GLOBAL MININGINVESTMENT CONFERENCE 2010

STATIONERS’ HALL ● CITY OF LONDON ● TUESDAY-WEDNESDAY, 28-29 SEP 2010

www.ObjectiveCapitalConferences.com

Investment Conferences

Gold & Silver OutlookArthur Vestey – Investment Manager, Cheviot Asset Management

DAY 1 - SESSION 3: PRECIOUS METALS SECTOR

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33

Gold & Silver Outlook

Arthur Vestey

Cheviot Asset Management

28th September 2010

4

10 Year Gold & Silver

GOLD SILVER

Source: Bloomberg

5

Why Silver ?

6

The History of Silver

7

Gold/ Silver Ratio 2007-2010

Source: Bloomberg

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Silver Usage

“Silver is the best technology stock you can own” David Morgan

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Gold/ Silver Availability

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Gold & Silver Bubble?

11Source: Bloomberg

Gold vs NASDAQ Secular Bull Market Comparison

12

Diminishing Marginal Productivity of Debt in the US Economy (in Dollars)

“You can’t bail out debt with debt”

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USD Purchasing Power 1971-

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1966: “In the absence of the Gold Standard, there is no way to protect savings from confiscation through inflation. There is no safe store of value... deficit spending is simply a scheme for the

confiscation of wealth. Gold stands in the way of this insidious process.”

2009: “The rise in gold and silver is strictly a monetary phenomenon and is an indication of the very early stage of an endeavour to move away from paper currencies’.”

2010: “Fiat money has no place to go but gold…If all currencies are moving up or down together, the question is: relative to what? Gold is the canary in the

coal mine. It signals problems with respect to currency markets. Central banks should pay attention to it.”

Alan Greenspan Quotes

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Current View

Silver Equities, 30%

Bullion, 40%

Gold Equities, 30%

- Central Fund of Canada [CEF.US]

- Market Cap $1bn + - Mainly small/ mid cap

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GLOBAL MININGINVESTMENT CONFERENCE 2010

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