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  • SouFun Dividend Yield Is Likely Deceiving [View article]
    that's not what I said. what do you expect the div to be? If div was zero, would you care?
    May 3 12:26 PM | Likes Like |Link to Comment
  • SouFun Dividend Yield Is Likely Deceiving [View article]
    1) FCF is plausible, but they would struggle to support the divs given acquisitions and if the divs were paid without using debt.
    2) The revenues are in RMB. They cannot pay US investors in RMB, that is illegal. China has currency controls. The penalties associated with moving money out of China are the costs I have described.
    3) They are, BUT there is no way to collapse that position yet those loans will come due.

    I think the key point you are missing is the addional cash flow constraints that come from China's capital controls as well as the VIE structure when cash flows occur at the VIE level. Paul Gillis has written on VIE tax accounting extensively, and the issues moving money offshore are well documented. In HK, there have been defaults in the offshore bond market because companies have struggled to move their cash out of China. A good example of a company doing the opposite was Perfect World. Last year, they moved cash out of China, and incurred all the penalties associated with it in order to be able to pay a dividend. You can read about the costs incurred and the process in their annual report.
    May 3 12:25 PM | Likes Like |Link to Comment
  • SouFun Dividend Yield Is Likely Deceiving [View article]
    I think there is some dividend expectation, and I expect the results will not include one. If you do not expect a 1 dollar dividend this year, and still own the stock, then I would think you are in the minority.
    Apr 29 10:11 PM | Likes Like |Link to Comment
  • SouFun Dividend Yield Is Likely Deceiving [View article]
    Classy comment, gabeazy. Actually they did not pay out their cash flows. They borrowed US dollars in an offshore account, and pledged RMB deposits, even though they cannot move that RMB into USD to repay the loans. Secondly, the analyst community as well as many financial information sites imply a dividend is coming this year, despite the recent purchase of the BaoAn property. I think it is likely there will not be a dividend of the same size as has been paid out previously, and that could disappoint some people. Using ad hominem arguments and factual inaccuracies make you lose credibility as well.
    Apr 28 10:14 PM | 2 Likes Like |Link to Comment
  • It Is So Fun To Conceal Related Party Transactions [View article]
    hey Glaucus- I just wrote an article on the dividend. Please take a look and let me know what you think. Great work here, and thanks for flagging this name!
    Apr 23 12:45 PM | Likes Like |Link to Comment
  • Gold Reserve Inc. Overvalued Due To Dilution Overhang, Litigation [View article]
    Typically, gold mining company management is responsible for finding and extracting gold. It is true there are management teams running public companies who are meant to speculate - Warren Buffett is a great example. However, in this case I believe that is not this management team's job, and I think it is indicative of too cavalier an attitude towards cash management period.

    If the CEO had taken say 1000 dollars only, and put it on black in a roulette game, would that be ok with you since it is only 1000 dollars, or inappropriate use of company funds period?
    Jun 5 02:53 PM | Likes Like |Link to Comment
  • Gold Reserve Inc. Overvalued Due To Dilution Overhang, Litigation [View article]
    Emilia - this is a bit aggressive.

    i agree i am speculating. but speculation is my job. it's not a bad thing at all. but not great for public company to do with shareholder capital in my opinion.

    my point was not just that they lost money, but more importantly the volatility of the underlying securities in which they were investing. You're right that 2% is not big vs the entire cash balance, but given their situation, taking on volatile investments is not a great idea.

    This is a matter of opinion, and you are certainly entitled to yours. We shall see what the panel decides. time will tell.
    Jun 5 11:32 AM | Likes Like |Link to Comment
  • Gold Reserve Inc. Overvalued Due To Dilution Overhang, Litigation [View article]
    and i could understand why, as a nervous long, you would not provide evidence of your claim, but what i don't understand is why you think that just saying there are misstatements would make your stock go up?
    Jun 1 05:40 PM | Likes Like |Link to Comment
  • Gold Reserve Inc. Overvalued Due To Dilution Overhang, Litigation [View article]
    the numbers do not add up. how could there have been an actual gain of 772K when we have the beginning and ending balances as well as the cash proceeds? These investments are Level 1 marketable securities: meaning stocks or bonds with observable prices.

    so you are happy they take risks as long as they make money? the point is that cash balances at a mining company should not be in the market at all.

    You're right, it is up to you if you want to investment with this management team.

    The Chavez response was saying that I do not think we are in a "rock bottom" scenario. The market thinks Chavez will die soon, and that everything will be fine. GRZ stock price is partially a reflection of that. GRZ was hitting highs April as Venezuelan credit spreads were on their lows.
    Jun 1 05:35 PM | Likes Like |Link to Comment
  • The Odd Case Of Gold Reserve [View article]
    Yes it does. if Chavez is out, the new government would likely pursue policies of more trade, and that would mean settling at fairer terms with plaintiffs and being a good citizen at ICSID in order to encourage foreign investment across all sectors. If Chavez dies, I would cover. It would be very bullish for GRZ.
    Jun 1 11:36 AM | 1 Like Like |Link to Comment
  • Gold Reserve Inc. Overvalued Due To Dilution Overhang, Litigation [View article]
    i don't think so. the market is actually warming to Venezuela. Their CDS has tightened to below 1000 now. it hit a low this year of 700. that is coming from 1500 in 2010. I think it is speculation on the death of Chavez.
    Jun 1 11:33 AM | Likes Like |Link to Comment
  • Gold Reserve Inc. Overvalued Due To Dilution Overhang, Litigation [View article]
    Emilia-
    I think you are incorrect.

    The comapny entered 2011 with 2.2mm USD in securities. we can look at the cash flows statement which shows 1.66 mm in disposals and 698K in purchases.

    so - you start at 2.2-1.6+698+returns = current portfolio value = 892k. that means the return is a loss of 400K.

    I am not saying 400k is the end of the world. but that is a substantial loss on that size of portfolio. I do not believe that is prudent management and indicates a willingness to speculate that is typically not found in standard mining company cash management. I would certainly not be ok with that type of risk-taking in a long position management team.
    Jun 1 11:27 AM | Likes Like |Link to Comment
  • Gold Reserve Inc. Overvalued Due To Dilution Overhang, Litigation [View article]
    emilia -
    a) the 14.7mm will likely get sold, i think the recent short interest is probably hedging against those shares to be received.
    b) when the management is punting stocks and losing 20% or more on investment securities, you should be worried about the cash.
    c) this litigation is likely more difficult than you think. it is better to preserve a war chest (which they can use to buy back stock if there is excess cash) instead of putting yourself in such a thin cash position.
    May 30 03:02 PM | Likes Like |Link to Comment
  • Gold Reserve Inc. Overvalued Due To Dilution Overhang, Litigation [View article]
    14.7mm shares does not get rid of all the debt. read the exchange offer.
    so it comes down to you thinking there will be a significant recovery, it will happen quick and easy enough that the remaining cash will be sufficient, and that dilution is already priced in.
    If it was really that easy to collect on Venezuela, no one would ever settle. Venezuela does need some trade agreements, agreed, but with China refusing to acknowledge judgments against governments, they can sell the oil to them just fine.

    I disagree with your view. that's what makes a market.
    May 29 11:24 PM | Likes Like |Link to Comment
  • Gold Reserve Inc. Overvalued Due To Dilution Overhang, Litigation [View article]
    I am not attempting to mislead anyone. How is the speculation of dilution misleading? In the first case, it comes directly from the company announcement. There will be 14.7mm shares issued if the agreement works. That's a fact. It comes down to 2 issues: recovery and share count.

    I think shareholders will reject this deal since it puts the company in a tough position. that means using the share redemption mechanism.

    I could clearly be wrong about the amount recovered, and that is described in the variant view section. I am very bearish on the ability to recover from Venezuela. Argentina is probably one of the highest profile examples of how you can lose at ICSID and still not wind up paying. If there is a protracted fight, GRZ will need cash, and it is better to have that cash than spend it on the redemption. the downside is dilution.

    At a 300mm USD recovery, then the stock is properly valued. I do not believe the number will be anywhere near that, and i do not think the bondholders accepting tons of shares will stick around to wait for a year to find out. the shares could experience a dramatic fall on the redemption. Look at GSS.
    May 29 08:26 PM | Likes Like |Link to Comment
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