MLPs And Interest Rates, How Right Is Mr. Gundlach? [View article]
The MLPs which have predomenately fee based transportation revenues will get inflation adjusted rate increases. The initial debt costs and capital investments are fixed. Rising rates will cause refinance rates to be higher but on a supposedly lower amount of project related debt. The 10 years or so of rising fee revenue should cover any increase in debt costs.
The problem for the MLPs in the 2008 - 2009 meltdown was not one of interest rates. The problem was that they were relying upon short term cheap debt for a large part of their funding. So that, even though the business remained stable and sound, the banks simply would not renew or roll over loans.
What is missing from Gundlach's comments is the recognition that higher interest rates theoretically raise the discount rate used to value every company's earnings. The higher dicsount rate should lead to lower valuations across the board. My own evaluation of that is that within a range of "normal interest rates the change in rates have little real market effect.
In any case, if there is a buy-it-and-forget-it class of investment in this environment, the pipeline MLPs are as close as it gets in today's environment. Reasonable cash distributions with moderate increases that compound can allow the investor to somewhat ignore the price ups and downs. Generaly higher yields than the electric utilities and without the PSC problems. Gundlach is looking at it from the trader mentality. An investor looking at these as a method of simply providing increasing cash flow for retirement can have a different perspective.
Individuals Have No Business Picking Stocks? Really? [View article]
IIRC, Rattner paid $6,000,000 to NY state to get them to agree that his hanky panky with various pension funds was not criminal. His handeling of the GM takeover and eliminating the rights of bondholders and pensions for salaried employees was certainly borderline criminal.
Why Arguments Against Exporting Natural Gas Don't Add Up [View article]
How is it possible to run NG through the turbines and export the heat to Europe?
Most of the world is buying NG and liquid LNG based upon BTU relationship to an oil basket with pricing determined primarily on a government to government negotiation. The private producers and generators / processors in the US have not operated on any direct linkage basis. Sure, competing energy resources have some influence on the prices of others, But there has never been an absolute direct link. The US is one of the few countries where the private individuals own the mineral rights. Property rights in the US extend from the grass to the granite. That subsurface is not the king's property. here as there has never been a king.
The article seemed to be trying to make a point about requiring a 4% yield when investing is possibly unrealistic or directs investment into low quality stocks.
Now, suppose someone has been investing for 20 years, with the last 15 being directed toward dividend paying stocks with strong financial condition and reasonably well understood. That investor may hae a fair general knowledge of maybe 50 or so tickers that they have owned, or own now, or would like to own if the price is right. The determination of whether the "price is right" is determined by looking at dividend yield greater than 4%.
It seems to me, after looking at the good screening information provided, that the real problem is that the prices are Too Damn High, same as NY Rent. My point is that the general idea of 4% is not necessarily a bad thing as it may be keeping that investor from getting involved in yield chasing.
I was looking on Seeking Alpha. I pulled up the 1 yr chart, estimated the low price from the chart, then used the SA current dividend rate to do the calc.
WAG was below $30 and pays 1.10 - close enough. PEP was about $65 and pays 2.27 - I looked at Yield not Dividend PM appears to have been below $80 and pays 3.4 Even JNJ was about $60 and pays 2.44
Without being too fined tuned about it, and I did not really try to run any stock screens, there were opportunities within the last year to have invested the cash and meet the 4% threshold. Those boats seem to have left port without any definite schedule so the next date of opportunity cannot be predicted.
My real point was simply to note that, with prices at these levels, it may be time to be cautious rather than to force the money into the market. An investor holding the cash should not be forced to do any buying.
Not really trying to beat on a dead horse here, but if you look at the charts of the last year, WAG, PM, WMT and PEP were all available at 4% yields. After looking at the price runups since then, and almost everything of that type has participated, it might be wise to really consider holding the cash for a while rather than buying now if the amount is significant.
Whether today's price is overpriced or even cheap cannot be determined until we see the market price next year and the year after. I believe any meaningful increase in rates, less Fed Buying, will take some of the air out of the prices of the traditional higher yielding stocks. We cannot know if that will happen within any normal time frame though. Maybe the Fed is targeting the Japan interest rate model with rates low for the next 10 years.
Faded memories can create unusual responses to current situations. It really was not that long ago when a 3% yield would not have much influence on the investment decision. Today's riddle is "How can I earn 3%."
Why Arguments Against Exporting Natural Gas Don't Add Up [View article]
It was not very many years ago when the US House proposed to sue the countries in OPEC because they refused to increase output to export more oil. John Kerry stated that the President should demand that Saudi Arabia greatly increase output when gasoline was at about $1.90 a gallon. Now it seems that the US is refusing to develop and export.
As to the slightly increased costs for the low income families, consider the offset from the taxes on extraction, increase in jobs and taxes, royalties paid to private mineral owners with taxes payable, and probable lower oil prices as that commodity will have some backout if NG is cheaper around the world.
I don't believe that it is possible to liquify, ship on special vessels, and then gassify again for a cost less than at least $3. US manufacturers would have at least that much cost advantage. It is pretty ironic of Liveris to bluster over producers having access to export markets. His scheme is to take the landlocked cheap gas, process it through his plants, and export the gas through his products. Is there a real difference in export the gas or shipping fertilizer sourced from NG?
Once this gets going and the facilities are developed, expect to see a great deal more methanol used as motor fuel. That could begin to break the OPEC strangle hold on the economy. Currently identified NG reserves are sufficient for about 100 years supply. More to come.
The idea that the energy companies don't own the developed resource is nonsense. The gas has been there for several hundred million years. It has been known that the reserves were there, just not an economic method of recovering them. Now that the oil companies have created value for the asset, the Sierra Club claims to own it. How much wilder can it get?
Mr. Shaw, It is possible that both you and the investor requiring the 4% yield could both have excellent and logical positions. When I reflect upon your comments about the stocks that currently meet the hurdles are relatively unattractive, I've concluded that you have a good point. However, your analysis is of the current market prices, after an extended run up in prices, and a great runup in prices of relatively stable companies with attractive dividend yields.
Maybe the take-away from the investor who requires something greater, from high quality companies, is that NOW is not the time to buy or add to positions. When they tell you that they are earning 6% on their investments, that could be their Yield on Cost, so that they might not have added anything in the last 6 months or so.
Tesla's Gift Box: Inefficiency Wrapped In Hype [View article]
"Highest Temperatures on Record" is a term used to promote the AGW fraud. Considering that there are only records for about 200 years of so, the time frame is meaningless. You must know know nothing of what temperatures have been in the past and are certainly incapable of admitting that both CO2 levels and temperature levels have been higher than the present.
Last year is was increased tornado numbers that "proved" the Global Warming catastrophe was upon us. No mention this year of the very low number this year. Is it due to Global Cooling?
Last year it was high summer US temps that "proved" the Global Warming catastrophe was upon us. No mention of the extended winter in Europe this year. Or that this spring has been abnormally cold and extended. How about global Cooling for an explanation?
There is not enough information available to conclude that a rise in CO2 levels is a cause of temperature change. A computer model can be tortured to produce any result, torture it enough and it will produce the desired result for your political purposes. Contact Michael Mann if you need instructions on the methods.
Those of you who get your climate catastrophe information from Jurassic Park and an Algore movie have my sympathies. I can feel the trauma you are experiencing as a true worshiper of Mother Gaia. That religion causes you to ignore the statements from the British Meteoroligical Service which has stated that there has been no Global Warming for 15 years. It makes no difference to you because you just know that Tuvalu is sinking.
lIn any case, stomp, slobber, froth, spit and steam all you want. This is my last post on the thread. Someone else will have to help you break free
Tesla's Gift Box: Inefficiency Wrapped In Hype [View article]
nogood, why would you write such nonsense. We know that there has been NO global warming for the last ten years, or more. We know that the IPCC report predicted temps to be higher than currently observed. Perhaps it is not CO2 which is the determining factor in world temperatures, Walk outside and you might even be able to feel the sunshine on your skin. Can you use that energy to cause a bulb in your dark brain matter to light?
As to changing the subject matter, it is you who have switched to some argument about what someone's models predict from elevated CO2. My reference was to historic sea levels and to point out the sea levels have also varied over a wide range.
In any case, Mr. Petersen has asked that you who worship Mother Gaia and revel in computer models of catastrophe find other spots to gather for support, rather than posting on his year old article.
Tesla's Gift Box: Inefficiency Wrapped In Hype [View article]
Doty, You are certainly getting closer to admitting the truth on the AGW nonsense. Of course the IPCC report was a political document. The models it was based upon are constructed for political purposes, as well as for purposes of fraud. That is what has now been recognized by many of those who were once fooled into an acceptance of a nonsense catastrophe religion.
Tesla's Gift Box: Inefficiency Wrapped In Hype [View article]
Idiots with little knowledge continue to lead the charge to control all human activeties. They make wild claims and hurl insults.
If you believe that sea level changes have been only 10 meters, why don't you an experiment that even a simpleton can understand. those White Cliffs of Dover are deposits which were below sea level. What is the height today above sea level?
The Great Barrier Reef offshore Australia was once a dry basin. How high has the sea level risen since then?
It is natural for levels to rise and fall. It required no human activety in the past to initiate the changes. It is nowhere claimed by anyone I know of on the right that the actual changes over millenia will be insignificant. What is claimed is that the policies proscribed to change the inevitable will reduce living standards to neanderthal levels and accomplish approximately nothing with regards to forestalling climate change. Those policies will simply make it more difficult to adapt.
Tesla's Gift Box: Inefficiency Wrapped In Hype [View article]
You fail to understand what the report was claiming. The prediction was that temperatures would rise under all scenarios. Restricting the CO2 output would lower the increase by 0.2 degrees. don't let yourself be misled by the overlords with the anti-human agenda.
Tesla's Gift Box: Inefficiency Wrapped In Hype [View article]
Sea levels have risen several hundred feet since the current warming period started and the cooling of the last ice age ended. the suggestion is that modern humans will be forced to adjust to changing climate as have all species. The variability of the sun's energy output will certainly continue, in spite of the promises of Algore and Obama to control the weather.
Now, if you want to believe in AGW and do the most that any human can do to reduce energy useage, I can suggest some jumping spots for you. The report of the IPCC projected that a large reduction in CO2 emissions would reduce the worldwide temperature by about 0.2 degrees C in 80 years. Quite a difference there.
Is It Worth Holding Cash And Being Patient? [View article]
That $200 difference in Gain that you are analizing is really going to be immaterial in the total scheme of things if you simply held and reinvested the dividends for 20 years. It is fun to imagine that you can make timing decisions, but it really is hard to do in real life.
Perhaps you select the "Great Campanies" you want to hold for the long term. Let the dividends accumulate. Buy when price is below the 200 da ma. It might improve total return, as long as the pullback is great enough. Look at WAG for something to cogitate over using that approach.
MLPs And Interest Rates, How Right Is Mr. Gundlach? [View article]
The problem for the MLPs in the 2008 - 2009 meltdown was not one of interest rates. The problem was that they were relying upon short term cheap debt for a large part of their funding. So that, even though the business remained stable and sound, the banks simply would not renew or roll over loans.
What is missing from Gundlach's comments is the recognition that higher interest rates theoretically raise the discount rate used to value every company's earnings. The higher dicsount rate should lead to lower valuations across the board. My own evaluation of that is that within a range of "normal interest rates the change in rates have little real market effect.
In any case, if there is a buy-it-and-forget-it class of investment in this environment, the pipeline MLPs are as close as it gets in today's environment. Reasonable cash distributions with moderate increases that compound can allow the investor to somewhat ignore the price ups and downs. Generaly higher yields than the electric utilities and without the PSC problems. Gundlach is looking at it from the trader mentality. An investor looking at these as a method of simply providing increasing cash flow for retirement can have a different perspective.
Individuals Have No Business Picking Stocks? Really? [View article]
Why Arguments Against Exporting Natural Gas Don't Add Up [View article]
Most of the world is buying NG and liquid LNG based upon BTU relationship to an oil basket with pricing determined primarily on a government to government negotiation. The private producers and generators / processors in the US have not operated on any direct linkage basis. Sure, competing energy resources have some influence on the prices of others, But there has never been an absolute direct link. The US is one of the few countries where the private individuals own the mineral rights. Property rights in the US extend from the grass to the granite. That subsurface is not the king's property. here as there has never been a king.
5 Highest Yielding, High Quality, Low Volatility, Consistent Dividend Growers [View article]
Now, suppose someone has been investing for 20 years, with the last 15 being directed toward dividend paying stocks with strong financial condition and reasonably well understood. That investor may hae a fair general knowledge of maybe 50 or so tickers that they have owned, or own now, or would like to own if the price is right. The determination of whether the "price is right" is determined by looking at dividend yield greater than 4%.
It seems to me, after looking at the good screening information provided, that the real problem is that the prices are Too Damn High, same as NY Rent. My point is that the general idea of 4% is not necessarily a bad thing as it may be keeping that investor from getting involved in yield chasing.
5 Highest Yielding, High Quality, Low Volatility, Consistent Dividend Growers [View article]
WAG was below $30 and pays 1.10 - close enough.
PEP was about $65 and pays 2.27 - I looked at Yield not Dividend
PM appears to have been below $80 and pays 3.4
Even JNJ was about $60 and pays 2.44
Without being too fined tuned about it, and I did not really try to run any stock screens, there were opportunities within the last year to have invested the cash and meet the 4% threshold. Those boats seem to have left port without any definite schedule so the next date of opportunity cannot be predicted.
My real point was simply to note that, with prices at these levels, it may be time to be cautious rather than to force the money into the market. An investor holding the cash should not be forced to do any buying.
5 Highest Yielding, High Quality, Low Volatility, Consistent Dividend Growers [View article]
Whether today's price is overpriced or even cheap cannot be determined until we see the market price next year and the year after. I believe any meaningful increase in rates, less Fed Buying, will take some of the air out of the prices of the traditional higher yielding stocks. We cannot know if that will happen within any normal time frame though. Maybe the Fed is targeting the Japan interest rate model with rates low for the next 10 years.
Faded memories can create unusual responses to current situations.
It really was not that long ago when a 3% yield would not have much influence on the investment decision. Today's riddle is "How can I earn 3%."
Why Arguments Against Exporting Natural Gas Don't Add Up [View article]
As to the slightly increased costs for the low income families, consider the offset from the taxes on extraction, increase in jobs and taxes, royalties paid to private mineral owners with taxes payable, and probable lower oil prices as that commodity will have some backout if NG is cheaper around the world.
I don't believe that it is possible to liquify, ship on special vessels, and then gassify again for a cost less than at least $3. US manufacturers would have at least that much cost advantage. It is pretty ironic of Liveris to bluster over producers having access to export markets. His scheme is to take the landlocked cheap gas, process it through his plants, and export the gas through his products. Is there a real difference in export the gas or shipping fertilizer sourced from NG?
Once this gets going and the facilities are developed, expect to see a great deal more methanol used as motor fuel. That could begin to break the OPEC strangle hold on the economy. Currently identified NG reserves are sufficient for about 100 years supply. More to come.
The idea that the energy companies don't own the developed resource is nonsense. The gas has been there for several hundred million years. It has been known that the reserves were there, just not an economic method of recovering them. Now that the oil companies have created value for the asset, the Sierra Club claims to own it. How much wilder can it get?
5 Highest Yielding, High Quality, Low Volatility, Consistent Dividend Growers [View article]
It is possible that both you and the investor requiring the 4% yield could both have excellent and logical positions. When I reflect upon your comments about the stocks that currently meet the hurdles are relatively unattractive, I've concluded that you have a good point. However, your analysis is of the current market prices, after an extended run up in prices, and a great runup in prices of relatively stable companies with attractive dividend yields.
Maybe the take-away from the investor who requires something greater, from high quality companies, is that NOW is not the time to buy or add to positions. When they tell you that they are earning 6% on their investments, that could be their Yield on Cost, so that they might not have added anything in the last 6 months or so.
Tesla's Gift Box: Inefficiency Wrapped In Hype [View article]
Last year is was increased tornado numbers that "proved" the Global Warming catastrophe was upon us. No mention this year of the very low number this year. Is it due to Global Cooling?
Last year it was high summer US temps that "proved" the Global Warming catastrophe was upon us. No mention of the extended winter in Europe this year. Or that this spring has been abnormally cold and extended. How about global Cooling for an explanation?
There is not enough information available to conclude that a rise in CO2 levels is a cause of temperature change. A computer model can be tortured to produce any result, torture it enough and it will produce the desired result for your political purposes. Contact Michael Mann if you need instructions on the methods.
Those of you who get your climate catastrophe information from Jurassic Park and an Algore movie have my sympathies. I can feel the trauma you are experiencing as a true worshiper of Mother Gaia. That religion causes you to ignore the statements from the British Meteoroligical Service which has stated that there has been no Global Warming for 15 years. It makes no difference to you because you just know that Tuvalu is sinking.
lIn any case, stomp, slobber, froth, spit and steam all you want. This is my last post on the thread. Someone else will have to help you break free
Tesla's Gift Box: Inefficiency Wrapped In Hype [View article]
why would you write such nonsense.
We know that there has been NO global warming for the last ten years, or more.
We know that the IPCC report predicted temps to be higher than currently observed.
Perhaps it is not CO2 which is the determining factor in world temperatures, Walk outside and you might even be able to feel the sunshine on your skin. Can you use that energy to cause a bulb in your dark brain matter to light?
As to changing the subject matter, it is you who have switched to some argument about what someone's models predict from elevated CO2. My reference was to historic sea levels and to point out the sea levels have also varied over a wide range.
In any case, Mr. Petersen has asked that you who worship Mother Gaia and revel in computer models of catastrophe find other spots to gather for support, rather than posting on his year old article.
Tesla's Gift Box: Inefficiency Wrapped In Hype [View article]
You are certainly getting closer to admitting the truth on the AGW nonsense. Of course the IPCC report was a political document. The models it was based upon are constructed for political purposes, as well as for purposes of fraud. That is what has now been recognized by many of those who were once fooled into an acceptance of a nonsense catastrophe religion.
Tesla's Gift Box: Inefficiency Wrapped In Hype [View article]
If you believe that sea level changes have been only 10 meters, why don't you an experiment that even a simpleton can understand. those White Cliffs of Dover are deposits which were below sea level. What is the height today above sea level?
The Great Barrier Reef offshore Australia was once a dry basin. How high has the sea level risen since then?
It is natural for levels to rise and fall. It required no human activety in the past to initiate the changes. It is nowhere claimed by anyone I know of on the right that the actual changes over millenia will be insignificant. What is claimed is that the policies proscribed to change the inevitable will reduce living standards to neanderthal levels and accomplish approximately nothing with regards to forestalling climate change. Those policies will simply make it more difficult to adapt.
Tesla's Gift Box: Inefficiency Wrapped In Hype [View article]
The prediction was that temperatures would rise under all scenarios. Restricting the CO2 output would lower the increase by 0.2 degrees.
don't let yourself be misled by the overlords with the anti-human agenda.
Tesla's Gift Box: Inefficiency Wrapped In Hype [View article]
Now, if you want to believe in AGW and do the most that any human can do to reduce energy useage, I can suggest some jumping spots for you. The report of the IPCC projected that a large reduction in CO2 emissions would reduce the worldwide temperature by about 0.2 degrees C in 80 years. Quite a difference there.
Is It Worth Holding Cash And Being Patient? [View article]
Perhaps you select the "Great Campanies" you want to hold for the long term. Let the dividends accumulate. Buy when price is below the 200 da ma. It might improve total return, as long as the pullback is great enough. Look at WAG for something to cogitate over using that approach.