Some of the PM companies are now selling at less than half the cash on their balance sheets.

Buying opportunity or a suckers play?

http://new.goldmau.com/article.php?i...

Junior sector and resource funds

In September and October, 2 prominent resource funds closed: Ospraie and RAB. Both combined controlled over $3 billion in the resource junior sector. They literally owned 10-20% of the market and positions had to be sold. We saw classic margin-call selling. Prices of stocks were down 10% on consecutive days with small breaks in between and no rebounds. Many companies soon traded 10%, then 20%, then up to 50% below their bank cash balances. The situation clearly became irrational. Premier gold and silver producers such as Coeur D'Alene and IAMGold were down 50-70% in 2 months.

Where to go from here

As of October 20, the junior market looks to have stabilized and I am convinced the correction for quality companies will not last long (i.e. 6 months, less than one year for sure). This is much like the Nasdaq in 2001. Bad companies will go under, while good companies will survive and flourish