Eric King on FSN 3/15 (they just got the transcript up)

Jim Puplava: And I want to talk about juniors because we’ve been talking a little bit cautiously here that, yes, some of the juniors are up this year, some of them are up in a spectacular way, but Eric, you know, I’m looking at a screen here that has a hundred stocks on this screen – I’ve got the majors, I’ve got the intermediates, I’ve got the juniors developers; it’s all broken up by category – and the juniors have still been a laggard here.  So I don’t know about you, I’ve always favored this sector but in this kind of market what’s your impression of the juniors as opposed to let’s say the majors? 

Eric King:  Well, I think, Jim, you and I have a tendency to gravitate because we are value investors we just naturally we’re going to gravitate to the value.  And right now the value is you can go out and buy a company for 25, 30, $35 of gold per ounce in the ground or gold equivalent when there is a mixture of say gold and silver.

And again, I don’t want to mention any names but a major mining company executive off-loaded quite a bit of paper and I’ve kind of watched him redeploy that into juniors.  And I just think it’s brilliant thing to do.  You know, here’s a guy who’s made a fortune and takes some profit off the table which I think is great and basically says where’s the value, and it’s in the juniors, and so start starts redeploying capital into the juniors.  So the smart money is gravitating to the juniors because that’s where the value is.  And you go start getting stocks 6, $700 an ounce gold in the ground on say some of the large caps or the majors and, yes, going forward these stocks can go a lot higher but you know, is Agnico-Eagle going to go over $100 during the bull market, of course it is, but right now it’s what?  $77, wherever it is, $78, it’s try not to chase.  Again, buy the big pull-backs.  And again, if you can get into the quality juniors that’s really the place to be because that’s where you could see some extraordinary gains going forward.

Obviously, we’ve talked about Aurelian had a hundred-fold move in a 3 ½ month period of time and that’s sort of an extraordinary circumstance because they really hit the Mother Lode down there in Ecuador.  But these – fortunes will be made on these juniors and then there will be some duds and people will lose money.  Buy quality.  Get involved in a good fund is my advice for most people.  Sprott’s got one.  Jim, you’ve got one.  But if you have time and you study these things, try to go meet the CEOs, shake hands with them, get to know the company’s story, stay on top of them; buy quality, buy the pull-backs.  And of course, most juniors have been in a pull-back; right, Jim?  So there’s a lot of value out there.  But really, truly right now at 20-some odd dollar, 20-plus dollar silver, $1000 gold and the majors running, yeah, they’ll go higher and everything will go higher over time but the value – and it’s amazing at this point to actually have these kind of value plays across the board in some of these juniors because later on in the bull market there is not going to be any value.  There won’t be any value.  You’ll be looking around going, “what are people thinking buying some of these stocks?” where they’re going to be trading.  And by then, Jim, you’ll be selling them, your fund will be selling them, and I’ll be selling them and they’ll still probably go a lot higher.

But I just think for people at this point right now it’s kind of staggering to me that people can go out and buy these juniors.  And they’re on their own timetable.  We’ve discussed this two weeks ago.  Certainly they’re on their own timetable but I think the juniors when they finally turn and go into a bullish mode will not look back and the gains will be very, very violent on the upside. 

http://financialsense.com/fsn/BP/2008/0315.html