How many of those quarters was it trading 2 dollars below book? I see a Fed caused #$%$, and then overturned by maintained dividend. This stock started to run before the fed meeting, then it got shaken, then full dividend was announced. I think 32-33 is fair, all things considered. In all those other prior quarters there was a long period for the stock to gain momentum and move and then settle on a price near ex. I dont think what we have seen here this quarter is like any other. I think we will see a bigger than normal move (positive correction because selling was fear of dividend cut), and I think it will run right up till the 21st.
ya, makes a whole lot of sense to have a 2 day sell off right into dividend announcement. SEC should throw someone in jail. This is crime happening right before our eyes. Who sells right now? Who? No, I dont want a dividend right here before the end of the year, and I'm gonna sell before the dividend and take a loss without a dividend, instead of after with a dividend and maybe a gain because I don't like tax right offs or profits.
Totally lost your minds.
This thing was running till there was wind of a fed meeting. Good news is the result isn't any worse. I feel like this is priced in, AGNC might have seen $40 had the fed not started buying MBS. In any case, Bernanke isn't on my favorite list. One little thought: You wanna spur housing? Come out and tell the world the rate isn't going any lower. Say it flat out with some conviction and stand behind it. Your the Fed chair. Then the whole world looks and says hmm, it isn't gonna get any better than this...
That's when people who are on the sidelines start buying. That's how you spur housing. Just a thought.
I'll just go ahead and give you a real world example. Rates are low, and housing prices are down, makes sense to borrow as smuch as you can and then maybe 5 years down the road if things get better you have a nice little profit. OR, you might decide to buy a bigger house and enjoy the mortgage interest tax shield. You move into a bigger home, or buy a second one thinking about this nice big tax break your gonna get. Your planning it it for 30 years. It cost you money to move and close a house. Thousands of dollars...
Next thing you know Obama says we are gonna get rid of the mortgage interest deduction go have fun with that, kids...
Thats an issue. Its not funny. It's being discussed in congress right now, the bill exists.
Now take the idea and think big business.
They might as well chain the economy to the floor.
I use the term retarded because:
The whole concept of altering fiscal policy by the fed is to promote or retard (haha) the growth rate of the economy, or control inflation or both, etc..
The idea of what they are trying to do right now is make it easy for business to borrow money at a good rate so they can be profitable. What the are too "retarded" too understand is that its already cheap to borrow money, and it has been for a long time. Its not like you cant operate a business with todays rates as part of your debt structure.
The core problem is, your already taxing the T TOTAL ^$%# out of everyone, and possible new entrants are waiting to see what crazyness is next before they go borrow a whole lot of money and create a business or invest in a new project.
You can't play the game until you know what the rules are, and when the government has been right in the middle of all of it passing laws left and right, what you get is Stagnation.
Red = Stop sign.
Its not the rates. When they quit screwing with the economy, it will thrive again, assuming they dont bury us further in debt, which they are.
Bernake talking about being santa claus again, buying back more mortgage back securities. There was a meeting yesterday or today, 2 day thing, trying to decide if they want to be retarded or not.
I keep seeing large volume trading at the bell. Yesterday close, today open and close. Is this brokerages evening up positions or hedge buying or what? Any ideas?
The only reason this sold off yesterday is because I bought a call position. Someone needs to send the MM's a message that they can go F themselves. Not this time. You can run it down all you want and have AGNC's buyback kick in. If you want my money, you'll have to swallow AGNC's 500 million so ram that up your piehole. I'm solid, and I'll ride it into the ground if thats how you wanna play. In 2 weeks, when the full divi is announced, and all the money that people have in other special dividend stocks moves here, I'm gonna laugh at you. This thing will pop, the div run is late because div buyers have money elsewhere. That will change in the next 10 days.
Ive seen lots of times companies hint at a future cut in the dividend in a current earnings report. Last report we got was they thought it might be harder to make money but they still felt there was opportunity and they felt no reason to freak out about it. This company, with the money they have in hand, I see no way, no how, they cut the dividend this qtr. I see the potential for it in the future, but I would look for a hint to that in earnings release prior to it actually happening. They can pay this dividend regardless. Why rock the boat? That isn't a smart thing to do.
I agree with all your points. If someone doesn't want to do better, its just not gonna happen. I meant to add rather than have them sit and take 25, if you had them work for 15, and then paid them 15, so that they would have a little more if they worked, there will still be those that would just rather stay home and take 25.
Heck, if you gave me that choice I'd probably take 25. Sounds pretty good haha.
I wish they would make the bottom tier grim but the absolute basics for life met. For the able bodied... Rice, medical care, and the cheapest roof over your head you can think of. Disabled get a better deal. From their, I'd like to see an incentive scale that encourages people doing for themselves. Design it to where for every dollar they earn you pay them additional money. If the earn most of their money rather than you having to pay all of it you win, and you reward the work with a bonus so they have a reason to work rather than sit. As income increases you help less and less to achieve being over the poverty level.
Problem now is, if they sit at home, they cost 25k, but if they go to work they only make 15k.
Why not put them to work and they earn 15k, and we pay them 10k?
We saved 15k and also have the goods they provided to share among all consumers.
My way is better.
I wish I knew where they were on the Buy Back program. They said they were gonna be buying below book value. A few thoughts I have about this...
If you had money set aside to buy back stock, I wouldn't think you would buy soo much that you had to cut your dividend. That would be a pretty big oops. Your gonna set aside your scheduled Div payment, and buy as much stock as you can when it falls in the range, unless you have a different plan.
They could cut the div on purpose, to put downward pressure on the stock, to create a buying opportunity for themselves. The question is why? I can't answer that question but I know this for sure...
This dividend might be the last chance for anybody to enjoy a low capital gains tax on dividend income for the near future. There are many companies doing a one time large payment to enjoy the lower tax rate while its still a sure thing. Take future earnings now, etc while you can is the idea.
I also don't know what AGNC is bound to in terms of positioning, and max payouts and ratio's etc, but I'm totally fine with AGNC saying hey, we think we are gonna do the biggest DIV ever, later this month with this tax strategy in mind. It would be a nice little gift to the shareholders.
I guess we will find out whats gonna happen, but I just dont see how its possible we are gonna have a reduced dividend. As stated before, who cuts a dividend when they are in the middle of buying back stock?
There should be people everywhere taking advantage of this tax opportunity. Buy in hard, take a large dividend payment, and sell the stock for a small loss right after div, but before end of year.
I was considering the same thought a couple days ago. I think its important to remember that the option is exactly what it is. You are buying the right to purchase shares at a certain price. When they announce the date of the dividend, it doesn't matter which option you have, you can still take the shares at that price and hold them as long as you would like. Take the div if you want, or sell before, whatever. Worst case scenario for the Dec calls is if they announced the EX date to be dec 31st. You could still take the shares on the 22nd, and sit on them for a few days and sell high before EX, or hold through dividend. To me it doesn't really seem to matter, but I may be missing if something is already priced in based on what people are guessing on when the EX date will be.. before or after OPEX (22nd). That was my question, but I didn't get an answer.
We have to eat food for nutrition. We can go out to eat every night at an expensive restaurant and spend $60, or we can eat at home and have healthy food that we make ourselves for $5.
To me, that is the difference. When I look at how the post office is run, or any government program, they are going out to eat every night.
You still have to eat, yes. Cut the fat. That's the problem with our government. If we were more efficient with spending, there would be plenty for everyone to have what they need.
The problem is, everyone but the taxpayer has to get paid.
Cut spending across the board 20%, make people adjust, go from there. Ya, there will be less dollars and it will take time to adjust, but in the end, do you want to be efficient, or wasteful? When we are wasteful, we owe china more money. That's not the answer.
Obviously I dont want to buy Jan 13 calls and hold till after EX. They will be worth less, which points to the DIV being priced in. The DEC 12 should behave the same way, I'm guessing the DIV is priced into both but is it skewed one way or another based on a guessed EX date?
EX is either going to be before or after DEC OPEX. Right now nobody knows which. The DEC 12 and JAN 13, 29-30-31 strikes are all pretty close in price, the JAN 13 a little higher, but is this time premium only?
Will the date of the EX have any impact on these contract prices? I can hold either contract and get the DIV, it's just a matter of when I take the shares. If the price rises to say 35, you win either way.
I'm just wondering if one of these contract prices will rise or fall based on when EX date news is, specifically before or after DEC OPEX.
Ive seen some things happen to option pricing after the EX date, but will anything like that happen when the date of EX is announced?
Sept 2009 to feb 2012 this stock traded in a range of 24.80 to 30.67.
Almost like management was holding it in a range and keeping dividend in check.
No way I'm buying this into 33, but then again I'm usually wrong.
Or maybe there's just a whole lot of people running off the cliff, while I'm saying #$%$
So I stop and get run over.