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  • What Will Common Shareholders Of Genco Shipping Get After The Restructuring [View article]
    Be careful - the reorganized stock is not the same as the currently traded stock. There are about 44 million shares out there now - spread the $30-36 million over that & you get 0.68 - 0.81 per current, non-reorganized, share.

    Filing also estimates zero recovery for equity if they can't hold the restructuring together & they go into Chapter 7.

    Finally filing also notes that they are already experiencing disruption to business operations as a result of the financial restructuring issues.
    Apr 16 11:55 PM | Likes Like |Link to Comment
  • What Will Common Shareholders Of Genco Shipping Get After The Restructuring [View article]
    Typically a residual certificate which is effectively a right to a warrant is traded until the warrants issue. You would be short that.
    Apr 16 10:06 AM | Likes Like |Link to Comment
  • What Will Common Shareholders Of Genco Shipping Get After The Restructuring [View article]
    Package goes to all the banks today. Chapter 11 filing Monday. Shares cancelled prob within a month.
    Apr 16 10:04 AM | Likes Like |Link to Comment
  • Assessing The Bullish Case For Genco Shipping & Trading [View article]
    The reason for a vulture fund to buy the debt is so as to grab the equity value by demanding a huge number of warrants in return for forbearance on the defaulted debt. If you can get in higher up the capital structure at a discount, you're always going to do that.
    Feb 25 05:57 PM | Likes Like |Link to Comment
  • Tesla - Reality Is Beginning To Set In [View article]
    How many units can they sell in South Africa? It's a middle income country with long distances and no charging infrastructure.
    Nov 12 11:02 AM | 3 Likes Like |Link to Comment
  • Panic In Puerto Rico Bonds Presents Buying Opportunity [View article]
    What happens in Detroit is not relevant for Illinois (save in terms of perception). States are never subject to Chapter 9. They are sovereign entities which can choose, at their sole discretion, whether or not to honor their obligations and/or to prioritize among their obligations.
    Oct 19 10:42 PM | Likes Like |Link to Comment
  • Debt Ceiling And Stocks: Why The Media Is Deceiving You [View article]
    The imminent default by Puerto Rico is going to bring these fiscal issues home to a lot more people. PR debt is much larger and more widely held than all previous muni bankruptcies combined.
    Oct 19 10:26 PM | Likes Like |Link to Comment
  • Apple $395: Time To Give Up And Abandon Ship? [View article]
    You sound like that guy in Back to the Future talking about Japan.
    Apr 21 03:50 AM | 1 Like Like |Link to Comment
  • Muni Bond CEFs Take A Beating Again [View article]
    Looks like people are finally starting to realize that a write-down on Detroit is inevitable, whether through bankruptcy or negotiation. $14 billion of debt for 700,000 people is not repayable, especially given the economic and demographic prospects of Detroit. Michigan is making it clear that they will not bail Detroit out and, although Obama would want to, the chances of the House going along are zilch.

    The insurers will take the biggest hit but there's about $3 bn of uninsured out there. This will be a very public process and there are still a lot of retail muni investors who don't understand that defaults can cause losses.
    Mar 17 02:00 AM | 1 Like Like |Link to Comment
  • Cash Hoards On The Sidelines And The Great Rotation: Old Myths Meet A New Reality [View article]
    The money does exist. The government borrowed it from the Chinese and then gave it away (whether to worthy recipients such as our soldiers or to feckless friends of Barack who wanted new Obama phones). The recipients then spent it (a good proportion on Chinese goods). The Chinese exporters then sold the cash to Chinese state banks (in return for Chinese cash which is a separate loop), who lent it to the US government. No problem so far. But when the Chinese ask for their money back, that's the only reversible part of the loop.
    Feb 19 10:44 PM | 3 Likes Like |Link to Comment
  • President Obama will lay out yet another plan for trying to spark some life back into the economy when he gives his State of the Union address on Tuesday. The program includes investments in infrastructure, manufacturing, clean energy and education. But as with countless proposals in the past, any new spending plans are likely to hit strong opposition from Republicans, who would probably prefer to hear about cuts and deficit reduction. [View news story]
    Just stop spending other people's money Just stop it!
    Feb 10 04:28 AM | 17 Likes Like |Link to Comment
  • Fed Policy Supports Stocks Today - Future, Not So Much [View article]
    It is clearly true that it matters a lot how we get to 6.5%. The Fed doesn't seem to differentiate between getting there by growth or by getting there by a falling participation rate.

    Not that I think they should be just throwing money out there in anticipation of either scenario...
    Dec 13 12:05 PM | 1 Like Like |Link to Comment
  • Fed Policy Supports Stocks Today - Future, Not So Much [View article]
    I think the problem is that people look at inflation as a single phenomenon. We are just going to have a repeat of last time around. There cannot be real labor cost inflation while we have 16% un/underemployment plus a zillion Chinese/Indonesian/Indian cheep(ish) workers. As soon as there is any boost in consumer demand, it will not lead to higher prices, but rather to a higher current account deficit. Ordinarily this would lead to a weakening dollar, but the Asians will lend it back (in dollars) to the Treasury and crowd out some fixed income Treasury investors into other forms of debt. Thence leverage. Thence rising asset prices. Until again somebody realizes they're not going to get paid back (hopefully not the Treasury investors - that would be a real mess) and back we go to 2008.
    Dec 13 11:41 AM | 1 Like Like |Link to Comment
  • Recession Risk: The Threat Of Rising Interest Rates [View article]
    You didn't mention the wealth effect/margin call effect of the capital losses on bond portfolios if long rates rise. Do you not think that is significant?
    Dec 9 06:24 PM | 1 Like Like |Link to Comment
  • President Obama will go into budget negotiations with Congressional leaders on Friday calling for a $1.6T increase in tax revenues over 10 years, double the $800B discussed during debt-ceiling talks in 2011. The sides are sticking to their guns over tax hikes for the rich, while the GOP also want entitlement changes. Obama is due to today meet a who's who of top CEOs, including those of Wal-Mart, IBM and Ford. [View news story]
    Sounds like he's decided to go off the cliff and blame the Republicans.

    Big boost to his legacy, at least as Democrats see it, if he wins. Big hit to our portfolios either way.
    Nov 14 03:14 AM | 5 Likes Like |Link to Comment