Financial Sense Junior Gold Mining Index Review by Frank Barbera 10/29/2007

General Comments

A sagging greenback which was down four of the last five sessions continued to underpin untold buying support below the entire pressure metals complex, where money continued to pound its way through the front door. Remarkably, Gold closed at yet another 27 year high and finished the week with its 9th gain in the last 10 weeks ending with a gain of 2.62% or up $20.10/oz to close at $785.00. Were it not for a meager $1 decline the week of October 5th, Gold would now be up 10 weeks in a row going back to the lows of August 16th at $652.10. Since then, the Midas Metal has glittered its way north to the tune of $132.90 the ounce or 20.38%. In light of this stellar performance, it’s a good thing, isn’t it Mr. Poole, or was it Mr. Mishkin, that Gold has no inflationary forecasting value cause otherwise it might be sending some type of strongly worded message. –Nah!! that couldn’t possibly be it, ---lets talk to Mr. Summers who seems to believe that a 20 to 30% decline in the Dollar is, well, ---perfectly OK. -Excuse me, while I place another order to my bullion dealer, as I am trembling in fear of the US Strong Dollar policy. Seriously, the incredible level of Dollar “benign neglect” goes beyond the inconceivable, --- a total abrogation of any fiduciary responsibility on behalf of our cherished political and monetary leaders. So please forgive the mini rant, its just sometimes I can’t help myself as I visualize the price of toilet paper and toothpaste spiraling higher and out of control. At any rate, the unchecked Dollar weakness propelled other precious metals sharply higher as well with Platinum gaining $16/oz to close at $1454, a gain of 1.11%, while Silver gained $.73 or 5.41% to close at $14.22. Mining stocks seized on higher metal prices like a pack of hungry sharks with the XAU surging 8.66 index points or 4.98%, while the HUI gained 4.68%. Joining the fray was the FSO Junior Mining Index which gained 6.81 index points to close at 317.28, up from 310.47 for a gain of 2.19%. Within the FSO Sub-Indices, the Junior Producers gained +13.88 index points or 4.74% to close at 306.27, while the Junior Development stocks gained +14.49 index points to close at 556.40, for a gain of 2.67%. Finally, Junior Exploration names ended the week flat with Exploration Index ending at 229.90, up 1.76 index points or .0077%.

Financial Sense Junior Gold Index™

Mining Index

Above: the FSO Junior Mining Index - 40 stocks

Financial Sense Junior Gold Index™

Producer Index

Above: FSO Junior Producer Index

Financial Sense Junior Gold Index™

Development Companies

Above: FSO Junior Development Index

Financial Sense Junior Gold Index™

Exploration Companies

Above: FSO Junior Exploration Index

In the table below, we update the price history for the FSO Indices over the month of October which turned out to be quite a positive month for the Junior Miners. On the month thru Friday the 26th, the FSO Junior Gold Index is up 8.83%, the Junior Producer Index up 7.70%, the Junior Development Index up 3.17%, and the Junior Exploration Index up 14.21% which compares with a gain so far of 7.14% for the XAU.

That’s all for now,
Frank

*Please note that the individual companies in this index are proprietary and will not be disclosed due to compliance and regulatory issues resulting from the relationship of FinancialSense.com, Puplava Financial Services, Inc., Registered Investment Advisor and Puplava Securities, Inc. Member Firm FINRA/SIPC.