last week a conference call was held by sprott asset management, whose funds specialize in resource stocks.

they see a systemic financial meltdown. with alt-a mortgages down 20-30%, sub-primes down 50-70%, and financial institutions levered 25-1, they only need to lose 4% of their value to become insolvent.

the us dollar could weaken dramatically at any time, and bullion will go higher. their outlook is for gold at $2000 and silver at $40 within four years. that is their conservative approach, and they feel the metals could go well beyond those figures, well before then.

small cap mining stocks are ridiculously cheap, with some trading at almost cash values, and valuations are near 2001-2 levels. this has created opportunities to be realized when the gold price moves sharply higher. of the top 70 mining companies, 90% said they expected to make an acquisition in the next two years.

the gold price has been suppressed by market manipulation while mining costs are up. there is considerable evidence that hedge funds have gone long producers while shorting juniors, and have kept them under constant downward pressure. their recommendations are precious metals and energy stocks. while base metals are a bet on economic growth, energy and precious metals can survive on their own.

http://www.sprott.com/

the link to the conference call is on the right side of the page.