Bobhjon

MLPs Lining Up for a Happy New Year

Avi: In evaluating MLPs do you make any distinction between those primarily pipeline companies which depend on tolls for their income, and the E&P companies that get their income from product sales or hedging?

How Oil and Gas Investors Can Prepare for the Energy Trust Corporate Conversion

.A truly valuable and worthwhile article that answers a lot of the question of Canadian energy trust investors. But the poor investment results from the early converters raises additional questions.
What induced these companies to start paying corporate taxes before they were obliged to? What are the trusts that have not yet converted losing by waiting? What are the alternatives to corporate conversion, such as moving the bulk of their operations to the US, and how have they worked out for investors as compared to corporate conversion.

Three Asset Classes that Can Actually Outpace Coming Inflationary Price Increases

Paco ...
You say to avoid stocks as if "stocks" were a homogeneous asset class where one-size-fits-all; but advise holding precious metals, energy and agriculture, How do we do this? Fill our garage with copper bars? Put a 300 barrel tank for crude in our basements? Load up on gold ingots which the gov't will confiscate? (More on this later). And no matter how you do it, storage costs, sales charges, transportation, etc. will eat most of the profits. So what's a guy to do?

I have an aversion to mutual funds, ETFs, etc. where my assets are controlled by Madoff-type middle men. Isn't the only practical way to control energy, agriculture, etc. by owning equities in the companies that base their business on them? In other words: buy their "stocks"?

I said I'd return to the gold matter. I'm ninety years old, and grew up during the great depression. My father was a WWI vet and was opposed to both political parties (as am I). So during the twenties he chose to forego the enormous profits in stocks, and put all our savings in gold for just the same reasons that people are recommending it today. I even put all of my newspaper selling profits in gold coins. Come 1933, that great Democratic demagogue, Franklin Roosevelt, chose to force us to sell all our gold to the government at $20.16 per oz. Of course, we were still better off than having invested all our savings in Insull Utilities or some other widely touted stock, but with most of his retirement funds gone, my father had to work until he died. What makes anybody thing that that great Democratic demagogue, Obama, will do anything different?

AS inflation progresses, at some point the payment of interest on our ever increasing debt will become insurmountable. Since only housing speculators completely repudiate their debt, it is likely that the US will organize a series of financial forums to consider revising trade payments, mutual banking regulation or some other red herring, but from which will emerge instantaneously and without warning the "New Dollar" which will be worth one thousandth of the "Old Dollar" (that's what you and I are stuck with). But after just having been royally fleeced, why would anyone even consider holding debt denominated in "New Dollars" regardless of the interest rate? Because the "New Dollar" would be partially backed by gold. And guess where all that gold would come from!!
I

Sure It’s Legal … But Is It Right?

The American voter certainly does have a choice! They could insist that Congress establish publicly financed elections with jail for any politician accepting gifts or benefits of any type. The federally licensed networks would be required to donate a specified amount of time for all registered candidates and political parties with the registration requirements being sufficiently liberal to permit the emergence of several new parties that currently cannot hope to raise the $60B required for a national election. This would eliminate lobbyists, and, with additional parties, would do away with majority party line voting, and probably create legislative coalitions varying from item to item.

I have a more detailed outline for this approach to taxpayers regaining some control over the legislative process that was posted on another blog that I will publish here if there is any interest.
On Sep 02 12:40 PM Nick36 wrote:

> The thing about American voters is that they don't really have any
> choice in this matter. The Fed isn't officially responsible to anyone.
> And the US government is controlled by two political parties both
> of which are in the pockets of Wall Street companies and executives,
> who finance the election campaigns of politicians.
>
> Sure, it's not right to have such unfairness and inequality go on
> unchecked in the country. But those who can stop it have no interest
> in stopping it. And those who want to stop have no power to stop
> it.
>
> This is government corruption US style. And government corruption
> is very difficult to root out in any country, whether this country
> is democratic or not.

Enterprise Products Partners, Linn Energy: Petroleum Profits Without the Drama

jerdawg..
I don't know about PD but much of LINE's dividend is classified as Return of Capital and not taxed. So get it out of your IRA and replace it with LGCY which is also hedged well into the future. In fact, it's smarter to hold high div stocks like these in a Roth, if you've got one or can get one.

Goldman Sachs: Thoughts on the Developing Stolen Trade Secrets Scandal

At one time, banks were only permitted to invest in AAA- and US Treasury- bonds. Now Goldman and some other large banks get a large percentage of their profits from Trading ... a speculative activity.
Why are banks permitted to risk their depositor's and taxpayer's money in speculative activities?

In every trade, someone wins and someone loses. Since Goldman usually wins in its trades, guess who loses ... you and me!

Will Gensler Curb Manipulations in Futures Markets, or Is It Just Smoke and Mirrors?

When Lehman failed it turned out that they were counter party to a tremendous number of commodity future contracts; however they were an investment bank at that time. Now that all the old investment banks have had to become charter banks in order to qualify for TARP funds (did anything really change?),. it raises the legal question wherther Goldman and the others can continue to speculate in derivative markets with depositor and taxpayers money? Which leads to a related question: if the banks were forbidden from engaging in these speculative activities ("can't lose" computer programs notwithstanding), would there be enough privately financed groups to keep these markets liquid?

Why the SEC Just Doesn't Get Short Sellers

"To go short, you have to borrow shares from a brokerage firm. Once the stock you’re shorting collapses you then have to buy the shares on the market in order to return them to the brokerage firm"

It looks like the author is completely unaware of the naked short sale which the SEC is supposed to prevent, but doesn't.

Aircastle: Current Share Price Hard to Swallow

Speaking of steals, Yesterday, I sold some $2.5 PUTS on NRF for $1.50. If these are assigned, and I hope they are, I will have bought NRF for $1 / share which is equal to its annual dividend, less than half of its net cash/share, and at a price/book of 0.01. Its book is over $20 share, but since it's both a REIT and a financial, the smart? money is avoiding it. The insiders have been buying it and it has announced that it will pay out 90% of its 2009 income to shareholders.
Steal???

Voting (and Spending) Our Way to Catastrophe

I'm amazed! I never realized that other intelligent people were really concerned about the non-functional government problems that I have been grappling with for years. TeresaE has really nailed the situation. But what are we going to do about it? Perhaps some of you would suggest the url of a suitable blog or forum where we could discuss the problem more interactivelly than here. I would like to hear more about what is envisioned in a republic form of government.

Risk Watch: The Continuing Danger of the Young Money Manager

Tradename: I doubt that they learned a thing, because they know they were right, and the problems were caused by the stupidity of somebody else.

What's Going to Replace the Dollar?

I have been enjoying this intellectual discussion of a very imminent situation, but let's get real! Doesn't anybody remember when it was illegal for a private citizen to own gold in the US? And does anybody believe that our irresponsible Congress would not pass a similar law if they had the desire? As for private currencies, the Secret Service frequently has difficulty in detecting the sophisticated legal currency, wouldn't private currencies be counterfeited into oblivion? Has everybody forgotten Gresham's Law? For a practical view of what may happen, think of an International Zimbabwe!

Insider Trading: The Next Generation

But legal insider buying is frequently a better indicator of stocks to buy than many of the accepted financial criteria. Although the insiders are often several months ahead of the market.

Four Ways to Capitalize on 'Super Contango'

CITI and the other banks are renting the tankers, buying the oil, and paying storage costs with taxpayer money. If it costs $80MM just for the oil in a single tanker, and who knows how many tankerfuls they own, it's little wonder that they don't want to finance small business loans at something like Libor+4, and have to borrow from the Fed at 0% to cover their investments in credit card debt at 21%.