Uncle Larry

Rail Traffic Data: Still Recessionary

CSX was down 10% yoy last week. The secret is that CSX could recover that 10% or more simply by adding more cars to the same trains over the road trains.
This morning I saw a switch run that took less than 4 hours - they get paid for 8 hours minimum under union work rules. The crew could add quite a bit more workload without more pay by going into overtime or calling out a second crew.

Rail Industry: Why I'm Interested in Regionals

KSU, like the rest of the Class 1s handles a mix of freight.

Most of GWR's shortlines each serve one or two industries, with most of the lines tied to paper or construction materials. There is no way in the world to compare GWR with the other railroads because there is little bridge traffic - the GWR lines are gatherers that pass the carloads off to common carriers. It is the GWRs job to keep the manufacturers happy
I have owned GWR stock for 10 years, CNI and CSX stock for 5 years and KSU bonds for 2 years because I know that each has its own little monopoly and they will continue to be a cheaper way to products or raw materials than trucks.

Healthcare 'Debate' Dominated by Shouting and Lobbies

The "Public Option" is saying everyone MUST have health care, even if it goes against your religious beliefs, which it does in some conditions.
If the government becomes the sole source of medical care, which seems the intent, then they will become the sole purchaser of drugs and they can tell the insurance companies what they will pay for a drug,whether it there is sufficient profit margin or not. Drug companies will stop making drugs if the price does not provide enough income. This is why we did not have flu vaccine a few years ago.

Why ETFs Are a Better Way of Accessing the Bond Market

I own LQD. You might want to search on this ETF to find other articles that would compare Bond ETFs.

Ben Graham Portfolio: Snazzy Returns from a Vintage Strategy

Something that I learned from Ben Graham is look for increasing revenue, income, book, etc by averaging the last 3 years (2008, 2007, 2006) and average of years 10,11 and 12 years ago and see if there is a definte increase the key numbers over that time. Doubling of the numbers is very nice.

I am using years 2001, 2000, 1999 because these are the numbers that I have on my S&P report
Book value - 5.25 (current) vs 7.00 (past) down
Revenue - 2,065 mill vs 1,378 mill
Operating income - 233 mill vs 155 mill
Assets - 1,700 mill vs. 1,100 mill
Debt Current & Long term - 664 mill vs 549 mill
Cash flow - 199 mill vs 112 mill
Dividend 80 cents/ share vs 83 cents/share down

I suppose since the sales at the Winchester division is so go that should raise the target price (heh).

I'm (Intellectually) in Love with John Bogle

I do not like index funds like the S & P 500 which Bogle touts. It tells the investor that he has to leave his ethics outside and take whatever they want into their portfilio.
I personally, have a moral problem with encouraging gambling and pornography. I am told, with the S & P 500, that I have to finance casinos and Playboy (or had to when Playboy was large enough to make the 500). Yet this index is held up as the panacea to all of my problems.

Caterpillar: Bringing Home the Gold

Before you jump into CAT, please verify the following statement:
CAT is pulling out of the U.S. Road diesel market because they can not come up with a motor that will meet EPA tier 3 standards. The engine that they have developed for truck and locomotive use has a habit of catching fire.
I am not a CAT shareholder - it is worse - I am a CAT bondholder.

Five Utility Stocks with Dividends You Can Count On

This is one glory of FPL. IIRC they do not have any coal fired plants. They do have gas fired plants.


On Mar 22 04:05 PM Right in San Francisco wrote:

> I'm with oldtrader. Obama's plan to get $80 billion a year as a "carbon
> tax" will have a major affect on coal-burning utilities - that's
> the point. The question then becomes reading the politics of whether
> Obama will be able to get this through Congress, and that's a hard
> screen to use for investment decisions.

7 Ways to Profit from Asphalt and Highway Construction

I have followed the concrete and asphalt companies for several years, investing in Florida Rock, Vulcan Materials and Astec. Vulcan Materials by the way, got its start by grinding up the slag from iron production and using it as an additive in asphalt and concrete block.
Asphalt is a cheap source for paving material but it lacks the durability of concrete and it will never fully replace concrete. I will keep my concrete driveway, thank you. But concrete requires a lot of limestone to be turned into cement and this stone is not found all over the world.
Still, I am very impressed with paving equipment and methods, like Astec and with Astec's entry into lightweight gas drilling and pipeline trenching equipment, I feel this has a better future. Their production backlog is down at the moment but I expect to see added demand before the end of the year.
If you do not know much about asphalt get their investor's kit because it has a lot of great educational material about this product.

Alstom, Bombardier: Rail Stocks Bound to Benefit from Stimulus

These recommendations make little sense. They are not major movers in anything but the passenger car traffic. They have little effect on the freight industry which makes up the strong majority of the industry. The railroads like CSX, UP & BNSF are down right but the curve is starting to flatten out. I am going to hold on to my CNI, CSX & GWR.

Cramer's Stop Trading! The CAT in the Hat Is Back (11/10/08)

I bought CAT commercial paper that is giving a yield of 7.75%. A lot less risk than stock at the moment.

Warnings from the Shops and Shippers

Year to date, CSX auto and truck shipments are down 19% to 281,000 car loads Horrors!. But the total carloads is 3,849,000. Does not look like the auto industry is a significant portion of the traffic, even if CSX can carge more per carload than most other freight. Do the shipments of components to the assembly plants constitute a large volume? Maybe, but a large percentage of these shipments are shorthaul and go by truck.

What about steel manufacture to make the components? CNI will be hit much harder because they own the old Duluth, Missage and Iron Range and the Bessemer and Lake Erie railroads that are about dedicated to taconite ore shipments. I show 48,000 carloads of mettalic ore for CSX YTD - that is NOT statistically significant. Coal shipments for steel manufacture? These are short hauls again - from Kentucky, Ohio and West Virginia to steel mills in West Virginia and Ohio.

I am more interested in the other part of the 1,403,000 carloads of coal, most of which is going to domestic power plants, paper mills as well as export - and most of this is long haul. I watch those CSX coal drags go past that are going from Kentucky to Florida and I smile with contentment.

With a new coal fired in southwest Georgia going up soon, prospects look even better.

Buffett's Call on Railroads Right on Track

The railroad transportation market is a great market. I have been in it for years, BUT the list of railroads is way, too short.
GWR - up 50% - no dividend
KSU - up 52% - no dividend
CNI and CP have been flat for the last year, but CNI is up 100% over the last 3 years and will probably take a big jump as soon as its problems are resolved about acquiring the rail line around Chicago.

PowerShares Water ETF Lacks Focus

It is interesting that none of the stocks are involved in hydroelectric power, like Great Lakes Hydro.