I was not aware the voting rights belonged to the entity, and I was also not clear we were discussing an endowment rather than custodian. In this case, I would amend my opinion to be I don't know.

Hopefully you hear back from them to clear this up. I'll be interested in what they say.

to the best of my knowledge 13G does not apply to a custodian's aggregate holdings, only an investor (single entity, passive individual or institution) who holds controls over 5% of a company is required to file 13G. Keyword is 'control', the custodian is simply a place for clients to park assets. The custodian has no say over when to buy/sell or how to vote proxies, clearly failing the control test.

Based on what you've shared, I don't believe these custodians are out of compliance w 13G requirements.

I am not familiar with foreign reporting requirements for 13G though I would be very surprised if they did not apply verbatim.

Operationally, yes, I am pleased with the pace of progress and achievements, especially the form-10 approval. I have some concerns regarding fiscal management, especially these equity raises at $1.50. Although it is twice the market value, it reinforces the perception that the shares do not deserve a larger multiple. Again, I want to see bank loans.

Strategically, I am very pleased. In fact, this is the company's greatest strength, which makes execution and operational efficiency the crux of any successful thesis.

I also want to see continued positive interactions with government at all levels, especially local. Any souring of relations would have me revisiting my thesis.

I will judge the success of 2011 not by EPS, but by operational accomplishments, so I'll be looking for more of these in the final quarter. Quarterly projections are under the microscope for me. I'm looking 2, 3 years out and want to see them laying the appropriate groundwork to get where I see them going.

But since you asked, I would like to see them hit their .39 projection for their own credibility, though if they had not put it out there I think low to mid 30's is more realistic. Of course, there are many variables out of their control which could tease the final number a few cents this way or that. Another reason to shift focus to execution. The dollars will follow.

Frankly, whether they hit or miss estimates is only of concern to me if the trend/rate of growth is materially altered, otherwise I really just care they are operationally sound. (farm contracts, ground breakings, fish sales etc.) So long as they are making progress toward stated goals, I'm generally pleased.

I think management has a bit to learn about operating on an American exchange, but that will come in time. I also want them to learn the art of under-promising and over-delivering. Why they're so aggressive w their projections strikes me a naive at best. Granted this is based solely on last years miss of 29 cents. And yes, some of the miss was attributed to GAAP charges, but again, that's part of the game and as top brass you gotta know that. I believe they'll get there eventually, it's a learning process for them.

Will they do .39 this year? ehh, I give them a 50/50 chance, but .36, .37 ain't nothing to sneeze at. If they get .39 I'll look at management's projections as much more credible.

I'd like to see them scrap the dividend and get a decent LOC with a bank. Reinstate the dividend once there's "extraordinary" income, as Solomon put it. Otherwise they're issuing equity to help finance our dividend. How much sense does that make? especially considering the price they are raising it at.

Barring the unforeseen, if they continue to execute, I'm a bull for the long-run..at least another four years; and perhaps the next decade if this puzzle comes together just right.

agreed, and I don't believe this is under consideration by the company, just a few impatient shareholders who think it's the panacea to their problems.

to those losing patience and looking for a quick flip, feel free to sell and move on. Short-termism will only frustrate you with this investment.

OT: Petrobakken, you may want to also look into Petrobank (TSE:PBG, PINK:PBEGF) they own a significant stake in Petrobakken..haven't looked at them recently but I remember concluding that petrobank was a better value based on sum of parts.

A little fuzzy on this, but I think I recall Rato mentioning the name on another board...am I right Rato, or is my imagination having fun with me?

ding ding ding..we have a winner.

This should be the first question asked of Solomon. And asked again..and again until it makes perfect sense why they have not sought out a loan as opposed to issuing equity shares.

I'd lever up. Take out a loan. I'd be elated to pay 10-12% on cash I anticipate returning 50% after investment.

the CGS board is devolving into another YMB. most posts are:

1) I bought x @ y Wheeeeee!!
2) that POS is a zero
3) a thinly (or not so thinly) veiled personal attack
4) nothing (something of a ghost town lately)
5) blatant pumping

You're one of a handful that still make worthwhile contributions, but man...it sure ain't the same board that encouraged me to become a paying member.

sure it can get worse, that's the risk to owning equities. Remember though, we actually closed *above* where we were last Friday..just keeping it in perspective.

In addition, the fundamental story is even stronger now with the form 10 acceptance, so any lower and it's that much better a bargain. Put your stink bids in and take the emotion out of it.

we may see broad market single digit P/E's (perhaps as low as 6) in the coming years, so I would buy with that in mind, leaving plenty of powder for the screaming buys..if we get them.

I think the Fed steps in with a third round of money printing if and when we get to say, 1025. Of course if the sell-off is related to the a catastrophic event in the Euro banking system, and therefore the global banking system, all bets are off. Desperation and chaos will likely ensue.

Martin Wolf had a great piece in the FT earlier this week regarding why a break-up of the euro zone is so difficult and ultimately why bureaucrats insist on keeping it intact at al costs.

http://www.ft.com/cms/s/0/f2133a2e-e2e0-11e0-903d-00144feabdc0.html#ixzz1YhSi0686

dollars, treasuries, VIX only long positions working today. I'm of the opinion this is more than just a buy the dip kind of selloff. Maybe begin accumulating precious metals if you're underexposed, otherwise I'll wait it out, could be months or longer of waiting, but we're not remotely close to a broad market bottom here.

the NIA is a pump and dump shop IMO..google them yourself. besides, these guys have no more insight, if even as much, as others who have tried (and failed thus far) to pick the wheat from the chaff.

Granted, the report will move share prices, but underneath the surface it's just the same valuation techniques anyone can use..give yourself an important name (National Inflation Association?? Seriously?) and you might even be able to start a newsletter too.

what insight does the national inflation association have into the US-China space that everyone else lacks? Seriously, we've seen countless analysts burned, no, fried, covering these names, but this group rides in on white horses declaring winners and losers, game over? life-changing report?? c'mon...I think these guys are a pump and dump shop. google them and poke around yourself..

regardless, it will still move the shares of any co mentioned, especially at the boundaries. (isn't that the entire point of a pump n dump?)

LPH is as good a guess as it gets IMO.

CCCL - IB appears to have a short sale restriction in effect until close of AH trading tomorrow. Went into effect @ 11:02 EST.

Does anyone know whether this is IB or exchange specific?

comparing NEP to AAPL on valuation metrics...wow

Jordan Fund link in case you don't already have it:

http://www.angby.com/jsp/jordanfund/index.jsp?commentNumber=0#section0

Google Chrome will automatically translate the comments for you too. (you'll need the Google Translate extension, free) BTW, if you haven't used it before it's worth a try; much snappier on both my PC and Mac..and I usually have 30 to 40 tabs open at a time (8GB RAM strongly recommended)

http://www.google.com/chrome

TSL - anyone else buying? haven't seen this PPS since mid-May '09.

LPH - these roadshow presentations haven't acted as much of a catalyst, if at all, in the past.

Earnings though, obviously a legit catalyst.

CEO - It appears they *upgraded* the shares from underperform to hold, yet cut the price target to 13 from 14 HKD. Odd. I suppose they see a brighter future, just not yet?

http://www.cnanalyst.com/2011/09/analyst-actions-on-chinese-stocks-amap-asia-bcds-bidu-cedu-ceo-cha-chu-sep-9-2011.html

Anyway, I'd rather buy a down as opposed to an upgrade. Street analysts are largely trend followers..and usually late to spot them.

CEO - bouncing along 52 week bottom..

http://www.ft.com/cms/s/0/f72e5cb8-d170-11e0-89c0-00144feab49a.html#ixzz1XTnGmgn5

TSL - negative sentiment, technically oversold, attractive valuation.

been a buyer under 13, but have only blood on my hands to show for it thus far..

Rames, haven't seen you post in a couple weeks. any thoughts on the solar sell off?

I can see us retesting those March lows in the coming years, especially if and when the Eurozone breaks up.

I think there's a good deal of political risk with mREITs at the moment, which I believe is driving the recent weakness. The White House will likely push for some type of mortgage modifications in the upcoming "jobs plan". Whether it happens or not is irrelevant, perception is reality.

Too bad because otherwise the fundamentals for this asset class are excellent...

WSJ: Stung, Chinese Firms Now Look to Go Private

By DINNY MCMAHON

BEIJING—Hundreds of small Chinese companies flocked to U.S. exchanges in recent years, and investors eagerly greeted them as bets on China's surging economy.

That love affair has soured.

After a spate of recent scandals—and amid growing investor skepticism—a flurry of those companies are in talks to be taken private. In some cases, the companies plan to relist in two or three years in Hong Kong or mainland China, where valuations for such companies are now higher than in the U.S.

Shareholders saw billions of dollars in paper losses over the last year after a wave of accounting irregularities surfaced at dozens of U.S.-listed Chinese firms, prompting exchanges to delist several companies. The Securities and Exchange Commission also set up a group to investigate problems at Chinese companies listed in the U.S. As a result, investors have turned their backs on virtually the entire category, even though the vast majority of companies haven't been accused of wrongdoing.

The investor retreat has caught the attention of private equity groups. A number of them are working with the heads of Chinese companies to buy out outside shareholders, according to the companies' filings with the SEC. At least seven Chinese companies have initiated procedures for such buyouts or announced plans to, the filings show.

The deals can be dicey. Existing shareholders are sometimes dissatisfied with the prices they are offered and investor lawsuits are common, says Donald Yang, chief investment officer at Abax Global Capital, a hedge fund that is helping two Chinese companies go private. And critics, including hedge funds that short stocks, warn that some firms may be going private primarily to avoid scrutiny.

But some private-equity investors say they see an opportunity to snap up companies with experience dealing with the demands of international investors at what could be bargain prices.

"It's a perfect storm to be doing these deals...[and] there's a lot of people in the hunt," said Josh Kurtzig, a partner at Tangram Capital Partners, which is helping assemble a couple of privatization deals. "Some CEOs say that going IPO in the U.S. was the worst decision they'd ever made."

Many of these companies came to the U.S. because they were too small and lacked the influence to win a listing on China's state-run exchanges. Plus, there was ample demand from U.S. investors. Most listed through so-called "reverse mergers," which are backdoor processes that entail less regulatory scrutiny than traditional initial public offerings.

Joseph Chan, a partner at law firm Sidley Austin LLP in Shanghai, said interest in doing privatization deals started to pick up around the time the SEC started investigating allegations of fraud at Chinese firms toward the end of last year. The Bloomberg Chinese Reverse Mergers Index has fallen about 60% since mid-November, when sentiment started turning against the sector amid widening allegations of misconduct.

Among the deals in the works, Bain Capital is buying outstanding shares in Nasdaq-listed China Fire & Security Inc. for $9.00 each. That is almost 50% higher than the $6.26 closing price on March 7, when the company announced that a then-unnamed private equity fund was looking to buy it out. At that time the company's share price was 60% lower than a year earlier, despite not being implicated in the investigations or allegations swirling around the sector. It closed at $8.47 Wednesday, and currently has a market capitalization of about $240 million.

More recently, shareholders of specialty chemical maker Chemspec International Ltd. agreed in mid-August to accept an offer from the company's chairman and a private-equity fund headed by Fred Hu, former Greater China chairman for Goldman Sachs, to take the company private. The price of $8.10 per American depository share was 10% below its initial public offering price two years ago. The company delisted from the New York Stock Exchange at the end of last month.

Mr. Hu, whose fund Primavera Capital Group is paying $139 million for Chemspec's outstanding shares, says he decided on the deal before market sentiment began souring on Chinese stocks, but the slump "enhanced our case."

Still, he advises caution. "There's been a lot of talk (of doing these deals) in the wake of the massive sell off of Chinese public companies, but not everyone can do it," he says, pointing to the need for "in-depth due diligence to be sure of what you're getting into."

Skeptics say that at least some of these potential deals may not be all they are cracked up to be. Andrew Left, who runs Citron Research, a short-seller that publishes bearish reports on stocks, says some companies may just be floating privatization plans to buoy their share prices.

Mr. Left has specifically made that allegation against Nasdaq-listed Harbin Electric Inc., which makes electric motors, and is pursuing plans to go private with the help of Abax Global Capital. Mr. Left says Harbin Electric overstated its export revenue and committed securities violations, accusations the company denies. On June 9 he wrote on his website that Harbin Electric is a "struggling company doing whatever they have to do in order to keep that share price high enough."

Harbin Electric declined to comment. But on August 3, Chairman Yang Tianfu said in a statement that Citron's most recent report, posted that day, was "a patchwork of fabricated evidence, falsehoods, selective use of information, and clearly biased and dishonest reporting, showing that the authors' only intention is to drive our stock price down."

Harbin Electric's stock is trading at a discount of about 25% to Abax's proposed buyout price, indicating investor concerns that the deal might not happen. As of Aug. 15, more than seven million shares had been borrowed for short selling, representing almost a quarter of shares available for trading.

Write to Dinny McMahon at dinny.mcmahon@wsj.com

Jordan Fund translation:

Yesterday Siaf closed up +20%, followed by +10% today. There is still much appreciation left to reach the value we believe the shares should have - we will wait and see, perhaps given enough time they will.

OT; Shippers, Cosco, a Chinese shipping firm whose largest shareholder is the Chinese govt, signed a number of these long-term charters in 07/08 when capesizes were going for 50K/day. Now they don't like being stuck in these charters that are roughly four times the going rate so they're withholding payment to the ship owners (of course, all Western)..already had a few boats seized..crazy stuff.

Drex has a valid point regarding guidance, which proved to be aggressive last year and no, they did not provide an update before releasing annual results. It's really moot whether you're "running SIAF through the CGS sieve". Look only at the company's past results. Yes, there are also many positives to speak of, but let's not dig our heads in the sand and pretend SIAF does no wrong. Every company does..well all of them except maybe AAPL, they are clearly infallible.

On guidance, I'm not sure why management insists on being so aggressive when they have such a naturally impressive growth profile ahead of them. One would think playing it safe and surprising to the upside while providing a margin for error would be the comfortable and preferred strategy. Evidently, Lee feels differently.

I like that SIAF gets little to no mention on the CGS board. Believe me, it's a good thing in the current environment. If and when SIAF proves its merits in the second half of the year the money will certainly follow, but don't count on speculative traders pushing the price up in anticipation. It's definitely a "show me the money" atmosphere.

Forget about JoeN.

I'm enjoying the new found balance on the board. It's certainly more interesting and valuable than longs patting one another on the back. I remember the CCME board before the halt. Nary a dissenting opinion to be found.

I liked today's report. First and foremost, it didn't disappoint, which feels like a win given the number of misses (sometimes huge) other CGS cos have reported. Second, though the quarter itself was not worthy of an ovation, it appears to have sown the seeds for a potentially impressive second half. Of course, we won't really know the most important details until the conference call in Sept.

I'm long, I've been long since last summer. I plan to hang on for the ride, especially from these levels. In fact, I added today at 72 cents. I like the asymmetry I see in the risk/reward profile. GLTA

GLD - I have nearly half of my portfolio in silver and gold, though the positions started much smaller (maybe 20%, avg silver around $14 and gold around $800-$900) I just haven't sold anything.

Short-term it has to take a breather, nothing goes up forever, but who knows when or for how long..it's really moot to me since I'm in it for the next decade or $5K/oz, whichever comes first.

The Economist: Chinese Financial Scandals

http://www.economist.com/node/21526407

I disagree..they provide liquidity and act as a dampener on price movements both up *and* down.

Besides, it's not as if there's any guarantee they'll make money. They certainly assume risk.

CNTF - I'm not saying I won't sell. Y'all raise valid points..it is a huge question mark about what they knew and when they knew it, and that certainly has me reconsidering my long-term view of the company.

My point is, I like the odds on a swing trade from the threes

CNTF - really? I'm with y'all on the head scratching over mgmt, especially reaffirming margins so late in the qtr..it's borderline incompetent. But I'm not inclined to sell down here. It's still a profitable company with fairly decent prospects..despite what I'd now call less than average mgmt, but that seems priced in at these levels.

Time will tell, but I'm wagering we don't go too much lower.

WSJ, NYSE Seeks to Tighten Rules on Reverse Mergers

http://professional.wsj.com/article/SB10001424053111904480904576498510098826494.html?mod=WSJ_hp_LEFTWhatsNewsCollection

or simply read on..

By MICHAEL RAPOPORT

The New York Stock Exchange wants to toughen the standards that "reverse-merger" companies must meet to list on the Big Board, in the wake of accounting questions at many Chinese companies that have gone public via such transactions.

The exchange is proposing a series of "seasoning" requirements that would effectively delay an NYSE listing for reverse-merger companies and set bars they would have to clear to obtain it.

Imposing such requirements on a company "should provide greater assurance that the company's operations and financial reporting are reliable" and would provide more time to scrutinize companies and find any potential problems, the NYSE, a unit of NYSE Euronext, said in its proposal.

NYSE Amex, which has more reverse-merger listings than the NYSE, is proposing similar changes. Both proposals were filed with the Securities and Exchange Commission last week and are subject to SEC approval.

The proposals are in reaction to widespread concern over the use of reverse mergers, in which a private company, often from overseas, merges with a publicly traded U.S. shell company in order to trade in the U.S. and gain access to U.S. capital markets. Supporters of reverse mergers say they make it quicker and less expensive for companies to go public, but critics say they allow companies to avoid the scrutiny of their finances and operations that comes with a traditional initial public offering.

The practice has come under fire this year, as dozens of Chinese companies that have gone public in the U.S. via reverse mergers have encountered questions or allegations about their accounting practices. That has been an embarrassment to U.S. exchanges, since many of those companies have listed only in the past couple of years and apparently encountered little in the way of obstacles to doing so.

The SEC and the exchanges have suspended trading in some companies, and an SEC task force is investigating accounting and disclosure issues surrounding reverse-merger firms. The SEC also issued an alert in June that publicly warned investors about the risks of investing in such companies.

Under the NYSE's proposed tougher standards, reverse-merger companies would have to trade for at least a year in the U.S. over-the-counter market, or on another U.S. exchange or a regulated foreign exchange, before listing on the NYSE. They also would have to maintain a minimum share price of $4 for an extended period, and would have to file audited financial statements and an annual report with the SEC.

In addition, the NYSE would have the discretion to impose more stringent requirements on a particular reverse-merger company if the exchange believes that is warranted, based on factors like an inactive market in a company's securities or weaknesses in its internal controls.

In April, the Nasdaq Stock Market filed its own proposal with the SEC to tighten its listing standards for reverse-merger companies, with a six-month seasoning period and minimum share-price requirements. That proposal is still pending.

Write to Michael Rapoport at Michael.Rapoport@dowjones.com

CNTF - at 3.23 -- yes please

you do realize how crappy a sound byte that would make?

besides, you're stating the obvious. Why don't you just quote Gretzky? "skate where the puck's going, not where it's been"

you do realize you said the same thing as Buffett, right?

If you are to be fearful before others are fearful, what are they? greedy.

And if you're to be greedy before others are greedy..they are? right, fearful.

sure sounds like you agree with Buffett.

toot, I'm not saying you're crazy, but you'll need to give some support for your statement. This isn't YMB, give us some substance man.

QE3 - you're right about the effectiveness of it all, but to think elected officials and policymakers would be content to "bite the bullet" and endure a recession is absurd. Is it the right thing to do? probably, but that's not the road we're on -- far from it.

the tea party will whine and complain (what's new) and the GOP will distance themselves politically and people will talk about how the Fed is losing credibility and sparking inflation, but we know it's going to happen..it's Bernanke's M.O.

With that said, I still think gold is cheap, especially if you compare the price today with the global monetary base vs past periods. either QE3 doesn't happen and people flock to the safety of gold expecting negative beta as displayed today, or it does happen and people get the hell out of the dollar for commodities, including gold.