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CapitalSource Inc. Message Board

  • one_sonoran one_sonoran Mar 12, 2008 3:14 PM Flag

    Josh Peters

    If you follow the Dividend Investor from Morningstar you know that after having supported CSE vociferously for many months; yesterday Josh Peters notified subscribers that he *had sold* the porfolio's stake in CSE.

    However, at the bottom of the email in the disclosure section I notice that he has retained his own personal shares in the company. I'm certainly not selling, this seems like a dumb place to sell, I wonder if that portfolio call was dictated by others at Morningstar?

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    • CSE has a huge rediscount portfolio in FL, and NV. Why would you invest in a firm with land loans and lot loans in FL (huge concentration) as well as condo conversions in a multi-billion CRE portfolio in reserve status with limited take out and no personal guarantees.

      They do lot loans in the Bahamas..DOG

      SELL SELL SELL!!!!!!!

      • 1 Reply to iamthelaw1211
      • I am not sure what you are talking about. Can you reference your source of information? \

        Rediscount as I understand it is loaning money to other financial institutions. CSE is very dilligent in monitoring these institutions and their ability to pay and quickly (some would say over aggressively) acts to not lose money at the first sign of trouble.

        With regards to commercial finance lending on condo conversions, CSE pulled back from lending on those in 2006 and has experienced their typically low default rates on these loans.

    • Ferdie, did you do the debunking analysis? If so, input equals output and that explains why your statement has some issues.

    • TONE has pre-occupied and tied up mgmt's time for months now. The argument that TONE represented some panacea to lower cost of funds has been completely debunked now.

      CSE owning a bank subject to all the banking regulations to my way of thinking means greater administrative costs that offset any lower cost of funds argument.

      Banks are going to be probing reits very closely come time for their debt to be refinanced. I don't care what CSE's funding sources are they are in for one hell of a bank analysis that will likely see their banks wanting to pull back on lending.

      Another simple fact is CSE's best use of money today would be to buy in (self liquidate) their own shares.

    • Why beethc about an acquisition that has not accurred and looks to be re-negotiated at the very least and you say

      "Reits are going to have problems rolling over their short term debt."

      What does rolling aver st debt have to do with CSE? CSE has matched funding.

    • A large majority of the subscribers of the Dividend Investor Newsletter are retirement age. Josh Peters is not and perhaps he has a longer time frame and risk factor. I'm a subscriber and retired . I appreciate him pointing out risks in the portfolio. I still hold CSE but will watch it closer.

 
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