MASTER LIMITED PARTNERSHIPS

Thursday, September 04, 2008

In the blink of an eye were down almost 5 points on the mlp index with the dow down 266. Everything except for Calumet (CLMT) is down. That was easy.

7 comments:

Anonymous said...: Look for new lows, lower lows and worse and worse price performance. This TPP deal today show just how screwed the MLP model is. Without a raging bull, MLPs don't work.

Its a big shit sandwich and we all have to take a bite.; 9/04/2008 11:33 AM
Anonymous said...: New lows, lower lows, and worse and worse price performance???? You must be a barrel of fun to hang out with. Mr. Redundant, you need a cocktail, a drink, and a beer.; 9/04/2008 12:07 PM
Anonymous said...: Maybe he's short the market.

I have always been suspicious of anonymous posters who hysterically proclaim the end of the world and offer nothing of substance to back up their claims. If they really beleive that MLPs are such an awful investment why do they bother reading Joe's blog? Do these guys actually own any MLPs?

Bruce Sherman
Oakland, Oregon; 9/04/2008 12:27 PM
Anonymous said...: Bruce,

Look at the chart of AMZ which Joe posts daily. If you are a chartist, you would have to say we are going lower. Since fundamentals seem to be ignored by traders, the charts are all we have.

DrowingInCrude; 9/04/2008 12:37 PM
Anonymous said...: Drowning,

I agree that we may, in fact, be going lower but, ultimately, so what? If you own MLPs for income you will continue to enjoy the income. Eventually, the bear market will end (they always do)and unit prices will recover and grow.

In the meantime, one can use this opportunity to pick up strong MLPs at bargain prices. If you don't want to buy more, then just sit tight, collect your growing distributions, and quit worrying. Over the long-haul, we'll be fine.

I am not saying that paper losses are fun, but if they are causing the level of pain exemplified by some of the posts, then those people probably should be in less volatile investments (quality bonds, TIPS, CDs etc.)

Bruce; 9/04/2008 1:30 PM
Anonymous said...: I've posted my perspective on this before, but I think it's worth considering again...

I'm a long-term MLP investor. Owning MLPs is a lot like commercial real estate. Distributions are the rent checks and in most of my properties, the rent gets jacked every 90 days. The big difference in this analogy, of course, is that my MLP properties can be traded effortlessly in a highly liquid market. As a result, I can determine the property values with the click of a mouse.

To ascertain market value in commercial real estate, I'd have to list the property and wait for offers to trickle in. If I do this in a soft market, those offers may be at ridiculously low levels. I'll laugh and tell the prospective buyer to come back with a more realistic price. I'm under no obligation to accept crazy, lowball offers. If my fellow property owners feel compelled to sell-out at insultingly low prices, well, too bad for them. I'll continue to collect my rent checks and be thankful I'm not forced to sell into a buyers' market.

If you are into short term trading and flipping properties, well, take your chances and good luck. I'll keep my stable, long-term tenants and choose not to get emotionally wound-up in nonsensical daily market activity.

mike in new mexico; 9/04/2008 2:38 PM
Anonymous said...: Mike,

Fantastic post!

Bruce; 9/04/2008 2:43 PM