I am surprised Mesabi Trust is so high, if CLF gets the Essar mine, they could cut off shipments from Northshore all together. Just like Wabush, nobody will pick them up with the high royalty commitment.
In bankruptcy, you cannot bankrupt the state. Back taxes, loans, etc... all have to be paid back no matter what and paid before any secured loans. This why many assets are sold for taxes only.
When you posted yesterday I was thinking iron ore was trading in a tight range. Now it looks to be having a break out to the next level which could be in the $70 range.
The Mesabi Trust needs to see iron ore demand much higher to keep the flow of iron ore out of their holdings. CLF can cut off shipments from Northshore for a whole quarter in today's market. And if they pick up that Essar mine, they could shutdown Northshore for a year. Mesabi would be wise to renegotiate their royalty agreement or they could be another Wabush.
They know how to use the bankruptcy system to build their billions off the backs of working people, much like one of our presidential candidates.
Essar promised a steel mill in Minnesota, the State loaned them money on this and Essar pulled the plug on the steel mill, keeping the money Minnesota lent them. Essar then stopped paying on this loan as well as paying all their obligations to contractors and suppliers. The only thing sad here is the time it took for the State to act... this should have been done a year ago!
In both cases, the State has total control of the iron ore. In option 2, if Essar wanted to build condos, the State cannot control that activity as long as it meets zoning requirements.
I have to agree with ironorenstrong on this one. Plus the State and local governments are increasing their ownership with the loan, interest and back taxes which must be paid ahead of all other claims in bankruptcy. Plus, if the proceeds of sales does not satisfy all these claims, Essar will be billed as government claims will not be forgiven in bankruptcy.
All commodities move in cycles, just wish I would have picked the bottom of the cycle instead of jumping in too soon. I am convinced we will see CLF trading in the $50 to $60 range when the party is in full swing. Will I sell then, no! Holding out for the $100! With the huge short position and the counterfeit shares that were created, we could see the price move up that fast.
Are you my wife? I hear this every day. Really enjoy what I am doing, putting people's lives back together after a disaster. Plus I give back by helping people on low and fixed income with their home repairs. All I ask for is a cup of coffee and a cookie. Plus a review of their past life, love stories from the past! And you know, people love talking about they lives to people willing to listen..... The trouble with people today is that they all want to talk, no one wants to listen.
Thanks for the news! Finding it extremely hard keeping up the the news and working more hours each day.
Kind of busy the last 6 months, Just enough time to read some of the postings here and appreciate many of you staying on top of the breaking news. Still waiting for a short squeeze which will take this stock much higher.
cash is cash. How much interest do they pay on a stock offering and how much interest do they save using to pay down debt on a discount? Net - net, they come out on top.