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O C T O B E R / N O V E M B E R 2 0 1 7 www.resourceworld.com 5 Editor's Comments Ellsworth Dickson Ellsworth Dickson, Editor-in-Chief Email: editor@resourceworld.com T: 604 484 3800 | 1 877 484 3800 M ining stock investors have been patiently waiting for a sustained general recovery. We had a false start for the first half of last year, only to see it weaken during the last half. However, pieces of the required puzzle are starting to fall into place that could drive more mainstream investors to consider jumping back into mining stocks. There are numerous conditions that impact mining stocks: metal prices and momentum, prevailing investor senti- ment, geopolitical events (precious metals stocks), industrial and consumer demand (base metal and battery metals), and the great unknown – a surprise major mineral discovery. What I find of interest is the current multi-metal rally underway that makes for a stronger rally than single metal rallies. For example, precious metals, copper, zinc, nickel, and battery minerals such as cobalt have been rising in price. Importantly, gold has broken through the US $1,300/oz level. Prevailing investor sentiment is on the cusp of changing as US mainstream stocks are looking fully valued or overvalued. Some analysts are saying mainstream investors are looking for an excuse to sell as they are sensing the uptrend is nearing an end as US job creation is disappointing, the US dollar has been falling, US politics are dysfunctional and the DOW is down 10% this year. Then there is geopolitical anxiety such as about North Korea that is good for precious metals – not that we are wishing for war. Where will general investors then turn their attention – undervalued mining stocks? This brings up some comments made by mining analyst John Kaiser at the recent Metals Investor Forum and in our interview in this issue. He noted that previous major mining stock rallies have often been fueled by major discoveries such as the Dia Met diamond discovery in Canada's Northwest Territories followed by Aber's diamond discovery. These dis- coveries launched the biggest staking rush in history. Robert Friedland's Voisey's Bay base metal discovery in Labrador ignited mining stocks as well. During the past year, with many explo- ration financings completed and this money going into the ground, this can only increase chances of a major discovery. Kaiser said we may already have one – Novo Resources – with its gold nuggets in conglomerate discovery in Australia that seems to be a Witswatersrand, South Africa lookalike. This could be the big- gest gold discovery in the last 100 years. In addition, the Golden Triangle region in northwest British Columbia is seeing some great drill results – GT Gold in particular. On September 16, legendary investor and analyst James Dines was interviewed by Michael Campbell, host of Money Talks on CKNW radio. During the interview, Dines said that palladium has the most bullish chart of all the four precious metals and gold moves opposite to the stock mar- ket. Perhaps a startling comment, Dines said that silver is the most undervalued metal on earth and he believes it could go to US $300/oz driving silver stocks "to the Moon." These various pieces of the mining stock puzzle – except for select stocks like Novo and GT Gold that are already on their way – have not yet resulted in the TSX Venture Exchange breaking through 800. To me, it looks like a sustained mining stock recov- ery is in the process of being born. n This could be the start of something big