Joe Eqcome

CEF Weekly Review: All Fund Types Positive

VLD

I ask myself the same question. The story seems compelling enough: insider buying, selling at a significant historical discount, buying BRK.A at a discount, etc.

One issue maybe is the fact no one is comfortable with management. I'm hoping that the reinstatement of the dividend would bring another group of buyers to the stock that have avoided it due to its lack of dividend.

Maybe someone can add additional perspective to matter.

Joe Eqcome

Weekly CEF Review: Highs and Lows

Alan Young

I’ll try to include the average weekly prem/disc change per CEF fund type in next week’s CEF review.

CHN may be a more interesting China play than CAF given the former is trading at a discount, has a higher distribution, lower expense ratio and has not appreciated as much as CAF YTD. (Food for thought)

You’re correct on ascribing the term “trader” as opposed to investor regarding playing the volatility in commercial real estate securities (URE: long; SRS: short). I have a tendency to play URE both long and short as a result of it’s recent share price being under $4.00. However, more conservative traders should consider SRS as a short position.

Joe Eqcome.



On May 24 11:00 AM Alan Young wrote:

> Thanks for this fine overview. Would it be possible for you to post
> the average premium/discount within each sector? That change from
> week to week is of considerable interest.
>
> With regard to CAF, a week or so ago it was sporting a PREMIUM of
> over 30%! It's finally coming back to earth.
>
> With regard to real estate, I believe you mean that TRADERS (not
> investors) should consider URE and its inverse, SRS. Unless you are
> asserting that REITs are going to rally again?
>
> Thanks

Weekly CEF Review: Highs and Lows

Dan

On its face, it appears the actions initiated by BIF’s management (“insiders”) in late ‘08 may be intended to benefit insiders at the expense of majority shareholders.

Those actions include a staggered board, a suspended dividend and a cessation of new investments post a successful rights offering. All this curiously was enacted prior to the significant, systematic purchase by insiders of BIF’s stock at significantly lower prices.

We’ll all be curious to see what actions BIF’s management will take post completion of their share acquisition program with regards to reinstatement of the dividend and deployment of funds for investment. They may just shoot themselves with a smoking gun.

With respect to a staggered board, I believe this would not be in the best interest of the majority of shareholders (vote “No”). As someone once said, in the investment business, there’s either a conflict of interest or there’s no interest. The key is to manage the conflict.

I believe there are currently no checks and balances with regards to the potential conflict of interest of the insiders’ ownership (control person) and management of BIF being the same. The ability to summarily replace the entire board by a super-majority action (2/3’s) should provide some protection to shareholders as well as management.

Joe Eqcome (I have a small ownership position in BIF)

On May 24 01:10 PM Dan Plettner wrote:

> Joe, do you think that the Current Board of Directors has been acting
> in the best interest of the average shareholder? Assuming there is
> to be a final outcome of the Proposal 1 Proxy vote If there is an
> outcome on Proposal 1 at the previously "adjourned" May 29th reconvened
> shareholder meeting, what would the best possible outcome for the
> average investor be?
>
> I realize you continue to believe BIF is a long and I continue to
> believe your "house money" thesis holds merit. While I agree that
> restoration of the distribution policy would have positive effects
> on market returns, I believe an ethical Board of Directors not subjected
> to enormous Conflicts of Interest would do much more for all shareholders.
>
>
> Disclosure: I too am long BIF, as many readers already know.

Weekly CEF Review: Highs and Lows

Mavericks

To make a statement of opinion is your right under the First Amendment of the United States Constitution. However, as Hubert H. Humphrey once said, “The right to be heard does not automatically include the right to be taken seriously.”

To make a dismissive comment, as you have, without providing as basis for your investment position is of little value. I, and I’m sure others, would encourage you to substantiate your case against BIF. You may have strong reasoning from which we could all benefit. However, so far you haven’t provided any; you’ve just wasted electrons.

Joe Eqcome


On May 24 11:19 AM mavericks wrote:

> Long BIF, huh? Your credibility with CEF's just took a hit.