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  • Review Of 2013: Why My 9% Yield Excites Me More Than My 18% Total Return  [View article]

    Consider selling all or part (1/4, 1/3, 1/2) of your position if the appreciation is greater then three years worth of cumulative dividends/distributions. Usually, market cycles are anywhere from 2 to 5 years (cyclical not secular), which may allow you to buy back into these investments at lower prices and therefore increase total returns.

    Harvesting three or more years of dividends/distributions should also, in theory, give you the corresponding window of 3+ years to add the original investment capital back into these investments (or others) at potentially better entry points while utilizing the three or more years of income for expenses, if needed.
    Feb 17, 2014. 10:12 AM | Likes Like |Link to Comment
  • Atlantic Power: Is Another Dividend Cut In The Cards?  [View article]
    As stated by many, this company is in desperate need of new management. This company needs real utility industry executives, not semi-retired investment bankers who thought they could buy and sell generation assets, pay dividends in between deals and make themselves rich in the process.

    This new deal is interesting since it almost takes on a debtor-in-possession feel. The key will be who buys the majority of the debt. GS will likely price it attractively for themselves and their clients. It would be helpful to know who the clients are or at least what type of buyers, which of course we won't likely find out. BAML (B of A Merrill) is likely in the deal to stuff some of the debt to retail who will be along for the ride with the institutional/trade buyers.

    I believe the company will be sold eventually when a better market for IPPs develops. However, that may be some time given the current awful environment in power generation and a few mega utilities looking to sell generation assets as well.
    Feb 3, 2014. 09:30 AM | 3 Likes Like |Link to Comment
  • Activist investors seek to paint coal as the new tobacco  [View news story]

    Excellent point about Germany, Europe's largest economy, and an export machine. I have commented on other coal articles that German coal usage is Increasing as they move away from nuclear. The German move away from nuclear, in my opinion, is classic "knee jerk" reaction to the Fukushima disaster and likely misguided since Germany isn't prone to tsunamis and earthquakes.

    Of course, you never hear much from activist investors concerning energy use in the developing world since any complaints about the environment will be ignored (China) as growth and modernization usually win out over environmental concerns.

    Also, is it really better to build nuclear power in regions that are more prone to earthquakes/tsunamis (Asia)? And what about storage of the waste? Sure, you can move to natural gas fired plants which are less dirty, but that increase in build/usage will most certainly increase the price of natural gas over time and make coal the cheaper alternate for energy use in developed countries. Lower costs always win out in electricity and industrial use when individuals and/or businesses are given a choice, unless governments intervene with their arrogant "greater good" argument.

    How the current disaster in the U.S. government's involvement in healthcare will not be irrelevant (or forgotten) when they continue to "help" the country to cleaner energy use. A move away from coal will result in higher energy costs (removing a competing energy source and natural gas is still a depleting commodity) and even potential blackouts (pipelines down for example) since storing natural gas is more complicated than coal.
    Nov 21, 2013. 09:30 AM | 1 Like Like |Link to Comment
  • Bank Of America Hammered By The United State's FHFA  [View article]

    You are certainly not an empty slate, nor did I ever imply that, evident by your ability to think independently using intelligent insightful reasoning. Living one's life to their own moral standards (as long as one respect's the right of others to have that same freedom / sort of the "golden rule" I guess) while maintaining an open mind to every situation and/or different convictions is admirable and unfortunately very rare in most of the world. If this approach to life were widely practiced it would provide solutions to a variety of contentious issues or even prevent many problems from arising. For example, individual morality triumphing over greed by both lenders and borrowers in last decade's real estate bubble would have prevented the financial crisis of 2008 (enforcing existing regulation may have helped as well).

    Your second question is rhetorical and clearly I agree that is why it does work. I also happen to agree with your approach to voting about non party alliance and voting for the best person, although often feel voting for president in the U.S. requires choosing the lesser of two evils, but I do vote since the right has been fought and defended with blood and failure to vote diminishes the sacrifices made by earlier generations.
    Nov 9, 2013. 12:28 PM | Likes Like |Link to Comment
  • Bank Of America Hammered By The United State's FHFA  [View article]
    gwyn, I believe the affordable healthcare act was signed by Obama (passed under a democratic controlled Congress), but not created by him. Ultimately, this new system will undergo many changes and hopefully be a better system than what proceeded it.

    I also believe it hurts the people least able to afford healthcare, since if they don't sign up and receive the subsidy, they will be taxed/penalty/fee (whatever they want to call it) by withholding the amount due by reducing refunds or tax credits (mainly to the so called 47%), which, ironically, may actually increase government revenue in the short term.

    If you are not pro big government, how can you justify universal all encompassing federal mandates that require action to be taken? Also, just as importantly how would non-compliance be enforced? If not by a big powerful central authority (unfortunately in our country, the IRS) then how? An honor system? In theory that would be utopian, but likely unrealistic.

    Beliefs/convictions are choices by individuals on how they conduct themselves in their lives (at least in free countries) and usually come to be reflected in political parties (especially when close to elections), although after elections are concluded, what you get from any party is not exactly as promised. Having no beliefs/convictions would indicate an empty slate, so to speak, and would be ripe for the brainwashing you speak of by the more manipulative and clever in any society therefore leading to more narrow views or as you say prejudices.

    Finally, it seems that any government that governs waiting for reality or just dealing with it, would be reactive rather then proactive. In order for that to work with any degree of success would require every government in the world to act the same without defined national interests, unfortunately that will never occur.
    Nov 8, 2013. 12:42 PM | Likes Like |Link to Comment
  • Bank Of America Hammered By The United State's FHFA  [View article]
    I am sorry about the link not working, but it does work here (in the U.S.) when I click on it. The short video is not bashing the ideals of the affordable care act, which are admirable (it discusses the philosophy behind it). Everyone in a rich industrialized country should have access to healthcare insurance (and healthcare) and at prices they can afford (the devil is in the details). However, it should be an individual's choice not a mandate from a government that believes they know what is good for you and everyone else.

    Also, you seem to have a slight hostile/condescending attitude towards the people in the U.S. with your comment about being brainwashed. My take, the fact that you state that indicates an arrogance and intolerance of views that you don't agree with, which of course makes you fit right in with the ultra liberal left in this country.

    However, please stay in Europe since they seem to have all the answers to most problems in the world today. Things are going well in Greece, Italy, Spain, Portugal and Ireland. I am sure Europe will lead the world out of the current mess with their enlighten views.
    Nov 8, 2013. 10:40 AM | 1 Like Like |Link to Comment
  • Bank Of America Hammered By The United State's FHFA  [View article]
    As mentioned earlier, most of these mortgages were originated by Countrywide and the government was grateful and encouraged BAC and other large banks to buy these failing institutions. The lawsuits against the banks are "no good deed goes unpunished" and clearly are holding back credit being extended more broadly in the economy.

    Also, it is ridiculous to actually think and say bubbles were/are knowingly created by a few to benefit themselves. For a bubble to grow it needs wide participation by multiple groups of investors/buyers and as far as I can see, no one was/is holding a gun to their head to participate.

    If you actually believe the recent actions of the DOJ is just, then you clearly are supporter of most incompetent administration this country has ever seen. If that is the case, please write about politics instead of investments/finance.

    To further show you the arrogance and absurdity of the current administration and their poisonous agenda, watch the link below. It sets a simple clear argument based on logic, responsibility and morality, all lacking in the Obama agenda and unfortunately in growing segments of our country that believe in his misguided vision.
    Nov 8, 2013. 09:21 AM | 1 Like Like |Link to Comment
  • FHFA demands $6B from BofA over mortgage bonds  [View news story]
    This is classic "no good deed goes unpunished". The banks in question (JPM BAC as the two largest) made quick decisions (with government prodding) to buy these troubled failing banks to help stop the growing panic in financial markets.

    Why is DOJ doing this? I believe this administration is anti-business and their true colors are now showing since they no longer face re-election and will not need the funds usually obtained form business. These lawsuits/settlements they believe plays (likely correct) well to the their base of very left liberals and anyone new to entitlements this clueless administration hands out.

    Sadly, they miss the larger issue, which is a healthy financial sector lending and growing (not focused on building reserves for lawsuits/write offs etc..) will help generate more tax revenue in the economy on a sustainable basis rather then these onetime shakedowns could ever achieve.

    Oct 21, 2013. 09:20 AM | 5 Likes Like |Link to Comment
  • Stay Away From This Sinking Ship  [View article]
    As stated above, the VLCC rate is not applicable for NAT. The suezmax rate is the meaningful spot rate for NAT.

    NAT, as are all oil tanker shippers, are in difficult times, but they continue to show access to financing so it seems likely they will be a survivor. Real recovery in tanker rates still seems distant and according to John Fredriksen (likely the best investor/operator in this industry) probably won't occur until 2015 (link below).
    Sep 27, 2013. 11:46 AM | 1 Like Like |Link to Comment
  • Chinese demand for coal is cooling  [View news story]
    I believe the trillions is a typo or just showing that this article is an attempt to attack coal stocks, again.

    The U.S. I believe has the largest coal reserves in the world, estimated at 483 billion short tons (link below).

    Also, Germany is burning more coal as they attempt to move away from nuclear power after the Japanese disaster. I believe their coal consumption will not be replaced that quickly (if at all) since their natgas supply is almost exclusively from Russia and always a problem with regard to price and politics.
    Sep 24, 2013. 09:05 AM | 1 Like Like |Link to Comment
  • Microsoft's Nokia Acquisition: Too Early, Too Cheap  [View article]

    Very good observation regarding branded versus unbranded phones for the lock-up period. Bringing back former Nokia employees, especially for design, to produce an adroid phone manufactured by a third party would keep them in the game as a niche player. This would keep them somewhat current in smartphones and potentially set-up a return of the Nokia brand in ~2.5 years. However, not sure they could ever return to be a major player again in the mobile phone market via this strategy.

    I like the observation mentioned earlier that Nokia, minus the phone division sold to MSFT, would be an ideal target for Samsung. After that acquisition, Samsung could buy ALU and really consolidate the network industry.

    Finally, I agree with the author that a lot remains to be seen how Nokia develops after this deal and the phone division was sold way too cheap, although further risk was removed from Nokia by the sale as evidenced by their bond price performance yesterday.
    Sep 4, 2013. 08:37 AM | Likes Like |Link to Comment
  • Nokia estimated to have 87% of WP8 base; Bernstein downbeat about Q3  [View news story]
    This dependency should increase leverage for Nokia when dealing with Microsoft. Would still like to see Nokia manufacture some android phones to take some market share from Samsung. However, I believe the WP8 is a better operating system then android.

    Finally, I don't believe anyone really cares what Bernstein's analyst thinks, since he doesn't see the forest through the trees and seems to be one sided and closed minded. As more carriers sell lumia devices, market share for WP8 will continue to increase, albeit slowly it seems. Europe needs to recover more fully for Nokia to benefit with quicker market share growth..
    Aug 20, 2013. 01:03 PM | Likes Like |Link to Comment
  • Nokia Mugs Siemens  [View article]
    They don't need to buy Nokia, but it would be a smart move to prevent a buyer from taking away MSFT's mobile smart phone manufacturer. It als0o really wouldn't cost MSFT all that much since the parts they don't want can be sold to trade buyers or via an IPO. I described how MSFT could buy them over a year ago below.

    Obviously, the numbers have changed and will change after the NSN buyout from when I wrote this, but, IMHO, the logic of the buy is still the same.

    From last June:

    Will Nokia Recover Or Be Bought? [View article] Below is my take on Nokia, I responded to an article on Seeking Alpha last week which discussed the recent MSFT announcement (and the lack of mentioning Nokia prominently during the presentation other than using Nokia Maps and pureview/ both indicating cooperation) on their tablet and rumor they may make their own WP8.

    If MSFT is considering buying NOK, I doubt they would be issuing statements that would help drive up the price. If they are in current negotiations to buy NOK they would be restricted in what they can say publicly.

    MSFT buying NOK would be a classic buy vs build decision for entry onto a global platform giving them critical mass immediately to compete with AAPL and Samsung. MFST clearly has staying power and brand recognition, a new Microsoft/Nokia brand in mobile phones would be a strong competitor.

    If MSFT bid $5.0 per share for NOK (~$18.5bil) they get ~$13.0bil in cash/liquid investments, assume ~$6.25bil debt (which they service and call as soon as possible to retire or refinance at their credit rating) and the patent portfolio's cash flow of ~$625mil per year. Therefore, the bid will cost MSFT ~$5.5bil cash net (actually less if you consider the $1.0bil they are paying NOK under the current partnership and patent portfolio income which could be viewed, in essence, as financing the acquisition), less than 10% of their cash position and probably be further reduced if they sold patents they didn’t view as necessary or desirable as well as NSN.

    NOK's restructuring to stop the cash burn only makes the company more attractive to MSFT, although the price they would need to pay will rise once the cash burn is halted.

    The recent announcement that they will produce their own tablet shows they will be more involved with hardware production, therefore how can they not be looking at this as an alternative?
    Jul 1, 2013. 01:17 PM | 1 Like Like |Link to Comment
  • Nokia Mugs Siemens  [View article]
    This deal may well be a reason why recent MSFT NOK talks on D&S and /or acquisition by MSFT ended. Any future talks between the two would now present different scenarios.

    Q2 earnings report will now be a little overshadowed by this deal since adjustments to cash flow and earnings will be adjusted by analysts to show 100% ownership of NSN going forward.

    MSFT should buy NOK soon or risk paying much more later.
    Jul 1, 2013. 09:23 AM | 1 Like Like |Link to Comment
  • A huge bet on Bank of America (BAC +1.8%) has either been initiated or covered, writes Steven Sears as an unnamed investor purchased 50K January $11 puts today. Only a check of tomorrow's open interest numbers will tell if the trade was to offset a previous bullish short put position or to open a new bearish stance. Today's open interest is about 67K contracts - check back in the morning to see whether it's higher or lower by about 50K.  [View news story]
    $22k not so expensive to an institution or option fund given the premium cost less than a half of a penny move on the 5,000,000 share position. That is, if the position was established as a hedge However, it could be a punt on the outcome of the hearing and the risk is $22k with six months to expiration and the likely cover this summer when and if the trial is decided, therefore avoiding most of the time decay for a buyer (gain for the seller of the put).

    Open interest is now ~117k contracts, so it looks like it is a new position.
    Jun 29, 2013. 10:59 AM | Likes Like |Link to Comment