EASTER HOLIDAY LOOMS
NO RESURRECTION HERE!
Doom and gloom continue in MLP land. No signs of a bottom, Some pre-market selling in a few issues which is unusual. No reason for hope in here. Just lower prices and even higher yields. Hedge funds continue a massive unwinding of positions. My God it feels like we own tech stocks and its 2000 all over again.
Nothing of consequence in the news department. No upgrades or downgrades. You would think the brokerage houses would come out and defend some of these but except for Wachovia defending Boardwalk (BWP) yesterday we have silence.
Crude and Nat gas all down very hard this morning. Crude is under 100 bucks and nat gas has an 8 handle on it again. Commodities collapsing (finally) affecting the same hedge funds driving margin calls.
Hopeless.
joseph cioffi's Source Page - Associated Content
4 comments:
Here's what Cramer wrote this am:
"And it has meant absolutely nothing for one of my absolute favorite dividend plays, Enterprise Products Partners (EPD - commentary - Cramer's Take). (I believe some hedge funds borrowed a lot of money, at a low repo rate from brokers, and bought this stock and did the arbitrage like it is a mortgage bond, and now they are unwinding the trade, causing EPD to drop endlessly.)
What's going on? Why aren't these safe dividends enough protection for people who want to get yield that's much better than Treasuries? I think it is because the fear factor is way too high. The fear that somehow the companies -- even the ones that are going to grow their dividends -- are going to cut the dividends is playing a big role.
I think the worry is wrong. If you buy high-quality companies with good dividends that are easily paid for out of current cash flow, I am sure you will do better than most asset classes, because you have done better, particularly when the cash rates are so low."
Bruce
From Cramer on Thestreet.com:
And it has meant absolutely nothing for one of my absolute favorite dividend plays, Enterprise Products Partners. (I believe some hedge funds borrowed a lot of money, at a low repo rate from brokers, and bought this stock and did the arbitrage like it is a mortgage bond, and now they are unwinding the trade, causing EPD to drop endlessly.)
not often you see a 5 dollar drop for an mlp on no news as kinder morgan did just a little while ago. Too bad i had no stray cash.
Cramer hit the nail on the head.
I mentioned essentialy same thing yesterday but, not as eloquently as Crammer. That's why I've been scooping up CEP and EROC at these fire sale prices. I guess its KMP's and ilk turn to be taken out to the woodshed today. I always thought that the yields on MLP's last midyear did not compensate for the risk. That's why I dumped out of them then. Lessons Learned?????
Anyway, I'm always in awe that people (including me) are willing to buy at the top and not the bottom
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