WACHOVIA CUTS (LIKE THEY HAVE CREDIBILITY!) &
IS IT A BASE OR A PLATFORM?

This morning Wachovia has taken out the knife and is cutting Suburban Propane (SPH) and Nustar (NS) both to market perform from outperform. And technically they are correct as both mlps are trading at 6 month highs and Suburban Propane is trading near a 52 week high. So if we take them to market perform and the market goes higher from here then these mlps will continue to go up! You got that...its a cut but not really! Such absolute convoluted bullshit really and since these guys are the smartest folks in the room you are most certainly going to follow their every move. As Patricia Heaton used to call Ray Romano on Everybody Loves Raymond...IDIOT! In this case its plural..IDIOTS!




We are a little chart happy this morning as we have 4 of them to look at. Above we have the MLP index and the Dow Industrails. We are in outperformance mode for the most part; at least as measured since January 1st with the mlp index up over 25 points or nearly 15% plus a distribution thats about toe be paid vs the dow which is down for the year. And while day to day we see some days where we are down less...or some days when we are up less. Overall i think the outperformance continues as long as 10 year rates continue to rise.




The mlp outperformance is occuring even though the Dow Jones Oil and Gas index of big energy stocks has gone nowhere. Crude looks like its trying to bottom. If big energy stocks can get on the ball and break out of the base that will probably give mlps an additional tailwind. We have a lot of things converging this week including the governments bailout announcements so keep your seatbelts securely fastened.

Boardwalk Partners (BWP) puts up earnings this morning. What is interesting about Boardwalk is that it was among the first mlps to fall when it ran into cost overrun problems and the stock price started to fall long before other mlps. And now after the banking crisis it has emerged as one of the better performers. It helps to have Loews Corp and the Tisch family as a sugar daddy as they hold sizeable stakes and have provided financing.

Not much else happening this morning. The energy complex is higher this morning which helps. Btw got heating oil delievered this week at 1.79 a gallon. Can't remember last time heating oil was this cheap.