Originally Posted by
Sanlmar
The ratings agencies are way behind on bonds. Wouldn’t you agree Daly? This is the dark and scary stuff.
How do you work out the threat that government involvement in the consumer discretionary stuff like cruise won’t be dilutive to equity?
Like they are going to be commanded by the populist public to do so, no?
Came this close to shorting for a scalp today but no balls. It just feels wrong reaction .
Talk to me. I’ll play nice.
Still HODL EMINI NASDAQ 100 from close yesterday so obv I’m soft as a grape. I’m losing it.
I don’t pay any attention to rating agencies and neither do you. Total joke.
There is an order tonthhngs that an investor needs to worry about in this environment.
#1 Bankruptcy - can’t buy something if it’s going under. All of that fear (for the most part) went out the door between the Fed and the Bailout law.
2. Dilution - For better (for shareholders) or worse (for taxpayers) the Bailout is a giant loan facility at a decent rate. So airlines have literaly nothing to worry about anymore. With them it’s a low risk waiting game. All the airlines are ~ 50% off the high. Pick one and wait enough time and you got a double.
Cruise lines and Casinos have no shot at a bailout so you really need to do homework. These two industries (CCL and MGM are what I’m tracking the closest) are ~70% off the high. Balance sheets are uber important and cash is king. CCL had a B to start added 3 more from existing credit lines and then last night added 6 more in a deal with wall st banks (GS and JPM) where they agreed to sell them 1.3B of new shares at a market rates so roughly a 10% dilution in exchange they now hold almost 12 Billion in cash. They can go three years without a passenger and still make payroll. CCL isn’t going out of business and now have partnership with NY banks. You think this stock is going to get a bump in the next 1-2 years now that Wall St owns a piece? MGM, almost to its detriment, has so much cash and owns so much equity in its properties it doesn’t need to pimp itself out to Wall Street. It’s a similar waiting game to owning a airline stock.
Jet Blue, MGM and CCL. I’m 50% invested at the moment (little more weight to CCL & MGM) with the other 50% in dry powder in case I need to average down - which in some ways I hope i have too.
Reply With Quote