Agree - unless you think this thing is going Chap 11, in which case we should sell now anyway, I am going to reinvest and lower my cost avg .
Ken, I did that very thing a long time back in the dotcom era. I'd lost such a large percentage I figured it would turn up. Lost it all. Belly up. Lesson learned. I got into a gold stock years ago, almost the same story. What I pad $3 for was sold at $2.30. Watched that one go to $0.50. It did rebound (within a year) and the co. found a buyer to buy them out. Wasn't worth the gut-ride to me. Since '08 I am super-cautious about anything. Anything , that is, except another market crash.
The way I understand this article Congress may try disapproving it but the prez can veto that. It would then take 2/3 majority in both houses of congress to override the veto. The whole thing stinks, I agree. Not to mention BIG time dangerous. But here's the article: http://news.yahoo.com/constitution-check-congress-limited-yes-no-iran-nuclear-103606322--politics.html;_ylt=AwrC1CiLOa1V.VAAzgvQtDMD;_ylu=X3oDMTByMHZ0NG9yBGNvbG8DYmYxBHBvcwM3BHZ0aWQDBHNlYwNzcg--
the iran deal with not pass the us congress
Do not sell. The Iran thing is just an excuse to use to drive the price of oil down. The US house and senate will never pass the Iran thing. The GOP control congress and the GOP does not want the Iran deal. So it will fail to be passed in Congress and will not take affect. So Iran will not be putting any oil out in the market. After the thing blows over and it is a done deal that the Iran treaty will not be done, then oil will recover.
Jay, I thought about putting LNCO in my IRA some time back. Been watching it since. A 12+% div was really hard to pass up, but I did. Fact was though, they were paying a 12+% div, but with a negative income statement. Now, I know some people hold that you have to look at cash flow, and this or that. But losing money and paying out a 12+% divvy is hard to imagine that holding up. With the 11.5% drop in sp today that wipes out most of a year of divs. I guess accounting and numbers do mean something. When oil turns around and their profits improve it may be a safer deal.
I'm down 76%, it's your call but I would start taking the dividends as cash. At least they can't take that away then.
This seems like the likely explanation. LINE/LNCO are not especially sensitive to how low prices go (thanks to robust hedges) but are very sensitive to how long they stay low.
The distribution is fine this year (unless they cut it as a preventative to pay down debt) and fairly good next year, but if prices remain low in 2017, things start to get really dicey. By 2019, when the first big batch of LINE's bonds are due for redemption, low prices are a potentially lethal problem.
Of course, Iran's infrastructure is in poor shape and there will not be much money to repair it with low prices, so at the moment, the market may be overestimating how much they are really going to add to supply. When thinking over periods of several years, markets also tend to discount demand growth due to low prices, so things may not be quite as terrible as they presently appear.
seasonal overreaction-oil and natural gas will not be this low for long-2/3 of iran oil in ships is high sulphur content which can only be refined and bought at low prices-most major oil companies have been burned for doing business in iran and won't do it again unless extremely sweet deals are offered.demand for both oil and natural gas have been increasing worldwide-coal is the real loser in the energy market. REMEMBER-Goal is to buy low and sell high.......
This, in turn, doesn't bode well for LINE/LNCO, BBEP and other highly leveraged MLPs' distributions and long term viability.
Think about it: until the Iran nuclear deal and perhaps even China's recently dampened economic prospects, many were predicting a return to $60-$70+ oil by year end. Those expectations have been dashed in the minds of some analysts, and I suspect shorts are betting LINE/LNCO will cut or eliminate distributions no later than the end of 1Q2016.
I'm long LNCO, so don't bash me as a short.
Thoughts are welcomed.
Resist the urge to buy more. I thought I was looking at a bottom a couple weeks ago after it fell to $9.50. Never thought after a 70% drop I'd see my new position fall by 30% in 2 weeks!!!!!!!!!!!!! I have no doubt a new position here will fall 50% or more in the next week.