By Kevin Michael Grace of ResouceClips.com
Read an interview with Peter Grandich expressing the same concerns as Frank Candido

Wednesday should have been a good day for Golden Hope TSXV:GNH President Frank Candido. His company released the first resource estimate of its Bellechasse-Timmins gold project, and he might have expected the market to reward its pioneering work in Quebec�s Beauce region. Instead, it was pummeled. Again.

Golden Hope shares fell Wednesday from $0.125 to $0.08. Candido is weary but not surprised. He explains, �In today�s market, good news doesn�t affect the market�s view of companies. If you look at all the press releases we�ve put out since March 1, you can be the judge if the results were good or if the information was positive.�

Candido doesn�t exaggerate. Golden Hope issued seven press releases featuring high-grade assays since March 1. The result was that their share price halved. Now it has halved again. �Press releases in this type of market are seen as liquidity events,� he says. �If you have volume, people are looking to get out.� He argues that this points to a dysfunctional junior market. But more on that below.

Based on a mere 268 holes and trenches, the June 19 43-101 estimates an in situ indicated resource of 2.9 million tonnes grading 3.36 grams per tonne gold (313,900 ounces) and an inferred resource of 2.17 million tonnes grading 1.46 g/t (102,000 ounces gold), based on a 0.6 g/t cutoff.

Candido comments, �It�s a first for our company and a first as far as I know in terms of [any company issuing a] resource estimate in southeast Quebec. So we�re very happy. And we�re especially happy with the grades we�re getting. We�ve always felt we have a nuggety type of deposit, and maybe the drill bit underestimates the grade, and there seems to be reason to believe that�s true.

Press releases in this type of market are seen as liquidity events. If you have volume, people are looking to get out�Frank Candido

�If you look at what we drilled in 2010 and 2011 and early 2012, I think if you add them up, it works out to roughly some 32,000 meters of drilling in a 2.5-year period or so. So it wasn�t a lot of drilling to achieve the results we achieved, and we certainly have a plan to continue drilling and exploring to increase that resource both shallow and at depth.�

Candido is excited by the possibilities of the newly discovered Champagne Zone. He says, �There was a historical resource on it, non-43-101, of course, of some 300,000 tonnes grading something like 2.4 grams gold, and it�s a VMS target. Unfortunately, we didn�t know where the collar locations were when we drilled it because we don�t have that information available to us.

But we drilled it and intersected similar-type mineralization. We flew a VTEM over the winter months, and now we know exactly where we need to drill. We think we can bring the Champagne target into resource. It�s very exciting. We�re in a brand new region of Quebec; we�re not in the Abitibi or in Timmins, Ontario; and we�re the first company to actually make a go of it. Other companies have come into the area but are certainly nowhere near as advanced as we are.�

Golden Hope had $1.5 million in cash �as of the last quarter.� Its burn rate is about $70,000 per month, but Candido admits �that obviously doesn�t include major exploration. We definitely will at some point need to finance, but we don�t need to finance right now.�

Financing could be a problem. Candido reports, �I was in Toronto [Tuesday], and afterwards I was speaking to a number of bankers and analysts, etc. The business is dead, and there�s nothing going on. Financings aren�t getting done; companies aren�t getting any bids; things aren�t moving; lots of companies are in trouble.�

The world economy is lousy, which partially explains the malaise Candido describes. But there are problems particular to the industry he believes must be dealt with. �Listen, there are a lot of reasons why companies are in the trouble they�re in, especially the juniors. There are too many of them, too many projects that are marginal at best. Flow-through financing has in one way helped companies raise money, but in another way you�re not raising money from shareholders interested in what you�re doing. It is simply a tax write-off, and for that reason, [flow-through investors] are agnostic to what the project is or what you�re doing, which is not putting the shareholder and project on the same page.

�There are too many warrants being given out. And flow-throughs with their four-month hold period, I�d like someone to show me how they can take money from this and fourth months later demonstrate to that shareholder how they utilized that money to build shareholder value. The fourth-month hold is, to me, a disaster. Historically, it was a year, and it should go back to a year at minimum. If you look at private placements, it�s now typical that companies like ours are giving full warrant coverage. Where is the incentive to hold the stock? You can sell the stock four months and a day later and hold onto the warrant, and if it works out, it works out; but if it doesn�t, you haven�t really lost anything. Really, I think the cards are stacked against juniors from the get go. There is this constant revolving door of having to raise capital, raise capital and raise capital and dilute the shareholder, which I think is a negative and needs to be addressed by the industry.�

I think the cards are stacked against juniors from the get go. There is this constant revolving door of having to raise capital, raise capital and raise capital and dilute the shareholder, which I think is a negative and needs to be addressed by the industry�Frank Candido

Candido�s complaints don�t end there. �There are too many companies with too many marginal deals,� he declares. �Available dollars are being spread too thin. I think the Exchange really has to take a look at all these deals they�ve approved that go public based on a simple technical report which has no chance of ever advancing anywhere.�

In addition, �A lot of Canadian companies have rushed to go and list on the OTCQX in the US as we did, and you know what we found out? We found out that there simply is not a market in the US for Canadian juniors.�

Despite the above, Candido remains optimistic about Beauce gold and his company�s future in discovering it. �We have a large land package, and we know what to do in terms of expanding this resource. We have Champagne now, and we have a number of other targets we�re anxious to drill because we know that gold cannot have happened on one spot alone in southeast Quebec. We�re in the Appalachian Belt, and there are many deposits found along the Trend all the way down to Georgia. We�re in a geopolitically stable area of the world, and deposits with grades like ours don�t pop up every day.�

Candido concludes, �At some point, the market will rebound, and companies that actually have fundamentals will rebound with that market. Companies that don�t will maybe disappear, and maybe that�s not such a bad thing.�

At press time, Golden Hope had 131.4 million shares trading at $0.09 for a market cap of $11.8 million.