Fellow Investors,

Having just read Joekings dramatic post to the EDITORIAL in El Universo by a financial columnist. I find it very difficult to determine how JoeKing jumps to the conclusions he did.

Therefore lets analyse what this writer and financial advisors advise and determine what his commentary is worth.

He write's,  

/The rise of mining exploration in southern Ecuador is based on two factors.  First, it is high mineral prices.  At lower prices, exploration at such a remote site would not have been attractive./

First, exploration companies had been exploring for minerals before the bull market in commodities started ( ARU being one of them ) I would have to say the first part of his statement is wrong then. 

Second, this writer obviously has no idea of what a remote mine location is. Remote is in Canada's north, the Artic circle, 12,000 feet up a mountain in Papua and many parts of Russia just to name a few. Remote is not in Southern Equador. Why would Southern Equador be any more remote than any of the other surrounding countries that already have a prosperous mining industry hahahahahahaha. Therefore I would have to say the second part of this statement is just pure nonsense.  

He writes,

/The other factor is Ecuador’s current mining law.  Former president Gustavo Noboa appointed as his MEM minister Pablo Teran, an experienced miner, who designed the current law that encourages exploration./

True enough, however he wrote up a mining law that was the most attractive by far in the world, vertually no tax's of any kind. For those who really know how any government works around the world, this fantasy was not going to last long. It did its job, which was to encourage exploration and attract attention to Ecuador as a future mining hot spot. 

He writes,

/Today, there is a statist and environmentalist government that views mining operations with skepticism.  If mining companies can reach an understanding with this government, they would no doubt be shielded from risk if conditions vary in the future.  In contrast, oil companies signed contracts with a pro-investment government, and now they are facing negative consequences./
 

Once again, his first statement is totally foolish. Every real news article that has come out of Ecuador has show that this government is serious about starting a mining industry. They have created a department of mine's, officials have made many pro mining comments and most importantly they have broken up NGO organized blockades of mining projects. Very importantly, they have also granted timely work permits to those companies in good social standing and with a good working plan. This does not seem the actions of a government that is skeptical of mining or statist.

With regards to oil companies signing contracts with a pro investment government hahahahahaha. They signed contracts with corrupt governments and officials, who they bribed in order to give them free reign and exaggerated profits, while they stripped the country and people of its oil wealth. 

Why do you think that so many former Presidents were booted from office. Who other than Correa, whom most people seem to forget was a finance minister in one of these former governments, is in a better position to know just how corrupt they were hahahahahaha.

Perhaps that explains his platform of getting rid of corruption in the government because he disliked what he saw. Perhaps he just realized the time had come and it would be politically expediant for him to run on such a platform. No matter what the real reason so far he has followed his campaign promises to the letter, which shows so far he is a man of his word. To bad our politicians in the supposed politically stable West were not also men of there word hahahahaha.

Therefore, the secound part of his statement and what he implies is just so much garbage.

He writes,

/1.  The highest possible income for the country.  It must go until the point which is attractive for the company to make exploitation, and not beyond, otherwise resources would remain underground./

Well this is just what any government is supposed to do, it is a sharing between the people and there resources in a country ( who governments are supposed to represent ) and a company that wishes to extract them. The only difficulty in this is recognizing the point at which the economic ballance shifts from one side to the other. This is not a problem because Ecuadorian government officials have already stated that any new taxes will be an average of what can be found in other countries. Especially those neighbouring countries who they have to compete with for resource investment. Therefore I am still expecting an attractive new mining legislation relatively speaking to be brought in.   

He write's,

/2.  The best environmental practice.  Any economic activity has an environmental impact. The issue is to lessen it, and ensure it does not cause permanent damage.  Be sure to create a trust that survives the legal duration of the company in order to meet unanticipated potential environmental damage in the long run, such as metals leaks that pollute water./

Well who would not want that. Even now companies realize that it is in there own best interests to enact such policies. Any one who would say otherwise is just a hypocrite. If it were in there own back yard they would not let a company get away with loose or non exhistant environmental controls hahahahahaha.

He writes,

/3.  The best possible conditions for the communities located in the mining area.  The extraction requires a lot of manpower.  This means firms will generate many jobs, and any unskilled villager in good physical condition is qualified to do the job./

Once again he states the obvious. This practice is done all throughout the world in every industry. Why would a company not want to bring the locals on board by giving them jobs and take advantage of the relatively low labor costs in Ecuador. This is a huge advantage for them and to pass it up would be total stupidity.

He writes,

/Mining also offers an opportunity for the government to create a southern mining region.  It could link via rail Puerto Morona, by way of the Amazonas river, with Puerto Bolivar, which serves the mining area and Loja./

This kind of refutes his earlier remote location comments hahahahaha.

He writes, 

/The president and his assemblymen will call the shots whether Ecuador will enter an era of large-scale mining on a firm footing, or not./
 
Once again he has a total understanding of the obvious hahahahaha.

This rather uninformitive article then leads me to wonder why it would elicit such strong commentary from Joe. Then I read his commentary on S.H. and it was by far even stronger hahahahaha.

Commentary such as he made was not called for and it just leads me to wonder why he made it hahahahahahaha.

Hold onto your shares fellow longs, the professionals will try and use tax loss selling season to there advantage and the traders are trying to buy back the shares they have sold resently also.

Regards,

F.F.