hello friends,

i was an early investor in noront, right before its original big move and have taken a position in u s silver. so i am happy to share some of my research, happy to have comments and others assistance so all of us can better understand this opportunity.

i purchased shares in the 18 to 21 cent range approximately with silver (the metal) a few dollars lower then today. i still hold every share of u s silver i purchased and am hopeful that silver will continue its climb and as such so might u s silver. here is what i wrote to a business associate a few months back.

note this was originally written several months ago. i still feel the same about u s silver now as i did when i wrote it.

-------------------------------------

the "silver valley" - u.s. silver corporation (symbols ussif.pk or usa.v, DB Frankfurt: QE2) - my analysis and opinion


a stock i purchased is well worth investigating for the family office. once again, a very simple idea, which also has long term legs in my opinion.

if you believe the price of silver will hold at this level (or rise as i believe) i determined i would have a difficult time finding a better priced and valued security then u.s. silver corporation (symbols ussif.pk and usa.v via yahoo finance ticker, DB Frankfurt: QE2).

market cap around $50 million. $46 million in sales last year with net income of $4+ million, multi-million $ positive cash flow!!, multi-million ounce silver producer!! with additional substantial production of lead and copper. long life solid reserves and massive undefined reserves if my study of the history of the area is correct.

solid balance sheet, no long term hedges on their silver production (my understanding of the financial footnotes leads me to believe like most miners their bank requires them to put on a type of short term hedge as the ore is shipped to the refiner to protect for price movement while the ore is in transit and being refined. -- here is the direct quote from their notes --- "Variations between the price recorded at the shipment date and the actual final price set under the relevant contracts are caused by fluctuations in the market prices for copper, lead and silver, and result in an embedded derivative. The embedded derivative is recorded at fair value each period until settlement occurs, with the changes in fair value recorded to revenues."), owns MASSIVE land position and leases additional land. properties include the united states second most prolific silver mine in history (the galena), all located and permitted in the "silver valley" of the couer d'alene/wallace idaho area. nice NOL to shelter future earnings. some major capital expenditures are now complete, the benefits are about to be realized.

they own two mills, quite valuable to them and others needing a mill. substantial 43-101 compliant reserves. recently thomas kaplan (the billionaire investor who launched apex mining and then wisely sold out near the top before apex went down the tubes with hedges) just bought the sterling mining company assets which are right near the u.s. silver assets ie the couer, galena, caladay, and dayrock mines among other properties u.s. silver corportation owns or controls.

u.s. silver corporation just released some important drill results featuring additional major intercepts. my understanding of the vein system that dominates the mines u.s. silver owns is that a 5 foot wide intercept that runs several hundred feet, like u.s. silver has and recently reconfirmed (see below), can easily be followed with little loss to waste rock relative to many other mining operations.

here is a link to u.s silver recent drill results and earnings statements.

drill results:

http://www.us-silver.com/s/NewsReleases.asp?ReportID=401303&_Type=News-Releases&_Title=U.S.-Silver-Drilling-Proves-High-grade-Ore-Extensions

here is a small example of what i see as important:
(Initial stoping on the vein has identified an ore shoot 241 feet (73.5 m) in length, having an average width of 5.0 feet (1.52 m), and average diluted grade of 34.19 ounces of silver per ton (1,172 gpt) and 0.68 percent copper. The widths and silver grades are similar to results obtained from the recently developed stope in the 220 Vein just above the 4600 Level. Here the stope is 235 feet (71.6 m) in length with an average width of 5.0 feet (1.52 m) and an average diluted grade of 36.19 ounces of silver per ton (1,241 gpt) and 0.79 percent copper.)

my note: focus on OUNCES per t of silver with substantial credits for copper.

to simplify it a bit as i see it, u.s. silver can spend a lot of money drilling and proving up reserves OR they can just follow the veins and mine the silver thus saving themselves a lot of money in lean times. understand the silver valley and its history and you will understand what i mean by this statement.


recent earnings statement:

http://www.us-silver.com/s/NewsReleases.asp?ReportID=399050&_Type=News-Releases&_Title=U.S.-Silver-Reports-2009-Financial-Results

http://www.us-silver.com/s/NewsReleases.asp?ReportID=402107&_Type=News-Releases&_Title=U.S.-Silver-Reports-First-Quarter-2010-Results



recent financial statements:

http://www.us-silver.com/i/pdf/fs/2009_Annual_Report.pdf

some things to focus on:


a. catalyst, some major capital expenditures are now completed, benefits will be realized in the near future.

b. look at chart on page 7, notice the leverage to silver prices at $20 per ounce.

c. look at page 10, 43-101 compliant reserves in ounces per ton. then study the history of silver valley mining and understand that this proven, probable, and inferred reserves may barely scratch the surface of what is present should they ever drill off the site or even better, just follow the veins with minimal reserve building efforts.




321gold site report mentioning u.s. silver:

http://www.321gold.com/editorials/moriarty/moriarty050810.html

highlights thomas kaplan, billionaire investor, buying substantial stake in neighbor mine and thus providing potential catalyst in form of consolidation. perhaps not mentioned enough in my opinion is the potential major catalyst of merely bringing attention to other area plays and other investors discovering what i have detailed above by kaplans arrival in the area.


note, i had reviewed u.s. silver when it first launched about 3 years ago and found it lacking at that time. the stock peaked at about $1.30 per share in 2007. my personal opinion is it is a whole new story now with new management, better capital structure, major expenditures behind it, etc and a current price of $.22 cents a share (this was correct when i wrote this some months back). the key of course is the price of silver going forward. if my analysis is correct, $21 silver will be what it takes to totally unlock the value of this play in the form of a xx (opinion deleted) bagger. at a stable price of $18 dollar silver i view it as a (opinion deleted) in 4 - 6 months. if silver goes to $13 and ounce or less and stays their this stock will have big troubles. it is certainly a small cap speculative stock but reasonably liquid if one exercizes patience when buying.

--------------------------

these are my personal opinions and everyone should do their own research. i picked up shares, about 2/3 or so for a core position and 1/3 for a trading position in the event silver pops in the near future (note this was written a few months ago i have not sold or traded any shares yet).

-------------------------

end of old message.

also see below

========================

everyone should do their own due dilegence before they invest a penny in any investment.

anyone with additional insights specifically about this company, please share your insights in this forum.

regards,

jsq