Seeking Alpha

Lake Investor

Lake Investor
Send Message
View as an RSS Feed
View Lake Investor's Comments BY TICKER:
Latest  |  Highest rated
  • False Market Profits On A False Jobs Report Prophet [View article]
    Hope you haven't been in cash the last four years. Fed accommodative, risk premium for stocks over bonds at very high levels, massive cash holdings in US, coming off years of outflows from stock funds, divided government--all point to a raging bull. I am staying long.
    Mar 10 11:00 AM | 1 Like Like |Link to Comment
  • REITs: Why The Dividends Are A Mirage [View article]
    If they didn't pay the dividends there would be adverse tax consequences (entity level tax) and the appreciation you talk of would not appear. REITS are managed to be tax efficient. You should retract your article.
    Mar 5 05:53 PM | 1 Like Like |Link to Comment
  • REITs: Why The Dividends Are A Mirage [View article]
    Why can't you admit that if an amount equal to the equity capital raised is used to purchase new properties at yields that are accretive to EPS there is no dilution? You've made the same silly comment over and over.

    Get upset with your REIT managers if they're not able to invest new capital in a manner that is accretive to EPS. The REIT tax structure makes growth through retained earnings impossible (they're required to pay out 90% of earnings). Consequently, in order to grow (when growth is an attractive prospect) they have to either issue debt or equity. It's that simple. No nefarious scheme here. The REIT investors on this board appreciate the benefits of the tax structure which reduces overall tax burden.

    I'm up big on CLNY and OHI in last six months and I've seen repeated capital raises. I'm fine with it as long as I have good management that knows their market niche. They've continued to raise my dividends during this time. I did get mad at my broker because his firm managed one of the secondaries and he didn't call me when I was in an acquisition mode on CLNY.
    Mar 5 05:51 PM | 1 Like Like |Link to Comment
  • Buffett Has The Solution For Apple [View article]
    I think there is a "deemed repatriation" and you'd have a tax bill for 35% of the cash thus used in the foreign buyback.
    Mar 5 03:56 PM | Likes Like |Link to Comment
  • 4 Mega-Cap Stocks With The Largest Share Buyback Activities [View article]
    The value is there in increasing share value. Sell if you need cash. Don't get me wrong--I like steadily rising dividends. XOM has a good record in that regard. Look at long term price chart--a steady ramp up. Though their business is sometimes cyclical XOM goes straight up--because of steady retirement of shares.
    Feb 20 10:37 AM | 1 Like Like |Link to Comment
  • 4 Mega-Cap Stocks With The Largest Share Buyback Activities [View article]
    With a 2.6% dividend and 4.9% of shares retired in a year, Exxon is effectively yielding 7.5%. Awesome.
    Feb 20 12:53 AM | 1 Like Like |Link to Comment
  • GE Looks Poised To Further Increase Its Dividend And Make Industrial Acquisitions [View article]
    I believe the purchases with foreign cash are deemed to be repatriated and the repatriation tax would be owing.

    I think the Italy acquisition done last year was a good use of foreign cash. I think a foreign sub merely used cash holdings to buy Avio SpA. Since that asset is still held offshore there is no repatriation tax and a better use of foreign cash. However, if the deal goes well it will only result in even more cash piling up overseas. I think the day will come when the government will see the wisdom of revising the current tax scheme to encourage repatriation and investment in the US.
    Feb 15 01:31 PM | Likes Like |Link to Comment
  • GE Looks Poised To Further Increase Its Dividend And Make Industrial Acquisitions [View article]
    I'm very long GE. I sold out in 2007 and came back in big in 2009 post-crash.

    I like the recent deals --this one especially as it allows the business to be more focused on industrial deals. The most encouraging thing from Zvi's article is the focus that GE--a highly indebted company--has no refinancing debt and lowering interest costs. This will pay dividends for many years to come. It's probably more important than an interim dividend increase or more share buybacks. I think the dividend increase won't come until December. It will still probably be 2-3 cents per quarter as that keeps them in the double digit increase category.

    The thing I don't like about GE is that it is a rent seeker. A day of reckoning usually comes for such activities (speaking in a macro sense). GE seems pretty good at it though so might as well partake--it's the closest I'm going to get to taking from the government trough until I hit medicare and SS age in about 12 years.
    Feb 15 01:27 PM | Likes Like |Link to Comment
  • Why Hyperinflation Is No Myth: The Shadow Banking Component [View article]
    inflation can exist even when some of the goods and services measured do not go up in price as much as the general price level. There are alwaysrelative price moves driven by different microeconomic forces. Right now we have excess labor and so wages are not rising much. However, other goods in the basket of things measured to arrive at inflation have gone much higher.

    Inflation is nothing more than too much money chasing too few goods and services. That's it. We've greatly expanded the monetary base through fed actions. When the velocity of money picks up a little we'll have serious inflation. It will be accompanied by unemployment as in the Carter years. Obama is causing history to repeat in that regard.
    Feb 15 12:25 PM | 1 Like Like |Link to Comment
  • A dispute between an Indiana farmer and Monsanto (MON) over soybean seeds will be heard next week at the Supreme Court. At issue is how long MON can claim patent protection for its genetically engineered seeds, but it isn't just the agriculture world that's nervous about the outcome. Microsoft (MSFT) and Apple (AAPL) have filed briefs saying a ruling against MON would "eviscerate" their patent protection. [View news story]
    From your handle I would expect you would be in favor of patent protection!!

    I think the laws are about right. I think the patents on drugs could be a little longer as the drugs developed do wonders but they cost so much to develop. Of course, I"m jaded by my perspective as an investor in the drug and technology sector. Medicine would take a step back if patent protections were weakened. It's tough enough dealing with all the third world countries that allow blatant theft of technology.
    Feb 15 12:14 PM | 3 Likes Like |Link to Comment
  • Why Hyperinflation Is No Myth: The Shadow Banking Component [View article]
    I don't think you've ever taken an economics class. Inflation is a monetary phenomenon. Higher wages are one evidence of inflation--not the cause.

    We have some deflationary forces at work and countervailing inflationary forces. I believe the latter will win out within a few years. That is where the smart money is placing its bets. Demand for real estate has picked up greatly.

    This time around I think wages will rise but not keep up with inflation. To protect yourself you either have to rent seek (our national pastime) or invest in inflation hedges.
    Feb 13 07:23 PM | 4 Likes Like |Link to Comment
  • How Apple Can Generate A Decent Return On Its Cash [View article]
    Thanks for your comment. I like this idea the best. Even some significantly out of the money puts on Apple have nice premiums. I'm sure if the market got used to this activity the put premiums would probably drop.

    Large size of cash stash may make it impractical to write against more than a small part of the cash horde. Still it would allow you to boost the return on the cash significantly. Worse case is you retire shares at a lower price.
    Feb 13 05:19 PM | Likes Like |Link to Comment
  • Is Warren Buffett A Closet Dividend Investor? [View article]
    I agree that the "Kingdom building" impulse of corporate managers can be a great destroyer of wealth. Few are good at buying companies.

    I disagree that Sees is bland--I love their product!
    Feb 12 08:06 PM | Likes Like |Link to Comment
  • As Stock Prices Continue To Rise, Earnings Continue To Decline [View article]
    You hit on an important point--"The Fed pours billions per day to keep this market up." Don't fight the fed. Until it goes from an accommodative stance to a restrictive stance stay invested.

    GDP not really shrinking. We had one quarter of .1% decline but it will not probably repeat this quarter. Too many one time factors hit last quarter. As noted by Tack above profits are actually at record highs and climbing.

    a period of market outperformance made sense as the equity markets lagged badly for 10-11 years since the turn of the century. A long period of outperformance by bonds over equities as we experienced in that time is unusual and unlikely to persist. Get out of your long bonds now and into equities or you'll be sorry.
    Feb 11 05:09 PM | Likes Like |Link to Comment
  • Exxon Mobil Vs. Chevron: The Ultimate Comparison [View article]
    a judgment rendered in Ecuador does not necessarily translate into a collected judgment in the US or other places Chevron has assets. Banana republic verdicts are often ignored and not enforced in world commerce.

    I don't know the structure of Chevron's investment in Ecuador--probably should have isolated the risk in a subsidiary. Should also have done an asset purchase instead of a merger when it made the investment. Don't know exactly what happened.

    The claim is hokum. As are massive claims by Brazil's prosecutors over the 2,000 barrel spill (which prosecutors tried to spin into a new Macondo). Still the risk of investing in unstable regions is that tin horn dictators and corrupt politicians will try to steal your investment through pretense. I think Exxon manages such risks better than any other oil company. Probably explains their recent Canadian investments where such risk are low.
    Feb 11 01:41 PM | Likes Like |Link to Comment