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Inergy, L.P. Message Board

marklibera 494 posts  |  Last Activity: 41 minutes ago Member since: Aug 14, 2007
  • Reply to

    Hey marklib

    by lenloc Jan 29, 2016 12:52 PM
    marklibera marklibera Feb 3, 2016 10:23 AM Flag

    Ok, but how did you do with WMC?

  • marklibera marklibera Feb 3, 2016 10:13 AM Flag

    Never confuse a bull market with investing expertise. Dripping telecoms, utiilities or consumer staples, ok. When the next cycle runs its course, I look forward to a full accounting of whether your longterm drip strategy worked on the stock of a highly levered company that buys subordinated paper of commercial real estate.

  • Reply to

    O/T NMM

    by wingnut90266 Feb 3, 2016 8:35 AM
    marklibera marklibera Feb 3, 2016 10:08 AM Flag

    Kee, I give you credit for owning up to a recommendation that soured. You are right that we all do that. Every pick is based on an assumption. A pick can go wrong when the assumption proves faulty, but it also can go wrong if something else happens that no one was paying attention to (like the correlation between high yield spreads and high yield stocks). It also doesn't help when we get "confirmation bias" and everyone jumps on the same ideas without testing the assumptions.
    Bull markets in high yield stocks always end, in fact, all bull markets in every kind of stock always end with big losses.
    Some on this board keep insisting that high yield stocks are becoming better values as they continue to decline and cut dividends. At some point they will be right, like a broken clock.

  • Reply to

    O/T NMM

    by wingnut90266 Feb 3, 2016 8:35 AM
    marklibera marklibera Feb 3, 2016 9:53 AM Flag

    Helmut, I agree with Ed. These boards can provide great advice and ideas to investigate, stuff that goes under the radar. Many of us participated in the old Fording Canadian Coal board. Fording was a met coal producer. While I was introduced to Fording from a friend, I never would have learned as much about met coal and other met coal producers except through the Fording message board. I once remember Vinny reporting about floods in Australia which caused supply disruptions of Australian met coal producers which led to a doubling or tripling of prices for which Fording benefited.

    But it goes back to the point that you have to test the assumptions.Many of us witnessed this before the last crisis when bulk shipping and tanker stocks with high yields were all the rage. I think Ed, Vin and Bob played many of them. And then they collapsed. And everyone said "no one saw this coming." But it was there right in front for everyone to see, either technically or in the fundamentals. The truth is no one wanted to see it coming. Although I hate these adages that people are fond of quoting, they become adages because they often are true. (Yield) pigs get fed, and (yield) hogs get slaughtered.

  • Reply to

    Go see The Big Short

    by marklibera Feb 1, 2016 2:41 PM
    marklibera marklibera Feb 3, 2016 9:36 AM Flag

    payback, you are forgetting about the role of nat gas. Nat gas prices peaked in 2008 and started to decline. Many of the nat gas firms shifted their production to oil after nat gas prices started to decline because oil prices were higher, but would they have been able to do that if high yield rates did not enable them? For many of the MLP e&p firms that I followed, their overall debt increased during these times, meaning that they were added debt even as production increased.
    Second, this phenomena has occurred in other sectors when prices start to decline because of too much supply. The firms with the most power and deepest balance sheets squeeze the marginal players who used junk financing. We've seen this in computers, chips and telecoms. So the Saudis did what most companies do. This is not to downplay the geopolitical issues.

  • Reply to

    O/T NMM

    by wingnut90266 Feb 3, 2016 8:35 AM
    marklibera marklibera Feb 3, 2016 8:55 AM Flag

    But I thought it had good color? Are we seeing a pattern here?

  • Reply to

    Go see The Big Short

    by marklibera Feb 1, 2016 2:41 PM
    marklibera marklibera Feb 2, 2016 4:12 PM Flag

    Kee, I think you are wrong on oil. The point is that it fell during the crisis. You must have seen the layoff notices (I've posted a few) but you acknowledge a truism -- corporations will start to cut to make up what they are losing in revenue as the economy weakens. Remember I said in the summer that the 4thQ GDP estimates were turning lower? Remember the job numbers are all based on models, models that are backward looking don't incorporate what is happening right now.
    The blood in the streets is just an adage. Someone said today that it doesn't tell you how much blood is needed before you should be buying, or whether it is your blood or someone else's. Just remember how many people said that about oil when it was 75, 65, 55 and 45. I distinctly remember arguing with people about the "blood on the street" on the SDLP board when it was $19. It's now $3.
    Finally, has any mainstream firm that caters to retail ever avoided a bear market? When I was setting up the 401K program at my former employer, our rep from Legg Mason confessed to me that he could get fired for turning bearish. Their number one job is to keep funds under managment through some combination of telling investors that (i) you can't time markets (even though there are thousands of firms who try to do it and who sell stocks when they reach certain targets), (ii) stocks always recover over the long run (without telling you how long is the long run), (iii) most funds average 2 double digit down years every 7-10 years.
    Like a scene out of Animal House, the Kevin Bacons are going to come out of the crowd to tell people not to panic because the selloff is "contained." Don't worry about China, because it is contained. Don't worry about high yield spreads, because it is contained. Don't worry about the softening economy because it is contained. Don't worry about oil or metals or mining or currency devaluation or negative interest rates. They are all contained. Stocks go up. Buy buy buy.

  • Reply to

    So how is this gonna work out exactly??

    by gracieblackbelt.2012 Jan 30, 2016 12:41 PM
    marklibera marklibera Feb 2, 2016 3:53 PM Flag

    Len, the reason we are not being told to stop is because Wall Street wants to keep us at the table so that they can keep earning their fees on the account. It's like a casino disclosing the odds of each game at the table. You might still go for a free drink and to see the people, and then rationalize that you "had" to spend the money on something so it might as well be gambling with scantily clad waitresses.
    BTW, the Russell 2000 is close to being down 20% from the top. Watch for the shifts in the decline percentages. They will stop measuring the decline from the market highs and shift to measuring from Jan 1.

  • Reply to

    View on preferred stocks?

    by joefox711 Jan 30, 2016 4:23 PM
    marklibera marklibera Feb 2, 2016 3:46 PM Flag

    I will offer one piece of experience. Check out the yield on the company's bonds and compare to the yield on the preferred. Since the preferred is lower in the credit structure, it should yield more than the bonds.
    My view on NYMT is that most people don't know what assets they own or how those assets perform in a weakening credit and economic environment. They think they own a bunch of govt insured MBS.

  • marklibera marklibera Feb 2, 2016 3:42 PM Flag

    len, in the middle of the flood, you can always find one island that hasn't gone underwater yet. Let's revisit this post sometime later.

  • marklibera marklibera Feb 2, 2016 3:39 PM Flag

    Who could have seen this coming? I mean they told us that everything was fixed. No more debt, everyone working full time and getting big raises, Lake Wobogon for everyone, good color in all high yield stocks.

  • Reply to

    Hey marklib

    by lenloc Jan 29, 2016 12:52 PM
    marklibera marklibera Feb 2, 2016 2:17 PM Flag

    len, it is not an apocalyptic prediction and to call it that is to diminish the real risk. I have seen estimates of bear market declines ranging from 20% to 40%, depending on where the market started when the bear came. This is not my work, but those who have studied market history. I get the two decision argument, but I would counter that by saying that you can get the first decision right by looking at charts and other indicators, and by being willing to eat principal. For example, if you own VZ, you will notice that it ran up some 20% from 44 and is at an overbought RSI reading. Most stocks of regular companies only pay divies quarterly, so you are not really collecting a divy during the time after the ex-date. True, you would have to pay taxes on gains, but most people also have losses in their portfolio to balance out, and in fact, most become "trapped longs" in their losing positions because they keep thinking that the position will come back. Most trading types will tell you that your first loss is your best loss and to cut losses early, but most don't do this because they fail to think of their losing positions as an asset either to offset gains or get a tax refund.
    The second decision -- when to get back in -- is difficult, but as long as you are getting back in at a lower point (including the effect of paying any taxes on gains), that is better than just riding a position down.
    Finally, I don't advocate selling everything. Some positions may hold up with losses that are manageable. That can easily be tested by looking to see how a particular stock did during the last bear market. Also, there will be places to hide out and earn decent yields. Closed end muni bond funds have been on a tear since summer (I own a bunch) with some up over 10%. Many are still selling at a discount to NAVs and pay around 6% tax free. Telcoms and utilities should hold up and lower rates to come will help. More in next post.

  • Reply to

    Go see The Big Short

    by marklibera Feb 1, 2016 2:41 PM
    marklibera marklibera Feb 2, 2016 1:43 PM Flag

    Yep, I knew they would have her out soon. Meanwhile the Atlanta Fed just cut their q1 GDP estimate to 0.7%. I think they were at 1.1% for Q4 and it came in at 0.9%.
    Have you seen the 10 year? As I told Gambler, it took out the double bottom from Aug and October.

  • Reply to

    Go see The Big Short

    by marklibera Feb 1, 2016 2:41 PM
    marklibera marklibera Feb 2, 2016 1:41 PM Flag

    Oh, Keebon, wake up and see the writing on the wall. What were energy prices going into 2007? Falling.
    Employment strong? Come on man, what's the participation rate. Employment is a lagging indicator. Plus all the gains have been in bartenders and baristas.
    This just out from BofA (I'll post the direct quotes if you want) everyone is selling, retail, hedge funds and institutional.
    Ask yourself these questions? Did they get you out before the 2007 crash? Did they get you out before the 2001 bear market? Did they get you out before any bear market?

  • Reply to

    Sold TVIX...bought GLOP

    by rbgambler99 Feb 2, 2016 10:27 AM
    marklibera marklibera Feb 2, 2016 12:02 PM Flag

    I just bought some TZA. These triple inverse ETFs are difficult for me to trade and I have not been very successful in the past, mostly because I tended to buy them after the fear is in the news. But the market failing after last week's Japanese inspired rally, makes me think we are going down again this month.
    I think you are early on UWTI. It's still at RSI 35. Even when it goes below RSI 30, it can still continue to decline. Look at the slow stochastics. I'm not an expert on interpreting stochastics, but I can see that it's at a peak and headed down and history shows that when that happens the stock goes down. They are eventually going to have to reverse split UWTI.
    The 10 year Treasury just took out the double bottom from Aug and Oct. Recession here we come. Stocks to follow down.

  • Reply to

    a week day so far

    by sarge198502 Feb 1, 2016 10:16 AM
    marklibera marklibera Feb 2, 2016 11:29 AM Flag

    william, which Wall Street firm ever stands up and calls a bear market before it has already started? Probably never. If the definition of a bear market is down 20%, then by definition, you can't have one until the 20% damage has already occurred. By then, most people are out 20%. Some stocks may hold up. But the vast majority will be down and people won't know which ones are having dead cat bounces and which ones will hold up.

  • Reply to

    Go see The Big Short

    by marklibera Feb 1, 2016 2:41 PM
    marklibera marklibera Feb 2, 2016 10:56 AM Flag

    bob, the next move is going to be NIRP and helicopter money. Japan went to NIRP and that is going to force China and everyone else to devalue their currencies again, which is going to cause more deflation. Switzerland is talking about paying every person $2500 per month. We probably won't see NIRP here until next year. The recession probably hits late summer, so the new administration is going to have to do something. There have already been stories about the infrastructure program funded by more QE. Eventually this is going to cause gold to spike, but not until they knock it down good. Treasuries and munis are going to do well and high yield is going to get killed. The 10 year is now 1.88% and has recession written all over it.

  • Reply to

    Sold TVIX...bought GLOP

    by rbgambler99 Feb 2, 2016 10:27 AM
    marklibera marklibera Feb 2, 2016 10:51 AM Flag

    Gambler, I would prefer to buy the TVIX on a day in which the market is rallying, but I missed my chance last week. I think it is going to make sense to hold on to it, instead of trading it, as the market is going to tank. I read a piece that said we are going to revisit the lows on the S&P around 1814 and if that level does not hold, then 1400 is in the cards. I mentioned yesterday that China is going to devalue again.
    This bear is for real.

  • marklibera marklibera Feb 2, 2016 9:54 AM Flag

    Oh future teller, do tell us what happens in the long term. In other words, you are just guessing since you have no idea what will happen in the long term. You are so confident that NYMT will still be making profits, why? What do they do that simply must survive in the next economic downturn? What moats are around their business? Hint, they own paper. Deeply subordinated paper, levered up.

  • Reply to

    Go see The Big Short

    by marklibera Feb 1, 2016 2:41 PM
    marklibera marklibera Feb 2, 2016 9:36 AM Flag

    Kee, I wouldn't call the damage to midstream "limited." Almost every midstream that I follow is significantly off of its highs. There has been a significant loss of capital and if you didn't sell early on, it was brutal, and those declines off of highs are not likely to be made up by the income that one collected from holding.