MASTER LIMITED PARTNERSHIPS

Tuesday, July 08, 2008

Nustar (NS) & Buckeye (BPL) are trading like they are on their way to zero. Buckeye Holdings (BGH) and Nustar Holdings (NSH) are trading near their ipo prices from a couple of years ago.

Amazing isn't it. MLP down 5 at 264...off the low of 262.87. If they are going to bounce they better do it soon. Overall market is moving higher.

18 comments:

Anonymous said...: From thestreet.com:

Helene Meisler
VIX
7/8/2008 1:14 PM EDT

Okay, I finally have come up with a theory on the VIX and why it hasn't gotten jumpy. There is real selling going on.

While this may sound ridiculous to many, think of it like this: we've gotten so much in the way of redemptions in mutual funds that there has been real selling going on. Instead of buying protection against a downturn (ie. options) they are really selling. That's why volume has been high.

It's been a long time since we've had this much selling. The good news is that real selling ends up bullish in the long run. If you have sold, then there are no sellers above when we finally do rally.

Thus, the panic is in mutual fund liquidation.; 7/08/2008 1:40 PM
joewxman said...: I have another theory and that is the emergence of the the short and double short shares that make it real easy to trade the downside. Certainly has balooned volume.; 7/08/2008 1:50 PM
Anonymous said...: We need a way to hedge MLP's...; 7/08/2008 2:13 PM
Anonymous said...: mlps go down when the market is down
and go down when the market is up

one hell of an investment

its a keeper; 7/08/2008 3:44 PM
Anonymous said...: Since 1990, MLP's have only had negative total returns 4 times:

1990 ~-11.00%
1994 ~-8.00%
1998 ~-1.00%
1999 ~-9.00%

2008 ???

Mr. Pipes; 7/08/2008 3:54 PM
Anonymous said...: the paradigm may have changed, new tax laws
democracts in office
financing issues
cost of money; 7/08/2008 4:19 PM
Anonymous said...: This was a bizarre tape - ~1% off the lows - is there a bright side there?

Some of the most beat-down names were G&P - People might be realizing that the contract mix that makes some of these guys effectively short gas, long crude could be more dangerous than just being long commodities like the E&Ps are.; 7/08/2008 4:48 PM
Anonymous said...: In other words, Mr. Pipes, MLPs have been up 78% during each of the past 18-years. Sounds like pretty good eatin' to me.

As for shifting paridigms, when haven't they shifted? The markets always provide us with sufficient bogeymen to accuse of being the real culprits when things don't go according to Hoyle.; 7/08/2008 4:49 PM
Anonymous said...: Too quick on the submit again! Damn!

I meant to say, MLPs have been up 78% of the TIME over the past 18-years.; 7/08/2008 4:51 PM
Anonymous said...: i think if you rely on passed proformance you will be investing in the past.

what will drive future growth

if the tax laws change, there will be repricing in this space

look what happened to the candian royalty trusts after the tax change; 7/08/2008 5:09 PM
Anonymous said...: At the risk of sounding uninformed, has anyone heard of any serious proposal or threat of a proposal that the tax benefits of MLPs might we knocked out? Yes, I know the Dems are on the door-step, and yes, I know congress needs to figure out a way to recover the costs of their Economic Stimulus Stupidity and all the other IOUs they've floated, but apart from conjecture, has the suggestion of tax changes affecting MLPs actually been raised by any elected officials?; 7/08/2008 5:44 PM
Anonymous said...: Argh! I hate this argument, because it misses the entire point of the tax change in Canada. Canada had a tax break that could be applied broadly across many industries. Large companies were starting to abuse the tax breaks and depriving the government of massive amounts of revenue. In America, the tax break was created to apply to a very narrow segment of the economy to promote energy production and transportation. In a time when the average American's energy costs are going up, do you think ANY government (Democratic or Republican) would like headlines created when they make it harder for energy-focused companies to raise capital? There will be NO change to MLP taxation in the near future. Period.; 7/08/2008 5:48 PM
Anonymous said...: pipes mentioned it the other day on this blog

it may or may not happen but "not" to consider the possiblity is reckless; 7/08/2008 5:52 PM
Anonymous said...: now that bud has proclaimed that we are safe from tax regulation, will someone provide one simple reason why this sector will stage a rally,

what will likely change in this space to cause mlps to ral; 7/08/2008 6:10 PM
Anonymous said...: the dem are talking about taxong big oil profits, that will drive prices higher
where have you been; 7/08/2008 6:22 PM
Anonymous said...: Where has who been? Who are you talking to and what's the subject? A rally in MLPs? Possible (although according to Bud Heavy, not possible) tax changes to MLPs? Something else?; 7/08/2008 6:35 PM
Anonymous said...: great post; 7/08/2008 7:22 PM
Anonymous said...: There seems to be one thing not mentioned. The hedge fund world had totally ignored MLPs in the past. Only in the past few years have MLP-foused funds emerged that were highly levered and bought any MLP they could find. That created tremendous supply as bankers do what they do best and take more MLPs public where there is demand. Now that these funds are delevering AND underperfoming, more supply is coming to market.

The only thing that will resume the historical performance is more of these MLPs get taken back private so their asset values can be reflected properly.

Too much demand and the really liquid MLPs are going to take it in the chin the most.

Thats why I own AHD. Cheap and illiquid and owned by healthy funds.; 7/09/2008 7:40 AM