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Silver Wheaton Corp. Message Board

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  • forty2gallonbarrel forty2gallonbarrel Oct 31, 2010 12:09 AM Flag

    Potential Contract Problems?

    A contract is a contract. Our risk doesn't lie with the other party deciding to change a deal they agreed to, but rather a government deciding they want a bigger share of the pie and nationalizing or adding some type of new excess profit tax.

    At this point, I view this risk as low, but we all should monitor it.

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    • There are many ways that in which SLW could be harmed or collapse, but are so very very slim.

      1. A contract disagreement with added legal costs.
      2. Increased taxes of many kinds, limits on estate taxes
      3. A stock market repeat/worse than 2 years ago including index funds, sector funds and hedge funds.
      4. Fraud or something missing, accounting problems, contract estimations in error - With a class-action shareholder's suit
      5. Dilution over 700 million dollars
      6. Political unrest where contract mines are or extended labor strikes
      7. YDM deciding to go to the HL board or me posting more.
      8. The dollar on an extended sharp rise - never will happen
      9. Oil spill - sorry, met for FX board
      9b. Cramer upgrade to best stock of 2011

      There is only one thing that I do think about, but again it will never happen. Banks and bank hedge funds selling all of their shares, shorting a bit first. Banker's are honest, they would not do this. They are so nice to those with loans. They give us extra interest on our deposits. They share their taxpayer's bonus with those in need. They invite us to their mansions on holidays. They will give SLW all the money needed for dilution in the trillions.

      Mr. Barnes, I am only joking and we just renewed YDM posting contract for a five year/ term deal. A condition was met that he must post 50 times a day.

      • 1 Reply to newscentral2002
      • FIFTY times a day? Why the reduction in the number of my posts?

        As to going to HL in a handbasket, it's too late.
        Two more significant issues

        1. Competition.

        a. The cost is high, but others have entered the silver streaming business. Of course, we could buy them also as we did Silverstone, but the prospect exists. Note the worse the economy gets the more fantastical another entity would get the financial backing to do business. A "real" banker emerge as competition. Bankers can't justify investing in anything but T Bills, let alone silver and gold mines.

        Nonetheless, Silverstone did manage to establish relationships with financing to warrant a buyout of their company.

        2. Mines that upgrade silver byproduct to main business, and provide "more" competition, since they'll "need" the hedge. Little probability here.

        If you're going to hedge, you use the futures market and never get your hands dirty. That would be SLW organizational thinking, on an already existing market vehicle, the futures market.

        Which by the way, is exactly what we investors are doing.

        We're not doing too badly at it either.

    • I agree, the only real threat is government action. But, you're right again, there will probably be warnings before any actions that could badly hurt SLW.

      SLW is also spread out into a lot of countries so one country's actions wouldn't destroy SLW.

      I'm glad it's a Canadian Co. rather than a US one. I don't trust our govt much.

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