flat since 2021. There’s been no net change. But I didn’t, I never tracked the amount of shares outstanding for GDX and gdxj. They, the amount, the amount of shares available for those ETFs are near where they were during bear market lows in 2015 for gold and silver.

And I, when I, when I saw that, I couldn’t believe what I was seeing. So overall, still, even with Silver at 120, the interest in the junior mining sector, both gold and silver, is so low that even with the prices of this ETF like skyrocketing like 300%, the, the interest in these stocks is almost nothing. And you know, you’re not at the stage to be included in these, in these ETFs yet. But I mean, hopefully you’re headed there and, and I don’t know how much growth it would take. But what is your response to people who say that you’re not tracking the silver price? So why should I invest in you? Yeah, of course, of course.

That’s, that’s a really good question. So we actually are starting to get into the ETFs. We just got into SLVR in a small way at the last rebalance in December, but that’s usually the way it goes. You start off small. And I, I would say number one, when we look at the history of gold and silver bull markets, when people start investing in the mining equities, it usually starts with people investing in the big companies. Because those big companies at higher metal prices, they start putting out earnings that look really, really good. And especially in silver, when it goes from $35 a year ago to now, 85 today.

I mean, like, let’s just say it costs, I don’t know, $25 to produce an ounce of silver. And I’m just throwing a number out there. It’s different for every mine. At $35, you’re making $10 an ounce, but at $85, you’re making over, you’re making $50 an ounce. So your profits go up five times. And I think that when we start to see those earnings of the mining companies, the capital will flow into mining equities to start. And usually the way that this goes is that the bigger companies see the love first and the bigger companies are starting to move.

But we, I don’t think we’ve seen, you know, anything yet. And then that flows down into the smaller companies, the mid tiers and the juniors and the development companies. And then when that happens, you know, I know it happens fast just from personal experience, at least it has in the past. So typically that’s how bull markets, I think evolve. And once we start seeing the earnings from the majors, especially the silver companies, and there’s only four or five of them, you know, I, I think a lot of people are going to be shocked. Absolutely. I think it’s going to look really good.

Okay, so if I understood you correctly, what you’re saying is that as gold and silver head higher first the big companies get the price appreciation in their stock prices, earnings come out for them and then it goes down the chain into the juniors and then finally down the chain into the Explorers. And then by the time the explorers get investors, their stock prices just like just jump in, in. In Quanta. Right. Without, yeah, you know, the, the in. In quantum movements. So, but that’s, you Know Rafi, that’s for as a group but I mean a company like ours, we have a lot of catalysts coming.

We’re working on a significant resource update on our project in Alaska that I hope leads into a preliminary economic assessment and if that’s the case, we’ll be able to start talking about economic impacts. And that’s kind of us hopefully moving up the food chain a little bit just over the next in this year. Okay, so going to those, what are shareholders and potential shareholders, what should they look out for and over what time horizon? Yeah, so we’re in a great position in that We’ve got about 55 million Canadian dollars in the bank that we’re now ready to really deploy into adding value to our project.

So we’re drilling all three of our projects this year, starting on the New Mexico project called Maguillon. Now we’re drilling there. That’ll transition in early to mid March into a significant probably 7,000 meter drill program in Nevada at the Hughes property, where we’re really taking a shot at finding something big. Just. And those ideas are based on our collective geological experience. I’m a geologist. And then that’ll trans into transition into I think a very significant drill program on our Alaska project this year with three or four rigs where we look to both step out and grow the resource, confirm it, grow it and do some exploration on the targets around the property because it’s only 2% explored or something like that, give or take.

You know, the, the opportunities are large. So for us this year, if ever there was a time to go for it, it’s now. And for us this year we’re balancing extensive drilling with studies on the Alaska project called Red Mountain that we hope materially change the perception of the project. And that’s, and that’s really our focus. What I would say, if you’re interested, and here I’m talking both to potential investors and to Galen, that this is investing in silver versus investing in exploration companies. It’s not a mutually exclusive thing. But if we are, if we believe and we do that gold and silver are money and we’re going to have to have a much bigger supply of them for liquidity to trickle down, to use Republican terminology that I don’t ever use, I don’t know why I use it now.

It just came to my head to the masses. If we’re going to have real liquidity circulating, then the time before the crash of the fiat system is going to be the most opportune time for exploration companies to really Hit their stride, get the investors that they need and prove their resources and grow as companies. Whether they’ll be acquired by, by the majors or they’ll or a mid tier or they’ll develop into their own companies. Like if you, if you believe that you have a chance of really investing in a company that is going to become something from almost nothing, then this is the time to do that.

If you don’t, then it’s not for everybody. Right. Investing in juniors is not for everybody. And I always say you should focus on gold and silver bullion. Only secondarily gold and silver junior mining stocks. Yeah, I think that’s a good point. And Rafi, I’m a prospector at heart so I have that the opposite. But I think that’s a good point. Well, I mean the minority of people will be on your side because you’re the CEO of a company and most of us are not CEOs of any company and we’re more conservative people. But if you’re going to take the then, then you know all the power to you.

Somebody’s got to do it or no one’s going to do it. It has to be done. So Galen, thanks so much for coming on and I’m looking forward to hearing a lot more news about Silver 47 and all other, not all other, but many other junior silver and gold companies. I think this is going to be a very interesting time not just for gold and silver stackers but for the mining stocks. We just saw the GDX and GDXJ still nobody’s paying attention to them at all or at bear market bottom in terms of the number series issued.

That’s going to change and it’s going to change on a dime. On a silver dime. I don’t know exactly when but there, there’s going to be a point and, and I hope and I believe that Silver 47 will be part of that reawakening. What say you in closing? You know what I on a silver dime for sure. First slowly, then quickly as the saying goes and it’s silver 47. We will, we will be part of that and we’re looking forward to just concentrating on what we can control to add value to all of our projects and add value for our shareholders.

So thanks very much, Rafi. All right, cool. So I wish you the greatest success and to myself as a shareholder and I will talk to you again at some point in the future I’m sure. Of course, of course. Thank you very much. It.
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See more of Rafi Farber on their Public Channel and the MPN Rafi Farber channel.