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  • MFC Industrial: Large Discount To Book Value Not As Enticing As It Appears [View article]

    They announced in March 2015 that they will not pay a dividend in 2015. Ref the 6K
    May 8, 2015. 08:21 PM | Likes Like |Link to Comment
  • Trinity Industries: Why Guardrail Risk Remains [View article]
    I enjoyed reading your article summarizing the legal actions and the TRN unknowns/risks. I would like to add that there is a risk of a Truth in Nogtiations Act (TINA) or defective pricing violation. This occurs when a supplier to the government makes a change to a product, there is a decrease or a discount from suppliers of material/parts, changes a make/buy decision, or the product does not meet the design specifications (parts not within the specified tolerances) and the company does not notify the government of the change and provide the updated financial and engineering data. It doesn't matter if the change made a better unit, cheaper unit, or exact same functionality; what matters is the change was disclosed. With their patented device and no competition TRN would have had to comply with TINA for their Federal Contracts. Violations can result in both criminal charges, financial penalties and cost recovery by the government. A very high level description of TINA:

    Someone else commented on the possible requirements for installation and how those may not have been met by the installers. Of course, that is another area that could be a problem if there were not clear and concise instructions provided on the ground preparation and installation requirements. If installation directions are found lacking, then TRN could endup having to share costs in any lawsuit settlement even if their device performed as expected and the fault was traced to the installation.
    This is years from being settled and will not know the full financial risks until there is more disclosure and some of the accident law suits run to completion.
    May 1, 2015. 12:35 PM | 1 Like Like |Link to Comment
  • New studies link rising number of earthquakes with oil and gas drilling [View news story]
    "Earthquakes? Not so much."

    Actually, we do understand the cause of earthquakes, it is the precise prediction of when an earth quake will occur that is not able to be done. And the reason for that is not being able to collect all the data necessary to be able to do the prediction. You can read a high level description here:

    We also have overwhelming evidence that injecting waste fluids into deep wells in known seismic areas will increase the frequency and strength of earthquakes. The USGS has many studies dating as far back as 1968 containing data that proves this.
    Additionally, University of Oklahoma seismologists had data as far back as 2010 linking the increasing earthquake activity to the increased injection of fluid in certain areas of the state.
    It looks to me like a few of the science deniers have now latched onto the increase of earthquake activity as their next piece of science to campaign against.
    Apr 27, 2015. 12:31 PM | 1 Like Like |Link to Comment
  • New studies link rising number of earthquakes with oil and gas drilling [View news story]

    USGS has known and written papers on and established the scientific fact that disposal of liquid waste into deep injection wells was linked to earthquakes. Papers exist as far back as 1968.
    Additionally, Oklahoma Agency linked many of the quakes to drilling waste disposal as far back as 2010. But the data was not allowed to be released.
    People are not against oil; they are against the damage to their homes and businesses from these earthquakes caused by the injection of waste fluid into these deep wells under pressure. Even minor damage of plaster cracks, toppled chimneys, foundation cracks, pad cracks can be repaired, but someone has to pay for it.
    The scientific evidence is overwhelming.
    Apr 27, 2015. 11:39 AM | 1 Like Like |Link to Comment
  • New studies link rising number of earthquakes with oil and gas drilling [View news story]
    Good summary. The industry just has to crack down on the waste water injection and understand the geology. Some injection wells will have to be shutdown, but it doesn't have to stop the entire industry. This is not the first time earthquakes have been traced to injection of liquid waste. The latest findings from Oklahoma University on their unusually active seismic activity.
    Apr 25, 2015. 08:39 PM | 2 Likes Like |Link to Comment
  • Ford expected to invest $2.5B in Mexico plants [View news story]
    If you are only interested in corporations that invest in the U.S., then you should stay away from all the auto makers and auto parts suppliers. Auto manufacturing is a global business with parts and assembly taking place in many different countries. Likewise, corporate investment in manufacturing plants also has to occur globally.
    Apr 15, 2015. 07:59 AM | 2 Likes Like |Link to Comment
  • I Never Got Jaded About General Electric But Now I'm Going To Practice Caution [View article]
    The author was clear about having been purchasing shares over time. A 1 day bump of 10% should make a serial purchaser cautious at purchasing more at this time, especially with earnings report in the wings.
    The big question not answered here is what will the sale of assets do to earnings per share and will the stock buy back have a positive effect on earnings per share?
    Another reason to wait for the earnings report to perform the analysis.
    Apr 14, 2015. 08:41 AM | Likes Like |Link to Comment
  • Alcoa's Prospects Look Bright Despite Some Negative Reaction To Its Latest Results [View article]

    On Ford: the 2nd qtr sales for the 2015 F-150 should be the indicator to watch, but the available stats are indicative of good trends. For example the average time on dealer lot for the 2015 is 18 days v 45-50 last year this time for the 2014.
    Apr 14, 2015. 08:15 AM | 1 Like Like |Link to Comment
  • This Is Not The Same Alcoa [View article]
    GM is already using aluminum sheet in some of their models. The Yukon is one of them and the Cadillac will have some aluminum structure.

    "GM already uses the assembly process on the hood of the Cadillac CTS-V, and the lift gate of the Chevrolet Tahoe and GMC Yukon. Aluminum welding also plays a key role in the new Chevrolet Corvette Stingray."
    GM has also been experimenting with magnesium sheet metal, which if successful and cost effective will provide some competition to the use of aluminum.
    One other thing that many people forget about is Alcoa's Aluminum Wheels. This is a growth business and the company has projected an increase in revenue from $700M in 2013 to $1B by 2016 from this business area.
    Mar 20, 2015. 12:36 PM | 1 Like Like |Link to Comment
  • Is Ford An Immediate Opportunity? [View article]
    "The FED bought "commercial paper" to support the "lending arms""

    Definition: Commercial Paper - An unsecured, short-term debt instrument issued by a corporation, typically for the financing of accounts receivable, inventories and meeting short-term liabilities. Maturities on commercial paper rarely range any longer than 270 days. The debt is usually issued at a discount, reflecting prevailing market interest rates.

    Note the terms "unsecured" and "short-term" I would say that the FED guaranteed loan to Ford hardly qualifies as commercial paper since they didn't start paying back the money until Sept 2012 (2 years after the loan) and they will not finish paying it off until June 2022 unless they accelerate their payments.
    Either way you look at it, it was a government bailout because no one else was willing to risk their money by loaning it to Ford. And weather the government holds Ford commercial paper or Ford bonds it is still a government loan.
    Like I said, people bend over backwards to make the claim that Ford didn't take government money, when they actually did. It was all part of the auto and bank industry bailout.
    Oh, and GM has paid back the Government except for the money received from the Bush administration which had no strings attached. He did this in Dec of 2008 so that GM could continue operations until he left office. I believe it cost the US taxpayer around $13B so Bush could pass the buck.
    Finally, I never claimed mad any claim about monetary losses. My claim was that Ford took government bailout money and I have proved that they did.
    Mar 19, 2015. 11:52 AM | Likes Like |Link to Comment
  • Is Ford An Immediate Opportunity? [View article]
    Ford also was a recipient of Fed Guarenteed Loans of a little over $15B. A fact many wish to ignore since they didn't go bankrupt.
    Mar 18, 2015. 01:34 PM | Likes Like |Link to Comment
  • This Is Not The Same Alcoa [View article]
    "The strong Dollar is a Deflation Machine. And it just started a Bull Market."

    Did you really mean Bear Market?
    Mar 17, 2015. 02:00 PM | 2 Likes Like |Link to Comment
  • This Is Not The Same Alcoa [View article]
    Good analysis. Should have also mentioned Micromill which will revolutionize the production of aluminum coil. The process shrinks the time to transform molten metal to coil from 20 days to 20 minutes.
    Mar 16, 2015. 11:58 AM | 3 Likes Like |Link to Comment
  • General Electric: Is Immelt About To Play The Ace Up His Sleeve? [View article]
    @ Kluge

    Excellent summary and thanks for putting it together. The non-partisian studies and reports state basically the same thing. No real single cause but a combination of: conflict of interests, complex web of financial innovations, high leveraged borrowing, excessive risk taking, inadequate risk analysis, lax regulations on leverage, ...
    Just a few of the papers:
    Mar 3, 2015. 11:01 AM | Likes Like |Link to Comment
  • GE Director Makes A Big Bet On His Company; Should Investors Join? [View article]
    Ya, just ignore the financial engineering that Welch did using GE Capital in order to make his numbers. Also, Welch was the one who changed GE from an industrial company to an unregulated high risk financial company using short term borrowed money to make long term loans.

    Ya, your right, Welch had absolutely nothing to do with placing GE on the path of financial disaster.
    Feb 26, 2015. 03:47 PM | Likes Like |Link to Comment