Replies to post #7173 on The Rising Influence of Rising Affluence

[DewDiligence]

VALE would be a better LTBH [than CLF]

VALE would clearly be the better stock if not for three things:

1) A government-led consortium owns a controlling stake in the company, which makes you and I minority shareholders.

2) As a consequence of 1) above, the government may request (i.e. demand) that VALE do things contrary to the interests of minority shareholders, such as investing more in domestic steel production.

3) Unlike CLF, VALE has no buyout vig.

All told, it’s unclear, IMO, which of the two stocks is a better buy for the long term. Hedging your bets by owning both stocks is not a bad idea if you are playing for a turnaround in the iron-ore sector.

[DewDiligence]

Isn't CLF bordering on extinction

Not at all; CLF has ample liquidity with no debt maturities during the next couple of years—see #msg-84849534 and #msg-86289416.