Realistically, is 45 million overstating fair value for the ships? The carry value is 75 mill (figures pre bareback, which is a wash in some ways and comes out of these figures in GAAP way), but the difference is in line with the industry view, the ships should be priced at a black-scholes type of equation of BDI (BHSI if you like) and time against revenue spreadsheet. The carry value is indeed probably correcter than not, so share count? What 100 million?. So its realistic? Well yes and no. Yes its mathematically sound, no, the world is in a new kind of hurt, a black swan of biblical proportions perhaps. Ships are a 25 year deal, so the cycle is long to get rid of excess, and in tight times, everybody goes flat out trying to suck cash flow, so they keep BDI depressed far longer than if they were smart OPEC producers with restraint--little people dive for pennies and beggar everyone--except they can't replace ships when the cycle turns, but who cares if BDI turns, they will get bank money, right? So how many banks have been forking it over in the last five lean years? Far too many, why? banks also are desperate but for a different beast, the almighty interest rate in a world of diminishing returns (unless you are into shadow banking in China)--so they drive the unsustainable purchases, as long as they think they can get a few points, or they could go buy RE that might crash another 30%--tough choices and wrong decision, far too many new boats bought with funny stimulus money--its called inflation. Just when it all looks hopeless, a silver lining appears, the iron trade, it becomes harder and harder to imagine why anyone would mine iron if it can be bought so cheap in Brazil and Australia? Deep fuel discounts add to this, so the BDI continues lower but what does 5% growth mean? Its not small, a EU stimulus is certain or a new meltdown will occur, a Japanese stimulus is garanteed now, they are in big pain, but that means? Exports from China, imports of Iron too- imo
So many traders are stuck at averages that make themselves feel foolish and it is a sorry truth many may indeed have been rash. It was not at all clear how the 25 million Crede gave would get extracted back in April, and the shorting was endless it seemed and may still be endless, but a few things to remember, BDI took a nose dive the precise wrong time, when rallies normally occur, that other stocks in dry bulk, cratered, and so we headed south some more, and then we got played by the pump and dump that go on both by CREDE, who needs to do it or so they would argue, and others of less moral strength, Ahem, whatever. I guessed capitulation way to early, but then DRY buyers just saw theirs come and go, so could ours be nearing its end. The meeting spelled out the "plan", and it could be NEWL wool over the eyes or it could be a plan, but what isn't a plan is rs and watch the 1.00 vanish again, so they realize, and it isn't much better if CREDE is allowed to treat shareholders like the company's leftovers, no company survives like that--so the question is do they intend to survive? Well How? New Ships? So they say. Well, realistic? Tough to call, can a company that pulls in 7 million at a BDI of 782, and spends closer to 14 milion really fast talk a bank into a major investment? On the other hand, can a company on Nasdaq, with an ATM, just call it quits? No I don't think that is the Greek way--just go surf and see what is the Greek way, you can see it in the way they talk about their companies, they close ranks, all objectivity be damned, they love their companies, they close ranks around them. But they need to perform too. Free has a chance to show this, did it pull in more from the bareback than it cost? Much as the FED carried an economy sinking many years in the future, backwardation is not unfamiliar to Greeks, they know it all too well, but can they find a "FED"? a source of faith, new ships? Or is lies? Well it won't take long to find out, but if they do#$%$
Spoke too soon, the CREDE guy is going to try to hold it down imo, he is a real piece of work, has to have more warrants he wants to turn in, no way to burn the buy who really owns FREE, sucks.
The beauty of the FED system is a small group of bankers, not only unknown but unknowable as to identity, by law no less I am told. A mafia, lends money to the US at interest, and lends out money without backing it, and without promising to pay anything for it (this part i read myself), should then turn around and use the Navy of that country, the US, to give value to the worthless paper. Its like a leach only this leach has attached to the brain of the victim, the NSA is an example of this leach's overeach.
Not a real issue. The shares don't matter imo anymore, the concept is value, market value is driver. Is there a business more driven by margins. Management isn't trying to hurt shareholders, if rates had gone differently the dillution would have been less, but remember CREDE PAID 25 million for the dilution to profit them, we took it and at the time we were worth 50 million, so CREDE deserved one third of the shares, but they got much more, its almost toxic by my guess, but just shy. The best part is FREE did it at a time BDI was more optimistic, so they got the better of CREDE perhaps slightly perhaps. CREDE did the dirty shorting but FREE stipulated no more than 10% per day, to warn investors. this is all fine, but the real story is CREDE also saved FREE from certain death--and why should FREE die? It seems money is scarce, how weird with the FED printing funny money round the clock, even giving to the "pretend bank" whatever central bank Europe pretends to have, that borrowed from a FED that does not back the dollar with any known reserves of any kind, nor does it hold itself legally accountable for any failure to deliver. hence the only value of the dollar is the ability of the US navy to punch some sense into any errant nation. So in a scarce money environment, with FREE earning about half as much money as needed just to break even, CREDE essentially doubled or tripled FREE's value, or in a binary sense, gave FREE value in the first place, all three financing's were CREDE, so its a tangled mess,. The future is based on a breakeven point, and whether FREE can cross it again, backwardation and CREDE can save FREE, so its like the FED backing of the dollar, CREDE back FREE and although FREE should be able to get money anywhere, apparently not, so we are beholden to CREDE also--since we should value at something as soon as we hit breakeven, but we have no value only a contingent value right now--I'm saying let them have the rs, it makes no difference, BDI will.
trying, move back to Free, its not NEWL, the fundamentals are still there--a rise of six times from current prices will come, NEWL is a joker card, it has nothing to offer but potential, and all that potential may very well have be a scam to keep Nasdaq. These guys are smart, ruthless also--they will never get delisted, nothing bad will happen to FREE, I guess you know that. Its all guesswork, NEWL could short cover much higher than even 600%, it could cover at insanely high prices, since much of it was a conviction short from 4 dollars, haven't studied it, so can't say, just that FREE will run on fundementals, eventually, once the Greeks have had their share, and boy will they milk this cow, just never kill it.
Its been brutal. I haven't said anything since perhaps I was wrong. But its still hopeful, the BDI will decide. Elliot didn't work twice in a row, no C wave came, still pretty weird, but that is what happened, would love to hear why it didn't. The shorting by CREDE seems to have thrown everything for a loop? The main problem might be sectoral, DSX shows a lot of weakness, it too has been ignoring the BDI too
That was something I hadn't thought about, it could be the case, I think the quiet we see is a good thing, the stock has to rest now, after that long kiss with a bottom, and maybe a slow lift off is what is needed to get the fear of CREDE behind us, like a shark they are still lurking?
Forget today, its a message for Monday or Tuesday--someone maybe thought today was when CREDE went long? They will not drive it up till the other shippers move, DSX and DRYS, and they are both about to start a run imho--neither is a perfect analogy but its what the MM's use since they have no idea what they are trading, and since buyers are afraid of CREDE, rightfully, they are not coming back till some news.
slight editing problem, Ion;s mom is going to start chapter two in the greek saga of a shipping magnate and his beloved 125 foot yacht, and his crew of bankers (wearing swabis no doubt).
Unsinkable. That is why its such a hot stock o:::::::: just look through that telescope I drew you, you can see the mighty fleet headed into the perfect storm, you can see Ion standing on the Free Goddess, urging on his heard of tiny yet mighty Handys, "onward's Jupiter, high ho Impala! To the hurricane, our destiny is upon us!" Next to him, the CFO smiled, rising BDI, another clever financing, sure the company was running on dregs, but it could do so for a very very long time, but now came that storm, he had dreamt of night after night, the one where he was alone on a giant tower and waving to him was mother in a hot air balloon, she would call out, "cahflow is king" and she waived as she departed to the western lands, the land of the ancestors. Ion's own mother was a goddess With earnings now doubled, back to the January highs
So you see, you are entirely mistaken to liken our mighty fleet, and fleet footed bankers, to a sinking ship. As for share price, its sank already. We await the BDI miracle, and CREDE bought 25 million worth, do the math, its dead simple, and it sits at .15? BDI was bad in April, sector was holding, 1.60 was the price at 25 million shares or 50 mill cap, then 25 mill MORE is bought, gets you to 75 mill cap but shares are now 85 mill, and shorted by Crede, so that means each share is about .90 worth. The we had a sector collapse, which made Crede want to short even more, and probably also feeling burnt, but they understand its not worth .90 because so much of the 25 mill simply went to the wipe out debt, and insure survival--the shares are worth north of 1.60 now with the BDI where it is, they are $2.50 by December--lets see a reasoned rebuttal.