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aztecstargazer

First Majestic/ Mining Finance

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I am interested in other peoples feedback regarding First Majestic Silver Corp. and First Mining Finance. First Majestic is a Canadian company, which is the second largest primary silver miner in Mexico. Mexico is the largest silver producing nation in the world. 

First Mining Finance is a "mineral bank". The company is only 1-2 years old. It's mandate is to acquire gold mines in stable countries, which have already established infrastructure. So the point is to buy as many properties as possible, while it is cheap. Then once gold gets higher into the next bull-market, open sell and open the mines, while holding residual interest and generating cash-flow.

The CEO and chairman of these companies is a man named Kieth Neumeyer. He has a track record of building billion dollar mining operations. He seems to be held in high regard within the PM mining community. 

I guess I want to know what the PM mining companies look like during market crashes or corrections? What is likely to happen as the demand for silver increases with industrial applications, but the price doesn't seem to rise with it? Won't primary silver miners be forced to stop operations or demand higher prices to justify producing mines?

Gold isn't my forte. So First Mining Finance is less understood by me. I understand the concept, but I suppose, not the real value of gold. The need for having gold as a store of value is not lost on me. But the need to mine a metal with limited uses, doesn't really make sense to me.  

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8 hours ago, aztecstargazer said:

The need for having gold as a store of value is not lost on me. But the need to mine a metal with limited uses, doesn't really make sense to me.  

It is mined because there is demand.  If demand or price crashes then the high cost mines will be forced to shutdown, leading to reduction in supply which leads to higher prices.

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