Maria Smirnova from Sprott.....
"...TGR: Do you have a time frame for when the market might begin to favor precious metals again?
MS: That is hard to predict. A lot of what is taking place right now does not make sense. It is very difficult to predict when things will turn. We take a long-term view....
MS: I think you have to remain optimistic that the prices of the commodities, especially silver and gold, turn around. I do not even want to call them commodities, to be honest. I would call them currencies, especially gold. Silver is a hybrid because it also has industrial applications.
Once the turn happens, these stocks could explode in a good sense and completely revalue to the upside. Today, they are at depressed valuations.
TGR: Is there an across-the-board percentage recovery you would predict?
MS: Some stocks are down 50%–60%; they could double or triple...
TGR: And what are the reasons behind the more general mining equity slump?
MS: A lot of people believe we are fixing our economic problems and things are getting better. People are going to the U.S. dollar and to other assets and other sectors.
There have also been disappointments in the mining sector with companies not meeting their guidance and costs coming in higher. This too has put a damper on investor sentiment.
TGR: Can you leave us with a positive thought about the space in general?
MS: It is very comforting to see retail buyers choosing in droves to own the physical metal. We hope that leads to higher market prices for gold and silver, and in turn to a rally in the stocks.
TGR: Maria, thank you for your time and your insights.
Maria Smirnova joined Sprott Asset Management as a research associate in May 2005, and was
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