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Wednesday, November 2, 2011

Canada's next Gold Rush




Vancouver is home to many of North America's newest and brightest mining companies, and at last  weekend's Stocks 2011 Conference, mining companies were well represented.

Talk to anyone about mining in Canada, and inevitably the conversation will turn toward the excitement about Canada's Yukon territory, which some say will spark the next great gold rush.

The Yukon Territory is, many believe, the location of a massive Carlin-type gold discovery.  Traditionally, hard-rock miners looked for veins of quartz or minerals that can indicate the presence of gold.  In contrast, a carlin-type deposit is composed of extremely fine-grained particles of gold, stuck to other minerals (such as pyrite) and spread deeply throughout a large area.  Carlin-type gold can be mined cheaply by large open-pit mines.

Kaminak Gold (TSX: KAM), for example, has hit upon a large area of mineralization (trendily dubbed the "coffee project") with mind-blowing numbers, ranging from 1.08 to 17.1 grammes per tonne over an area 14 kilometres long.

Companies like Kaminak Gold, Northern Tiger, Golden Predator, ATAC, and Ryan Gold are all generating excitement, sitting within the Carlin-zone.  This December to January, soil sample results from last summer's prospecting will start rolling in.  If results are as good as expected, the whole area (and all the junior miners in it) could be caught in a speculative frenzy.

Make no mistake - junior gold investments are really educated gambles.  But, when the risk-reward ratio is in your favor, gambling is sensible.  As always with speculative investing, risk not a penny more than you can comfortably afford to lose.

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"It is in men, as in soils, where sometimes there is a vein of gold which the owner knows not of, and in your nature, there lies hidden rich mines of thought and purpose awaiting your development."

Jonathan Swift

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See also:
http://www.kaminak.com/

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Disclosure

Do not buy stocks, or take this or any other financial advice without doing your own analysis; including, but not limited to: reviewing business models, financial statements, management style and philosophy, recent developments, market macroeconomic analysis, and chart analysis. If you do not know how to do these things, you shouldn't be buying stocks in the first place. Seek the advice of professionals, as appropriate.

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