Why Silver Could Shoot Hundreds of Percent Higher

Why Silver Could Shoot Hundreds of Percent Higher
By Brian Hunt, editor in chief, Stansberry Research
June 01, 2009

Last week, one of the greatest speculative vehicles in the world made an important move... an important "breakout."

The vehicle is the tiny group of mining stocks that represent pure plays on the price of silver.

If all assets were patients in a mental ward, bonds would be the guy who sits silently in the corner and stares out the window. Stocks would be the guy who wanders the hall and mumbles to himself. Silver would be the guy they keep in the padded room all day...

As you can see from the chart below, silver is prone to fast, incredible swings in both directions. You see, silver trades a little like a precious metal... so it moves wildly when people get worried about a market crash or inflation. Silver is also an industrial metal... so it can trade up and down with global manufacturing activity.

Silver belongs in a padded cell

Okay... so you know silver is crazy. Now realize the firms that focus on silver mining are pure madness. Their profit margins and asset values fluctuate with more volatility than silver itself. Take one of the largest and best-known silver companies, Silver Standard (SSRI), for instance...

When the credit crunch hit last year, SSRI fell from $42 per share to less than $8... a drop of 75% in three months. After people warmed back up to mining stocks, it took the same amount of time to nearly triple in value. Which brings us to where we are now...

Silver Standard just broke out to a 9-month high

Silver Standard just broke out to a 9-month high

Just last week, Silver Standard blasted out to a fresh nine-month high. The global economy is getting "less bad"... and the incredible bailout plans have most smart people scared to death of inflation. That's driving the price of "real assets" like silver to the moon.

Why You Must Buy Gold, or Even Better, Silver, Now

The Way You're Trading Oil Is Probably Wrong

So the next time you're looking around for an "inflation trade," consider going long a company like Silver Standard... or taking a position in the silver ETF (SLV).

If the government's funny money scheme turns out badly, these positions have a long history of providing gigantic gains in no time.

Good trading,

Brian Hunt

Jim Rogers has been banned from U.S. television
Also... the surprise he sees coming for the crude oil market.

Update: Broken down CNBC commentator Macke now advising churches, denies insanity
Says he'll return to TV next week...

These high-yielding and super-safe securities are on the verge of a major breakout
If you're looking for income, this could be the perfect investment...

•	Silver approaching $16 an ounce, up 67% from November 2008 lows.
•	Investors losing faith in the dollar... euro up to $1.41, highest point this year.
•	Dr. copper gains 56% this year on bullish consumer sentiment... heading for fifth-straight monthly gain.
•	Earnings today... Altera, Apollo Investments, Enersys, Gladstone.

	Last	Change	52-Wk
S&P 500	909.84	+2.57%	-33.87%
Oil (USO)	33.93	+0.68%	-68.27%
Gold (GLD)	93.74	-0.44%	+2.75%
Silver (SLV)	14.40	-0.69%	-20.09%
U.S. Dollar	87.95	+0.16%	+19.30%
Euro	1.40	-0.17%	-11.32%
VIX	30.75	-5.76%	+57.29%
HUI	375.21	-1.04%	-14.96%
10-Year Yield	3.49%	0.04	-0.31

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Company	Sym	Industry
Catapult	CATT	software
Enterprise	EST	acquisitions
KongZhong	KONG	media
Seabridge Gold	SA	gold
Trian Acquisition	TUX	acquisitions
ChinaCast Edu	CAST	for-profit edu
Eldorado Gold	EGO	mining
IAMGOLD	IAG	mining
Rubicon Minerals	RBY	minerals
SolarWinds	SWI	software
Advanced Tech	AXC	acquisitions
Data Domain	DDUP	data storage
Hawkins	HWKN	chemicals
Palm	PALM	cell phones
Star Scientific	STSI	cigarettes
Arris Group	ARRS	telecom
Cott	COT	soft drinks
Randgold	GOLD	mining
NuStar Energy	NS	pipelines
Shanda	SNDA	software
AngloGold	AU	mining
Diedrich Coffee	DDRX	coffee
Global Brands	GQN	acquisitions
NetEase	NTES	networking
Starent Networks	STAR	networks
Allied Nevada	ANV	mining
Carmike Cinemas	CKEC	movie theatres
Global Consumer	GHC	acquisitions
NRDC	NAQ	acquisitions
SIGA Tech	SIGA	pharma
Caribou Coffee	CBOU	coffee
Force Protection	FRPT	autos
MYR Group	MYRG	construction
SciClone Pharma	SCLN	pharma
Western Goldfields	WGW	mining

Company	Sym	Industry
Liberty Acquisition	LIA	acquisitions
General Motors	GM	Big Auto
Burger King	BKC	restaurants
Alternative Asset	AMV	acquisitions
Hicks Acquisition	TOH	acquisitions