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James Shell  

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  • The Intriguing Story Of CVR Partners [View article]
    Update: I am long from 21.50.
    May 25, 2012. 08:24 AM | 1 Like Like |Link to Comment
  • A Surprising And Promising Trend In The U.S. Economy: Sharply Declining Oil Imports [View article]
    Oil imports have plummetted for three reasons: Our demand has never recovered to the pre-recession levels of 2007 and 2008, due to fewer vehicle miles driven, there is an additional 1 mbpd of domestic production from places like the Bakken since 2007, and the point about ethanol above is the third. The sum total is that
    last week we were importing less than 9 mbpd of crude oil, where in 2007 we were over 10 mbpd imports for this week....

    If we were in any kind of normal productive economy, there would be articles written about the dangerous increase in imports....

    It's all about demand, or demand destruction, in this case.
    May 25, 2012. 08:23 AM | 4 Likes Like |Link to Comment
  • The Intriguing Story Of CVR Partners [View article]
    Yes, I suppose that is a risk, tornado country and all, and this whole area was underwater due to a couple of weeks of particularly nasty weather...

    But, as Mike Tomlin says, sometimes you have to plan around your hopes rather than your fears.
    May 24, 2012. 11:38 AM | 3 Likes Like |Link to Comment
  • The Intriguing Story Of CVR Partners [View article]
    I dunno, he may do just the opposite, use UAN as the cash cow it is, and then shop the pipeline as well as the refinery.
    May 24, 2012. 11:31 AM | 2 Likes Like |Link to Comment
  • The Intriguing Story Of CVR Partners [View article]
    Aw, that is just one of the buttons the contributors have to click so as to disclose their position.

    I put a limit order in this morning to go long from 21.50. I will let you know if it is filled.
    May 24, 2012. 11:29 AM | 1 Like Like |Link to Comment
  • The Intriguing Story Of CVR Partners [View article]
    Yes, it is funny, at some point in the day you are at the mercy of the corn traders....the ag industry has changed completely since about 2007 because of our much heavier reliance on ethanol. right now, 9% of our national fuel supply is coming from this source... and I don't see backing away from that.

    The days of $2.50 corn are going to be a long, distant memory.
    May 24, 2012. 11:20 AM | 1 Like Like |Link to Comment
  • Aftermath: The Conoco Phillips/Phillips 66 Split -- Is The Conoco Portion Undervalued? [View article]
    The risk is that PSX may not get enough respect in the marketplace because of its refining business. If you look at what happened to MPC after it split off from MRO a year ago, MPC is now trading at only 5.14 times earnings, but its upstream former partner company MRO is at 7.

    Even at 7, the upstream MRO business is probably undervalued relative to some of its competitors.

    I am sure there is some underlying value that still can be extracted from the PSX portion.
    May 23, 2012. 09:46 AM | 1 Like Like |Link to Comment
  • The Importance Of Timing: The Calumet Stock Issuance [View article]
    Yes, that is true. And, there are some tax ramifications.
    May 22, 2012. 03:21 PM | Likes Like |Link to Comment
  • Long Opportunity: The Calumet Specialty Products Stock Issuance [View article]
    He may not be too far off. All of the refiners hit bottom last October, and VLO was at 20 in January of 2012. Boone has deep enough pockets that he can afford to get in at 21 rather than wait until it gets to 19.

    VLO was at 70 back in 2008. Maybe he is seeing the really big picture.
    May 21, 2012. 05:27 PM | Likes Like |Link to Comment
  • Two Harbors Investment Corp: Dump, Hold Or Reinvest? [View article]
    Yes, you're right. All of this depends on your entry price and your anticipated holding period, and if you do it on a big enough scale, you do have to worry about the tax effects of capital gains (or losses) versus dividend income.

    If I unloaded TWO right now I could take a writeoff on the long term capital loss which would partially compensate me for the dividend income I have this year. But I do not really want to walk away from that little income stream.

    Part of the idea of investing for income is not worrying too much about the nominal value of my account as much as the income stream. As long as they keep paying the solid dividend, I really do not need to worry about the price. There is a slightly different mentality, if you know what I mean.
    May 18, 2012. 08:50 AM | Likes Like |Link to Comment
  • Two Harbors Investment Corp: Dump, Hold Or Reinvest? [View article]
    Hey, you are sitting pretty I believe, you are hard pressed to find that kind of ROR anyplace. Around here, the $700/month places are still ostensibly priced in the $90's...or high $80's.

    The strategy here was to not unleash the massive backlogs onto the marketplace all at once. Most of the banks have sat on the properties after they are foreclosed, and have contracted with local realtors to sell them a handful at a time. In a way they have done us all a favor by not flooding the marketplace with distressed properties and collapsing the prices, but in a way there are a lot of unperforming assets sitting on the books of a lot of institutions and no one is talking about this.

    The other issue is, of course, that it did not solve the problem. In most of the suburban areas, prices are still declining at 10% per year. This is causing knock on effects with the county government, school systems and everywhere else that uses property values as the basis of the tax system. There is already a big disconnect between assessed property values and actual market value of the homes, which is a stealth tax increase on the part of the county governments.... aside from the fact that a significant portion of the properties over here are empty... it's a mess. No one is being honest about this either.

    The real problem is that there are no buyers coming in at the bottom of the marketplace because of the high unemployment rate among the young, and also, the student loan problem. Across the street from me are four 20-somethings still living at home, when they could be out working and saving up for a down payment.

    So, these problems are not going to go away any time soon. There are structural problems right now.

    I would love to know how much of the new mREIT business over the last six months is refinancing vs. originations of new loans. I think the pie is still relatively small and not growing as fast as it could if we were in any kind of normal economy. I also think that at some point if the pie does not grow, the mREITS will go through a consolidation stage, the big ones buying out the little ones...that phase is yet to come.

    The brief day in the sunshine in this industry could come to a screeching halt under a number of circumstances. Gotta keep alert for changes. Perils are everywhere.

    Meanwhile we can collect our 15% dividends and keep our finger on the trigger...
    May 18, 2012. 08:10 AM | Likes Like |Link to Comment
  • Two Harbors Investment Corp: Dump, Hold Or Reinvest? [View article]
    My working theory is that growth is good in this business, even if it dilutes your shares it means that the management is being aggressive.

    Because of the reduced interest rates, the companies that are less aggressive lose their portfolio because of refinancing activities.
    May 16, 2012. 07:47 AM | Likes Like |Link to Comment
  • Two Harbors Investment Corp: Dump, Hold Or Reinvest? [View article]
    It is interesting, I did a lot of work not too long ago, looking at rents vs. property values in my area, and the opposite was the case. Real estate prices are still falling around me (ATL). Rents have more or less stabilized, but at a level that does not yet support the investment.

    I did some analysis awhile back on this topic, and I suppose it is time for an update, because it is an important issue: When it is more profitable to be in the mortgage business than it is to be in the business of actually owning the property and renting it out, the prices are going to continue to fall.

    I am glad at least out west things are getting better. The area around Cape Coral FL was also bad, I will have to check into that too.
    May 16, 2012. 07:45 AM | Likes Like |Link to Comment
  • Two Harbors Investment Corp: Dump, Hold Or Reinvest? [View article]
    Yes, chaos is everywhere, but because of their relatively small size, TWO has a little adaptability that the NLY's and AGNC's of the world do not, as evidenced by this shift in hedging...
    May 15, 2012. 02:03 PM | 1 Like Like |Link to Comment
  • Two Harbors Investment Corp: Dump, Hold Or Reinvest? [View article]
    Oh, I am working on an article on CLMT who just recently had a sale issuance...
    May 15, 2012. 02:01 PM | 1 Like Like |Link to Comment
COMMENTS STATS
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