By Melissa Pistilli-Exclusive to Silver Investing News

Tuesday was another bleak day for those in the mining industry, especially for those stocks listed on the commodities-heavy TSX.  After dropping over 7 per cent on Monday, the diversified metals index lost another 5+ per cent. There are still some die hard bulls, however, who have managed to maintain a positive outlook for the long-term. Still, some analysts believe the s#!% has yet to hit the fan.

Andrew Martyn, Vice President of Davis-Rea Ltd. believes the mining industry is coming to the end of what as been a long, strong cycle characterized by “massive demand” from growing economies like China and India.

It takes an average of seven to ten years to bring an exploration project through to production. So, those mining companies who were applying for permits several years back are just now beginning to bring new supply to market, added Martyn. “There are two things going on with this: with the liquidity crunch around the world, there is concern that demand will slack off significantly in those markets.” Slowing demand coupled with rising supply will no doubt depress metals prices, “hence why these stocks have been creamed in recent months,” adds Martyn.

For precious metals miners, there may be a light at the end of the tunnel. Commodities like gold and silver are viewed as safe havens for investors in times of financial crisis, said Salmon Partners Inc Haytham Hodaly. Eventually, said Hodaly, the current economic crisis will weaken the U.S. dollar, “which will shed some positive light on owning precious metals, particularly gold and silver as basically a safe haven in this time of economic turmoil.”

This is the positive perspective taken by precious metals mining execs like Bradford Cooke, Chairman and CEO of Endeavour Silver Corp. [TSX:EDR]. “I think we can conclude that when everything goes up for sale, then nobody’s immune to a market selloff, but the demand for commodities is still extremely robust.”  Cooke remains confident that a “long-term commodity bull market” is still in place, “and the sell-off of the commodities in general and the mining shares in particular is overdone.”

“Endeavour’s fundamentals remain very strong,” Cooke assured. “The sharp market sell-off of gold, silver and precious metal mining stocks in recent weeks appears to be somewhat excessive. Silver and silver shares in particular seem to have fallen disproportionately compared to other commodities.”

Like Martyn, Cooke believes the precious metals will rebound as they regain their natural market status, as “hedges against financial crisis, monetary inflation and currency debasement as soon as the market liquidations of financial assets and their derivatives start to subside.” Hence, the low demand/high supply concerns that hang over the heads of those in the base metals markets may not necessarily apply to precious metals.

Speaking specifically about Endeavour, Cooke addressed the reasons management believes the company will remain attractive to investors as the markets once again leans towards the safety offered by silver and gold. “Regarding Endeavour, silver production in the 3rd quarter at our two silver mining operations in Mexico already exceeds the 2nd quarter production as planned and will rise again in the 4th quarter reflecting the next phase of our organic growth,” he said. “The Guanajuato Mine operation in particular is out-performing the jump in production planned for Q3, 2008, and cash costs continue to decline as production rises.”

With new silver vein discoveries at both its Guanacevi and Guanajuato projects, Endeavour is confident that its “silver reserves and resources will rise once again at year-end for the fourth consecutive year.” Last week, Endeavour had announced that exploration drilling on its Bolanitos properties at the Guanajuato Mines project had discovered four new zones of high grade silver-gold mineralization. The best results to date came from drill hole SJS-1, which intersected 374 g/t silver and 3.14 g/t gold over 9.5m, including 1147 g/t silver and 0.84 g/t gold over 1.90m.

“We are thrilled to see such positive initial drill results from the Bolanitos exploration drilling program,” said Cooke. “The Bolanitos vein system extends for several kilometres on Endeavour’s properties and the potential for additional high grade silver-gold discoveries appears to be very good. We now have two drills working around the clock at Bolanitos.”

Cooke will be speaking at The Silver Summit this Friday in Coeur D’Alene, Idaho.

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