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Caiman Valores  

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  • Silver Is Shaping Up To Be The Best Precious Metal Play Of The Decade [View article]
    Both the populations of China and India have been acquiring tremendous amounts of gold and silver as has the Chinese government. In Asian cultures gold is seen to be an important store of wealth and to a far lesser extent so has silver. Interestingly I currently live in Colombia and the emphasis here is more on silver than gold as a store of wealth partly because it is more affordable but also I believe because of that historical linkage to Spanish colonization in order to obtain silver.
    May 31, 2015. 02:07 PM | 2 Likes Like |Link to Comment
  • Banco Santander: One Of The Best Banks In The World Sells At A Discount [View article]
    Jake some great points interestingly the period between 1994 to 1999 where GDP declined was during the fallout from the breakup of the Medellin cartel and while the Cali cartel was being pursued.

    I also agree that while CIB is an extremely good bank it would have taken an extremely high degree of conviction to make that investment. Particularly with the internal security situation worsening at the time.
    May 31, 2015. 01:37 PM | Likes Like |Link to Comment
  • Oil Rally Will Be Short Lived, Sharply Lower Crude Prices Will Remain Longer Than Expected [View article]
    Rivber thank you for the kind words. I agree that now is a once in a lifetime to buy quality energy companies at an attractive or even extremely cheap price. I really like Value Mans investment thesis for Lonestar Resources http://seekingalpha.co... .

    I am also looking to write a series of articles on energy stocks to invest in and avoid in the current harsh operating climate.

    I agree it is going to take some time for the lower rig count to translate into lower supply as well and I feel that calling now as the bottom on the rig count is premature.
    May 31, 2015. 01:32 PM | 1 Like Like |Link to Comment
  • Oil Rally Will Be Short Lived, Sharply Lower Crude Prices Will Remain Longer Than Expected [View article]
    Wow great call, I have read a number of articles which claim the true motivation for OPEC's actions is actually a move to try and prevent green and in particular wind and solar energy generation from growing. This is another issue I am going to spend considerable time on in future articles. Thank you for commenting and bringing this to the fore.
    May 30, 2015. 09:58 PM | 1 Like Like |Link to Comment
  • Oil Rally Will Be Short Lived, Sharply Lower Crude Prices Will Remain Longer Than Expected [View article]
    2Fatcats thank you for the article. I was quite surprised by the Iraqi governments attempts to lift production given that ISIS can easily defeat their under equipped, poorly armed and poorly trained army. Will definitely take a closer look at the article.
    May 30, 2015. 09:56 PM | Likes Like |Link to Comment
  • Oil Rally Will Be Short Lived, Sharply Lower Crude Prices Will Remain Longer Than Expected [View article]
    2Fatcats thank you for the kind words and feedback. I looked very closely at the ongoing problems in the Middle East and how they affect the outlook for oil.

    I agree the fighting in Iraq and ongoing success of ISIS and their seizure of oil assets certainly points to Iraq being incapable of boosting production as much as they want.

    However, from the information I have been able to glean mostof the oil producing assets and infrastructure remains in government and Kurdish hands and it is relatively easy at this time to boost production, albiet the targets the govt has set do appear a little to optimistic. As for Iran I am in total agreement it will take time for both the sanctions to be rolled back and for the country to life output. But Iwhat I was trying to get at in the article and missed because I got to deep into the detail was the confluence of events and the fact that they are set to happen sequentialy rather than all at once.

    If they happened at the same time it is easy to see crude falling to well under $40 per bbl, but as a sequential series of events I think they will keep crude (WTI) at around $50 to $60 a bbl for the remainder of this year and into the next.

    I am planning at doing a series of articles focused on each single issue and obviously I need to revisit the China consumption issue and explain that a little more clearly and in detail.
    May 30, 2015. 09:14 PM | 2 Likes Like |Link to Comment
  • Oil Rally Will Be Short Lived, Sharply Lower Crude Prices Will Remain Longer Than Expected [View article]
    Gabor thank you for the kind words and feedback. With China it is the declining manufacturing and construction activity that had led to a significant drop in energy demand.

    While I acknowledge that growing consumption and vehicle sales will over time see an uptick in oil demand the country has yet to transition to a consumption based developed economy. it is still primarily dependent on infrastructure, housing and building contrustion along with export focused manufacturing to drive economic activity and demand for energy.
    May 30, 2015. 06:05 PM | Likes Like |Link to Comment
  • Silver Is Shaping Up To Be The Best Precious Metal Play Of The Decade [View article]
    Matthew I think you have missed the point and the comment is certainly not nonsensical in an economic sense. The geopolitical and economic environment in a multilateral world is constantly shifting and this creates risk.

    While you may wish to deny it PMs are an accepted store of value and they have held their value during times of crisis when other assets that you allude to such as a house or human educational capital haven't. To use an extreme example take a closer look at World War Two and the impact that had on the economies of Europe and what the accepted stores of value were at the time.

    I also think you are missing the second point of the investment thesis which is that silver is an industrial metal and commodity that is growing in demand because of its conductive properties in an environment where supply is shrinking.
    May 30, 2015. 05:30 PM | 1 Like Like |Link to Comment
  • Oil Rally Will Be Short Lived, Sharply Lower Crude Prices Will Remain Longer Than Expected [View article]
    JK101 that is a very good point. It will be interesting to see how many suffer from liquidity crunches and are unable to refinance when the time falls due. Although at this point I don't believe the impact on the industry is as severe as the headlines would have us believe.
    May 30, 2015. 04:35 PM | 1 Like Like |Link to Comment
  • Silver Is Shaping Up To Be The Best Precious Metal Play Of The Decade [View article]
    I think what you are both missing is that precious metals are a commodity, just like coal, base metals, iron ore and oil to name a few. All commodities are important components of various forms of economic activity without which many of the productive investments that you allude I guess being business offering goods or services in one form or another cannot function.

    As I have pointed silver has a wide range of industrial applications so besides being a store of value that makes a good means of hedging against geo-political and economic uncertainty it is used in the manufacture of the infrastructure, components and services that those "productive" businesses produce and offer.

    I am certainly not a PM permabull advocating that silver will have a miraculous rally because of the collapse of fiat currencies or an economic meltdown. But rather I am seeking to use fundamentals to identify credible investment opportunities in the commodities space. And as I have explained in the article there are a range of tailwinds that over the long-term will push silver higher.
    May 30, 2015. 04:32 PM | 1 Like Like |Link to Comment
  • Lonestar Resources: One Of The Best Oil And Gas Plays For The Downturn [View article]
    Eckman the key problem is not just the upfront fee but the ongoing costs associated with submitting regulatory documents and the compliance costs.

    While this is typically a drop in the ocean for a large O&G company with developed and highly productive assets like say CPG, it can be quite costly and a poor use of capital for a small O&G company focused on developing its assets and getting production to a commercially viable and sustainable level.

    Let's not forget, there are also considerable costs related to developing existing oil assets so as to sustain output and financial forecasts, particularly for shale oil producers with high decline rates and many wells only having a commercially 12 to 24 month life span.
    May 30, 2015. 03:19 PM | 2 Likes Like |Link to Comment
  • Lonestar Resources: One Of The Best Oil And Gas Plays For The Downturn [View article]
    CI I am not sure if your familiar with the banking and finance environment in Australia but it is certainly not a backwater. There are a range of investment banks, hedge funds, venture capitalists etc that are actively seeking investments.

    It is also a mature E&P market that has considerable capital available and a number of Australian O&G startups have been considerable success stories without listing in the U.S. This includes those that have had solely U.S. based assets or the majority of their E&P assets located outside of Australia including Aurora Oil & Gas and Karoon Gas.

    At this point I agree with VM and believe that there is no need at this time for the company to throw tonnes of money at a U.S. listing when it is far better invest in developing its assets and production.

    I would just point out that contrary to popular belief Australia does have the wheel and electricity and there is more than just kangaroos bounding across the harbour bridge.
    May 30, 2015. 02:39 PM | 9 Likes Like |Link to Comment
  • Lonestar Resources: One Of The Best Oil And Gas Plays For The Downturn [View article]
    VM great article and certainly worthy of a TI. A very clear case and I agree with your thesis on miss pricing. Typically U.S. investors are very U.S. centric and unless a company has a listing on a major U.S. exchange they just won't invest in it.

    There is also a sense of its listed on the ASX then it must be an inferior investment because it is Australian. Aurora Oil & GAs was having exactly the same problem until it was purchased by Baytex. Funnily enough all of its assets were in Texas in the sweet-spot of the Eagleford shale but a number of analysts and some SA contributors were highly dismissive of the company solely because it was Australian and only had a mainboard Australian listing.

    I also love your price sensitivity analysis on the indicative fair-value for the stock.

    While CI raises a good point the overall cost including ongoing costs of listing on a U.S. exchange is still quite prohibitive for a small company and let's not forget they already are incurring the costs associated with being listed on the ASX which is not cheap.

    Looking forward to more articles.
    May 30, 2015. 01:35 PM | 5 Likes Like |Link to Comment
  • Oil Rally Will Be Short Lived, Sharply Lower Crude Prices Will Remain Longer Than Expected [View article]
    L1329-8 thank you for the kind words. I must admit I started the article with a moderately bullish view on the outlook for crude and the more I dug into the numbers and looked at the position of OPEC and contango the more bearish I became.
    May 30, 2015. 11:43 AM | 3 Likes Like |Link to Comment
  • Banco Santander: One Of The Best Banks In The World Sells At A Discount [View article]
    Canada's economy is one of the few developed economies to really feel the impact of the sharp collapse in oil prices with oil making up a considerable portion of its GDP. Canadian Western Bank has considerable direct and indirect exposure to the price of oil and Canada's energy patch.

    The bank has C$600 million in loans to Canada's oil industry and 42% of its mortgages located in Alberta. While the Canadian housing market has grown strongly in recent years there are signs the housing bubble in the energy patch is set to burst.

    This will have a significant impact on Canadian Western and will at the very worst see its growth prospects flat-line for the foreseeable future.
    May 29, 2015. 05:35 PM | 1 Like Like |Link to Comment
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