Resource World Magazine

A U G U S T / S E P T E M B E R 2 0 1 4 www.resourceworld.com 25 Reports of their demise have been greatly exaggerated To the amazement of some, we're entering Q2 2014 with most of the junior resource companies on the TSX Venture Exchange and the Canadian Securities Exchange still intact. I say amazed as all one has to do is look back to the end of 2013 to review the many talking heads that predicted hundreds or upwards of a third of the junior miners would be cleansed from the exchanges by the second quarter of the year, and that most of the survivors would have to alter their business strategy to con- serve cash just to maintain their listing. Granted, a few companies did leave the resource sector to pursue other endeavors such as medical marijuana. Others merged with like companies or formed joint ven- tures to keep their projects intact. Still others arranged financings and are advanc- ing their projects with little or no delay. The point being is that the junior resource sector didn't collapse as suggested, and in fact, other than the higher number of busi- ness changes mentioned above, the junior resource sector seems to be relatively stable and, to my eye, an attractive investment. Look at a chart of the TSX Venture Exchange, benchmark of the junior resource sector. The Exchange at 1,023 is up by over 5.4% from its midsummer low and is approaching the high of 1,050 established earlier this year. Contrast this to the revolv- ing pattern in recent years where any new year rallies were abruptly reversed by late spring, leaving the junior miners in a deep slump, where they remained mired and only regained any optimism at the start of the next year. But here we are in the usu- ally mid-summer doldrums and the TSXV Exchange is trading near its highs of the year. The question is: will this rally continue or is there one more shoe yet to drop? Barring a calamity of some sort, I feel the lows for the resource sector have been seen. Gold bullion has gained over 7.5% since early June and is holding above US $1,300/ oz. Copper has improved by 10% in the five weeks to US $3.25/lb. Even lead and zinc are up by over 5% in recent weeks to reach US$1-a-pound. While these prices are still well below historical highs, they are defi- nitely well up off of their recent lows and are trending in the right direction. Rising resource prices across many sectors sug- gests some sort of underlying strength. All that is missing is a little more trading vol- ume in which to push the resource issues up through the existing resistance level at about the 1,050 and onto new highs for the year. This may come as investors reenter the market after their summer vacations. The people who run junior resource companies are a resilient group, whose demise should not be assumed because of a three-year bear market. To paraphrase Mark Twain – "Reports of their demise have been greatly exaggerated." n Rodney Blake is an Investment Advisors with Canaccord Genuity Wealth Management, a division of Canaccord Genuity Corp, Member- Canadian Investor Protection Fund. The information contained in this article is drawn from sources believed to be reliable, but the accuracy and completeness of the information is not guaranteed, nor in providing it does Rodney Blake, Canaccord Genuity Corp, or its sub- sidiaries, or affiliated companies, assume any liability. This information is current as of the date appearing in this article, we do not assume any obligation to update the information or advise on further developments relating to these securities. This article should not be considered personal investment advice or a solicitation to buy or sell securities. Canaccord Genuity and holdings of its respective directors, officers and employees and their associations, from time to time may buy or sell any securities mentioned herein. The views expressed are those of the author and not necessarily those of Canaccord Genuity Corp. Rodney Blake can be reached at 604-643-7567 or rod.blake@canaccord.com at t h e m a r k e t R o d n e y B l a k e TSX: MOZ Contact: Christopher Haldane, Investor Relations Telephone: 416.987.0714 Website: www.marathon-gold.com Developing gold resources in North America

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