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In case you missed it, just thought I'd ask again.
Was wondering if anyone had a strong opinion about any of these picks before I add them to the high-yield list:
MCG Capital Corporation (MCGC) 12.5% yield
http://www.mcgcapital.com
MCG Capital Corporation is principal investment firm specializing in middle market companies. It targets its investments in small to mid sized companies. The firm prefers to invest in acquisitions, growth financings, and leveraged buyouts. It does not invest in highly cyclical and volatile industry sectors and businesses with extraordinary volatility exposure. The firm seeks to invest in companies having revenues between $20 million and $200 million and EBITDA between $3 million and $25 million. It firm seeks to invest in the form of senior debt, including amortizing, bullet maturity term loans, and revolving credit facilities; second lien debt, that includes term loans on sole source and participant basis; secured and unsecured subordinate loans structured as current interest, deferred interest, and equity linked components; and equity that includes minority equity investments. MCG Capital Corporation was founded in 1990 by Mr. Bryan J. Mitchell and B. Hagen Saville and is based in Arlington, Virginia.
GSC Investment Group (GNV) 12.4% yield
Significant insider purchases recently
http://www.gscinvestmentcorp.com
GSC Investment Corp. is a business development company. The public investment firm specializes in buyout, acquisition, growth, recapitalization, and note financing transactions of middle market companies. It typically seeks to invest in companies that have an EBITDA between $5 million and $50 million. The firm structures its investments as debt and equity investments primarily by investing in first and second lien loans, mezzanine debt, senior secured bonds, unsecured bonds, and preferred and common equity. GSC Investment Corp. is based in New York, New York.
Technology Investment Capital Corp (TICC) 12.0% yield
http://www.ticc.com
Technology Investment Capital Corp. (TICC), a business development company, operates as a closed-end, non-diversified management investment company. The company primarily invests in debt and/or equity securities of technology-related companies that operate in the software, Internet, information technology services, media, telecommunications, semiconductors, hardware, and technology-enabled services sectors. Technology Investment Management, LLC serves as the investment adviser to TICC. The company was founded in 2003 and is headquartered in Greenwich, Connecticut.
>But who can predict the amount of drug ordered by the DOD once the approval hoop has been put behind us<
The government is an exceedingly unreliable and capricious customer, unfortunately.
It's not going to be anywhere near that for the ketamine program. Established clinical entity, and the trial program is not going to be anywhere near as extensive as a novel agent.
Still, 5000 to 10,000 pages represents a fair bit of work.
One would hope that they're already writing the NDA.
There is not a tremendous advantage to holding high-yield stocks in a tax-deferred account as long as they are subject to the 15% rate.
So most high-yield stocks should be held in your regular account. REIT dividends are taxed as regular income, so I imagine there's an advantage to holding them in a tax-deferred account.
I'm a scientist (more or less), not an accountant, so perhaps 10nisman or another person more qualified than me can chip in with more information.
Now I'm going to go buy some more CNE.
The Abu Dhabi Put
http://www.fool.com/investing/international/2007/09/27/the-abu-dhabi-put.aspx
Toby Shute
September 27, 2007
You may be familiar with the notion of the "Greenspan put" -- the idea that former Fed chairman Alan Greenspan would pump liquidity into the market whenever things looked dicey for investors. With the United Arab Emirates' purchase of PrimeWest Energy Trust (NYSE: PWI), I think we're seeing the beginning of a similar phenomenon that is bound to give the likes of Lou Dobbs some serious acid reflux. I dub it the Abu Dhabi put.
We have sent a lot of dollars over to the Middle East in exchange for precious petroleum. Some of those dollars are being spent on silly things like a configuration of man-made islands in the shape of the world's continents. The rest of those dollars are being deployed more strategically, namely to keep the good times rolling by diversifying into global energy and infrastructure assets. The recent buy of PrimeWest by state-backed Abu Dhabi National Energy Co. (also known as TAQA) is a great example.
PrimeWest is one of the larger Canadian royalty trusts, a group of firms that investors began dumping when the government started tinkering with their tax-advantaged status. Just look at the charts of PrimeWest, Penn West Energy (NYSE: PWE), or Canetic Resources Trust (NYSE: CNE) compared with the SPDR S&P Oil & Gas Exploration & Production (AMEX: XOP) exchange-traded fund to see the extent to which these CanRoys have been left in the lurch over the past year.
PrimeWest's droopy stock price provided an opportunity for TAQA to pick up producing assets on the cheap. This move follows up on recent purchases of properties from Pogo Producing (NYSE: PPP) and Pioneer Natural Resources (NYSE: PXD). If Middle Eastern buyers are happy to scoop up underperforming or nonstrategic assets from North American players at $80 a barrel, imagine how eager they would be to swoop in if the energy patch took a hit due to a domestic slowdown.
Thus, I'm led to postulate the Abu Dhabi put -- energy asset prices fall, foreign buyers swoop in, and energy investors stay happy. Protectionist hackles would no doubt be raised due to energy security concerns, but I have difficulty conceiving where else this cash might come from. While I wouldn't rely on such an underlying bid in selecting my energy investments, it's still somewhat comforting to know that these companies are firmly in the sights of foreigners with very deep pockets.
>I’ve avoided Canroys because my high yield investments are in my taxable account and I habitually avoid tax complexities (I do my own returns)... I understand, that it is wiser to put high yield stocks in nontaxed accounts to avoid tax on the annual distributions. My purpose, however, is to generate money for living expenses.. taxes cannot be avoided.<
If you're doing your own taxes, it is pretty smart to stay away from Canroys. Given the extra charge I get from my accountant, it must be a pain to deal with.
Canadian trust dividends qualify for the 15% rate, so they can be kept in a taxable brokerage account. Harvest's distributions are subject to a 15% foreign withholding tax. However, you can claim a foreign tax credit on IRS Form 1116 if you hold the stock in a taxable brokerage account. Foreign tax credits usually can't be recovered from a tax-deferred account.
The Big List of High-dividend Stocks
My acquisition for the week: IIA. Roughly 19% yield for this REIT. Also bought a basket of Canroys--I already owned HTE, also purchased CNE and PGH, although the latter I have some doubts about because the payout ratio is 95%. Will be adding to these positions slowly.
Speaking of Canroys, I find it amusing that the Canadian government, though the Royal Trust taxation issue, has essentially created a fire sale on Canroys. Not only have they screwed their retirees, they've also created a situation where they are essentially giving away their natural resources to...Dubai.
CSE has been an incredibly successful investment for me, so thanks to whomever mentioned it. Watching and waiting on BKCC.
As always, your recommendations are appreciated.
PS: I find it surprising that nobody seems to be interested in this board. I'm making a boatload on these stocks. Oh well, I guess any message board where Eternal Image--a .007-cent/share company that sells funeral urns--generates >100,000 posts probably doesn't have much of an audience for rational stock picking. (Aside from BV, of course).
AAV
ADVANTAGE ENERGY FD
13.90%
ABR
ARBOR REALTY TR
12.60%
ACAS
AMER CAP STRATEGIE
9.00%
ADVDX
ALPINE DYNAMIC DIVIDEND FUND
AGD
ALPINE GLOBAL DYNAMI
8.90%
AHT
ASHFORD HOSP TR INC
8.20%
AINV
APOLLO INVESTMENT CO
10.20%
AOD
ALPINE TOTAL DYNAMIC
APL
ATLAS PIPELINE PTNRS
7.20%
APU
AMERIGAS PARTNERS LP
9.60%
ARCC
ARES CAPITAL CORP
10.40%
AWP
ALPINE GBL PRMR PROP
BEP
S&P 500 CVRD CALL FD
11.60%
BFK
BLACKROCK MUN INC TR
6.10%
BGF
B&G FOODS INC. EIS
BGM
GENL MTRS CP SR NT
BIF
BOULDER GR & INC FD
14.60%
BKCC
BLACKROCK KELSO CAPI
11.60%
BKN
BLACKROCK INV MUNI
6.10%
BNY
BLACKROCK NY MUN INC
5.50%
BPT
B P PRUDHOE BAY UTS
10.80%
BRT
B R T REALTY TRUST
13.10%
BSD
BLACKROCK ST MUNI TR
6.10%
BTE
BAYTEX ENERGY TR UTS
10.70%
BVF
BIOVAIL CORP
8.40%
CHI
CALAMOS CV OPP & INC
10.50%
CNE
CANETIC RESOURCES TR
14.40%
CPL
CPFL ENERGIA SA ADS
9.00%
CSE
CAPITALSOURCE INC
12.10%
CVP
CENTERPLATE INC IDS
N/A
DCA
DIV CAP RTY INC FD
11.50%
DMLP
DORCHESTER MINLS
9.30%
DMLP
DORCHESTER MINLS
9.30%
DOM
DOMINION RES WARR TR
13.40%
DSX
DIANA SHIPPING INC.
7.40%
EBI
EVGRN INTL BAL INCM
8.30%
EDD
MORGAN STANLEY EMDD
-EGLE
EAGLE BULK SHIPPING
7.20%
EOD
EVGRN GBL DIV OPP FD
EOS
EATON VANCE ENH EQ
9.20%
ERF
ENERPLUS RES FD
10.50%
ERH
EVERGREEN UTILITIES
10.20%
FHI
1ST TR STR HI INC FD
12.40%
FHO
1ST TR STR HI IN FD3
FRO
FRONTLINE LTD
12.10%
HCD
HIGHLAND DIST OP INC
HQH
H Q HEALTHCARE SBI
8.60%
HQL
HQ LIFE SCIENCES IND
8.70%
HTE
HARVEST ENERGY TRUST
17.20%
HYB
NEW AMER HIG INCM FD
10.90%
JDD
NUVEEN DI DIV & INC
9.40%
JGT
NUVEEN MUL-CUR ST GV
JLA
NUVEEN EQ PRM ADV FD
10.70%
JSN
NUVEEN EQ PREM OP FD
10.40%
KMR
KINDER MORGAN MNGMNT
7.10%
MFD
MACQUARIE FIRST GLBL
12.20%
MTR
MESA ROYALTY TR
10.00%
NCV
NICHOLASAPPLGT CV IN
10.10%
NCZ
NICHOLAS -APP CONV &
9.80%
NRI
NEUBERGER BRMN RLTY
11.70%
NRO
NB RE SECS INC FD
11.90%
PFN
PIMCO FL RT STGY FND
10.30%
PGH
PENGROWTH EGY UTS
15.80%
PHF
PACHOLDER HI YLD FD
9.90%
PHK
PIMCO HIGH INCOME FD
10.00%
PHT
PIONEER HIGH INC TR
9.70%
PIPDX
PIMCO INTL STKPLUS TR STRATEGY
RDR
RMR PFD DIVIDEND FD
12.70%
SFL
SHIP FINC INTL
8.10%
SJT
SAN JUAN BASIN ROYAL
8.70%
TAR
TELEFONICA ARG NEW
13.30%
TRMD
AKTIESELSKABET DAM
12.40%
USS
US SHIPPING PARTNERS
9.00%
VRTB
VESTIN REALTY MORTGA
10.80%
ARAY reminds me more of ISRG (which I owned) and HNSN (which I wanted to buy at $12, but I was waiting for a pullback...it's at $28 now).
I think in many ways these companies are easier for the general public and undereducated fund managers to understand, at least compared with pharmacotherapy.
ARAY
I'd like to echo Dew's sentiment--thank you. I actually bought a little yesterday, spent last night on DD, and bought a lot more today.
>As long as they keep President VileBile away from Ground Zero, I'll be calm.<
But there were no Iranians involved in September 11. Why should Ahneedahandjob be prevented from visiting the site? Maybe it would knock some sense into him.
PS: Any attempt at limiting the right of Columbia--or any other institution--to invite whomever they want to speak is thoroughly against the spirit and language of the Constitution. This whole debate is ridiculous. Duncan Hunter should be expelled from Congress for even suggesting that funds be cut off. Any sugestion otherwise smacks of fascism.
Canroys...
I'm going to buy some CNE and PGH once they trade ex-distribution.
Anyone want to argue about which are the best Canroys? I own HTE and will own the above two, but I might make a basket of 4 or 5.
I don't understand. Angiomax is a replacement for the combination of heparin plus a glycoprotein IIb/IIIa inhibitor. Patients undergoing PCI do not get heparin alone.
So what is the premium price you're referring to? The cost of Angiomax is roughly equal (actually a little less) than heparin plus a GP IIb/IIIa. All of the GP IIb/IIIa's are branded.
>A drug I’d cite as evidence of the toughness of selling to hospitals is Angiomax. It’s a fine drug, but it costs a lot more than heparin.<
Not a good example. Angiomax isn't competing against heparin. It is competing against the combination of heparin or LMWH and a glycoprotein IIb-IIIa inhibitor (primarily Integrilin and ReoPro).
Oooh, ouch...I just got home.
My sympathies to whoever owned SNUS...we've all been there (my worst was NABI).
Who needs Androxal?
http://www.neuticles.com/
Further to the SNUS discussion:
I think one concept that biotech investors have failed to grasp over the past few years is the concept of total value to the healthcare system. That is to say, it doesn't matter so much any more whether a product provides an incremental improvement in efficacy. What does matter, however, is the value equation, which people have taken to expressing as value = quality/cost.
I have a fairly good handle on what is going on in the biotech/pharma industry, if for no other reason than the types of projects that are thrown my way. Over the past two years, there has been a seismic shift in that two years ago, all we cared about was efficacy and safety. For example, Lipitor was the most efficacious statin, so it's the statin of choice. Now, everything focuses on the total value equation.
The quality component consists of not only efficacy and safety, but the ability to meet standards imposed by the Joint Commission and other governing bodies. Taking a first step in this direction, CMS has identified several "never events" that will no longer be reimbursable. My understanding is that they are currently in the process of identifying "never events" related to cancer chemotherapy. Other standards organizations have developed and are implementing measures of quality of care that will also drive reimbursement.
Branded medications can make a stand here if they promise to help healthcare providers meet these quality measures. In addition, use of certain branded medications can help physicians meet pay-for-performance measures.
The cost component consists of total costs to the system, not just the costs of the drug. Branded medications can also make a stand here if they can reduce the total cost burden. I think QALYs are going out the window as a pharmacoeconomic measure because drugs will have to provide real cost reductions system-wide, not just demonstrate "cost efficacy."
The implications for a biotech investor are relatively simple: efficacy is becoming a less important parameter as we already have inexpensive medications that are fairly effective. A marginal increase in efficacy does not guarantee uptake (review the Crestor experience as an example). Instead, we need to evaluate how a new medication addresses each component of the value equation.
The only reason I'm writing this is because we often see people getting excited about more marginally more efficacious drugs in established therapeutic classes. It's not enough any more.
Of course, this presents a major dilemma for biotech investors. It's safer to invest in a company that's developing a drug in an established therapeutic class, but these drugs have little chance of ever making any serious money *unless* they provide value.
Sure, I'll make that bet, but let's make it a year. And now that I-Hub has a convenient mechanism for paying for gift subscriptions, it should be easy for you to pay up
You pay closer attention to these things than I do...10 quarters from approval and I won't even remember what the bet was about. So remind me when it's time for you to pay.
>>I would think that hospitals would like the 15 minute administration rather than the 3 hour as it would mean a higher number of patients could be treated each day.<
Not sure how you assembled that post, but just for the record, this quote comes from a different poster and is not my whole argument.
>More throughput is not a good thing if the hospital is losing money on each patient.<
I have no idea why you're assuming they'd lose money on a Toc-paclitaxel patient.
My point is that the differential in cost to the system between 15 minutes of bed time and 3 hours of bed time gives Sonus plenty of room to command a premium. Increased throughput has successfully been used as a rationale for vastly more expensive branded antithrombotics, and the difference is trivial compared with 15 min vs 3 h.
I have no position in SNUS, but speaking from the perspective of a catheterization lab, people get very excited over a 15-minute improvement in throughput. Beds are extremely expensive; the difference between a 15-20 minute and a 3-hour infusion is tremendous in terms of cost.
Even with noninferiority I suspect that there would be relatively rapid uptake if the difference in infusion times is that large. Not that that will do investors in SNUS any good tomorrow.
Nope. I just have an over-developed sense of empathy.
That is just cruel.
Funny you should mention that. The only "adverse effect" I've suffered from Chantix is vivid dreams. Deliberate use of quotes: I actually think the dreams are pretty cool.
The question is whether Chantix is eliciting the dreams, or if it is just helping me remember them. I suspect the latter given nicotine's effects on short-term memory.
And I have a hot neighbor, so if I bang on her door late at night no harm done.
I plan on stopping after three months, yes.
If anyone else is contemplating Chantix, it works best with either Nicorette or nicotine patches for the first couple weeks (there's a study out there showing this, don't have the cite right now). I haven't investigated the PK of Chantix, but I suspect it takes a while to reach stable, efficacious plasma concentrations.
>Chantix for smoking cessation has had the fastest sales uptake of any drug in the company’s history<
And as someone who is 3/4 of the way through a 3-month Chantix prescription, let me say that it actually works.
High-yield ex-US stocks
Came across this article while looking for high-yield ex-US stocks.
Investor's Business Daily
Emerging Markets' Fast Growth Triggers Electric Utility Boom
Thursday September 13, 7:00 pm ET
Reinhardt Krause
Some developing countries are waking up to a big problem: Power shortages could short-circuit their economic growth.
In Latin America and elsewhere, governments have been restructuring utilities to spur private and foreign investment. Heavy-handed regulatory policies are being replaced by market-based systems that give utilities higher returns on investment.
Hiking electricity rates is a tough political step for governments in countries where much of the population still lives in poverty. But, emerging markets need to build more power plants and modernize infrastructure.
"In most developing countries, power demand grows more quickly than the economies," said Jed Bailey, managing director of the Asia and Latin America groups at Cambridge Energy Research Associates. "To get investment in place, there's a sense that regulatory structures will evolve and prices on average will go up."
But after running up for much of the year, shares in Latin American utilities traded on the New York Stock Exchange have retreated along with stocks worldwide.
They include Brazil's Companhia Paranaense de Energia (NYSE:ELP - News), Companhia Energetica (NYSE:CIG - News) and CPFL Energia (NYSE:CPL - News), as well as Chile's Empresa (NYSE:EOC - News). CPL has a 9.5% yield. I'm watching it.
Shares in Argentina's Edenor (NYSE:EDN - News) have still gained 19% since its initial public offering in April. Other gainers include China's Huaneng Power International (NYSE:HNP - News) and Russia's Unified Energy System (Other OTC:USERY.PK - News), a state-owned monopoly that the government plans to break up by mid-2008.
Some utilities in emerging markets pay better dividends than those in the U.S., says analyst Rowe Michels of Bear Stearns.
"Most Latin American utilities provide above 5% dividend yields, some over 10%," Michels said. "That's well above what the average U.S. utility pays.
"U.S. utilities aren't growth stocks," he added. "Demand barely keeps pace with the economy. In Latin America, electricity demand is growing much faster."
Chile, Peru, Colombia and Brazil have "investor-friendly regulatory models," Michels said. Argentina's power shortages have worsened. Its government may have to take unpopular steps, Michels says.
"Some countries are on the verge of blackouts and rationing," said Michels. "A lot of times countries don't give in to business-friendly regulatory models until they have no choice," he said.
With oil-rich Venezuela led by radical socialist President Hugo Chavez and Bolivia renationalizing energy firms, some analysts warn that the region's investment climate may turn for the worse.
U.S. utilities have been exiting Latin America over the past five years, said Philip Adams, analyst at bond rater Gimme Credit.
"It's a higher priority for them to use capital at home," he said.
In March, Allentown, Pa.-based PPL said it would sell interests in utilities in Chile, El Salvador and Bolivia.
Still, Latin America is attracting investors from Europe. Spain's Endesa, which owns a controlling stake in Chile-based Enersis, plans to invest $3.3 billion in Latin America through 2009. U.K. hedge fund Ashmore Energy International has been acquiring power and natural gas assets in the region, Bailey says.
Latin America gets much of its electricity from hydropower. Sudden droughts have been a problem -- especially given rising demand for electricity. Such demand rose 6% last year, according to BP's Review of World Energy.
Meanwhile, Asia's demand climbed 8.5%, led by a whopping 14.5% increase in China, BP found.
"Much of Asia needs power plant capacity but they're still struggling with privatization," said Peter Maloney, editor of Platt's Global Power Report.
Indonesia and the Philippines are among the countries struggling to get new investment, says a PricewaterhouseCoopers report.
India still subsidizes the cost of electricity and supplies power to agricultural areas virtually free, Bailey said. He reckons such policies turn off private equity groups and other investors.
India plans to increase generation capacity 60% over the next five years. Power Grid Corp., India's biggest power transmission company, launched a $730 million initial public offering on the Bombay exchange this month.
Some of China's utilities plan to expand into Indonesia, Vietnam and Thailand. Hong Kong and Singapore-based investment groups are eyeing Indonesia and other power-hungry countries.
Globally, electricity demand is expected to double by 2030, with China's growth being a big factor.
China rationed power after blackouts in 2004 and 2005. After that, spending on new power plants surged. The country's utilities now face a short-term glut of capacity, Bailey said, although demand continues to grow in the double digits.
China's industries now gobble up about 75% of electricity. As living standards improve, China's 1.3 billion people should help absorb the power capacity coming online, said Joseph Jacobelli, analyst at Merrill Lynch.
China has big plans to add capacity from nuclear plants, hydropower projects including the Three Gorges Dam, wind farms and solar energy. But, most of its electricity still comes from highly polluting, coal-fired power plants.
Russia's plan to restructure power monopoly UES has drawn plenty of attention.
European utilities, including Italy's Enel and Germany's E.ON, are interested in buying stakes in UES spin-offs.
Michels advises investors to be careful because it's not clear what Russia's regulatory and pricing model will be after the breakup of UES. It also is not clear how UES assets will be carved up, he said.
VRUS
Did anyone else notice the incredible volume today?
But it's not off topic for Yield. Part of the reason I started it was so that I didn't have to wade through it here.
OT--I hereby pledge no more OT messages for at least a week. Or maybe I'll just post them on YIELD. Unless they're really funny like the Jamba Jerkoff.
In any case, I think this board has gotten a little off track with taxes and teacher pay. Not criticizing, since I contributed, but perhaps it's time to get on track.
If you want to talk about taxes, the economy, the idiocy of the .5% rate cut, politics (but only as it related to the economy), high-yield stocks, protecting your investments, teacher pay, or even how much smarter we PhDs are than MDs (kidding) I'll talk all you want on YIELD.
OT--Would you trust this arsewipe with your money?
I found this inexplicably hillarious
http://tinyurl.com/2c7o5c
Canadian Dollar at Parity With Greenback
One would have thought this would have helped the Canroys, but noooooo.....
Thursday September 20, 4:51 pm ET
By Jackie Farwell, AP Business Writer
US Dollar Reaches Parity With Canadian Dollar, Falls to Record Lows Against Euro, Indian Rupee
NEW YORK (AP) -- For the first time since Gerald Ford was president, the loonie can buy as much as the greenback.
The U.S. dollar's recent decline against the Canadian dollar, the euro, and even the Indian rupee, means Americans will pay more for imports and trips to Paris, Rome, Bangalore and Toronto. It also may drive overseas demand for U.S. goods and help raise profits at U.S. multinational corporations.
The U.S. dollar reached 1-to-1 parity against the Canadian dollar Thursday for the first time since November 1976. That means one Canadian dollar now buys one U.S. dollar, so a bottle of maple syrup could cost an American as much in Toronto as it does in New York.
Today's numbers, however, do not mean that the dollar is facing a meltdown.
Thursday's drop is of greater concern to currency markets than U.S. households, except "if you're a connoisseur of French wines or Canadian maple syrup," said David Gilmore, a partner at Foreign Exchange Analytics in Essex, Conn.
A lower dollar makes U.S. exports more competitive, which is good news for American manufacturers but spells rising prices for imports to the U.S. The dollar's decline also diminished the spending power of American tourists while attracting to the U.S. foreign visitors who seek cheaper accommodations and shopping.
Daina Jefferies exited Macy's at the Walden Galleria Mall in the Buffalo suburb of Cheektowag, about 10 miles from the Canadian border, and added a couple of bags to a collection already in the back of her car.
"I just bought the same things I bought last week in Toronto for half the price," she said. "I'm going to go home and return them. I knew I was coming so I thought I wouldn't take the tags off. Now there's no way I'm keeping it because it's twice as expensive."
Krys Esteves of Caledon, near Toronto, headed into the mall with her mother, Maria Swica of Mississauga, Ontario, planning to take advantage of weaker American dollar.
"My son wants a soft-serve ice cream maker for Christmas so I'm looking for that," Esteves said. "It's just to compare. Right now, I know it's definitely to our advantage."
The Canadian dollar hovered near parity in late New York trading Thursday, buying 99.93 U.S. cents.
Known as the loonie because of the bird pictured on the one-dollar coin, Canada's currency rose sharply against the U.S. dollar after the Federal Reserve on Tuesday announced a dramatic half-point cut in its benchmark interest rates. While aimed at shoring up U.S. credit markets, the cut further weakened the dollar against other currencies by reducing returns on dollar-denominated investments.
Even before the rate cut, the Canadian dollar experienced a summer of record highs. Canada, a major oil exporter, has benefited from soaring crude prices and a strong economy.
Oil prices surged into record territory Thursday as the weakening U.S. dollar fueled buying by making futures cheaper for foreign investors.
"The Canadian economy that once used to be the sleepy little resource backwater of the North American economy is certainly turning the tables on its big brother in a hurry," said Jeff Rubin, chief economist and strategist at CIBC World Markets.
The United States, meanwhile, has suffered a collapse of much of its housing market and a worsening credit crunch, prompting the Fed's dramatic action this week. The central bank is far less concerned about the value of the nation's currency, however, said Michael Woolfolk, senior currency strategist at the Bank of New York.
"There's a conspicuous silence coming from the Fed with respect to the value of the dollar," he said.
A lower currency typically fosters worries about inflation, but the U.S. dollar's decline over the last year has been too gradual for the Fed to consider intervening by raising interest rates, Woolfolk said.
The U.S. currency also plummeted to a new low Thursday against the 13-nation euro, which traded above $1.40 for the first time since it was introduced in 1999. The euro rose as high as $1.4098 Thursday before falling back to $1.4076, up from $1.3964 late Wednesday.
The $1.40 level has long been viewed as a key benchmark in terms of driving the euro toward becoming a reserve currency of choice -- a position long held by the now-weakening dollar.
The dollar was down across the board Thursday, dropping to a nine-year low against the Indian rupee amid strong demand from foreign funds investing in India's booming economy. The rupee rose to 39.92 per dollar in intraday trading, breaching the 40 rupees-per-dollar mark for the first time since May 1998.
The dollar also dipped against the British pound, falling to $2.0099 from $2.0025 late Wednesday, after U.K. retail sales in August rose by 0.6 percent from July. The U.S. currency fell against the Japanese yen to 114.44 from 116.09 late Wednesday.
The falling dollar could be good news for multinational corporations because it makes American-made goods more affordable in international markets while making it harder for foreign manufacturers to undercut domestic competition.
On the other hand, it worries the U.S. government by scaring away foreign investors who help to finance the country's debt. As investment in U.S. Treasury securities dwindles, the government will have to pay higher rates at weekly auctions to find buyers for its bills, notes and bonds.
That eventually could push up borrowing costs for all Americans.
Associated Press writers Matt Moore and Melissa Eddy in Berlin, Rob Gillies in Toronto, Carolyn Thompson in Buffalo, N.Y., and Tali Arbel in New York contributed to this report.
>[A] noble cause that deserves putting some small change behind it.<
My favorite charity is the Multiple Myeloma Research Foundation.
http://www.multiplemyeloma.org/
Bob,
E-Trade has much the same thing. These "independent research providers" are computer-generated reports that rely on parameters like earnings, share price momentum, "quality ranking" (whatever that is).
There's little if any human input in these reports. I've looked at them a few times, if for no other reason than to feel sorry for people who trade on this information.
Back to investments....
Was wondering if anyone had a strong opinion about any of these picks before I add them to the high-yield list:
MCG Capital Corporation (MCGC) 12.5% yield
http://www.mcgcapital.com
MCG Capital Corporation is principal investment firm specializing in middle market companies. It targets its investments in small to mid sized companies. The firm prefers to invest in acquisitions, growth financings, and leveraged buyouts. It does not invest in highly cyclical and volatile industry sectors and businesses with extraordinary volatility exposure. The firm seeks to invest in companies having revenues between $20 million and $200 million and EBITDA between $3 million and $25 million. It firm seeks to invest in the form of senior debt, including amortizing, bullet maturity term loans, and revolving credit facilities; second lien debt, that includes term loans on sole source and participant basis; secured and unsecured subordinate loans structured as current interest, deferred interest, and equity linked components; and equity that includes minority equity investments. MCG Capital Corporation was founded in 1990 by Mr. Bryan J. Mitchell and B. Hagen Saville and is based in Arlington, Virginia.
GSC Investment Group (GNV) 12.4% yield
Significant insider purchases recently
http://www.gscinvestmentcorp.com
GSC Investment Corp. is a business development company. The public investment firm specializes in buyout, acquisition, growth, recapitalization, and note financing transactions of middle market companies. It typically seeks to invest in companies that have an EBITDA between $5 million and $50 million. The firm structures its investments as debt and equity investments primarily by investing in first and second lien loans, mezzanine debt, senior secured bonds, unsecured bonds, and preferred and common equity. GSC Investment Corp. is based in New York, New York.
Technology Investment Capital Corp (TICC) 12.0% yield
http://www.ticc.com
Technology Investment Capital Corp. (TICC), a business development company, operates as a closed-end, non-diversified management investment company. The company primarily invests in debt and/or equity securities of technology-related companies that operate in the software, Internet, information technology services, media, telecommunications, semiconductors, hardware, and technology-enabled services sectors. Technology Investment Management, LLC serves as the investment adviser to TICC. The company was founded in 2003 and is headquartered in Greenwich, Connecticut.
Leaving my personal finances out of this, Barack's "proposal" is below. Clinton has said she'd raise the top rate to 39%. The top rate is currently imposed at incomes of >$336,550. Since I live in NYC, that would mean that 50% of every dollar I make over $336,500 goes to the government. Not including property taxes, sales taxes, etc, etc, etc.
Aside from that, raising taxes on dividends means that I have to work substantially longer before achieving a level of income that allows me to move forward with my personal plans. That's the personal disaster.
I don't think "leveling the playing field" should come at my expense. I went to school and made a crappy $16,000/year stipend (in NYC) until I was 28 and worked 90-hour weeks for years after to get where I am.
Enough said for me on this topic. It makes me sick.
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WASHINGTON - Democratic presidential candidate Barack Obama on Tuesday proposed a tax cut of more than $80 billion for low- and middle-income workers and retirees funded by higher taxes on investors and some businesses.
Like other major Democratic candidates, the Illinois senator already has said he would eliminate the portion of the Bush administration tax cuts that benefits families earning more than $250,000 per year, so his tax plan would amount to a significant shift of the tax burden away from low- and middle-income Americans toward the more affluent. One would assume that because he specifies "families"--probably married filing jointly--this would kick in around $125k for individuals.
...Investment income from capital gains and corporate dividends is currently taxed at a lower rate than workers' income from wages. The maximum tax rate for capital gains and dividends, currently set at 15 percent, could rise to "as high as" 28 percent, although the campaign has not yet determined the exact rate they would propose, according to the campaign adviser who briefed reporters.
http://www.chicagotribune.com/news/nationworld/chi-070918obama,1,7664350.story
IDEV:
Just stating the obvious: 12.5% of significant sales is a hell of a lot better than 15% to 20% of almost nothing.
Allergan should be able to quadruple sales of Sanctura within months.
On the face of it, I would say this is excellent news for IDEV. The Allergan folks are experts at marketing things that people don't really need (such as yet another OAB drug). Esprit did a horrible job with Sanctura.
So now we know that all 3 Democratic candidates have their eyes on capital gains/dividends as well as the top regular income tax rate as mechanisms to raise money for universal health care.
This represents a serious dilemma for me: I find Republican's stance on almost everything aside from taxes absolutely revolting; however, a raise in taxes of the magnitude the Democrats are talking about would represent a major disaster for me in that it would delay my personal plans significantly.
Given that the choices from the Republican field are--to put it mildly--pretty bad, I think it is fairly certain we're going to end up with a Democrat president as well as a Democratic majority in Congress.
I hate politics. It injects an element of uncertainty in everything I do. And let me tell you, I'm really looking forward to having >50% of my income taken from me for taxes.
>And the average university professor in the sciences is much smarter than the average doctor.<
Logically, this is a true statement, but not because someone with a PhD is inherently smarter than someone with an MD.
University professors represent the 1 in 100 people with PhDs who actually make it into a faculty position, while (presumably) almost everyone who enters medical school eventually gets an MD. So you're comparing the top 1% of a group of smart people with PhDs to the entire group of physicians, good, average, and bad.