Chesapeake's (CHK) decision last October to sell its hedges against low gas prices has exacerbated the company's cash crunch, left it largely unprotected against low gas prices this year and WSJ calculates losses of around $750M-900M on the positions. Chesapeake has generally been successful with these kinds of levered bets, but acting more like a hedge fund than an exploration company can clearly backfire. [View news story]
I don't know the WSJ time frame. How much has CHK recovered on the NG bounce up? How much do they stand to recover, relative to the WSJ time event? Did the WSJ measurement cover solely the worst performing period?
I don't know, but I'm wary of hindsight-driven proclamations, where strict credence to it can be nearly tantamount to, "The price is now zero, so sell everything now." This seems to be the big question for CHK: to ride it out, and flourish if/when prices and demand resume, or die trying. That seems to be the essential strategy. Like it or not, it's better than selling out at zero (ish).
Where Is Bank Of America's 'Overdue' Recovery? [View article]
fxfx this is purely anecdotal, but just in case it's representative - I have heard of 3 residential home walkaways with BAC mortgages. To my knowledge, on not a single one is BAC is doing anything with respect to foreclosure, renting out, listing for sale. Then there are the situations where the home remains occupied as the slimy credit/bankruptcy advisors tell them to (rent free, or perpetually behind), with practically zero possibility that the slimeballs will service the loans the way they committed to when they signed the contract (sorry, I'm just pissed). I haven't heard of any letup in this going on.
I know it's inconclusive weak anecdotal drivel but since I know it truly exists - and I'm very likely not alone in seeing this - how can there not be extend and pretend financial creativeness in play? All I'm saying is, it makes me wonder, how many zombies are they not disclosing. Who knows if they're booked at true value or writeoff value. So they've written off tons, and the bad loans are getting ever smaller? Still smells fishy in Denmark.
Interesting too that you say if it were not for Europe you'd be swimming long BAC, though the article suggests that Europe is not a real factor.
Wells Fargo (WFC) reaches an agreement with Memphis and Shelby County to resolve a discriminatory lending practices lawsuit. In return for dismissing the case, WFC will invest $7.5M in the city and county, provide $4.5M for mortgage down payment and home renovation assistance, and make $425M in mortgages available to low- and middle-income borrowers. [View news story]
Like the others said. Penny wise, Memphis. Good luck ever seeing a dollar from me again.
Chesapeake Energy (CHK -13.9%) may have to delay some of the $14B in asset sales planned for this year because low natural gas prices may hurt its ability to comply with credit covenants, the company says in an SEC filing today. (more) [View news story]
All right, if it was short term then I stand corrected. I'd apologize, if I had criticized the phrase "short term."
I do admit that I'm busted - maybe. The conference call was May 2 and I interpreted it as "new news" - I did not know it was before the warm winter. Thank you for chastising me to review the transcript.
All the same, it still may be the right move. More on that in a minute. But, now, are people really saying that the headline number (2012 statement effect) is the full extent of their thinking and analysis? I mean, come on, if they're nothing but yokel cretins, then they should just write options, both sides, and book the proceeds. I don't think the conference call content precludes common basic analysis, just because they didn't go into such detail. I'm not saying you're wrong; you may know the players well enough to say, 'yes, they're that superficial and financially unsophisticated.' I just am skeptical, and the conference call is unpersuasive. I'm still open to persuasion though.
As to "the right move" - it really comes down to scale. And MARGINAL effect. Did $353 million displace (already, or in the future) $353 million of put exercises? If not, and NG doesn't sink further, then it simply is the numerically correct move.
Not picking on you at all, but just musing now - risk management (which sounds like is the issue here) can be somewhat like macro economists (cough, Keynesians, cough) in that those practitioners who have invested great study and research and refinement think, "we're the only ones qualified to pontificate on the correct approaches of these things." Never mind that they're in the wrong ocean to begin with. At any rate, I assume that the risk managers' "conventional norm" is to moderate volatile revenue items like energy (or costs like jet fuel prices) by hedging with futures or other derivatives. If you read that in Forbes it's hard to argue with that. Because, yes, it's prudent, and right - except when it's not. Risk managers (some! Sorry, anybody!) would have you always hedge, and would have you buying puts when the price is zero, even paying the United States interest if you just hold my dollars in Treasuries (the bizarre negative yield condition).
I'm just saying there's a threshold and I believe they evaluated it. I don't have the numbers so I could be all wet. If NG sinks sufficiently it could be bloody too.
I haven't seen enough to say that "desperate" and "ashamed" are premature, and - I stress, potentially - potentially 180° wet. But then again, maybe they got shredded between the price of 3 and 2.5. Maybe they're zombies. Once again - we'll see.
Chesapeake Energy (CHK -13.9%) may have to delay some of the $14B in asset sales planned for this year because low natural gas prices may hurt its ability to comply with credit covenants, the company says in an SEC filing today. (more) [View news story]
But talk like that mjp is suggests that there is no price that is too high for insurance. Would you pay $4,000 every six months to insure a $4,000 car? I know that governments financially operate that way but in the real world there's viability, recoverability, exposure, and against all of these - COST.
I tend to feel that this was a marginal probability-weighted revenue/cost decision. Moreover, if nat gas has truly bottomed, in hindsight it will be a 100.0% correct move, and what you call sensible is wrong - again, potentially, in future hindsight. We'll see. But to summarily call this out with, and I quote, "desperate" "ploy" "ashamed" "$ supplant sense" ? You'll be advised to eat those in the public square, if NG has bottomed.
Southeastern's Lack Of Ideas Fails To Rally Chesapeake [View article]
(I don't know how boosting the price 10% or whatever would benefit shorts; but as I detect that the popular rage is to scream about CHK, it sounded like an angry thing to say :) )
Though Scott Thompson remains in place for now, Yahoo (YHOO) director Patti Hart, who was in charge of the CEO search that resulted in Thompson's hiring, reportedly won't stand for reelection at Yahoo's next annual shareholder meeting. Hart was also a Dan Loeb target. (earlier) [View news story]
Say what you will about the embellisher - she gets off too easily. Far.
Dan Loeb Questions Yahoo CEO Scott Thompson's Credentials [View article]
I can't speak to the "materiality" of this. But this is without debate "fraud." I am in corporate business. No one, no one, I mean no one in corporate business gets their degree wrong on bios or resumes. Only in fraud. Even if this is "small or trivial fraud."
And on the real possibility that his bio was prepared by another, the possibility that it was not presented for Thompson's own review is zero. No CEO in Budapest would let others write their bio without caring to even read it.
All remarks apply equally to PayPal service for what that's worth.
I own no current position or affiliations with either.
Dan Loeb sends a letter to Yahoo's (YHOO -2%) board questioning whether CEO Thompson has a computer science degree as stated in company documents. A check of the records, says Loeb, shows Thompson with just an accounting degree. Loeb also questions the academic background of Patti Hart, who chaired the CEO search committee. [View news story]
Yahoo expects this to be upgraded by the end of January 2012.
That's an inside joke; I'm typing this in April 2012. Suffice to say, yahoo acts like, and for all I know truly is, a gaggle of clueless yokels. You'd think that after a few decades as one of the world's top technology firms, that they would have a clue. But I don't believe they do.
Bernanke Does Not Understand The Depth Of His Powers [View article]
"The Fed does not cause inflation. It may allow it by not reining in liquidity, but it doesn't cause it. " - netbluesky
A little perspective on all this ranting I've been doing in this thread...
Netblue, that may be topically accurate, but my point is that this is a minor abstraction in the big scheme. They've got everyone (enough of everyone) so impressed with their shrewd fertilization and irrigation tactics, that no one even asks any more that they take the yard out at night and sell it for body parts.
And even THAT would be one thing if indeed it was "shrewd." Every Fed report says "indications suggest blah and we believe we have a handle on blah and we are continuing to keep an eye on blah and we intend to continue a steady approach on blah" and - wait for it - if that's not putzy enough, ALL of that is based on BLS absolutely contrived statistics! But there's more: that's just the "consensus position!" And their inevitable, certain next policy statement on the next bubblicious disaster will sound *exactly, exactly the same.* As they ALWAYS HAVE. Seeing Dr. Greenspan's puppy tears doesn't makes it all okay to continue the Fed's Keynesian bubble/kick the can course.
Keynesianism has failed, and continues to before our eyes, ALL AROUND THE WESTERN WORLD now. Still the Fed practices and vehemently espouses it; they are hell bent on inflating, while we get to take their word that it won't get out of hand (Don't worry, says Shalom; they'll just adjust the fertilizer, they have plenty of tools should the need arise).
So netbluesky, I took Econ courses starting with Samuelson and used to be enamored on how it so elegantly explained the big picture. But in between Koolaid sips, I'm trying to suggest considering whether you're being robbed blind.
And with inflation, you really are. And once we convince MSM of this simple truth beyond their infatuation with fertilizer, the elderly are going to catch on to the robbery. The elderly at some point will arise from their perceptive coma and understand that it is permanent, and that it will last for years and years and continue to fester at their wealth and living ability every day of their remaining lives, violently so should they so tragically ironically live to a high old age, outliving savings massacred by inflation.
If only Dr. Paul had put it that simply, he'd be picking new curtains for the green room already. (Eerily, the 76 year old conceded Florida with hardly any visits, maybe no ads, spending maybe a nickel in total there. With all those senior citizens there. Hmm.) But at any rate, one day that galactic elderly voting block is going to catch on to the big picture scam. Instead of being Koolaided with topical policy actions.
The Fed can tweak inflation with the use of tools like reining in liquidity. We must not be fascinated by this such as Dr. Fool Krugman is, ignoring that simultaneously they've got a meth lab grinding out inflation in the basement right beneath them.
Continuing Debt Troubles Mean Investors Should Avoid Chesapeake For Now [View article]
I don't understand a couple of [nonsubtle accusations?] here. You've expressed some fair beefs but a couple don't sound right:
-Doesn't the 2008 hub-hub show that shareholders, BODs, the WSJ and Aunt Mimi already know about this participation business? What's this about it being 'secret' - I mean, 'nonfully disclosed.'
-What am I misreading when it sounds like one company in Oklahoma is the only one using NG vehicles? I sense that the remark meant to only refer to "DNG" but the paragraph is structured to be interpreted more harshly.
-Are all continents (and entities within them) outside North America self-sufficient with respect to LNG? Can you mention a few nonArab ones? I might want to move. Oh please, please have Amsterdam on the list!
-As to "CEO misdeeds" - I don't deny that they exist given the extremely frequent and specific street buzz about this ... but Aubrey might. Your article doesn't make the case, so it strikes me as audacious. I'd review your writers insurance.
I'm not saying this is a dishonest article and I cherry picked peccadilloes, but some of these sound like you might be getting carried away.
Chesapeake's (CHK) decision last October to sell its hedges against low gas prices has exacerbated the company's cash crunch, left it largely unprotected against low gas prices this year and WSJ calculates losses of around $750M-900M on the positions. Chesapeake has generally been successful with these kinds of levered bets, but acting more like a hedge fund than an exploration company can clearly backfire. [View news story]
I don't know, but I'm wary of hindsight-driven proclamations, where strict credence to it can be nearly tantamount to, "The price is now zero, so sell everything now." This seems to be the big question for CHK: to ride it out, and flourish if/when prices and demand resume, or die trying. That seems to be the essential strategy. Like it or not, it's better than selling out at zero (ish).
Where Is Bank Of America's 'Overdue' Recovery? [View article]
I know it's inconclusive weak anecdotal drivel but since I know it truly exists - and I'm very likely not alone in seeing this - how can there not be extend and pretend financial creativeness in play? All I'm saying is, it makes me wonder, how many zombies are they not disclosing. Who knows if they're booked at true value or writeoff value. So they've written off tons, and the bad loans are getting ever smaller? Still smells fishy in Denmark.
Interesting too that you say if it were not for Europe you'd be swimming long BAC, though the article suggests that Europe is not a real factor.
Wells Fargo (WFC) reaches an agreement with Memphis and Shelby County to resolve a discriminatory lending practices lawsuit. In return for dismissing the case, WFC will invest $7.5M in the city and county, provide $4.5M for mortgage down payment and home renovation assistance, and make $425M in mortgages available to low- and middle-income borrowers. [View news story]
Genworth Finanancial's CEO Hosts Annual Shareholder Meeting Conference (Transcript) [View article]
Why Chesapeake's Low Price Is The Right Time To Buy [View article]
http://onforb.es/JwAOJq
http://bloom.bg/Jh061g
Chesapeake Energy (CHK -13.9%) may have to delay some of the $14B in asset sales planned for this year because low natural gas prices may hurt its ability to comply with credit covenants, the company says in an SEC filing today. (more) [View news story]
I do admit that I'm busted - maybe. The conference call was May 2 and I interpreted it as "new news" - I did not know it was before the warm winter. Thank you for chastising me to review the transcript.
All the same, it still may be the right move. More on that in a minute. But, now, are people really saying that the headline number (2012 statement effect) is the full extent of their thinking and analysis? I mean, come on, if they're nothing but yokel cretins, then they should just write options, both sides, and book the proceeds. I don't think the conference call content precludes common basic analysis, just because they didn't go into such detail. I'm not saying you're wrong; you may know the players well enough to say, 'yes, they're that superficial and financially unsophisticated.' I just am skeptical, and the conference call is unpersuasive. I'm still open to persuasion though.
As to "the right move" - it really comes down to scale. And MARGINAL effect. Did $353 million displace (already, or in the future) $353 million of put exercises? If not, and NG doesn't sink further, then it simply is the numerically correct move.
Not picking on you at all, but just musing now - risk management (which sounds like is the issue here) can be somewhat like macro economists (cough, Keynesians, cough) in that those practitioners who have invested great study and research and refinement think, "we're the only ones qualified to pontificate on the correct approaches of these things." Never mind that they're in the wrong ocean to begin with. At any rate, I assume that the risk managers' "conventional norm" is to moderate volatile revenue items like energy (or costs like jet fuel prices) by hedging with futures or other derivatives. If you read that in Forbes it's hard to argue with that. Because, yes, it's prudent, and right - except when it's not. Risk managers (some! Sorry, anybody!) would have you always hedge, and would have you buying puts when the price is zero, even paying the United States interest if you just hold my dollars in Treasuries (the bizarre negative yield condition).
I'm just saying there's a threshold and I believe they evaluated it. I don't have the numbers so I could be all wet. If NG sinks sufficiently it could be bloody too.
I haven't seen enough to say that "desperate" and "ashamed" are premature, and - I stress, potentially - potentially 180° wet. But then again, maybe they got shredded between the price of 3 and 2.5. Maybe they're zombies. Once again - we'll see.
Chesapeake Energy (CHK -13.9%) may have to delay some of the $14B in asset sales planned for this year because low natural gas prices may hurt its ability to comply with credit covenants, the company says in an SEC filing today. (more) [View news story]
I tend to feel that this was a marginal probability-weighted revenue/cost decision. Moreover, if nat gas has truly bottomed, in hindsight it will be a 100.0% correct move, and what you call sensible is wrong - again, potentially, in future hindsight. We'll see. But to summarily call this out with, and I quote, "desperate" "ploy" "ashamed" "$ supplant sense" ? You'll be advised to eat those in the public square, if NG has bottomed.
Southeastern's Lack Of Ideas Fails To Rally Chesapeake [View article]
Southeastern's Lack Of Ideas Fails To Rally Chesapeake [View article]
They wouldn't happen to have "personal accounts" with 200% weight shorts by any chance, would they?
Though Scott Thompson remains in place for now, Yahoo (YHOO) director Patti Hart, who was in charge of the CEO search that resulted in Thompson's hiring, reportedly won't stand for reelection at Yahoo's next annual shareholder meeting. Hart was also a Dan Loeb target. (earlier) [View news story]
Dan Loeb Questions Yahoo CEO Scott Thompson's Credentials [View article]
And on the real possibility that his bio was prepared by another, the possibility that it was not presented for Thompson's own review is zero. No CEO in Budapest would let others write their bio without caring to even read it.
All remarks apply equally to PayPal service for what that's worth.
I own no current position or affiliations with either.
Dan Loeb sends a letter to Yahoo's (YHOO -2%) board questioning whether CEO Thompson has a computer science degree as stated in company documents. A check of the records, says Loeb, shows Thompson with just an accounting degree. Loeb also questions the academic background of Patti Hart, who chaired the CEO search committee. [View news story]
That's an inside joke; I'm typing this in April 2012. Suffice to say, yahoo acts like, and for all I know truly is, a gaggle of clueless yokels. You'd think that after a few decades as one of the world's top technology firms, that they would have a clue. But I don't believe they do.
Bernanke Does Not Understand The Depth Of His Powers [View article]
A little perspective on all this ranting I've been doing in this thread...
Netblue, that may be topically accurate, but my point is that this is a minor abstraction in the big scheme. They've got everyone (enough of everyone) so impressed with their shrewd fertilization and irrigation tactics, that no one even asks any more that they take the yard out at night and sell it for body parts.
And even THAT would be one thing if indeed it was "shrewd." Every Fed report says "indications suggest blah and we believe we have a handle on blah and we are continuing to keep an eye on blah and we intend to continue a steady approach on blah" and - wait for it - if that's not putzy enough, ALL of that is based on BLS absolutely contrived statistics! But there's more: that's just the "consensus position!" And their inevitable, certain next policy statement on the next bubblicious disaster will sound *exactly, exactly the same.* As they ALWAYS HAVE. Seeing Dr. Greenspan's puppy tears doesn't makes it all okay to continue the Fed's Keynesian bubble/kick the can course.
Keynesianism has failed, and continues to before our eyes, ALL AROUND THE WESTERN WORLD now. Still the Fed practices and vehemently espouses it; they are hell bent on inflating, while we get to take their word that it won't get out of hand (Don't worry, says Shalom; they'll just adjust the fertilizer, they have plenty of tools should the need arise).
So netbluesky, I took Econ courses starting with Samuelson and used to be enamored on how it so elegantly explained the big picture. But in between Koolaid sips, I'm trying to suggest considering whether you're being robbed blind.
And with inflation, you really are. And once we convince MSM of this simple truth beyond their infatuation with fertilizer, the elderly are going to catch on to the robbery. The elderly at some point will arise from their perceptive coma and understand that it is permanent, and that it will last for years and years and continue to fester at their wealth and living ability every day of their remaining lives, violently so should they so tragically ironically live to a high old age, outliving savings massacred by inflation.
If only Dr. Paul had put it that simply, he'd be picking new curtains for the green room already. (Eerily, the 76 year old conceded Florida with hardly any visits, maybe no ads, spending maybe a nickel in total there. With all those senior citizens there. Hmm.) But at any rate, one day that galactic elderly voting block is going to catch on to the big picture scam. Instead of being Koolaided with topical policy actions.
The Fed can tweak inflation with the use of tools like reining in liquidity. We must not be fascinated by this such as Dr. Fool Krugman is, ignoring that simultaneously they've got a meth lab grinding out inflation in the basement right beneath them.
Continuing Debt Troubles Mean Investors Should Avoid Chesapeake For Now [View article]
-Doesn't the 2008 hub-hub show that shareholders, BODs, the WSJ and Aunt Mimi already know about this participation business? What's this about it being 'secret' - I mean, 'nonfully disclosed.'
-What am I misreading when it sounds like one company in Oklahoma is the only one using NG vehicles? I sense that the remark meant to only refer to "DNG" but the paragraph is structured to be interpreted more harshly.
-Are all continents (and entities within them) outside North America self-sufficient with respect to LNG? Can you mention a few nonArab ones? I might want to move. Oh please, please have Amsterdam on the list!
-As to "CEO misdeeds" - I don't deny that they exist given the extremely frequent and specific street buzz about this ... but Aubrey might. Your article doesn't make the case, so it strikes me as audacious. I'd review your writers insurance.
I'm not saying this is a dishonest article and I cherry picked peccadilloes, but some of these sound like you might be getting carried away.
Bernanke Does Not Understand The Depth Of His Powers [View article]