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Adam Scott  

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  • The Rising Rate Of Interest In Interest Rates [View article]
    Thanks for the comment, Bill. Are you sure they didn't have adequate cash on hand to make that investment without the bond offering?
    Jun 5, 2013. 11:55 AM | Likes Like |Link to Comment
  • MLPs And Interest Rates, How Right Is Mr. Gundlach? [View article]
    Yes, I suppose we do. With the exception of this week, REITs have been on a steady tear for years. As their yield as dropped they have become less attractive to us, in relative terms. And they don't have the same ability to increase rates (and therefore distributions) as the MLPs do. But there are also different factors driving their appreciation. We own both asset classes -- in slightly different allocations than in years past.... Keep the good stuff coming, Phil!
    May 25, 2013. 10:58 AM | Likes Like |Link to Comment
  • MLPs And Interest Rates, How Right Is Mr. Gundlach? [View article]
    Hi Philip,

    Great article and I'm happy to be following you! The short answer to your question is 'yes,' but it's a little more complicated these days. In our view, US Treasuries hold just about zero relative value to cash, so in "relative terms" you aren't really gaining much advantage by making that comparison today. When it comes to cost of capital for assets that are highly leveraged, Treasury rates are obviously important. Not sure if that answers your question?

    Thanks again!
    Adam
    May 22, 2013. 11:00 AM | Likes Like |Link to Comment
  • MLPs And Interest Rates, How Right Is Mr. Gundlach? [View article]
    Hi Matt,

    Neither your #1 nor #2 most important points are, in fact, the most important point. The single most important point with regard to how attractive an MLP is, or MLPs are, is their after-tax yield.

    A great deal (60-100%) of an MLP's distributions are recorded as 'return of capital' and, as such, are tax-exempt. The remainder are taxed as ordinary income. If I'm a long-time municipal bond investor who has watched my risk- and tax-free interest income dwindle from 10+% all the way down to 2-3%, I'm suddenly very interested in the beneficial tax treatment the MLPs' distributions offer.

    Historically, yes, the comparison of MLP yields vs. 10-yr Treasuries has been a relevant factor in determining MLP valuations. I think it's more interesting to consider what could happen if just 5-10% of the trillion dollar municipal bond market shifted towards the space....

    Adam
    May 19, 2013. 07:08 PM | 1 Like Like |Link to Comment
  • A Rising Tide Lifts All Ships [View article]
    It is extreme. I can't imagine there were too many people in 1983 who had $50k to put into a single stock that would be the slightest bit concerned about paying capital gains taxes along that ride in order to mitigate risk and diversify. There are also the considerations of tax deferred accounts (in which this entire discussion is moot) as well as tax loss harvesting and carry-forwards....
    May 13, 2013. 12:07 AM | Likes Like |Link to Comment
  • A Rising Tide Lifts All Ships [View article]
    That's a fairly extreme example, though it does prove your point. If I had to go back 30 years and put cash to work in a single stock -- yes, KO would have been a good choice.
    May 11, 2013. 11:49 PM | Likes Like |Link to Comment
  • A Rising Tide Lifts All Ships [View article]
    I don't see how that could possibly be true.
    May 11, 2013. 12:10 AM | Likes Like |Link to Comment
  • A Rising Tide Lifts All Ships [View article]
    Thanks, TF. I suppose you're right, to some extent, that I'm promoting a bit of timing here -- what's the difference between timing and tactically allocating?
    May 11, 2013. 12:09 AM | Likes Like |Link to Comment
  • A Rising Tide Lifts All Ships [View article]
    My guess is that there is a direct correlation between how high the market runs and how many people are swimming naked.....
    May 11, 2013. 12:08 AM | 1 Like Like |Link to Comment
  • The Curious Case Of Benjamin Bernanke [View article]
    Ok.
    Apr 28, 2013. 04:48 PM | Likes Like |Link to Comment
  • The Curious Case Of Benjamin Bernanke [View article]
    ;-)
    Apr 26, 2013. 01:11 PM | Likes Like |Link to Comment
  • The Curious Case Of Benjamin Bernanke [View article]
    Thanks, Phil, I appreciate the feedback. And in particular the Super Grandmaster vs. Grandmaster comparison..... ;-)
    Apr 26, 2013. 01:00 PM | 1 Like Like |Link to Comment
  • The Curious Case Of Benjamin Bernanke [View article]
    Why is it unsustainable? Because you say it is? Was it unsustainable when your father taught you to ride a bike using training wheels?
    Apr 25, 2013. 10:05 AM | 2 Likes Like |Link to Comment
  • The Crisis In Cyprus Is No Thrilla In Manila [View article]
    Thank you for the great feedback.
    Mar 22, 2013. 02:26 PM | Likes Like |Link to Comment
  • Things That Could Continue To Go Right In 2013 [View article]
    Great. Thanks.
    Feb 20, 2013. 08:43 PM | Likes Like |Link to Comment
COMMENTS STATS
42 Comments
14 Likes