From Chris Mayer in DailyWealth:

Since I started writing my investment advisory over 10 years ago, the economics of the gold mining business have never looked better to me.

Before we go further, realize mining is a hard business. Gold miners process tons of rock for only a fraction of an ounce of gold. It's complex, costly, and risky. The gold price is also volatile and will have you browning your undies if you're not prepared for it. So just a word of caution here about the inherently speculative nature of gold mining stocks.

Now... if I haven't scared you off, let me show you why gold stocks could shoot much higher in the next few years. Let's look at some rough numbers first...

The price of gold miners as a group is off more than 30% in the last year, even though the price of gold has held firm. Add to that mix falling mining costs in 2009, and you have a recipe for explosive earnings.

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