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Silver Standard Resource CEO John Smith on why he sees strong demand for silver.
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-- silver standard resources closing down after reporting a steep fall in fourth quarter profits today but.
Despite the bottom line hit the company is issuing a pretty strong 2012 outlook for silver prices and silver demand.
And again you buy low sell high so maybe now's the time to get -- joining us in a Fox Business exclusives John Smith is president CEO of silver standard.
Resource is John that thank you very much for coming in very exciting time for your company.
Because they're there they're changing over from discovery to mining operation specifically your company has.
But your first major operation took a hit -- the Argentinian mine.
Was close down I guess in July and September.
That really -- operations now.
Now hi David hi this time -- we certainly did the -- just -- for us this year was all of right getting -- sort of dive in 2011.
We did just that we sort of very.
Crushing capacity was sort of -- processing issues.
And -- really set for a good 2012.
And 2011 fought us was exactly that was a right getting the people on board getting cash into the company.
I'm getting tricky to sort of right so in terms of what we wanted to achieve for eleven we -- dot and that sets us up well for the good strong future.
OK and you've also got a lot of projects in the pipeline some fifteen essence so John -- my question to you is.
How many ounces do you expect to -- in 2012 for your company to sell.
-- our guidance for this year is between.
Eight point two to eight point five for the year but what we're gonna be doing particularly is moving forward that -- -- mine in Mexico that is a mind.
That will produce somewhere between seven and eleven million axis -- -- for a long long time.
So really our focus this year is about getting that through feasibility stage getting in front of our board trying to get this project move forward such really exciting for us.
And as -- just in Mexico -- another mine.
Ya next time I'm just gonna say Mexico and Peru that to -- countries in which are going to be producing this over are the number one and two countries producing.
Summer I didn't quite get an answer though John about Argentina.
It is right now the only producing mining operation you have is it -- -- stay open because it did have those closures in July September.
-- very much David I mean did to -- why they closures happen what are right on solving the problem we solve that problem in 2011.
And since the fifth and November we've been producing daily constantly.
We're ahead of shape -- even even a notwithstanding the reading.
In the early part of this year so for four to keep this that those issues of the -- -- -- that was part of the what we undertook could and that.
We -- to get your perspective on the price of silver and that for a while there last year everybody said oh it's a moon shot to forty dollars an ounce for silver.
And then that in gold started to fall off a cliff and even though was interesting to see that silver outperformed gold for part of the year last year.
Where do you see silver prices heading now -- they've had a pretty decent move year to date.
This that's exactly right I think if you go back to fundamentals on 2011.
Very much driven by the macro wall what was happening in the economies.
Have you -- -- to the US dollar.
So when he went back for liquidity and for safety that investors have to put that money to work in 2012.
Source they -- -- and they start to take a bit more risk to put their money to walk.
They quickly come to gold and silver and and then behind that is the equities so we see a strong silver future Q2 Q if -- materializing and -- from there.
John let me ask -- very simple question -- you -- at -- -- valuation of silvery do you see up like a tenfold increase from back when it was three dollars announced.
You haven't seen that same kind of increase in gold why not.
I think silver has been and actually volatile.
-- -- relative to gold.
But if you go back David a what a ten year PD and it is not what the fundamental price about a fifty times.
Silver to gold so that we shouldn't -- quite well solid and it's being sort of the average over ten years was well -- a gold.
I think there's a strong future for so we're coming out this year I'm -- you very quickly forget about it and here that so what is good for invest -- but once said.
The economy turns and things happen it's it's it's got an industrial sites -- Well speaking of the things turning in -- you've got the Chinese -- trade deficit today worst in 22 years and and so just a quick question will that markedly negatively affect silver at this point for the use in industrial purposes.
By.
-- I think it -- but this is what it plays -- it's got a jewel site to your advantage goes to precious metals so we've seen the move from base and depression as a result of that.
That band supports us is we're sort of next to gold in terms of opportunities for people some kind of played both ways of course not really is pot why it's volatile natural.
But if you look at the fundamentals industrial -- It's good long term and so but as old as it is.
It's actually very much of tomorrow's medical technology and medical you can't beat that fabrication and finally for the Scott files out there where you from in Scotland.
I -- -- in the out of sky right on the West Coast Davis is back.
That a move to Aberdeen had a heart.
Where the oil -- and so that's my heritage of guy thank you John very much stuff Johnson actually is Thanksgiving you bet president CEO of silver standard resource is ticker symbol SS RI stock is up 14%.
