First, I look for smaller exploration companies that appear to be on the right track or that have started producing precious metals and are able to do so at a low cost per ounce.

First, in order to compensate for the diminishment of purchasing power that usually accompanies rising inflation, investors normally have demanded higher interest rates on their investment assets. This was particularly true in the 1977-81 era when inflation soared to almost 20% and interest rates rose to roughly the same level.

Over the past few months we have noted a gradual increase in news relating to inflation—but during the past month this gradual increase has accelerated steadily and has now taken on the appearance of a virtual flood.