Keith Neumeyer: Big Institutional Money is Moving Back into Silver
Keith started building his company back in 2003 when silver was around five dollars. He was looking for a new opportunity in the resource sector and silver had just the right supply-demand characteristics. Back then there were very few players in silver. He focused on building an excellent management team as he had done with his previous venture. It took some time to set up but the timing was almost perfect. Today they are in the top five silver producers on the planet.
Keith says silver is a very misunderstood metal. Some investors look at silver as money while others see it as a commodity. Keith views silver as a strategic metal that is needed in almost every modern device and commercial application. The world will continue to require a lot of it and there just isn’t that much being produced. Eventually, the current silver deficit will have to show up as higher prices.
Mining is a high-risk business and capital for it is only attracted to outsized returns. In bull markets, prices can be volatile but the returns are often extreme. We have gone through a very long gut-wrenching bear market which finally ended in late 2015. Money is beginning to move into the sector with companies beginning to be financed. Hopefully, this bull market lasts as long as the last one.
Silver is lagging and needs to get above 17.50 but it will have resistance around 18.50. Higher prices are very possible and silver mining companies will do very well in the twenties.
He recommends that investors focus primarily on finding the high-quality management teams with past successes as that is the biggest risk factor.
Time Stamp References:
0:40 – Building First Majestic Silver.
3:00 – Silver the misunderstood metal.
5:30 – Are we back in a bull market for gold?
7:20 – Institutional money is coming back.
8:30 – How will the resource equities perform?
11:00 – Why management teams are key.
Talking Points From This Weeks Episodes
• The early days of building First Majestic Silver.
• Silver is a strategic metal.
• The resource sector has outsized risks so investors want outsized returns.
• Look for high-quality management teams with previous success.
Keith Neumeyer is President & CEO of First Majestic Silver Corp. He has worked in the investment community since 1984. He began his career at some Canadian national brokerage firms. Mr. Neumeyer moved on to work with several publically traded companies in the resource and high technology sectors. Keith has been the President and Chief Executive Officer of First Silver Reserve Inc. since June 19, 2006. His roles have included senior management positions and directorships responsible in areas of finance, business development, strategic planning, and corporate restructuring. Mr. Neumeyer was the original and founding President of First Quantum Minerals Ltd. (T-FM). He founded First Majestic Silver in 2002 and First Mining Finance in 2015. Mr. Neumeyer has also listed several companies on the Toronto Stock Exchange and as such has extensive experience dealing with the financial, regulatory, legal and accounting issues that are relevant to the investment community. Keith also won the E&Y Entrepreneur of the Year Award in 2011 for the Metals & Mining category.