It’s a pity that the geopolitical situation in Bolivia is casting a huge shadow over CDE, which in our opinion is one of the best silver mining companies around today.

From the chart we can see that CDE has taken a battering and looks to be in a in a beaten state. Has this silver stock now found a support level, which incorporates the political situation, or could it drop further? The question now is where do we go from here? Do we sell and take a small loss, do we buy more and average down or do we continue to observe?

An anti capitalist government wishing to use its weight does not fill us with confidence. Can the management at CDE negotiate their way through this minefield and strike a win-win deal with present government? Its all a little hazy and does not get any clearer with contradictory statements coming out of La Paz on a seemingly daily basis.

For now we will remain patient and observe the movements of the market. Market perception is a powerful tool and should not be ignored. If a recovery begins to show itself then we may well put more money in to this stock to reduce our average price.

Be patient for now.

Coeur de Alene Mines trades as CDE on the NYSE.

11 January 2007