Delojozafado

Dividend Aristocrats: 3 to Watch

Why mess with Wal-mart? You can just buy Apple a retailer that is unable to meet demand and makes me like the beaten down RFMD. There is also the (HD) HRO if you want a serious dividend. It went ex TODAY! so you can expect a further drop in the next few days in this immediate shadow period. It is near to it's conversion/redemption.

Dividend Aristocrats: 3 to Watch

As other posters posted, I have BP in my portfolio. STO has the best Beta, off a drop in oil & priced in a hard currency so rising oil gives leverage. I am out of it now as I am also out of UCO. I added to MTP today at $14.03. IRR,ENY,AMJ.KYE,REP-A, along with ENDTF, PGMYF and DAYFF round out my energy patch. I sold my MMR-M today on valuation issues. One of the best dividend plays left in CEFs is the NGZ global convert fund. It does not dip too often and when it does like it did today I add. NGZ with a more recently hard to find discount to NAV of -5.5%. KYE now over 10% premium but for total return mostly worth it. I used the BDJ back in the year end rally and it is good in a rising market. I also have added to my BCF as of late with it's strong met coal positions as well as the iron ores and other base metals. In health care I would go back into HSP Hospira medical delivery. Sold it on valuation but any significant market pull back would be a chance to get back in it. The HCN-G ,is a little late to the party as the time to buy it was when it was first announced that it (HCN) would replace Sovereign Bank (taken out of a near collapse by B Santander) in the S&P 500. I am an owner of VZ for the dividend and also own the IPS~ OTT, and BLIAF. I am looking at a chance to grab some RFMD off the disappointing Nokia numbers, lots of cell phone diseased customers of Apple, RIMM, and the rest of the chic fashion accessory "bugs". They will starve their children before giving up these permanent appendages. They have no clue that there is anything wrong with their brains when their phone starts to ring while we are praying at the side of a grave where some of us, are paying our last respects to a loved one. We are sorry to lose such good customers when they win their Darwin awards meeting up with a 40 year old oaks or a Honey wagon when the phone drops on the floor of their car. There is however an inexhaustible supply of 9-12 year olds always coming up behind to replace the lost business. There are some very good yields to be had in the shorter Med term bond market funds. Of course dilution issues with funds but then diversification too. Who knew so many A or better rated individual bond issuances like WAmu would just default! You can get an awful good yield without the qualified dividend tax break in a string of beads of TIP,WIA,GYB,CUI,LQD,MI... JGT,ESD, FAX and IAE. There are besides the NGZ some great convrts AES-C and ADM-A are both just smokin' as of late. Very speculative if it pulls back below $68 the MMR-M and the HL-C a very interesting como se llama. The conversion plus the year of delinquent CUMULATIVE distributions are built into the stock. When it sometimes sells off it is a great chance to get something at a deep discount. HL will of course report monster earnings in 2 weeks and this should drive the shares higher as we are currently seeing with the confirmed but not quite sure discovery that has driven MMR 13% higher in the last two days. PAL another small fry that just got a C$50.4 million infusion on a subsequent share issuance of 16 million new shares. More of an investment as they pivot around the closing price on the deal of $2.87 US $s. The cash will be put into production improvements that should be quickly accretive. HL for instance went deep in the whole for some acquisitions and just paid out $38 million in cash to retire the debt. A 50% move higher in Silver this YTD has left them flush. They have increased their market cap from just under one billion to 1.12 billion in the last 6 weeks.

What's Next for Gold and the Dollar?

In a democracy it is not nice to fool all of the people some of the times. The right sold America on their ability to manage their own wealth and life savings in Roths, IRAs and 401-K defined contribution pensions. It was a solution . It was the closest thing to Marx's Utopian idea of the proletariat owning the the means of production.
Then as with Major Tom something went wrong. The Fed Chairman said not to worry "well contained". The New Century CEO retired 4 months before it was revealed that there were irregularities in the financials. The "Dumya" went on a spending spree on a War on weapons of mass deception and the creation of the Medicare prescription drug program. Taxes to pay for any of it ? Then we found out CIT & Washington Mutual & their ilk were shopping around their debt ratings. It turned out the ratings agencies were getting paid for their debt ratings. Uht oh! Finally we were told we had to spend a couple trillion dollars to bail out the likes of BOA so they could pay out bonuses in the millions to Merill Lynch employees who had made lots of money for a failed firm. They performed well so they were not to be punished by the failure of the firm.

In a Democracy it is not nice to pizz off the plebe cite. What we have now is the back lash of the American people voting themselves some of the largess. Indeed the whole mid-term election will swing on whether the S&P can get back to a 1250 range and stay there for a while. The bitter health care debate is not going to matter when voters go to the polls in 13 months. Instead it will be what they see inside those envelopes that they receive in July . Voters are now starting to open those quarterly 401-K and IRA statements and they are feeling more sanguine. A 1250 S&P means they will see loses in their investment portfolios instead of a total annihilation of lifetime savings.

The massive liquidity flood must continue on for that to happen. Americans are now intent on voting themselves largess. They are intent on extracting some thing more from the wealthy and the filthy rich. What they perceive now as a class of people who prospered at the expense of their life savings and children's college funds.

The people want what they want. They don't care about or even need to understand about asset inflation. The seniors with CD's did not lose their savings? But they are losing their ability to support themselves on 1.7% CD rates. They embrace the hope of a '70- 80s inflation and 17% CD rates. No one is going to be sold on the idea that the defined contribution retirement plan is going to replace Social Security anymore. We still find state legislatures defining usury as being 39%. Again if you allow the creditors to amass giant un-collectable balances there are going to continue to be failures.

The right in America failed miserably in their leadership when they had the people. The average guy on the street does not care about M-2, the value of the Yen, what some bureaucrat in China says, or what is going on with precious metals. His or Her perception is based on whether they think they are going to get a "Fair Deal" from the leadership of the country. For them Rush is as entertaining as Sienfeld. Very entertaining for less than ten minutes. For them it is now about more reality and less O'Rielly.

TIPS Are No Longer a Steal

A lot of arguments here as to whether the inflation or deflation or the price of gold etc. So what! I have investments with good gains in both WIA and TIP. So do I sell ? I think I will hold for the really great distributions as against my cost basis and their being by nature some kind of bunker. Since the melt down I have moved from 65% bonds to 50% bonds and continuing to reduce. Last week I got another tender offer filled on $10K for $10.5K on some '11s. Now I figured with the interest I can earn going forward and the $500 premium to par then I am going to be ahead by 4/11 when the bonds would have been redeemed at par.

I had already figured out a month ago what the author is pointing out. So then what do we do? I started buying GYB the Goldman Sacks floating rate derivative at 5.8%. I guess that was a good idea then!, so now it is 5.25% and I am not so enamored of it. So this past couple weeks I added some GGC with all it's complexities with premium/discount/ROC the whole mess and yet as long as these gold and Nat resources continue higher then the 10% yield will hold up? Probably not but then even with a correction down near $900 on gold the TOTAL return should work as well as the TIP and WIA, especially if they do get legs again. Friday I added a 100 of VZ as an initial position for the 6.4%.

I would appreciate some posters posting some alternative same concept ideas to TIP instead of debating the finer points of what may happen or maybe is happening in the inflation debate. Google "Mark Hulpert/ Bonds and gold"... for a very well thought out piece on that debate.

While I was nearly 4% exposed to precious metals I recently have been trying to get that increased to 6.5% by buying HL-PC (Suspended but) cumulative and some GGC. I have also in the last two weeks added 5 Canadian Platinum Maples to my bullion position.

With so many bonds either medium term funds like LQD, CIU,MIN & DUC, or short term individual Corporates I have been taking out some insurance on a dollar cost averaging basis in PST,TBT and more recently adding some TMV as well. While I am down +3K in that combined position most of my preferred stuff with long term exposure is up +30%. REP-PA, ADM-PA, HCN-PG, JPM-W, OHI_PD,AES-PC , GFW,GFZ, DKT. I am trading in lower yielding bonds for high yielding long maturitiy Preferreds and stocks like BRPFF,ATPWF,NFYIF,ATBUF, OTT ,BLIAF, any thing that is better than a 6.5% yielder with growth and of megatrend capacity.

Every time I discover another gem like GYB,GFW and GFZ "they" swoop down and drive the price higher before I get a chance to add to the position at any kind of decent valuation.

Those are some IDEAs I am getting itchy on in waiting for this next sell off like we last saw in July. It is sure to come and I want to be ready to nail down some good stuff cheap. IAF is looking good to me now but too richly valued. I keep waiting for BLIAF to knock off 50 cents some morning so I can add. All this stuff keeps going higher . Tips are not the only thing getting way over valued!

WE saw the ten year note hit 3.14% on Thursday 10/8 mid-morning.
On Friday we saw it sell off sharply making a 3.4% mark intra-day finishing at 3.384. That is a fairly large 2 day swing. So maybe the next move in the Ten year back to the 4% level we saw in the spring may have already started and income investors that stayed patient hoarded cash ansd hedged longer term maturities will finally have a chance to buy into the Medium term market again for good solid yields.

Supercycle or Not, Expensive Oil Is Unavoidable

America's love affair with the auto is driven by the Gov't which we must suppose is a reflection of the will of the people, not having any national policy to support mass transit. On the other hand we see such things as AMTRK being made a whipping boy for not being able to operate at a profit.

The whole profit thing needs to be taken out of the mass transit issue. If we want to have a national policy reducing oil dependence then we need to do what other nations do and make the riding of mass transit "Too cheap to meter". If you provide adequate service and frequencies then mass transit that costs 1/3 to 1/4 th of what driving a car costs then the consumer will gravitate to a less convenient transportation mode. As it is now even the parking lots at many mass transit stops charge a parking fee. Parking has to be vastly expanded and made free of charge. Increasing costs of labor,maintenance and operation have to be mostly borne by the Gov't to foster the delta of driving to work vs using the bus and train economically disadvantageous. This means toll roads and higher tolls as well ,and high gasoline taxes to subsidize mass transit.

In the end only the Vegan types are willing to vote for that agenda. What do you do for the parts of the country that are thinly populated?
Create a population density coefficient to apply to the higher gas taxes?

How Low Can the Dollar Go?

I read the article to say that there is LIKELY to be a further decline in the US dollar. This resulting in the investors and speculators of other nations with strengthening "hard currencies" coming into the US and global markets to purchase commodity related themes. There may also be an advantage for US investors to not just invest in those country's currency FXs as FXC,FXE ,SZR, etc, but also to invest in companies that are commodity related and principally traded in those currencies on their respective exchanges.BTE, STO, SSL, RDS/B for example.

An excellent resource for gleaning the trend and the daily update to this concept is the chart at the bottom of the KITCO home page. Here are put in relation not just the daily price swings in gold but the concurrent swings in major currencies as well. Gold advances and retraces at different percentages as against different currencies.

Some other themes that may benefit are for example a SLS the vertical chart with it's portfolio of INTERNATIONAL REITs strongly !under! weighting US REITs. The NGZ the global convertible securities fund only 17% US weighted. The EWC and EWS two ETFs that are sector funds in two countries with very strong banking systems and central banks that are eschewing "Q" easing. IAF the Aussie dollar theme. EWM the Malaysian thing also with huge resources both mineral and agricultural. LAQ for the Latin American exposure with the same theme. CRESY and SQM in Ags. VWDRY & BRPFF in Alt energy. BPR in oil.Etc Etc.

How Low Can the Dollar Go?

Pinky locks on your post. Perhaps one of the best ways to play the Loonie however is to own those things you mentioned. The BAM owns majority interests in both BRPFF and ATBUF. While the pure cap and trade play BRPFF was yielding over 8%/9.4%BWT when it sold last Jan and FEb for under $13.00 US Pe$os it now is a strong $16. Lumber futures sliding below $1.70 make the ATBUF a REIT play, a Fuel oil alternative for the Northeast of North America as they not only do pulp, forestry nurseries, OSB, and the usual lumber products as well as pulp, they also produce cord wood and wood pellets for heating. The real estate holdings are very significant as against the Unit price. Either of these would be great additions to portfolios on a market swoon. Meanwhile the BTE, along with the STO (Noky hard Currency) &SSL (Randy Hard currency) can be traded (bought)on moves in the black gold below $65. These are then sold in 60-80% of the position lots as against oil rallies above $75. SCO is then a place to park if you are not too risk averse back down to below $67/BBL. While "IT" has already started. The seasonal strength in gas in the ANTICIPATION of the heating season has gone on for a few weeks now. This morning 9/14 Gas once again getting a strong bid under it illustrates... A nice 20 cent move higher as against most all other commodities falling off. Here I have recently been rewarded with additions of Daylight DAYYF and Paramount PMGYF. These have great EFFECTIVE distributions well over 9%. Are near 100% Gas E&P CANROYs. They have both accomplished acquisitions as of late DAYYF taking down two as of late and just now grabbing High Pine Beetle Energy the OIL E&P entity. The PVX and PGH may in fact be as good but maybe not in as sound in their financials. I am also mugging up on Bell Aliant (BLIAF)for the VZ "FIOS" of the Maritimes outbuilding of broad band and their very loyal narcissistic cell phone customer base. With these strong dividend plays you get a leverage to owning the FXC. The EWC is of course a great ETF as is the from worst to first ENY. Very interesting chart on the GACHF. Of course there may even be place to buy Teck Commie. The SXRZF has made a quad as against it's 10/28/08 low, as uranium is mentioned.Meanwhile I still believe in the SQM for it's lithium exposure over the Lonnie guano. As for grains how about a 3 week chart of that CRESY . EH?


On Sep 12 04:43 PM Mad Hedge Fund Trader wrote:

> iivn Hedge fund longs have been bunching up in the Canadian dollar
> for the past two months. Canada makes what everyone wants and doesn’t
> have enough people to consume it, making them a major exporter of
> everything hot. I bet you didn’t know that the frozen wasteland to
> the North is our largest foreign oil supplier. Most people guess
> Saudi Arabia. The Canadian supply is slated to double over the next
> 20 years, thanks to the environmental atrocity of oil sands. The
> land of Mike Myers, Jim Carey, and Pamela Anderson (note gratuitous
> photo below) is also a big supplier of gold, silver, lead, grain,
> uranium, wood, and other hard things. As for mosquitoes, they’ve
> got a lock on the market. Use dip to accumulate the loony. If you
> catch me singing “O Canada” in the shower, you’ll understand why.

How to Invest in Cellulosic Ethanol

"Oopps", a little typo in my previous post. "subsequent 'debt' issuances", should have read "subsequent share issuances/offerings".

Well then it happened with VRNM. As I had pointed out a reverse split of 1:12 was approved at Monday's annual meeting. In addition the "option swap" of worthless options for the highly compensated top level management in this micro cap company, for new options instruments with equity created out of shareholder equity was also approved. VRNM saw their shares fall off more than 7% in after market trading to 55 cents. That is down from the 65 cents they closed near last Friday.

Amazing that the Obama administration's DOE would grant loans/loan guarantees/&/or grants to this company where in a Merrill Lynch/BOA type of scenario TAXPAYERS MONEY will be diverted as BONUSES into the pockets of high level management that have so miserably failed in the management of the company that they now have had to resort to a reverse stock split! Obviously no one in the Obama Administration is paying any attention to these low level small company chiselers.

You have to wonder how many hundreds of these kinds of scams there are going on out there! The Obama Administration is legitimately trying to get the economy going by helping out these outfits who in the end, each provide employment for hundreds of employees. I guess it is like food stamps . If only 10% of the food stamps are used to buy Lobsters & Steaks for someone at 80 cents on the dollar so that the person in that way 'selling" their food stamps can buy cigarettes and beer with the cash, at least 90% of the needy are actually getting the help they desperately need?

How to Invest in Cellulosic Ethanol

This is a very decent article. One of interest that was not mentioned was Dyadic DYAI.PK. They seem to have of late established some superior relative shere price strength to VRNM. DYAI is a smaller cap ~$13MM vs the capitalization of VRNM near~ $65MM in capitalization. The Verenium management is mostly an arrogant rapacious predatory group. After adjourning yesterday's annual meeting they have yet to release any memos or information on what was discussed or how the vote went on a couple management sponsored resolutions that will potentially create shareholder dilution. There was a vote on a reverse stock split that would go 1:10 or 1:20. This would allow the company to issue further subsequent debt issuances with out breaking the long term $1 share price to remain listed and not be kicked over to the pinks & then the bulletin board. This would have been OK as the company's operating revenue does not meet current operating expenditures. Except for the second proposal that was a more egregious rapacious plundering of the shareholder equity and current cash flow/burn. This was a stock option swap scam. There would be no need for a stock option swap of worthless options for new option instruments that will further dilute shareholders if the directors and management had succeeded in maintaining and enhancing the share price. Mr Rivas the CEO already receives more than $700K in annual compensation. Most senior members of the board are in the +$400K range of compensation. They did not see fit to exempt themselves from eligibility for this theft of shareholder equity. This is the same scam as the Merrill Lynch/BOA bonus fiasco! in this case rather than TARP money, the VRNM board is anticipating the Gov't windfalls of a Gov't guaranteed loan/ loan /or grant under the DOE alternative energy sponsorship program. This again might have been not so bad if VRNM had enough operating income to meet or even nearly meet current expenses. It is one thing to give such incentives to some of the more than 300 rank and file employees but to perpetrate this kind of theft from shareholders to benefit senior management is unconscionable. It is plainly theft of shareholder equity at best. At worst it is likely if it passed and they still more than a day later won't reveal that, likely to trigger a class action shareholder law suit that is going to create even more negative cash flow to the operating cash burn of VRNM.

Be careful of this one. It has legs against the Gov't funding/assistance forthcoming but the traders and insiders are likely to leave you high and dry if you think you can make a total position, an all in all out Long term holding.

A couple larger caps also of note here are the Dutch conglomerate RDSMY.PK and ADM or more specifically the ADM-A mand cnvt of 5/11 with it's 8.25% yield. While ADM has it's 20% of its business model in mostly corn based ethanol, they have put expansion mansion designs into their newer facilities to accommodate a morphing into the accommodating of larger quantities of biomass for a transition over to a cellulosic process, most likely under a license from a VRNM,DYAI,BFRE etc There is a very excellent website "thecesite.com" that has about 80 different companies listed to explore this whole cellulosic ethanol theme.

What Does the Future Hold for REITs ETFs?

SLS loses money even for thiose shorts that are correct as the structure has the cashing out daily. This ETF may have to do a reverse stock split even as the commercial REITs collapse around it. Best to short the smaller capitalized individual REITs themselves like hotell chains STrategic Ettc. The Wyndam company with it's monster(RCI?) time share segment is obtaining financing & swooping down on properties @ a song that will ,fit it's business model. Best to focus on the epicenter of the REIT meltdown and srteer clear. The Canadian/international REITs seem good bets both for their better economic outlooks and a s currency play. The Closed end fund SLS (!!!NOT SRS!!!) has nearly doubled off it's March low is only 17% exposed to US properties. Very impressive relative strength as of late.

Friday's Closing Update

"VRNM surges on positive JV news"?????? What does this mean? JV Juinor Varsity? June Voltage? Joint Venture perhaps? then Joint ventured with whom?

Natural Gas: The Next Big Thing

Global production continues to increase. Third world entities are now liquefying rather than flaring most of the gas by products of oil production. The world fleet of LNG carriers continues to swell as vessels contracted for when gas was pushing $16/MM`BTU are delivered. At some point in a correction of this commodities led rally in the markets Nat Gas should bottom. The markets are even now reacting to the green shoots theories as being rather too sanguine. Nat gas may be the value of a life time right now, but after this market meltdown I would rather live twice! Look at the 52 week low for CHK! Ouch if you get in here and there is a retrace and test in the market of the March lows! I am awaiting a dip and then may tip toe in.

SPEs: The Next Financial Crisis Buzz Word

So the investment themes to seize on this wheel turning? I guess we have to be long the SRS, TBT, BGZ, & commodities on pull backs in sympathy with the stock market correcting, IRR&IGE, BCF&BGR, BDD&GCC, DAG,MOO,HOOorVMI ENY,BIRDF,GLHIF,ATPWF,... MTP,KYE,BSR, Some emerging markets and commodity centric currency themes like VPL,PXR,EWZ,ILF,EWC,EW... as well as their mid and small cap subordinates DIM,VSS,MDD,GWX, which leaves only to add the International non-US-hdqrtered integrated O&G BP, RDS/B, STO. REP, REP-PA, E, AES-PC (LNG).
Cash would seem to be the best investment against the final push lower in the energy,Base metals, precious metals and AGs in the next leg down in the global stock market averages? At another lower valuation the acquisition of any and all commodity/energy themes with yield would seem to be the way forward. How about the TMV?

Mortgage Resets: One Shoe Dropping

Well, this weeks Treasury auctions are the miller that tells the tale! 71 billion floated out in a week. The 30 year basically down sharply BEFORE Thursday's auction and then collapsing in the Auction. The bid ratio was a paltry 2.1. The Ten year was then of course beaten down as well to a 3.35 yield in sympathy. The Treasury is going to be floating out over a $135 billion in 30 year notes alone this year. After yesterday the only hope for the Treasury bonds is that we get a substantial correction in the stock market over the Summer months. That would not save the "Q" polluted 20 & 30 year bonds but would at least bring the ten year and lesser maturities back up in price as investors flee to their relative safety.
The Game is over with the "Q" easing. Look at the price action in international (NOT international US based) oils like BP,STO,RDS/B and the ETF ENY (Canada) since the Fed meeting in March. Look at the price action in oil itself. UT ..OHH we are heading for +$60 with in a week? The price of Nat gas has vaulted through $4 as well making a huge percentage move in just days. Silver backed off some after smashing through $14, but the gold, silver and platinum are moving ahead again this morning. If gold breaks out of the $865- $920 trading range to the upside then the US Treasury,Fed and Long Term bond holders in general are going to have the hurtin' put on them.
What all this MEANS??? Is that the sub 5% /30 year mortgage rate is about to become a missed window of opportunity for the would-be buyers awaiting lower housing prices. The lower prices are coming no doubt but will the actual cost of ownership be going down? Not likely as taxes, utilities, and insurance as well as mortgage loads increase against the known expectation for inflation in what is now perceived by most to be in the mid term NOT long term out look.
There is still some disinflation afoot as evidenced by the telecom action this week as well as the sanguine attitude towards this weeks unemployment numbers as a derivative somehow being a positive. All of this is going to ultimately weigh on wages and pension benefits to those employed in the public sector. More disinflation pressure I suppose. In all the euphoria over the Stress tests underwriting the major banks no one seems to pay any attention to the Treasury's & fed's stipulation that the expectation going forward is for an additional 700 Billion in write downs still on their way for these banks. Sure they will now be expected to survive it but at what cost? Anyone like the TMV,TBT, or SRS?

Why This Rally Is Unsustainable

I am a total lunatic with three partials in (SRS) and looking to add at $21.XX. I love the (TBT) and am hoping to unload some of it today while the trend is still up. I have sold out completely of two LT bond Funds in the last 2 weeks for nice gains (ICB), & (BDF). I just unloaded a junk bond/bank debt fund as well (VTA) for a very slight loss as things are just too scary up at this level. I have raised over $100K in cash in the last 6 weeks for some great gains. I have fired my former slime ball predator Raymond James Broker. Too bad it is a great highly reputable firm but they let this POS work there and misrepresent and sell inappropriate crap! They will learn. If only I can get out from under some TBT so when it derops back below $45 again I can buy some (TMV). Why are the AGQ,DGP., and PTM working so well? well there is the physical holder platinum ETF comming. Now we see these VIX ETFs just introduced. i agree with the authors "slow money" fast money leveraged professional trader scenario. By the time the late to the party, panicked that they were missing out on this raly individual, mutual fund, and pension fund investors figure it out there will be tha dearth of buyers. Remember those +5% one day down days last year? As Naufal has pointed out, what has changed. YUM & BWW profits are up and they are hiring at $11.50 an hour? These kinds of jobs can not even support the utilities, insurance and property taxes on a house! The (TBT) action is telling us that the sub 5% 30 year mortgage is about to be a brief footnote in history!