A Conversation with Keith Neumeyer of First Majestic Silver


Keith Neumeyer is CEO of First Majestic Silver and chairman of a new venture called First Mining Finance. He stopped by TFMR today to discuss a number of topics near and dear to the hearts of metals investors everywhere.

Among the topics Keith addresses in this 28-minute podcast:

  • The current state of miners and mining, the cost of production at First Majestic and the steps that miners take to manage and minimize costs during this period of depressed silver prices.
  • The intentions and goals of the new venture he has formed with Eric Sprott, Rick Rule and others. Named First Mining Finance, Keith describes how it works and where folks can find the shares with the U.S. symbol "FFMGF".
  • His attempt in 2014 to organize silver producers to withhold production in order to regain some control of the paper derivative pricing scheme.
  • The letter he sent to the CFTC last month alleging concentrated positions and price manipulation. (https://www.zerohedge.com/news/2015-06-03/one-largest-silver-producers-w...) He also tells us about the response he's gotten from the CFTC on these issues.
  • What changes Keith would make to the current paper derivative system in order to establish a free and fair market for discovering price.

It was a real pleasure and honor to have the opportunity to visit with Keith and we wish him well in all of his endeavors. Please take the time to give this podcast a thorough listen.


p.s. You may notice a few edits in the audio. Just as I was asking Keith about the CFTC and their response to his letter, the Skype audio cut out. Coincidence?


Jul 13, 2015 - 12:33pm



Jul 13, 2015 - 12:36pm


Marchas was fast today!

Jul 13, 2015 - 12:37pm


only 4th?

Danforth Coxwell
Jul 13, 2015 - 12:38pm

Now to....


Jul 13, 2015 - 12:43pm

Jul 13, 2015 - 12:46pm

Kudos + 'stock tip' from shoeshine boy

Congrats and kudos for landing this interview, TF! Looking forward to listening. The following is a Canadian mining company I HAVE NO DIRECT KNOWLEDGE ABOUT OR EXPERIENCE WITH, and thus is merely a suggestion to carry out your own thorough due diligence, but was mentioned by a respected friend who has actually done well with PM miners in the past. Apparently they have some very promising Au and Au/Ni plays in motion in Quebec. Caveat emptor, this is not advice, merely info for anyone who might have interest in such matters: https://www.balmoralresources.com/s/Home.asp

Jul 13, 2015 - 12:47pm

CIPS scaled back..

For Turdite info:

From Reuters just today(Monday): Chinese payments system scaled back.


Joseph Warren
Jul 13, 2015 - 12:50pm

Been Holding Some First Majestic for Quite Awhile . . .

(Ticker symbol: AG). Not a lot of shares - but been watching it.

In miners, management is one of the top things to consider - and Keith Neumeyer is a major reason I own some AG now and hope to own a lot more when things turn around.

Jul 13, 2015 - 1:03pm

good interview

Thanks Craig

Jul 13, 2015 - 1:10pm
Jul 13, 2015 - 1:12pm

NO! Am I


Good Interview Turd. I Can't can't believe the CFTC has never gotten back to him. Well I guess I can, knowing who controls them. Keep Stacking.

Jul 13, 2015 - 1:16pm

How about this

They could charge 20 euros for McSouvlaki on a bun with special sauce.

Jul 13, 2015 - 1:22pm


AUAGforever - when did McHugh write this? HUI almost hit 138 today.

"In this weekend's newsletter, on page 47, we show a chart for the HUI Mining stocks that we believe provides clarity for the path of prices. It looks to us that Mining stocks are finishing the final wave of a five subwave Declining Bullish Wedge from late 2014. The pattern really fits nicely, is well defined, and means the HUI should bottom soon, perhaps after it drops to the 135 to 140ish area. There is a possibility it has bottomed, but we cannot rule out a bit more decline over the next few weeks. Then it should rise substantially for a long long time. The coming rally should coincide with the coming stock market crash."

Jul 13, 2015 - 1:32pm


unlike Bo, he leaves room for margin of error. McHuhe used to say metals woudl rally over the last 8 months of year to at least 1425, maybe 15-20% higher--he stil have the same dollar targets but says over the last 1/2 of year coiniciding with marekt selloff

and he says the first stage of selloff wil not be so bad-its the following waves that will kill the market

Jul 13, 2015 - 1:53pm

Greek Deal

Has A Long Way To Go Yet and Not A Done Deal.

They Are Fuming In Greece and A Few Are Really Pissed Off. Keep Stacking

Jul 13, 2015 - 2:00pm


McHugh wrote this on Friday, but his HUI 138 or so target was first mentioned 2-3 weeks ago I believe. His DIA or SPY trades work out but his Gold stock trades keep underperforming. It's do or die time. I'm still a believer these pitiful gold stocks will perform, eventually. LOL

I hate to even mention it ( Jinx it ? ) but Santa's stock is holding up at the current level and seems to be under an accumulation phase.

Jul 13, 2015 - 2:04pm

Note from a hedge fund guy

Got an e-mail this AM from a manager we use--Thought I would share

A quick search on Investopedia finds the definition of a command economy as “A system where the government, rather than the free market, determines what goods should be produced, how much should be produced and the price at which the goods will be offered for sale. The command economy is a key feature of any communist society. Cuba, North Korea and the former Soviet Union are examples of command economies.”

Today we live in a system where governments and their proxies determine the level of interest rates, the price of bonds and collateral, and in some countries the value of equities. Since price conveys information, wrong prices can encourage wrong decisions. Today all you have to do to be rewarded in the stock market is issue debt, buyback stock and pay a dividend.

A perusal of the largest corporations in the world would suggest the death of return on capital investing and entrepreneurship. Vision, boldness and investments are gone from a CEO’s job qualifications and replaced with dividends buybacks and stock option packages. The boardroom’s mass delusion with the intellectually bankrupt modern portfolio theory and manipulated interest rates is encouraging an epidemic of wasted capital and squandered opportunities.

The radical innovation that sustains long-term economic growth, even as it destroys the economics of the established corporation, is alive. The future of many industries is being, or is about to be, dramatically disrupted. We own the disruptors – whether it’s in banking, technology, retail, automotive or medicine. Governments need to be warned - overreaching into price mechanism brings risks to the economy but more importantly government’s sole source of power – creditability.

Being “boring” is the latest investment fashion trend but like corduroy suits and acid wash jeans it will be looked back upon with regret. Capitalism is an evolutionary process - not a permanent state of stability. Governments will default. Big companies will go bankrupt. New companies will rise. That’s what makes today one of the greatest times in history to be an investor. Have a nice weekend


Jul 13, 2015 - 2:19pm

No Current Silver Shortage

If producers like Keith aren't in a position to name their own price for their physical silver production as opposed to accepting the fake paper price then that pretty much says it all.

Keith has failed to accomplish anything in his past efforts to temporarily withhold sales and in his puffball letter sent to the CFTC (with no follow-up on his part).

Pitiful and pathetic (PAP smear).

Jul 13, 2015 - 2:31pm

hedge fund letter

the problem is that when the stuff hits the fan disruptors wil be hit also.

the key then is knowing what to buy in this next big selloff. Sort out the good stuff from the crap. the shopping lists should have already been prepared. Who survives the biotech train wreck, the retail train wreck (Costco is Richard Russels fav at a much lower price) .

there is always the change the world as we know it or want to kno w it does not survive in this form, in which case, what do you need. PM is a good thought.

there is one last little issue--you buy a stock to see it go up because the company has a killer product and gains revenues. Our economy ain't growing, no surprise. a growing economy is helpful and we do not see it. Growing companies are not plentiful but they are out there. That would help in any selloff but perhaps it wil be best to be out of market.

also need to remember almost everybody is human and sees the good in what they are doing-even us here. our problem is its not popular with the government--Gibsons Paradox, written by larry summers who tell sthe world how to control interest rates is by controlling the price of gold. This guy was president of harvard, Treasury Secretary, Head economic advisor to Obama, considered to repl Bernanke as Fed Chief and he is a specialist in manipulating markets. Whats wrong with this picture.

Jul 13, 2015 - 2:44pm

The game begins for bitcoin

I was out of pocket this weekend and read with interest the banter over btc. I've been a fan for a long time and have started keeping my money in it instead of the banks due to fear of what just happened to Greece.... bank holiday. Too bad it's not a fun holiday with party favors, noise makers and such.

Now you can short bitcoin with up to 5x leverage: https://www.coinsetter.com/margin-trading

This should make things more interesting. The govt does hold a lot of coins that they have stolen from the likes of Ross Ulbricht and others. I can see them leveraging them up and shorting the market at critical junctures to keep the interest from popping too much. Ultimately they will lose just like they will with Au/Ag.

Edit: And I'm not worried about getting to my btc, because if the grid goes tits up then money will be the least of my worries.

Jul 13, 2015 - 2:59pm

Robert Mundell, evil genius of the euro

The idea that the euro has "failed" is dangerously naive. Euro is doing exactly what its meant to do,

The idea that the euro has "failed" is dangerously naive. The euro is doing exactly what its progenitor – and the wealthy 1%-ers who adopted it – predicted and planned for it to do.

That progenitor is former University of Chicago economist Robert Mundell. The architect of "supply-side economics" is now a professor at Columbia University, but I knew him through his connection to my Chicago professor, Milton Friedman, back before Mundell's research on currencies and exchange rates had produced the blueprint for European monetary union and a common European currency.

Mundell, then, was more concerned with his bathroom arrangements. Professor Mundell, who has both a Nobel Prize and an ancient villa in Tuscany, told me, incensed:

"They won't even let me have a toilet. They've got rules that tell me I can't have a toilet in this room! Can you imagine?"

As it happens, I can't. But I don't have an Italian villa, so I can't imagine the frustrations of bylaws governing commode placement.

But Mundell, a can-do Canadian-American, intended to do something about it: come up with a weapon that would blow away government rules and labor regulations. (He really hated the union plumbers who charged a bundle to move his throne.)

"It's very hard to fire workers in Europe," he complained. His answer: the euro.

The euro would really do its work when crises hit, Mundell explained. Removing a government's control over currency would prevent nasty little elected officials from using Keynesian monetary and fiscal juice to pull a nation out of recession.

"It puts monetary policy out of the reach of politicians," he said. "[And] without fiscal policy, the only way nations can keep jobs is by the competitive reduction of rules on business."

He cited labor laws, environmental regulations and, of course, taxes. All would be flushed away by the euro. Democracy would not be allowed to interfere with the marketplace – or the plumbing.

As another Nobelist, Paul Krugman, notes, the creation of the eurozone violated the basic economic rule known as "optimum currency area". This was a rule devised by Bob Mundell.

That doesn't bother Mundell. For him, the euro wasn't about turning Europe into a powerful, unified economic unit. It was about Reagan and Thatcher.

"Ronald Reagan would not have been elected president without Mundell's influence," once wrote Jude Wanniski in the Wall Street Journal. The supply-side economics pioneered by Mundell became the theoretical template for Reaganomics – or as George Bush the Elder called it, "voodoo economics": the magical belief in free-market nostrums that also inspired the policies of Mrs Thatcher.

Mundell explained to me that, in fact, the euro is of a piece with Reaganomics:

"Monetary discipline forces fiscal discipline on the politicians as well."

And when crises arise, economically disarmed nations have little to do but wipe away government regulations wholesale, privatize state industries en masse, slash taxes and send the European welfare state down the drain.

Thus, we see that (unelected) Prime Minister Mario Monti is demanding labor law "reform" in Italy to make it easier for employers like Mundell to fire those Tuscan plumbers. Mario Draghi, the (unelected) head of the European Central Bank, is calling for "structural reforms" – a euphemism for worker-crushing schemes. They cite the nebulous theory that this "internal devaluation" of each nation will make them all more competitive.

Monti and Draghi cannot credibly explain how, if every country in the Continent cheapens its workforce, any can gain a competitive advantage.
But they don't have to explain their policies; they just have to let the markets go to work on each nation's bonds. Hence, currency union is class war by other means.

The crisis in Europe and the flames of Greece have produced the warming glow of what the supply-siders' philosopher-king Joseph Schumpeter called "creative destruction". Schumpeter acolyte and free-market apologist Thomas Friedman flew to Athens to visit the "impromptu shrine" of the burnt-out bank where three people died after it was fire-bombed by anarchist protesters, and used the occasion to deliver a homily on globalization and Greek "irresponsibility".

The flames, the mass unemployment, the fire-sale of national assets, would bring about what Friedman called a "regeneration" of Greece and, ultimately, the entire eurozone. So that Mundell and those others with villas can put their toilets wherever they damn well want to.

Far from failing, the euro, which was Mundell's baby, has succeeded probably beyond its progenitor's wildest dreams.

Joseph Warren
Jul 13, 2015 - 3:03pm

'government' and 'corporations' . . .

are nothing but word fictions. I don't disagree with the well made points of Silver66 above, but its important that we pay attention to our General Grammar, - that is the definitions of the words that are used. This is one way that people are deceived.

'government' and 'corporations' in this sense refer to the individual (evil psycho/socio path) power mad human beings who use the current political/economic system to plunder and enslave humanity. The words are used as a cover and a shield and to obfuscate. (A 'corporation' did this, the 'government' did that.) A perfect example is the recent Trans Pacific Partnership goings on. Individual criminals in 'government' positions did as ordered to give false 'authority' to individuals in 'corporation' positions to usurp any attempts by the population to protect themselves & redress injury through law and representative government. Evil people did a power grab.

Karma Will catch up with the individuals responsible, . . . especially the many millions of Americans over several generations, who didnt pay enough attention to what was allowed to happen to their country.

Jul 13, 2015 - 3:18pm

unedited keith notes

Keith N interview notes
tf intro july 13
hui index is 139, same as 2003. 1magestic stock down too
metal is higher, miners are not
what does 15.50 silver do to industry??
kn- it's been a challenge. when silver was 40 all was well. at 40 spent 200 million, at 15 we spend 70 million on production.
now treated as manufacturing, we produce a product.
tf- how low can price go, what ddoes a mining co. do with these low prices. what about company and employees.
kn- didn't hedge because investors would have freaked and not bought stock. cant hedge, just have to reduce cost. no idea how low it can go, maybe low 14s, ...lot of seller exhaustion. but i think we'll end higher this year.
tf- physical floor in london seems to be in place, do you mothball mines, or limit production?
kn- we expand mills and production, in 2016 we'll expand. high-grading, must have 200g silver and higher. during sustained low prices and running out of high grade it eventually leads to shutdowns.
tf- many other companies are more distressed. you are working to acquire fund distressed mines?
kn- yes, man shareholders followed me, i put 1MS together, and other companies. ...by buying properties nobody wanted. we're the 2nd largest producter in mexico. currently sifting through 1,000 companies looking for the next success. just got a big one in canada.
tf- how to invest in first mining co.
kn- it's on the pink sheets, but not quoted properly.
tf- canadians can find on toronto
kn- yes.
tf- with you, rick rule, eric sprott... blood in the streets, accumulate now right? more questions...
tf- what about your ideas to have miners hold back production?? any success?
kn- no, we have held back some, but we're just a fraction. but yeah, tried to get others at the table. but nobody joined up
tf- you get it, what's wrong with the other mining ceo guys?
kn- they don't understand their product apparently. ...more process focused instead of product focused.
tf- ?-lack of understanding price derivation, banks etc. in paper gold and silver the banks add enough to control price. it's unfair. you wrote the cftc re: short positions of specs and banks etc... ever hear anything??
kn- no, no response.
tf- so... the paper markets are supposedly created for you as a miner, they are supposed to watch them, you wrote them, they won't write you back??
kn- nope, no response.
tf- you alledge crimes and hear crickets from cftc??
kn- yes, 800 million oz per year is produced. we're pretty big, but no response
tf- what if you never hear from them?
kn- they probably get a lot of people writing them and just toss the letter into the pile.
tf- last question- craziest thing, the prices effect real people with real jobs. individuals all through mexico woujld have good job but silver is so low the employees lose jobs. It's unfair,... if you had the power, how would you setup price discovery of Silver?
kn- fix the leverage. 10:1 sounds fair. like banks have to keep liquid capital, require traders to do same thing. limit the supply of the paper. make comex keep at least 10 percent.
tf- sounds like a good way to go, your new company is on pink sheets now
kn- going public'er' soon, ...this is the sector to be buying
tf- the value is there, you're in the know regarding the best miners.
closing out

november4 Goldencross
Jul 13, 2015 - 3:34pm


WOW! How did you find this site? That narrative explains much regarding the Greek crisis. As well read as I believe I am, I had not ever before encountered this very cogent explanation of the origins of the EZ and the Euro. Thank you for coming to this site and thank you for your contribution.

And, Turd, thank you again for creating a forum that invites such intelligent input.

Jul 13, 2015 - 3:35pm


The short squeeze is overdue and the commercials are ready. But they couldn't do it last week, neither today. So they wait. And here is why:

1. It's because of Greece and China....Gold/silver are not allowed to be seen as save havens in the time of real crisis.

2. The cartel needs to keep control of the PM prices ....something they've worked so hard for the last few years....and that could get out of hand

They have to wait for calmer times, for things to settle down ....and then they will fleece the spects and run the cash register...Prices will rise, but with the cartel full control.

arch stanton
Jul 13, 2015 - 4:19pm

good luck

trying to buy FFMGF on the pinks. I tried all week last week could never get the order to fill. Look at the bid ask today: Last price .397 Bid .01 Ask 1.00. I would love to own several thousand considering the crew running it. If any of you more sophisticated guys know how to get a buy done let me know.

indiana rod
Jul 13, 2015 - 4:45pm

$100.00 A Share

When silver is $100 an ounce, where it would easily be if fairly priced, First Majestic would have a billion dollar cash flow. That would make them a $100 a share company.

I think I'll hold on to my shares.

Jul 13, 2015 - 4:46pm

Some Miners Well-Bid

Some heavy buying in certain, strategic silver miners...

AG - 4.06%

CDE - 4.10%

EXK - 4.55%

HL - 10.37%

SSRI - 2.26%

Who smelled the bargain?

Sound Money Minnow
Jul 13, 2015 - 4:46pm

Is it just me or is the audio awful on this thread?

Just wondering if anyone else is having a problem with Keith's portion of this audio?

Maestro nadgeskaul
Jul 13, 2015 - 4:56pm

I did!

including the woodwind section as well.

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