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caustic_fred 8 posts  |  Last Activity: Jan 31, 2015 11:06 AM Member since: Jan 3, 2010
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  • In years past, Niska Gas Storage customers bought cheap gas in the summer, paid NKA to store the gas, and sold that gas at higher prices in the winter.

    The fracking boom applied a steady downward trend on top of the season pattern. Recognizing the downtrend in 2014, NKA’s customers no longer wanted to store gas for the winter since spot price would clearly be lower in winter. In 3Q2014 NKA experienced withdrawals to the point that gas pressure ran too low. Every week since, the U.S. EIA reported additional withdrawals.

    On Monday, NKA will report that 4Q2014 gas storage levels were lower than ever, NKA burned cash losses every day, and the dividend has been suspended.

    In January, oil tanker ship companies like Frontline signed long-term contracts to rent out tanker ships to speculators buying “cheap” oil now to store it until prices are higher. While I doubt that the oil speculators will profit, the tanker owners have locked in highly profitable storage rates. Stock speculators bid up NKA while imaging that a similar speculative storage phenomenon must be occurring with natural gas. While it’s true that oil speculators are buying storage capacity, the U.S. EIA reports make it clear that gas continues to come out of storage. The NKA speculators are in for a nasty surprise on Monday. So is everyone that was expecting continued dividends. Monday will be a bloodbath for NKA shareholders.

    Have a nice weekend.

  • caustic_fred caustic_fred Jan 3, 2015 11:16 PM Flag

    As another reader already pointed out, NADL does not sell oil. If you're going to make up facts to try and pump up your losing investment, you should at least try to make your lies plausible. And what are you doing investing in a company that you do not begin to understand?

  • Reply to

    NKA tanking?

    by therabbit14 Dec 29, 2014 2:12 PM
    caustic_fred caustic_fred Dec 30, 2014 4:38 PM Flag

    What makes you think you'll get a dividend?

    The last dividend was paid on 11/20/2014, but if you bought only a couple weeks ago then you missed it. As for the future, the 10/30/2014 press release stated, " However, in light of the continuing challenges in natural gas storage market conditions, it is likely that the distribution will be reduced or suspended if current market conditions persist." So when you purchased in December "for the dividend", what dividend were you expecting to get?

  • Reply to

    EGLE Put Options @ 1.5 Strike

    by tplaxsblax Dec 23, 2014 12:43 PM
    caustic_fred caustic_fred Dec 28, 2014 4:42 PM Flag

    You should learn the rules of the game before you play with real money.

    You entered into an options contract without bothering to understand the simplest details of that contract. Your puts give you the right to sell pre-reorganization stock at $1.50 but since the pre-reorganization stock has all been cancelled the options cannot be exercised and they have zero value. It is astoundingly naive of you to ask "Do I just have to wait until expiration to realize my gains?" You must wait until expiration before you realize your 100% loss for tax purposes. Between now and then you can stare at the top line of this message.

  • caustic_fred by caustic_fred Dec 13, 2014 9:34 PM Flag

    At the start of 2014, China was an unlimited market, able to absorb each and every car that Tesla could produce even if sales were zero in the rest of the world. From the 2/29/2014 investor conference call:

    Elon Musk – “Yes, absolutely. Yes, I mean -- I think, based on current trends it seems unlikely that we'll be able to satisfy demand in China this year. So there will be unmet -- likely to be, I think, unmet demand in China.”

    From the 5/8/2014 investor conference call:
    Elon Musk – “So to the degree that our sales track that of other manufacturers presumably China would over time become the biggest market for Tesla. I mean that’s probably the best guess that anyone could make at this point, or in the short-term is that we really don't have a demand issue in China like we’ve got a lot of demand.”

    Mid-year, Musk was still planning to accelerate the roll-out in China. From the 7/31/2014 investor conference call:

    Elon Musk – “So in terms of number of stores by the end of next year -- or number of service centers I should say by the end of next year, actually I don't have that off-hand. But it's probably on the order of 100 in China alone, I'm guessing, by the end of next year.”

    After leading-on investors for most of the year, Musk did a 180 and said that the rest of the world could absorb each and every car that Tesla could produce even if sales were zero in China. From the 11/6/2014 investor conference call:

    Elon Musk – “I wouldn't say we're strongly dependent on China for deliveries next year. In fact, I believe even if we did not sell in China next year, we could probably still meet our targets. So even if there was zero China sales. We would like to exceed the targets, but even if we had no sales in China, we would still achieve the targets we mentioned in the quarterly earnings letter.”

    And on 12/12/2014 Tesla China President Veronica Wu resigned.

  • See the Fortune article titled "VW aims to leapfrog Tesla, Nissan with new battery technology".

  • caustic_fred caustic_fred Nov 30, 2014 8:47 PM Flag

    If I buy an electric vehicle from one of the majors, I know I'll get warranty service when I need it. Buying from an independent startup carries major risk to the buyer. While you acknowledge this intellectually, people don't yet have a gut understanding of this regarding Tesla. But when people begin to appreciate the potential of bankruptcy, they will stop buying the car, which will make bankruptcy quickly move from a potential to a certainty.

  • As Tesla approaches bankruptcy, potential buyers will realize that free charging and warranties end when the company is bankrupt. Tesla knows this. That's why they try so hard to maintain the illusion of viability. Talking about how many cars they'll be selling in 2020 makes people envision the company still being alive in 2020. But the balance sheet and cashflow statement portend an earlier demise. Between now and then, a couple more capital raises will bring in new investor cash to fund the daily losses. One day, potential car buyers and equity investors will all wake up and realize it was an illusion. When people stop believing then the company will collapse very quickly.

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