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6/28/12

Tahoe Resources (THO.to) and Guatemala

We know that Tahoe Resources (THO.to) has great rocks, we've known that for ages, but your author has kept away from the stock all this time because of its address. And now the wheels come off the THO.to stock price due to that political risk which was, sadly, totally expected by your author and completely ignored by the dumbasses in suits that pump stocks to you up North Here's an extract from IKN143, dated January 29th 2012:

Recent optimism as to the state of play in Guatemala under the new Pérez administration may continue (or may not, watch those prices in FV.v, RDU.v, THO.to and others and find out) but unless progress is made on the mining law reform, the rally is bound to peter out. Your author continues to avoid exposure to Guatemala for his personal cash though does recognize, as we did in IKN133, that the risk-takers amongst the audience may feel it’s a place worth a dabble. A small bit of fun money risked on Guatemala isn’t such a bad thing, but the thought of major cash exposure to the country, such as that of anyone in Tahoe (THO.to) that’s betting on a smooth and direct run from here to production, still breaks brows out in a cold sweat in this office.

And here's a bit from the IKN133 report referenced, back further in November 2011:

The bottom line here that my personal call isn’t going to change and i still say “avoid Guatemala”. However, high risk money may feel like a flutter on Guatemala risk and potentially playing a new-found pro-mine feeling on the Perez Molina election. Who needs reality when you have perception, anyway? Of the three Guatemala vehicles mentioned here, RDU.v appeals the most and those into flippy type of trades (and as long as you go in with eyes wide open knowing that risk here is high) may want to consider it, tax loss selling season or not. FV.v is also a possible (see Zinc Basket) but is so tiny on a market cap level it brings its own risks. THO.to, for it sheer size compared to the others, scares me far more even though it’s got wonderful rocks and world-class mining potential.

Here's a YTD chart for THO.to including the fun today as the market reacts to the new Guatemala government's cunning plans for the sector. And to think The Can of Corn actually called them "a positive"...utter dumbasses of the highest water.


Errr.....Toldyaso.

UPDATE: THO halted its stock on the waterfall and then told the world that it wasn't affected by the new law proposal. Here's how the NR starts:
VANCOUVER, BRITISH COLUMBIA--(Marketwire -06/28/12)- Tahoe Resources Inc. (THO.TO)(TAHO) today reported that government-proposed mining law reforms in Guatemala should not affect its Escobal project.

Oh of course you're not affected guys. Of course not. In other news, Otto Perez has a bridge for sale, but be quick before John Doody and his subbers make a collective bid for the thing.