Headlines of Interest

15 thoughts on “Headlines of Interest”

1. Had a Merchant’s 5.35% CD mature overnight which I was aware of (8/9/24 maturity) but also a JPM 5.20% as well – supposed maturity 11/8/24. Not sure why they would call the latter with their CDs out there up to 5.50% (I have a couple) but I am assuming it has to do with the earliest available call date.

   Nevertheless, I have quite a large chunk of $$$ now to figure out what to do with next week!

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2. I did a quick read through of Runway, Oxford Lane, MFA, Liberty Broadband and CTO
   I admit I don’t understand everything I am reading, but nothing stood out about any of them, except CTO.
   Between buying back stock, issuing more stock, dividends seemingly more then basic income from the business not counting T bill income, swapping out debt at a decent interest rate but increasing amount borrowed to 800 million, multiple classes of common stock ( A, B, C) and preferred these reports read like a lot of financial juggling.
   On the other hand I read the report for
   CTO, selling one property, investing in a 5yr non callable note, buying 3 other properties, and announcing a 96% occupancy rate once signed tenants move in sounds almost like a plain vanilla investment compared to everything else I looked at and read.

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   1. with pfds of HOV CTO and Liberty this interests me so thanx. Yes Albright at CTO has done a great job navigating the transition from corp to REIT, narrowing focus geographically and keeping debt in check. HOV had two credit agencies upgrade it after cleaning up a lot of debt and is more in ‘growth’ mode maybe the decline in mtge rates helping a little on that front, of course non cum pfd and risky, that big chunk of Charter stock makes the Liberty pfds quite secure, may even add some if volatility keeps up.
      Apparently the Hoya bunch joined Brad Thomas’ group at SA, Alex at Hoya’s weekly updates were so helpful in keeping up w REIT goings on hopefully they continue as I have a lot of REIT pfds now.

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      1. Bea, I like REIT related businesses, and like you I have been picking though the companies. I think a lowering of interest rates will help the sector but still too early I feel for some parts of the sector like builders HOV being one and GRBK being another. Don’t get me wrong, these are good candidates and worth watching but builders go in cycles and are not long term holds for me. AHH is a unique one, similar to what Brad Thomas used to do. They build and are a construction company that also holds RE. Just that they got caught holding too much commercial RE. Saul centers is also a combination builder and REIT property holder but they went more toward shopping centers and apartment / housing? good combination. People live in your housing and shop in the nearby shopping centers.
         As for Liberty, I tend to shy away from something I don’t understand completely. Maybe as a owner of a regional cable and internet provider it gets bought out at a future date or it goes along playing in its own sandbox I don’t know.

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   2. I’ve got AHH-A, BFS-D, and UMH-D in the REIT space. Long term holder, don’t understand the weakness because all 3 businesses seem to be performing. UMH-D and AHH-A have woken up recently, finally above my basis.

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3. The CUBI situation is interesting. Looks like no monetary fines from what I read.

   Added some of their sub debt CUBB today.

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   1. And yet CUBB dived another 3.8% today.
      I own it. I don’t understand it.

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      1. I own it too. Mr. Market may believe that other cockroaches could appear.

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         1. I read through enforcement agreement and decided not to sell. I have an overweight position in both preferred. The bank is one of the few remaining (after Silvergate& SVB) friendly to fintech/crypto startups, so no surprise the hand of the deep state is slapping them with red tape to chew on.

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            1. Re CUBI interesting point by Tyler Winklevoss on X:

               “What exactly did Customers Bank do to earn this regulatory straitjacket and be forced to abdicate its own business judgment and decision-making to the Fed with respect to banking crypto companies? That part is entirely unclear. The non-allegation allegations are so hand-wavy and vague, they would make Franz Kafka blush.

               All we know from the 13-page order is that during the most recent examination and inspection, the Fed “identified significant deficiencies.” Not a single fact or tangible finding, however, is provided to back up this claim. The public must take the Fed’s words for it”.

               Agreed. If there were any substantive findings they would have certainly been highlighted and paraded.

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               1. Just an observation, Dan:

                  Winkevoss has a very vested interest here. Just talking his book.

                  Also, I suspect that the “deficiencies” in the “most recent examination and inspection” were communicated to the bank as part of those examinations and inspections. They just weren’t put in the letter (or on twitter).

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                  1. So the elephant in the room here is the digital assets. The Feds want control and oversight (over literally everything), so hence the heavy-handed enforcement action. How dare a private company enable transactions that Darth Vader could not inspect, control, and interrogate?

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                     1. No Comment
                        https://seekingalpha.com/article/4711630-the-biggest-systemic-risk-to-the-banking-system

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                        1. yes you are not allowed to comment! lol. there is more and more of that over there at SA but especially him, the fear monger of disaster hitting all our banks going to zero EXCEPT the ones he says are safe IF you subscribe. I mean really?? he is a big baby and cant deal w things, cries if they dont publish his whacky articles, says the SAME thing in every one of his articles exact same thing..I get technical analysis and use it to a degree but geez.

                           I have no problem rolling tbills or being in a tbill etf which I am but because it gives me more interest than these stingy banks do.
                           I did read that and will say these ‘hedges’ and ‘plays’ that are being made around the world can blow up hard, the risks to letting private credit run amok are real and the push button movement of money (by people or algos) is a risk. We saw that this week w the carry trade- borrowing in cheap yen denominated loans and buying in other currencies- these things flush out and to me rather than being ‘end of the world gloomy’ about it, I take advantage of the volatility. Bea rant..sorry!

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                           1. It’s all intertwined. With reading the quarterly reports the BDC’s and CEF’s have lines of credit with banks who are not supposed to be doing direct high risk loans that these companies are doing. Does that make the bank lines of credit any safer?