BDHPlayer

Making Capital Gains, Or Getting 12% Dividends with ING Cumulative Preferred Shares

I have a 4.5% 5 year arm with ING. Their margin on this business right now has to be hugh. The risk is how much the Fed increases interest rates over the next 2 years.

Attractive and Secure Monthly CEF Distributions?

I'm guessing that your wrong on the management fee. Total expenses include the borrowing costs of the leverage.


On Aug 26 04:11 PM GlobalTrekker wrote:

> User 445849,
>
> Where did you hear about the div cut? Even their public desk was
> unaware. The delayed dividend announcement was a tip off. Quite a
> big drop: 12% cut.
>
> Joe Eqcome,
>
> Like your posts and analysis, but I think there is a limit to this
> type of screening analysis. A much more valid approach would be back-testing
> these hypotheses on random time intervals and seeing if the short-term
> return was greater than the S&P or appropriate bond index over
> that interval. I really have doubts about most of these picks. DHF
> and FAM both look like a bunch of crap that have underperformed compared
> to their indices. It's just their discounts have fallen. DHF with
> a 3.1% management fee is appalling compared to JNK's 50 b.p.s fee.
> And FAM is a disaster waiting to happen at 29% leverage and a completely
> unjustifiable 3.6% management fee.

Shorting Las Vegas

$200 per night? I spent 9 days in Vegas for $211 including taxes.

In March I spent 3 nights at Wynn for free including $100 of slot credit. After running the slot money through the video poker machine, I cashed out for $90.

Only action they received was in the poker room which is not the type of margins they are looking for.


On Jul 10 08:48 AM TCK wrote:

> After living in Las Vegas for over 5 years, I think I can say that
> the business model has failed. Over priced rooms and meals combined
> with horrible games is a bad strategy for success.
>
> Their only minor achievement has been to convince the tourist that
> $100 per night for a room is now a "good deal ".

CEF Funds Review: Worst to First

Good luck finding shares of PHK to short.

Money-Center Banks to Re-Default on Their Loan Modifications

Your missing one point. Profits of $198 billion in 2006 was net of allowances for bad debt. What were the allowances in 2006. I'm sure they were on the low side, but there still had to be some provision.

The Reverse-Convert Scam

If I recall, didn't Lehman Brothers issue these securities and the holders of these securities were up a creek without a paddle when Lehman went bankrupt.

GM Secured Lenders to Get Full Repayment: Why Not Chrysler?

Was there a quid pro quo? Take 29% on Chrysler and we'll give you 100% on GM?

Bank of America Shares Now Worth Less

Your wrong on the net income pie. The net income does increase by the earnings on the cash received, as well as, leveraging the cash received.

The question is whether earnings per share will increase or decrease because of the additional shares issued.

Credit Default Swaps May Be Playing a Supporting Role in Chrysler Bankruptcy Filings

I don't have any sympathy for Chrysler or the unions. Secured lenders are exactly that . To get the short end of the stick because the adminstration decided that should be the case is wrong.

The bankruptcy process should protect the secured lenders and modify the union contracts to make them competitive with the contracts of domestic based non union auto manufacturers.

Why would anyone want to lend to Companies on a secured basis for the low interest rates that secured loans pay?

Bank and Broker Default Risk

What I find interesting about these numbers is that BCS and ING have lower CDS rices thatn JP Morgan. If you look at the preferred stocks of these companies, they are yielding in the area of 40% per year.

Which market is right?

Geithner's Plan Ignores Mark-to-Market: Where's the Beef?

Am I wrong in believing that a big part of the mark to market problems is potential returns that buyers want. For example, a buyer won't buy unless he can get a projected return of 20% per year. The bank or brokerage firm that owns the asset wants a 8% return. Bingo, there is a big difference between the bid by the hedge fund and the offer by the bank.

Another Round of Farcical Congressional Hearings

I'm waiting for the Representatives and Senators working for $1 per year until the financial crisis is solved. Don't hold your breath.

Just watching the monkeys from DC is enough to short the entire economy. As usual, the politicians don't have a clue.

Waiting for a Saturday Night Live skit to give the answers that Dimon et al really wanted to give. Starting that Barney Frank and his cronies are responsible for the housing crisis.

Capital Crossing Preferred Corp: Too Cheap?

The claim is as of 9/15/08. The bank took significant write offs at 9/30/08. I wonder if some of the perceived decline in value for these items was already reserved at quarter end.

The 12/31/08 financials will give a better clue of where Lehman Brothers Bank stands.


On Feb 05 07:30 PM User 351933 wrote:

> Despite the fact that the potential return has grown on this play,
> I still do not find the risk-return favorable.
>
> In the prospectus for CCPCN, it reads: "The returns from your investment
> in the Series D preferred shares will depend to a significant extent
> on the performance and capital of the Bank. A significant decline
> in the performance and capital levels of the Bank or the placement
> of the Bank into bankruptcy, reorganization, conservatorship or receivership
> could result in the automatic exchange of your Series D preferred
> shares for preferred shares of the Bank, which would represent an
> investment in the Bank and not in us. Under these circumstances."
>
>
> So how healthy is the Bank?
>
> The Bank currently has a 2.2 billion claim against Lehman Bros. Holdings,
> for loans that were to be purchased by them on Sept. 15. But bankruptcy...
>
>
> Let's assume that the 2.2 billion lawsuit delivers nothing for the
> Bank. It is then my suspicion that the loans will not be saleable
> at their carrying value. Sept 30, 2008 data from the FDIC (the most
> recent available) shows a YOY drop in equity capital of over 1 billion.
> Current equity capital stands at 1.009 billion. If the 2.2 billion
> has a 10% haircut, that will wipe out over 20% of remaning equity
> capital. I'll let you figure the more gruesome scenarios.
>
> This of course still assumes that all the rest of the banks' assets
> are fine. June 30, 08 to Sept 30, 08 shows a drop of over 700 million
> in equity capital. In sum, I suspect that the Bank is a couple bad
> quarters away from receivership.
>
> See Buffett's rule #1--don't lose money. There is a real risk of
> permanent capital loss on this one.

So Tom Daschle failed to disclose and pay taxes on hundreds of thousands of dollars of income. This one is going to be fascinating to watch.

If Daschle was a Republican, his nomination would be DOA. Just goes to show how big of hypocrites the democraps are.

PIMCO High Income Fund: Look to Swap Out

I think that you can forget about trying to short PHK. Tried to borrow shares on Wednesday and none were available.