Just Remember That Seeking Alpha is a Business

I watch a few folks on Seeking Alpha–let me repeat–I watch a few folks on Seeking Alpha. I say watch because I will take any good idea I can find, but honestly most folks on SA don’t write to help you and hear me out–they write to create revenue. I have no problem whatsoever with that, but I do have a problem with folks who are ‘experts’ in one area holding themselves out to be expert in everything–most of this based on quotes from Warren Buffett.

I had mentioned a month or so ago, that all the ‘heros’ on SA that mistook dart throwing luck for skill, would soon learn that owning stocks and bonds is not a 1 way street. The thrashings are now occurring. Some authors should feel very humbled right about now.

Everyone has to learn that SA is a business–it is about creating revenue–not about being right so use it for some ideas–don’t take anyone’s word on a ‘buy’. Do your own due diligence–don’t blame anyone else for your personal lack of homework.

29 thoughts on “Just Remember That Seeking Alpha is a Business”

  1. Grid, I think mentioned on here recently but don’t forget the bankruptcy of Washington Public Power WPPSS I enjoy the company of all the people here on III
    I have seen a lot of mention on this site of SLMNP an I had some interest in it , but for people new to this site I would like to mention one of my rules in general is stay in the sweet spot of around 25.00 to 40.00 per share. the best example I can give is I can only buy one once of gold for 1,200.00 but I can buy 75 ounces of silver at 16.00 for the same amount of money. This also applies to stock. I may be able to buy 2 shares of SLMNP at 1,0421 but I can buy 41 shares of a 25.00 stock.
    GLTA

    1. Grid, My apologies My wife pointed out WPPSS was in the 20th century. I admit I misspoke when you said the only utility to go bankrupt in the 21st century and I replied.
      Time flies when your having fun. Seems not that long ago. Excuse my error.

      1. Good morning Charles. WHOOPS fiasco wasnt a utility. It was a consortium for nuclear plant construction. Building nukes is the only thing that would be a flag for me. Best of my research indicates no T&D only utility has ever suspended payments on preferreds since great depression of 1930s. And even then in a couple years later they were paid in full. I dont think one should just blindly invest in utilities but they generally are very safe. The 08-09 crisis most recently proved that in the preferred market. They held up infinitely better than the other sectors during that crisis.

        1. Gridbird, the only secular risk to that record I can see is the effect of local alternative energy generation. To the extent that point of service generation and storage take hold the utility grid could become more a stranded asset. In my part of the country, building codes will require solar panels for new residential. They already require an EV 240v plug in the garage. An EV is also a battery storage system when plugged in. Distributed generation and storage could be a big threat to ute models. I seem to remember some relevant stories a few years back about the effect on utes in Germany as they went renewable. I’ll find them if I can.

          1. Qniform, yes well aware of that. That is why the T&D utes are the safest. Everyone cant be grid free. In fact the batteries and stuff are now being integrated into producers as cheaper peakers and such. And T&D utes arent dummies. Notice the pricing trends over the years? They are going the base monthly hook up fee and minimum bill route. And then raise them…Very progressive and sneaky for Utes. They could care less about power costs and stranded plant assets as it isnt their problem. The grid needs to be here…The power suppliers and builders of plants are the exposed ones to stranded assets.

    1. Please note – I did not post this message for any political purposes. It’s just a video from a SA advisor that was interviewed some time ago. You can make your own decision like I have done in the past.

      1. Kaptain, I seen that previously compliments of you. It was painful to watch as he was emaciated on a national tv show. It was almost as painful to watch that as it is to read his weekly recommendation of perpetual wallet flattener dog SKT from $30 on down to where is now.

  2. I subscribe to Alpha Gen, mostly for CEF and preferred recommendations. I also subscribe to Colorado Wealth Management for REIT, BDC, and preferred recommendations. Happy with both. The number 1 subscribed service by far is Rida Morwa and many of his recommendations are highly risky. I am a frequent visitor to Innovative Investor and am grateful to Tim for maintaining the site. Lots of valuable info.

  3. I’d like to call out an exception to to the comments about Seeking Alpha.
    Take a look at Yield Hunting by Alpha Gen Capital on that platform. You might see a familiar name on this board involved in their preferred analysis. The main person that operates this site is top notch with regard to investment savvy and ethics.
    Specializes in CEFs but provides excellent overall investment guidance. That’s my take in any case.

  4. Seeking Alpha is like a buffet. There’s greasy stuff you should avoid. But there is a healthier salad section. I learned how to evaluate muni CEFs from the more conservative Seeking Alpha authors. And munis are holding up my house right now.

  5. I visit SA less and less. My education is in accounting. When a writer highlights financials and I look them over I often come to a different conclusion. Go figure.

  6. Tim, thanks for this post. I came to that conclusion many moons ago, when the owners of the site launched their marketplace service to monetize their efforts. Can’t blame them for that, as you say, but the atmosphere at the site changed from a serious place of discussion to one resembling a barking carnival. I seldom visit anymore.

  7. I have used it for ideas over the years. One of the intuitive things I watch for is how popular a certain stock is, by seeing how many articles and how much people comment on it. Remember Sea drill ?
    One thing that is in short supply is writers similar to you Tim who look at a “safe” investment. I see more articles on common than preferred and I see more commentators who call themselves investors when they really are traders.
    The push lately for pop up’s pushing their premium service may backfire if too many individual investors get burned in a downturn

    1. Right – the more articles a company has written about it on Seeking Awful, the greater chance it’s a turd. Especially if it is a low market cap/low price stock.

  8. Tim my friend; I agree with you about 1,001%. There are many many “HOMERS” on S.A. I spend quite a bit of time reading many articles over there and just about everybody becomes a “CheerLeader” for the writer. If somebody brings up a negative he usually gets attacked very quickly. I have 158 followers over there and I try hard to be careful what I post. The other day I asked the writer of an article on ALIBABA as to how he might go about trusting the accounting of a Chinese company when it is well known that the Chinese are less than honest when it comes to just about everything. Of course I was attacked for even questioning their accounting methods. I take the site with a “grain of salt” anymore because most of them are like you say just trying to create some revenue for themselves. Does anyone own SYF+A???? Its trading at a pretty good price right now.

    1. Chuck P–right on. I have no problem with what is a capitalistic model–but the hubris of many authors drives me crazy.

      1. Tim, they are play hour wanna be balance sheet readers who roll in the trash dumpsters chasing yield. I couldnt count how much money those dummies have cost people in Frontier, CBL, WPG, SKT, and PEI…In addition to the dumb wallet killing ideas like 2 times leveraged MPL funds, etc. I sit in the peanut gallery blasting them, showing their losses but most get scrubbed.

        1. I suspect that if this “correction” becomes worse and prolonged, that SA will see a decline in views & readership. Rida Moron subscriptions will likely see some reduction in revenue, but he’s still sitting pretty even if he loses 1/2 of what he gets now.

          The past 3 days have been pretty rough, even for my illiquid and income portfolio. Seems like folks are just dumping Preferreds indiscriminately – they are probably happier with a 1.7% MM yield than a 4.9% Preferred yield.

          Bought more RNR-E and RILYM below par.

          1. Inspy, it sure isnt your IPWLK causing you the heartburn though…I got in past week or so for the zillionth time for a couple hundred at $103.50 blend.

            1. Our Ute illiquds are a lagoon of calm in this Ocean of Red. Even red=headed stepchild IPLDP seems to be doing well on XD today.

              Rest of the Preferred/BB world not feeling the calm, however. Many good names down 1-2.5%. I’m getting the itch to add more, but suspect we have a bit further down to go.

              KTBA at $27 would be a good buy.

            2. Hi Grid –
              Could you, please, enlighten me on why you feel comfortable purchasing IPWLK above the $100 Call price?
              Thanks,
              Malka

              1. Malka, I only reenter at $103.50 ish tops and that is when its about to kick out next divi and basically the next one is in the bag. There really has only been one shot below par in years. And that was last summer 10-20k sell off by someone liquidating. I bought a big slug at $98 ish and flipped them days later at $102 without any sweat.
                As you can see by recent days some of these preferreds have dropped more percentage wise on price movement than one could lose owning IPWLK on a call. I was sensing turbulent waters past two weeks and tightened up the ship..Look at IPWLK price chart..Overall through the years its a rock of Gilbrater. But most quality illiquid utes bought at correct entry points are.
                Some stay out of cash forever and wait for sell offs to exploit. That can take a long time. I use illiquids as my “cash” and earn money through the months and or years waiting for the liquids to blow up. That happens more frequently than a high quality illiquid. It how I profited bigly from 2013 Taper Tantrum, 2016 recession scare, and Dec 2018 equity credit spread blow out event.

                1. Grid- Thanks! Love learning from you.
                  My cash account needs some of these gems and even in this nasty market
                  I can’t find any of these “oldies but goodies”. I wish SLMNP would come down to the low prices we saw a while back. I would be buying a truckful.

                  1. Malka, SLMNP is a good issue, but I wouldnt let the terms blind one from over allocating. It really is a subsidiary preferred not the big LYB corp preferred. I noticed its name has been changed to Lyondellbasell Advanced Polymers Inc, from A. Schulman to represent what the actual name of the division is. Its quit possible problems could occur from that subsidiary and LYB not be responsible to continue paying.
                    Im not a legal expert on this, but the devil is always in the details which I am not an expert to specifically analyze.
                    No one can guarantee anything, but one can lean into issues that will at least pay and are prone to less volatility. Have you considered IPLDP?

                    1. “No one can guarantee anything, but one can lean into issues that will at least pay and are prone to less volatility. Have you considered IPLDP?”

                      Sounds like you have become more cautious on SLMNP. Do you still own it?

                    2. Furcal, yes I do. I was mentioning IPLDP as something to look at knowing Malka already had SLMNP. I was sensing a “doubling down” which makes me nervous if I dont completely understand something.
                      IPLDP and SLMNP are in effect sisters as they are subsidiary preferreds. But I completely understand Interstate Power…I dont understand Lyondellbasell Advanced Polymers subsidiary financials and how its capitalized and implications of parent paying or allowing payment if they had a rough spot. I cant find or at least figure out these details. Im just not going to stick my neck out that far like I will with a ute. Chemicals can be cyclical also.
                      Utes are hard to kill off. Look at PGE only ute I know of to have gone bankrupt in 21st century and they managed to do it twice. And all be damned if the preferreds are going to survive both bankruptcies and get paid in full again.

    2. Where do you guys/gals go for info such that you find on SA…but is written for my benefit and not the writers? I do get good ideas, but I do it like watching the ballgame with the volume turned off. Thanks!!

Leave a Reply

Your email address will not be published. Required fields are marked *