johnheiderscheit

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5 Comments

    • Wed Sep 24th 12:07 PM | Rating: 0 0
      Commented on:
      Municipal Bond ETFs and Closed-End Funds
      fpt


      On Sep 01 05:46 PM DaleT wrote:

      > Closed end usually sell at a discount to net asset value, and may
      > come into favor as tax rates go higher. Anyone know a good AMT free
      > closed end intermediate to short maturity closed end fund?
      View article »
    • Tue Mar 18th 12:03 PM | Rating: 0 0
      Commented on:
      Posing the Right Questions to National Atlantic
      David I sold my shares for $6 (basis was a little north of there because I had some at $10 and some at the bottom) but I will be rooting for you nonetheless. I just couldn't stand to look at the position anymore.
      View article »
    • Thu Jan 31st 13:27 PM | Rating: 0 0
      Commented on:
      Business Development Companies Raising Capital in a Recession
      The thing is that stock must be sold above NAV. Even with the nice rally of the past week or so the club of BDCs selling above NAV is extremely exclusive. So your point that "other BDCs will be following suit in the weeks ahead" is questionable.
      View article »
    • Thu Jan 24th 18:22 PM | Rating: 0 0
      Commented on:
      Recession Talk Has Gone From 'If' to 'How Bad'
      With unemployment claims at extreme lows, interest rates on ARMs and other consumer loans falling sharply, retails sales holding up decently, big fiscal stimuli on the way, and an easy first quarter comp the economy is not in recession at this time. I suspect within a few days the talk will turn from "how bad" back to "if".
      View article »
    • Sun Jan 13th 18:32 PM | Rating: 0 0
      Commented on:
      What is American Capital Strategies Worth?
      Here are the problems with buying ACAS now.

      1) As the author notes a key (perhaps the key) competitive advantage for ACAS is cheap capital. Several sources of cheap capital are, at least temporarily, ieither off the table completely or at least much more expense. First, in the current environment stock offerings will be much less accretive. Second, asset securitizations on good terms may be more difficult. Since the credit market difficulties appeared in July securitizations have been few and far between. Third, bank debt is going to become more expensive.

      So I view the current situation as a race between the increasing cost of capital for ACAS and ability to deploy capital on what will certainly be better terms.

      2) The chart. Its beyond ugly. Why is today the bottom? Why not tomorrow or a year from now. Financials are in a bear market. The BDC portion of the financial space started declining in early 2007. A bear market typically last 12-24 months. So based on the technicals I suspect a bottom may not be in.

      3) Credit quality has been good but not great in a wonderful economic environment. What will happen in a weak or even very weak environment. ACAS's investment classes in 1999-2002 performed very poorly. Essentially, ACAS outran these problems through tremendous balance sheet growth after 2003.

      Taken all together, I don't think ACAS is yet a fat pitch.
      View article »
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