If the company's videos are true, then it appears that the fraudsters and crooks are the short sellers, not the company. In any event, this episode warrants an SEC investigation, because someone perpetrated a fraud here, it is just not clear who - the company or the short sellers.
Longwei Petroleum: The Most Brazen China-Based U.S. Listed RTO To Date [View article]
I was also wondering about that. Why cameras on the truck zone, but not the rail area? And were the cameras on the truck zone correctly positioned? The short sellers claim they were, and emphasize that in their article, but it may not be so clear cut.
In any event, the company needs to provide a meaty response, and fast.
Longwei Petroleum: The Most Brazen China-Based U.S. Listed RTO To Date [View article]
What I do not understand is... if the company is a complete fraud, why does it pay Chinese authorities so much in value added taxes? Photocopies of these tax receipts are contained in the company's website:
Are these receipts fake? Because these are value added taxes, you can calculate the company's revenues by working backwards. In fact, the auditor confirmed the tax information, and reconciled it with the company's financials.
I don't think GEO satisfactorily addresses the tax issue. Either the receipts are fake, or they are not. I doubt a company that is a fraud would pay taxes over phantom revenue.
Something fishy here, I'm just not sure who to believe... the short sellers or the company. In any event, tomorrow we'll have a press release from the company, which should shed light on the situation. It should be interesting.
The Fed owns about half or even a majority of Treasurys across several different maturities along the yield curve. If we toss in holdings by China, Japan, and banks borrowing for free from the Fed, are there any real-money investors still holding U.S. government debt? [View news story]
Fed intervention in the long end of the T-bond curve has created a situation where these instruments are dangerous for investors. These instruments offer little yield, and are by Fed design exorbitantly expensive right now. Because of convexity, even a small upward movement in interest rates can cause the price of these long duration bonds to crater. Extremely high risk (i.e., no so-called "safe haven"!), and no yield. Buyers beware.
Petroleum & Resources Commits To 6% Annual Dividend: Is It A Buy? [View article]
The discount at which PEO trades is not justified by its fees, which are relatively low. Perhaps a slight discount may be warranted by built-in capital gains? These gains are a non-event provided that the fund does not liquidate its positions.
In any event, closed end funds that commit themselves to fixed distributions frequently trade at a premium. The dividend yield on PEO's positions will probably be insufficient to fund PEO's own dividend. Some positions may need to be liquidated, which could result in adverse tax consequences to PEO's investors given the likely built-in gains and pass through tax treatment to investors.
QE3: Ineffective Parachute for Fiscal Cliff [View article]
So "fiscal cliff" is the new "Greece"? Market prognostication by sloganeering is a bore. Equities are still cheap relative to bonds. Once that relationship changes, I'll start getting concerned.
More on Consumer Sentiment: Importantly, according to the report authors, the large gain was evenly split between the first and second halves of the month, suggesting continued gains into September. Panic hits the bond pits thanks to a combination of a Fed adding stimulus to an economy maybe not needing it. The long bond yield +13 bps to 3.06%. TLT -2.6%. [View news story]
Panic should have hit the bond pits a long time ago. The panic of - gee, I guess I just realized that I did not know what I was doing. Bond traders who paid yields of 1.38%, 1.47%, 1.63%, or even the current yield of 1.85% for the 10-yr bond apparently can't do math. The long T-bonds are a deteriorating asset at recent yields. Anyone with a spreadsheet can play around with the coupons, repayment schedule, and govt inflation data and Fed targets, and confirm the size of the built-in loss. You can also play around with sensitivity to upward movements in interest rates, to confirm the sharp pain as long-term interest rates creep up. Long bonds are the idiot's version of greed: lots of risk for no yield.
Monster Energy - The Momo Train Is Letting Off Passengers, Time To Short [View article]
Yeah, yeah. Nice analysis. Blah, blah. I still don't understand why anyone would short ANYTHING in this market environment, given that the Fed keeps pumping huge amounts of liquidity into the system. You can easily get your teeth knocked into the back of your mouth, if you short.
Seriously, Can Hewlett-Packard Be This Cheap? [View article]
The technology sector is all about intellectual property. Research and development costs are not capitalized. They are expensed when incurred. Therefore, book value does a poor job of measuring the company's true "capital". There are other issues.
Seriously, Can Hewlett-Packard Be This Cheap? [View article]
I disagree. In the technology industry, book value means very little. It's almost a meaningless metric in terms of valuing the cash flow potential of a company.
Is The Outlook For YPF Growing More Positive? (Part 1) [View article]
The obvious question - what about political risk? This is a company that was recently expropriated. Down the road, will minority shareholders be treated fairly? Is there a prospect of dividends resuming at some point in the future, or are would-be minority shareholders buying the proverbial share in somebody else's swimming pool? Given the recent expropriation, is it realistic to assume that the company will be able to secure partnerships to develop its properties, other than perhaps at a huge discount? This may be one of those instances where the share of the company is cheap for good reason.
Market Euphoria Continues As We Get Ready To Jump Off The Fiscal Cliff [View article]
After "Greece", the "fiscal cliff" is the new short-sellers' boogeyman. Meanwhile, 10-yr T-bonds stand at a yield of 1.66%, well below inflation. If there is a "fiscal cliff", long T-bonds would be massively sold off, and where would the dollars go? Other asset classes, including equities.
If the Fed wants you to go long equities, you should go long. End of story. You don't want to end up a statistic - just another short seller who loses his shirt fighting the Fed.
Market Euphoria Continues As We Get Ready To Jump Off The Fiscal Cliff [View article]
After Greece, the so-called "fiscal cliff" is the next short-seller's boogeyman. 10-yr T-bond yiels are at 1.67% right now, well below inflation. If there's a fear of the so-called "fiscal cliff", long T-bonds would be massively sold off, causing yields to spike. Where would the money go? Other asset classes, including equities. End of story.
Longwei Petroleum: The Most Brazen China-Based U.S. Listed RTO To Date [View article]
http://bit.ly/URU211
http://bit.ly/NTCRvp
If the company's videos are true, then it appears that the fraudsters and crooks are the short sellers, not the company. In any event, this episode warrants an SEC investigation, because someone perpetrated a fraud here, it is just not clear who - the company or the short sellers.
Longwei Petroleum: The Most Brazen China-Based U.S. Listed RTO To Date [View article]
In any event, the company needs to provide a meaty response, and fast.
Longwei Petroleum: The Most Brazen China-Based U.S. Listed RTO To Date [View article]
Longwei Petroleum: The Most Brazen China-Based U.S. Listed RTO To Date [View article]
http://bit.ly/RvBrsy
Are these receipts fake? Because these are value added taxes, you can calculate the company's revenues by working backwards. In fact, the auditor confirmed the tax information, and reconciled it with the company's financials.
I don't think GEO satisfactorily addresses the tax issue. Either the receipts are fake, or they are not. I doubt a company that is a fraud would pay taxes over phantom revenue.
Something fishy here, I'm just not sure who to believe... the short sellers or the company. In any event, tomorrow we'll have a press release from the company, which should shed light on the situation. It should be interesting.
The Fed owns about half or even a majority of Treasurys across several different maturities along the yield curve. If we toss in holdings by China, Japan, and banks borrowing for free from the Fed, are there any real-money investors still holding U.S. government debt? [View news story]
Petroleum & Resources Commits To 6% Annual Dividend: Is It A Buy? [View article]
In any event, closed end funds that commit themselves to fixed distributions frequently trade at a premium. The dividend yield on PEO's positions will probably be insufficient to fund PEO's own dividend. Some positions may need to be liquidated, which could result in adverse tax consequences to PEO's investors given the likely built-in gains and pass through tax treatment to investors.
QE3: Ineffective Parachute for Fiscal Cliff [View article]
There's No Longer A Bernanke Put [View article]
More on Consumer Sentiment: Importantly, according to the report authors, the large gain was evenly split between the first and second halves of the month, suggesting continued gains into September. Panic hits the bond pits thanks to a combination of a Fed adding stimulus to an economy maybe not needing it. The long bond yield +13 bps to 3.06%. TLT -2.6%. [View news story]
Monster Energy - The Momo Train Is Letting Off Passengers, Time To Short [View article]
Seriously, Can Hewlett-Packard Be This Cheap? [View article]
Seriously, Can Hewlett-Packard Be This Cheap? [View article]
Is The Outlook For YPF Growing More Positive? (Part 1) [View article]
Market Euphoria Continues As We Get Ready To Jump Off The Fiscal Cliff [View article]
If the Fed wants you to go long equities, you should go long. End of story. You don't want to end up a statistic - just another short seller who loses his shirt fighting the Fed.
Market Euphoria Continues As We Get Ready To Jump Off The Fiscal Cliff [View article]