Some of the suggestions have some merit as things that should be done.
Since the people that run SOLV are supposedly bright and intelligent,
one has to wonder why none of these things have been pursued. In the
interest of full disclosure, I have been following SOLV for about a
year. Had considered a long position initially, but decided to wait.
Recently, (about two months ago) began considering a short position,
and attempted to do so: was not able to get shares to short, however.
My reasons: (1) Oilsands are inherently risky and thus subject to
wildly varying opinions. (2) I have read all of Asensio's material
and all of SOLV's. While some of Asensio's claims are obviously
exagerated, a long position requires a belief that the company will
either make money, and thus appreciate the stock price, or have a
story that will make it tradeable for a short term profit. SOLV has
problems on both counts. The basic story is old news. Every oppor-
tunity for a new story that could move the stock has come and gone.
The prospects for any profit any time this century appear remote. I
don't know about all of the SOLV supporters here, but I am not a
venture capitalist: I would like to see a return before my hair is too
much grayer. (3) A mere belief, no matter how firmly held or correct,
that Asensio is all hot wind, is not the same thing as good underlying
fundamentals. To hold this stock long requires a belief in SOLV's
credibility, not Assensio's lack of credibility.
From my standpoint and in my opinion, SOLV's credibility is not much
better than many think of Assensio. A few examples: (1) SOLV did
promise commerical production by Q1 97. To deny that they did so is
to play the same kind of word games and semantics used to criticize
Assensio: Assesnio blew it on the permit issue and SOLV blew it on
commercial production. They have not delivered. (2) The existing
financing was supposed to complete the plant. It didn't. You can't
get to $600 million bigger and better, until you have finished what
was supposed to be the initial plant. (3) SOLV claimed to have hired
an "independnat" investigator to quash the negative rumors and then
the day that he was supposed to be on a conference call, they cancelled
the call. The justification for cancellation was a purported desire
not to engage in a public debate. They would respond with results.
Well, not only has there been little public debate (I say little since
they now appear to be responding publically again), where are the
results. When the plant supposedly began production, Randell promised
quantity and quality information. Where is it? It doesn't take 6
weeks to add up the quantity. (4) Not enough money to stay open for
3 more months. That was Randell, not Assensio. If that doesn't scare
longs nothing will. Heck, most stocks tank on news of lower than
expected earnings -- they really tank, and stay there, when the CEO
says we are out of money.
Finally, who is being investiagted? I don't know for sure and neither
will anyone else until the SEC tells us. If it is SOLV, there is real
trouble ahead if you are long. Ask Bre-X and GIFS shareholders. If
it is shorts, so what. An investiagtion of shorts is not likely to
have much impact on the stock price. So what if Assensio gets
indicted. It doesn't change SOLV. It may make some longs feel good,
but it won't do much to SOLV's financial position. I found it
peculiar that SOLV and Randell did not say that neither of their
activities were part of the investigation. All the press release,
supposedly approved by the SEC, said was "Solv-Ex has been advised that
the SEC investigation relates to the manipulation of Solv-Ex stock in
the NASDAQ over-the-counter market. . . ." It did not say that the
investigation was of Assensio or other shorts and it did not deny
that it did not include SOLV or Randell. I recognize that my point
may be playing word games, but it does seem peculiar to me.
A video tape would be a good idea. An independant one would be better.
If SOLV is not for real, then a video from them won't mean a whole lot.
Would many of you trust a video from Assensio? Probably not.
I have at least as much interest in what SOLV hasn't said as what they
have said. There are a lot of unanswered questions and a prudent
investor has to ask why. This story has gotten bizare enough that I
have little trust for what either SOLV or Assensio says.
The $22 million in recent financing looked desperate to me. $22 mil
is a lot of money, even though it is far short of what SOLV seems to
need. The scenarios justifying or explaining the investment have been
expounded on enough here. In either event, it must be just the
beginning or SOLV is dead.
Regardless of how this turns out, most money can make more money
elsewhere which, in and of itself, is enough reason not to be long in
SOLV. The risk is substantial and the returns, if there are to be any,
are a long ways out.
Just my thoughts....
Troy McKinney
Houston
PS - I have never met or talked to Assesnsio or SOLV and am not being
paid by anyone in relation to this stock. I can be e-mailed at
WTMHouston@aol.com or WTMHousto2@aol.com. |
