Yes, you are reading those numbers correctly. Of course it is ridiculous to think there is more gold in MISM's crappy placer claims than every produced in the State of Nevada. But no, nobody is crazy - it is simply a deliberate attempt to deceive.
Actually, I take it back - there may be some crazy people involved - any investor that falls for this. I would hope that most of the MISM investors are simply in it hoping for a bounce or a "run", and not actually waiting for gold production.