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Monday, February 8, 2010

Breakfast with Dave

Great read on  how the banks are stuck with sovereign debt. In other words, if the countries in Europe go bust, the banks books will suck.
Breakfast With Dave February 8, 2010 (David Rosenberg)                                                          

9 comments :

Anonymous said...

Hey Palmoni,

I found a really interesting post-SPAC play. The company is involved in purchasing agency mortgage paper and collecting the spread on the money they borrow at and what the paper pays. Since the company changed its business plans to get share holder approval, this triggered a delisting notice and now the company trades on the OTC.
The company is already fully invested in these agency paper and at the current price trades at a nice discount from book value. The competitors in the same industry trade for around 1.05-1.15x book value. The company is also registered as a REIT so most of the cash it generates will be paid out to shareholders. If you go check out the what the company is doing and their portfolio, then you'll see how shareholders will make really nice money. I'm not going to say what it is here since people should do some of their own research. The company name is Armour Residential (AMRR.ob)

I warn you, the volume is a bit thin like that Colombian gold play, but accumulating a decent position should pay nice dividends while you wait for the capital appreciation. It also has warrants at a higher strike price if you want to have that leverage, but the value is in the common stock.

Also, any updates on that Colombian co.? I talked with some investors and they say there is good news, but it isn't public yet. So I'm guessing it refers to the PPM. I'm learning that patience is truly a virtue!

Anonymous said...

interesting read. I would love to follow you on twitter. By the way, did you guys learn that some chinese hacker had busted twitter yesterday again.

Anonymous said...

Palmoni, are you a gay bear now?

Anonymous said...

Palmoni,

Do you know why the gold stocks are down while gold is up?

ABX and HL getting hit.

Anonymous said...

so Rosie now is a great read? He is not s stupid bear anymore with broken crystal ball? how table turned!

Anonymous said...

oh the horror!

I'm a bull! Ouch.

Beat me!

Anonymous said...

Anytime they'd like to ramp this thing up to new recovery highs, and crush all the shorts that have been piling in the last few weeks, is fine by me.

No hurry, really.

How about tomorrow?

Palmoni said...

not a bear

I thought the chance of countries going bust was just a bit more than someone walking away from a subprime house underwater

when I said great I meant entertaining

Anonymous said...

Anytime they'd like to ramp this thing up to new recovery highs, and crush all the shorts that have been piling in the last few weeks, is fine by me.

No hurry, really.

How about tomorrow?
--------------------
well if you did not happen to sell at the highs - too bad for you. And do not get your hopes up about tomorrow either.