today's only news that matters in the long run is the following:

Chiriboga rejected rumors that a new state-run mining company will take over revoked metal concessions, and said the firm will start mining for construction minerals like cement.

assuming chiriboga was telling the truth, the revocation was not a land grab, and fruta del norte is safe. i do not consider the downgrade by haywood jublome securities to be news that would affect the operations of the company.

if you take the time to read the report, you will see that they arrived at the $1.40 figure by estimating a coin flip between what used to be their worst case scenario, that a state run company would seize a 40% interest in aru (unlikely, given chiriboga's statements today) and that no bank in its right mind would finance building a mine in ecuador, yielding a npv that translates to a market price of $2.40/share. the other scenario is that aru escapes ecuador with only its cash of $66 million, or 0.49/share. so they came up with an average of $1.40.

it seems to me that this is a cya report, covering themselves against the threat of outright nationalization of everything. i doubt anything like that will happen, as correa has a phd in economics from the univeristy of illinois, and he understands better than any of us the need for investment in ecuador. unfortunately in these past few days he has also shown himself to be a common garden variety politician, i.e. lacking a backbone, and doing whatever is expedient.

if nothing else bad happens, and the state run mining company does not take over the revoked concessions or start competing with foreign companies, this situation will resolve itself within 6 months. the speculatiors, large and small, who thought they would double or triple their money in the next month just got their fingers burned, but at these levels, i think the risk of being out of aru may be greater than the remaining risk of being in the stock. it can go up a lot from here, and it can only go down 3 points.

i would like aru to give us some guidance about which regional targets they have been drilling, barbasco, naranjilla, and which two other concessions other than fdn look the most promising, but i'm won't hold my breath on that.