The Northern Miner's hot-off-the-press 11^th edition of Mining Explained is getting high praise from I Think Mining's Jack Caldwell. This updated version of our guide to the mining industry for retail investors is by able Northern Miner editor and geologist John Cumming. To order a copy, go here.

On another in-house note, now you can watch our TNM TV News segments on your iPhone or iPad. We've switched from Flash to MP4 format for the newest videos and we're in the process of switching over videos from previous years. (If you're watching on your computer and find that the image and sound don't synch up, try upgrading to a newer browser.)

Even though The Northern Miner is a subscription site, our videos are available for FREE on The Northern Miner and Mining Markets websites, and on YouTube.

BHP Billiton (BHP-N, BLT-L) announced last November that it was considering selling its diamond interests -- consisting of an 80% stake in Canada's first diamond mine, Ekati, and its 51% stake in the Chidliak exploration project, on Baffin Island. In December, it made good on the promise, announcing the sale of its interest in Chidliak to its joint-venture partner, Peregrine Diamonds (PGD-T).

Now, rumours are swirling about Ekati, set off by a report by Bloomberg. According to the news service, Former Stornoway Diamond (SWY-T) president and CEO Eira Thomas is one of several parties interested in buying the rich Northwest Territories mine. Harry Winston Diamond, which holds a 40% stake in the nearby Diavik diamond mine, is also named as a potential buyer. Thomas is reportedly working with investment firm Apollo Global Management, while a separate group led by KKR & Co. is apparently also pursuing Ekati. The price tag for the mine, according to Bloomberg, could be between US$500 million and US$700 million. Ekati is nearing the end of its mine life in 2019.

Thomas played a major role in the discovery of Diavik as a young geologist working for Aber Diamonds, her father's company. She also founded Stornoway, and until recently, served as a director and chairman of the company.

But outside of a seat on the board at Lucara Diamond (LUC-T), she has not had any official ties in the diamond business since last August, when she announced she was resigning all posts at Stornoway.

Our deepest condolences go out to Eric Coffin and his family. His brother and business partner at newsletter HRA Advisories, David, died suddenly on Feb. 16.

David was always very kind and generous with his time and geological expertise. He never hesitated to share his insights, developed over decades in the mining sector, with me and other reporters at The Northern Miner.

He had a unique, no-nonsense style that garnered much respect in an industry full of hype. He will be missed.

I'm working on our annual review of geophysical advances right now (Exploration Trends & Developments), but I'm also squeezing in a visit to the Cambridge House resource investment show in Vancouver starting this Sunday.

Look for an interview on the Mining Markets website next week with Brent Cook of Exploration Insights. I'll also be speaking with Frank Holmes of U.S. Global Investors, for the March issue of Mining Markets magazine. Frank's debate with Gordon Chang on the strength of China's economy is sure to be a highlight of the busy week, which also includes the AME BC Mineral Exploration Roundup conference.

In the meantime, we always knew our readers were smart - but now we have proof. Sort of.

A study published last month in the Journal of Finance draws a positive link between IQ and stock ownership. The study has been criticized for drawing a wide conclusion from a very narrow sample (Finnish soldiers), and having seen a lot of smart people lose a lot of money in the market, I'm not convinced. What do you think?

If the roiling markets of 2011 left you feeling a little seasick, you might want to steer clear of the market for the first half of 2012 too -- if you believe TD Securities' 2012 forecast.

In its 2012 Outlook report, released in mid-December, the bank calls for increased volatility (!!) in 2012 and a bumpy first half dominated by -- surprise, surprise -- the euro zone's troubles.

But Q1 -- when TD expects a "hard default" by Greece -- should see the lowest prices of the year for copper, oil, palladium, platinum and silver as demand for commodities softens in emerging nations. (TD forecasts Chinese growth at only 7.8% this year). Renewed fears over the outcome of the European sovereign debt crisis will also hit commodities prices, with investors steering clear of risk. The authors predict that even gold won't be immune as investors sell the yellow metal to increase liquidity.

But the report strikes an upbeat tone for commodities come summer.

"In sharp contrast, the latter part of 2012 looks much more robust for commodities, with prices moving sharply higher into Q3-2012. We expect the worst of the financial crisis to be over in the second half of the year and see China undertaking aggressive fiscal and monetary action to jumpstart growth, which should send commodity demand sharply higher."

TD predicts palladium will be a big winner of 2012, and suggests buying palladium at US$616 per oz. (with a protective US$550 put) and a target of US$825.

"By mid-year, we should have more clarity on the European situation and many of the central banks around the world should have injected plenty of liquidity into the system, including large balance sheet expansions. Therefore, palladium, as a precious metal, should move much higher into year's end."

Also helping to drive commodities and gold higher in the second half are supply concerns, geopolitical risk in the Middle East, further quantitative easing from the Fed, and the likelihood that the ECB (European Central Bank) will act as a lender of last resort to euro zone countries.

RBC Economics also sees light at the end of the tunnel in its 2012 forecast.

Rather than the world ending in December 2012, as some interpret the Mayan calendar to predict, an RBC report from mid-December predicts a renewal of sorts post-2012.

"While 2012 may, at times, feel as if doomsday has arrived, we expect 2013 will be the start of a prosperous cycle driven by strong global growth and the return to sounder fiscal practices," says the report.

Before we get there, RBC predicts the euro area will have another quarter of contraction in Q1 2012, slipping into a shallow and short-lived recession.

The bank also sees slower growth in emerging economies in the first half of 2012, but predicts a rebound in the second half - although growth will still be slower than last year. RBC pegs China to grow at 8.4% in 2012 - far from a hard landing.

As for metals prices, RBC anticipates they will remain lower than recent peaks, but still "well above" historical averages.

In a late December report, Scotia Capital's vice-president economics Patricia Mohr predicts that copper will see the biggest price gains in 2012. Those forecast increases are due to fundamentals: even with a projected 6% increase in global mine supply this year, copper will remain in a supply deficit. (In 2011, copper mine supply rose by just 0.4% followed by several years of 1% growth that coincided with rising demand from China.)

While the first quarter could see China's growth slowing, Mohr expects growth to pick up in the spring - sending commodity prices higher and the copper price back up to US$4 per lb. Copper could remain at just under US$4 for much of 2013 as well. (Copper reached a new record high of US$4.60 last February.)

Looking further down the road, to the middle of the decade, Mohr anticipates that zinc prices will strengthen significantly because of mine depletion around the world.

And the United States? BMO Nesbitt Burns forecasts that U.S. growth will pick up a little in 2012 (to 2.2% from 1.7% last year) while growth in Canada will slow a little (to 2% from 2.3% in 2011). The U.S. forecast assumes that Congress will extend the payroll tax holiday and unemployment insurance benefits beyond Feb. 29.

U.S. growth should improve to 2.6% in 2013 but "federal government belt-tightening" could eat into that significantly.

Tax-free savings accounts (TFSA) offer one of the few tax havens Canadian investors enjoy.

And while many Canadians now have TFSAs -- 44% according to a recent BMO Bank of Montreal study, they clearly don't get them.

BMO found that only a third of respondents knew that mutual funds can be held in a TFSA, while the same proportion were aware that guaranteed investment certificates (GICs) are eligible.

Although it's called a "savings" account and many commercial banks have promoted their use as such, TFSAs aren't limited to cash or GICs. You can also invest in bonds, mutual funds or stocks - just as you can in a registered retirement savings plan (RRSP).

Whereas RRSPs offer tax deferral to a time when your income will presumably be lower, TFSAs offer tax-free gains but no immediate tax relief. This is why interest-generating investments such as GICs have been touted as TFSA appropriate - because interest generated outside of a TFSA (or RRSP) is fully taxable.

However, GICs and savings accounts aren't garnering much of a return these days.

So should you give junior mining stocks a try? Well, that depends.

If the stocks you picks do well, you're in for a windfall, says Liam Fitzgerald, a senior tax partner at PwC.

"You could put $5,000 worth of junior mining penny stocks in there and if they took off and you tripled your money to $15,000, that $10,000 gain is not taxed."

Held outside of a TSFA, the realized gain on selling the stocks would be subject to capital gains tax (50% of the gain is taxed at your marginal rate).

The drawback of course, is that if your stock selection instead declines in value, you forgo the capital loss deduction you would have been able to claim had they been held outside of a TFSA.

"You have a trapped loss, you don't get the benefit... so if you buy $5,000 worth of stocks and it becomes $2,000, you don't get to deduct the $3,000 loss," Fitzgerald says.

Capital losses can be carried backward three years to offset capital gains in past years (at a rate of 50% of the loss), or can be carried forward indefinitely.

So while it's advisable to avoid putting tax-advantaged investments into a TFSA, there are no hard and fast rules.

If you haven't opened a TFSA yet, note that you have been accumulating contribution room to the tune of $5,000 a year since TFSAs were introduced in January 2009 (assuming you're a Canadian resident and were 18 or older for the past three years). That means you could open a TFSA and put up to $15,000 in an account right now - or $20,000 next year.

One other note about: there's been a lot of confusion regarding over-contributions to TFSAs, which are subject to a penalty tax of 1% a month on the excess contribution.

Just make sure that if you withdraw money from your TFSA, you wait until the next year to put it back.

"Essentially, once you reach your contribution limit for the year, you cannot reinvest or return money that has been withdrawn from your TFSA in the same year," says David Heatherly, vice-president, BMO Bank of Montreal. "However, that withdrawal amount gets added to the contribution room available in the year following."

Mining Markets has finalized its editorial calendar for 2012.

In March, we'll be tackling specialty and critical metals - anything from the rare earth elements to lithium; tantalum, to tungsten; vanadium to indium, and beyond.

Our June issue will take a look at exploration and development activity in the Far North - from Alaska to Nunavut.

September is reserved for all things gold, one of the world's favoured safe havens.

And we'll warm up December with a focus on Latin America.

While we've come up with broad themes for each issue, there's still lots of room to allow us to cover timely issues. If there are other themes or specific stories you'd like to see covered in Mining Markets, let me know at ahiyate@miningmarkets.ca.

With tax season on the way, Mining Markets is planning a feature on tax-efficient investing for our December issue.

Do you have questions about TFSAs, RRSPs and mining stocks? How about flow-through shares? Send your questions to me at ahiyate@markets.ca and I'll put them to the tax experts.

Just a quick note to let everyone know that we've moved.

Our new mailing address is:

80 Valley Brook Dr.,

Toronto, Ont.

M3B 2S9

All of our other contact information is unchanged.

One of the main themes of the Denver Gold Forum last week was the disparity between gold prices -- which had climbed to a new nominal high of more than US$1,900 per oz. in early September -- and gold equities, which have lagged the gains in the gold price.

While the consensus among gold company executives was that their stock prices would soon catch up to the rise in gold bullion, gold's volatility and recent pullback has actually meant the reverse, says David Christensen, CEO of long-term closed-end fund ASA Gold and Precious Metals (ASA-N).

"Unfortunately, since Denver, the price of gold has caught up with many of the miners," Christensen quipped yesterday, during a telephone interview from his office in San Mateo, Calif. "One has to be careful what they wish for. They were right, but for the wrong reasons."

The plunge in the gold price - which dipped as low as US$1,535 an oz. on Sept. 26 - may have spooked investors, but Christensen still sees strength in gold for the foreseeable future.

"During the next six to twelve months, we continue to see that the global economic environment . . . is going to continue to keep gold in the spotlight. We don't see a great deal of downside from where we're at today and we think gold will continue to trade in a broad range of US$1,400 to US$2,000 an oz. for the next couple of years."

That may not please the gold bugs, but it does point to some opportunity in the gold equities, which Christensen says have historically been better investments than physical gold.

"I think that the gold mining companies have been overlooked for the last year or so, especially since the market crashed in 2008 as investors realized that the mining shares carried a great deal of risk that wasn't inherent in gold bullion," he says. "Many of the reasons people had looked to gold for a safe haven in the past two years had to do with currency or general market risks that weren't hedged away by buying the mining stocks. And so you saw a great groundswell of interest in buying gold bullion."

Christensen continues: "I think that is starting to come around and people have begun to realize that the companies, over time, clearly have added a lot more value than owning gold bullion."