Mike L

Mike L
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  • A Better Inflation Hedge Than Gold  [View article]
    Here we are a year later. Gold has continued to fall even as inflation has begun heating up, and interest rates have risen. Inverse bond funds have fared poorly however, so far. But the case still looks good that with tapering continuing and FED interest rate hikes looming in 2015, now may be a very good time to make a play into inverse bond funds. I just bought into DTUS because I think the short term rates will be the steepest and quickest rise in the yield curve. Look at a long term inverse leverage fund like TMV however, and it has been a disaster the past year, in spite of rising rates.
    Aug 5, 2014. 01:25 PM | Likes Like |Link to Comment
  • The Fed Has Not Been Printing Boatloads Of Money  [View article]
    Let me see now. My taxes just skyrocketed in 2013 with whopping increase, gas is $4 / gallon in Calif whereas it was about $ 2 - 3 gallon before all this 'easing' began in 2008, food is WAY up the past 6 months, a new housing bubble is forming, medical/health care is escalating through the ROOF, virtually every service is going up fast to pay for Obamacare and such, commodities and precious metals are roughly double now, where they were when this monetary 'easing' began 5 years ago, ..... but........uhhhh......... no inflation? LOL!
    Mar 21, 2013. 11:47 PM | 1 Like Like |Link to Comment
  • Future Quite Bleak For Rare Earths Miner Molycorp  [View article]
    That's what they all said about coal miner Patriot (PCX now PCXCQ) when it was at 10 a few months back. Now it is at .17 cents.
    Aug 31, 2012. 03:50 AM | Likes Like |Link to Comment
  • Get Out Of Coal Stocks  [View article]
    I don't agree that coal will 'go away' as a relic used only for making steel and powering trains...because global demand is rising in emerging markets even during times of global recession pressures.

    However, on balance I think your article is spot on. There is more risk to coal than reward. Some completely insane article authors have been writing about 'major bullish' developments in coal for years, even as the sector has been totally decimated.

    One SA author in particular, even liquidated all other holdings to buy Patriot coal (PCX), last August 4th at 14.75, thousands of shares on margin. , and then borrowed from, and did early distributions from a 401K plan, to buy more shares. Just before they went BK. Now those shares are worth approx 1 cent on the dollar. That author told everyone he was going to make 10,000% or something along those lines. Instead, he lost 200% (being fully margined) by trying to call a coal bottom for a straight year.

    CHina is in massive decline, ditto the EU. And India will not be taking up the slack, they will not be immune to the global slowdown. Nat gas may rise a bit but there is so much pent up production looming at any substantive price increase above 3.50, , that it will not be enough to help coal regain it's former percentage of US power production.

    JRCC will probably be the next domino to fall.
    Jul 25, 2012. 04:16 PM | 3 Likes Like |Link to Comment
  • Where Investors Need To Be Looking In The Coal Sector Right Now  [View article]
    We are headed in to global recession. Coal exports will drop in the months ahead. As will prices. There will be a better buying opportunity.
    Jul 20, 2012. 05:15 PM | Likes Like |Link to Comment
  • The Darkest Coal Moment Before Dawn  [View article]
    Agreed, China is going to have a hard landing. They can't keep up with building phony un-needed and unused projects. Their steel and met coal demand is going to collapse, and their thermal coal demand curve is going to flatten big time. Supply and demand are concepts that remain intact. The China government engineered 'forward demand' of bridges, commercial space, trains, malls, ghost cities (like Ordos), et al that no one is using, is an enormously wasteful endeavor that will be the latest and greatest bubble that will pop.

    Given the entire global economy is heading south, led by China's biggest trading partner the EU, this is not a time to go whole hog in to coal. Coal will have international growth in future, but prospects are very dicey right now.
    Jul 11, 2012. 03:49 PM | 3 Likes Like |Link to Comment
  • Patriot Coal Plunges: It's Not Too Late To Sell  [View article]
    Debt holders must get 100% before shareholders can see a dime. Since the debt was (properly) trading at approx 30 cents or so before BK announcement, and since the real experts at assessing valuation have done their due diligence, the probabilty of common shareholders getting anything is now approx .000000000000000000000...
    Jul 10, 2012. 02:51 PM | 1 Like Like |Link to Comment
  • Patriot Coal: What A Short Squeeze Looks Like  [View article]

    One need only look at this chart to see who the real fools are when it comes to owning solvent coal producers vs. insolvent ones.


    Unless you are only a trader and not an investor, a 3 or 4 day short squeeze pop, has nothing to do with whether you are making sound investment choices. It is merely noise in the long term scheme of watching good undervalued profitable companies rise, and high risk / poor balance sheet non profitable ones fall.

    If you were a long term investor, would you feel better about having BTU or PCX right about now? With PCX you'd be so far underwater, the pressure would be blowing out your eardrums. Never mistake short term moves with long term investment. That's like trying to use a few days unusually hot or cold weather data to decide whether anthropogenic global warming theory is valid.
    Jul 5, 2012. 09:58 PM | 2 Likes Like |Link to Comment
  • Patriot Coal: What A Short Squeeze Looks Like  [View article]

    Bondholders are not subject to short squeezes. IMO, bonds would be mojo rising if there was any great financing deal in the works.
    Jul 5, 2012. 09:54 PM | Likes Like |Link to Comment
  • Coeur D'Alene Mines: Undervalued Miner Is 50% Below Analysts' Price Targets  [View article]
    But what about the big roll off in India and China precious metals purchases? Does this not give you pause about the seceular bull in PMs, that has been in large measure driven by this demand?
    Jul 5, 2012. 04:25 PM | Likes Like |Link to Comment
  • Why I Am Sticking With Patriot Coal  [View article]
    Peter these insider shareholders who are at executive management level, often get issued new equity in a restructured (and much stronger) company after BK, if they hang around for awhile.

    It would be good for jobs and for Patriot as a company to unload their huge debt, pension liabilities, and other unfunded liabilities, and have a clear path forward to become profitable when coal and the global economy go in to rebound mode some day.

    They certainly can't mine profitably now, so no 'export' miracle is going to save them financially.
    Jul 1, 2012. 02:01 AM | 1 Like Like |Link to Comment
  • Why I Am Sticking With Patriot Coal  [View article]
    Somewhere in Kentucky, a coal train has gone off the rails.
    Jun 29, 2012. 02:00 AM | 3 Likes Like |Link to Comment
  • Why I Am Sticking With Patriot Coal  [View article]
    "Mike - face it. you're just a hater"

    You are right and I will mend my ways since I now see the light of MA's brilliant analysis, and the correct way for a good investor to interpret the data. I don't know how I missed it before. So now that I understand it better, let me summarize;

    - Coal production higher = bullish for coal
    - Coal production lower = bullish for coal
    - Nat Gas production up = bullish for coal
    - Nat gas production down = bullish for coal
    - PCX price drop of 10% = bullish for PCX
    - PCX price drop of 95% = bullish for PCX
    - US coal consumption down = bullish for coal
    - US coal consumption up = bullish for coal
    - PCX goes on to pink sheets = bullish for PCX
    - PCX debt drops to .20 cents = bullish for PCX
    - Severe weather = bullish for PCX
    - Mild weather = bullish for PCX
    - In between weather = bullish for PCX
    - Obama is re-elected = bullish for PCX
    - Romney is elected = bullish for PCX

    OK, I think I have my head right now on this whole topic.
    Jun 28, 2012. 02:19 AM | 5 Likes Like |Link to Comment
  • Why I Am Sticking With Patriot Coal  [View article]
    "buying at todays price and selling a $1 Sept call is pushing a good shot at 30% profit"

    More like a good shot at a 50% loss. PCX could see a short squeeze spike periodically, but barring that it will likely drift below a dollar and end up on the pink sheets by September and you will be stuck with shares at much lower levels. Hoping for short squeeze spikes are gambles, not investments.
    Jun 28, 2012. 02:19 AM | 3 Likes Like |Link to Comment
  • Why I Am Sticking With Patriot Coal  [View article]
    Mark claims that PCX and U.S. coal industry will be skyrocketing soon. The DOE report that just came out predicting consumption demand states just the opposite. In fact, it is quite dismal with it's projection that coal consumption in the U.S. will not get back up to 2010 levels until at least 2 decades! With Appachian coal being mentioned as one of the most expensive sources.

    Then you look at International growth markets in coal and find that Australia can meet most of that need, and that although U.S. exports are up, they have not kept pace with electrical denerating demand drop, and to top all that off, U.S. infrastructure (coal export terminals) are not sufficient for any massive ramp up in coal exports. This huge boom market in U.S. coal looks mighty improbable and 'iffy' from my vantage point.

    The recent DOE report summary below;

    DOE: US coal consumption to stay below 2010 level through 2031
    Posted: Jun 26, 2012 7:57 AM PDT Updated: Jun 26, 2012 7:57 AM PDT
    By Pam Kasey - email

    The U.S. Department of Energy's Energy Information Administration has once again reduced its coal demand forecasts for 2025 and 2035.

    The U.S. coal consumption forecast for 2025 is 20 quadrillion British thermal units, or quads, in the reference case in the EIA's Annual Energy Outlook 2012, released June 25. That's down almost 3 percent from the forecast in January's early look at the reference case — and down more than 10 percent from the AEO2011 2025 projection of 22.6 quads.

    Coal consumption for 2035 is forecast at 21.15 quads, down from the January projection of 21.6 quads and down 13 percent from last year's 2035 projection of 24.3 quads.

    The Annual Energy Outlook is the DOE's most comprehensive forecast of U.S. energy production, consumption and market trends. The AEO2012 forecasts activity through 2035. Its reference case takes into account policies that are in place; the outlook also includes 29 alternative cases.


    The EIA sees total U.S. coal production declining through 2015, then rebounding as electricity demand grows and natural gas prices rise. Exports increase over time and the use of coal for synthetic liquids contributes to demand growth.

    But while both Western and Interior coal production grow, Appalachian coal production, after falling through 2020, is nearly stagnant.

    "Appalachian coal production declines substantially from current levels as coal produced from the extensively mined, higher cost reserves of Central Appalachia is supplanted by lower cost coal from other supply regions," the outlook reads. "An expected increase in production from the northern part of the Appalachia basin, however, moderates the overall production decline in Appalachia."

    The price of Appalachian coal is already well above the U.S. average, and that price spread grows. Some of the higher price for Appalachian coal reflects declines in coal mine productivity and some of it an expected shift toward higher-value coking coal."
    Jun 27, 2012. 04:55 PM | 5 Likes Like |Link to Comment