Dear Participant,Thank you for submitting your question to the...

Dear Participant,

Thank you for submitting your question to the Sprott Precious Metals Round Table Webcast. Our panel is pleased to provide the following response to your inquiry:

Your Questions:



Many of the high quality junior mining companies that have been recommended by Sprott over the past two years are still hemorrhaging, are we better at this time putting more money into juniors or gold and silver bullion. Where do you see the biggest upside?

Bullion and juniors represent very different investments. The juniors always have the most upside, and the most downside. Your Sprott broker can work with you to determine a good balance between the two, which is always a personal decision in the end.



How long do you believe the manipulation will continue. I've been investing in gold and silver related assets, so my concern is that this could last 10 more years before markets fully realize their real potential.

We (at Sprott) are not in agreement on this question internally, but we do believe that markets are more powerful than market actors, even when those actors are governments, or government supported cabals. If you have been involved in precious metals markets over the last ten years, you must be somewhat pleased at their performance so far. We are convinced that they have farther to move.



There has been some commentary at some point that when there is a collapse, the markets could close. How do you recommend going about investing in an environment where there is so much uncertainty?

We would prefer to say "IF" there is a collapse…our representatives would be happy to discuss the most suitable strategy for you at your convenience.



Can Rick Rule provide insights where he is putting his money these days? Two years ago he said to that it was time to allocate cash, now he's saying be aggressive? I've listened but I'm at cash. Should I use my bullion proxy to buy more juniors?

Allocation questions are matters of individual circumstance and preference. I have very large personal and portfolio cash holdings, in part because I am able to, and because I am a very aggressive speculator. I am adding to the bullion holdings in our portfolios, and I am eager to participate in more private placements. I am an after market participant, particularly in the developmental stage gold and platinum sectors.



Is Rick allocating his mother's account to juniors and gold at this time?

My mother has done a good job building and maintaining her wealth. In the 2008 melt down, we were able to buy her many of the infrastructure income stock (pipelines, ports, etc.) that were so cheap then. She needs to preserve purchasing power now, not take chances to increase it. Her greedy son (Rick) is being aggressive, however!



The manipulation of lately seems to be increasing, can you provide any insights as to what is occurring in the metals market, and do you speak with the Chinise and Russians on what their plan is with the metals that they are buying?

With respect to Russia and China, we at Sprott speak with official and private participants with some frequency, and monitor official sector purchaces. It is clear from statistical and anecdotal evidence that both countries political leaders see bullion as important components of their official sector reserve holdings, and are encouraging individual precious metals holdings as a component of individual savings.



Why aren't the major gold companies buying the juniors with assets? Are they worried about their shareholders? If they are going to need to replace their reserves, what are they waiting for? What are the executives thinking?

We believe there are two reasons for the hiatus in major company acquisitions: a failed acquisitions strategy over the past decade, and a scarcity of attractive projects. In the past decade the majors attempted to acquire large assets that increased their gold leverage, rather than their profitability, a big mistake. Secondly, we can only see about twenty juniors that are worth acquiring, and fewer than ten are genuine bargains.



Is Rick in the same camp on the silver story that Eric and John subscribe to? I listen to Rick in different forums and I don't get his same excitment on silver as gold. Gold is a fear trade and silver is a "greed" trade.

Yours would be a fair interpretation of one of the internal debates at Sprott.



Platinum seems to be going up lately, is this a good time to be buying platnium even though it passed 1700?

We can't make short term price predictions, but we launched our recent New York Exchange listed " Sprott Physical Platinum and Palladium Trust" precisely because we believe that the PGM markets are ready to move up.



Martin Armstrong has indicated that a country that hold the reserve currency will never have a hyperinflation? Can you provide perspective on this?

The world has never been as interconnected as it is now, so a major dislocation at the center is not impossible, inflationary or deflationary. Remember that gold prices are up five fold in twelve years, in the absence of hyper inflation or a dramatic collapse. If the next twelve years delivered a repeat of the last twelve, would that performance satisfy you?



I've been buying many of the junior gold miners that Rick has been recommending, but I'm poorer then I was when I started buying themm Can you provide thoughts on how to proceed?

Resource markets are very cyclical. Bear markets cause bull markets and vice versa. While last year was a year that almost all partcipants in junior precious metals equities would prefer to forget, the entire Sprott organization, including Rick, have delivered many more good years than bad, and we believe that time is on our side.



Can you talk about allocation of PMs in one's portfolio?

By all means, but privately. Please start the conversation with your Sprott Global broker.



If we invest in the Sprott trust how can we get our gold if we need to?

The redemption mechanism is explained on the web site. http://sprottphysicalbullion.com/



Why do you think silver keeps trading in the $30 range. What will be the trigger to get silver higher?

Many triggers could be appropriate, new inflation fears, a gold breakout, short covering…



Are you seeing the Chinese buying silver?

Chinese buying of gold is much more visible.



Last couple of years, Rick has been talking about a 9 year discovery cycle. Does he still hold to that theory and when does he see that coming to fruition?

Yes, and now.



Can you ask Rick what his thoughts of juniors in west Africa? Is he worried about political risk? it seems like Burkino Faso is the last frontier of gold exploration, so is this an opportunity?

We are attracted to West Africa because of its geological endowment, and despite its political risk, which is very real. We share your enthusiasm for Burkina Faso.


Seems like Americans are still clueless about gold and silver, what will change this awareness? Will it change?

Time, just like in the 1970's.