Hello Pezz, Today’s Report: Tankers blowing up in the gulf, Japan tanking in Pacific, pacific confiscation deluge washing over Argentina, deluge of confiscation in Zimbabwe, Hong Kong on the precipice, Bush about to make speech, follow-on act by Greensputin.
What to do?
(a) I have activated and drawn on my Japanese Yen line of credit, and the funds (amounting to 5.2% of today’s NAV) will be available day after tomorrow, credited to my Yen a/c. I do not yet know what I will do with the Yen, but I know I will not be returning it to the Japanese;0)
I will immediately (October 9th) convert most of the sure to be worth-less Japanese currency into soon to be worth-less USD, HKD, AUD, and EURO currencies. I will quickly use the various currencies to buy shares (or sell puts against). I may even buy some Japanese shares.
(c) I received notification that my precious Hub Power of Pakistan will pay a dividend of USD 1.3844 per share (value date Sept 16th). I had bought my shares for USD 9.75 per share on July 16th 2002, and I suppose 14.2% for every few months is a fair return, courtesy of WATWOT effort:
Message 17742648
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July 16th, 2002
BTW, my Hub Power (Pakistani power plant traded in London) got executed, as in bought, at USD 9.75 and below. I am now looking forward to increased WAT-WOT dividend payout over the coming 12 months of say around 30-40% yield. It will be a race against Axis of Evil and the Matrix of Doom, as in dividend recovery vs. capital wipeout, by lack of effective law, poor regulatory environment or nuclear winter.
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Details of my Hub Power DD is here:
Message 17738578
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July 15th, 2002
directly invested (my investments and speculations has little to do with politics) in the continuing televised success of WAT-WOT-whatnot via the London Stock Exchange:
online.wsj.com.
“First, Hubco's strong cash flow allows it to pay a historically rich cash dividend, now about 31%, which amounted to nearly 40% of its earnings per share in fiscal 2001. Second, Pakistan is in the midst of a regulatory overhaul of its utilities sector, which analysts say will benefit Hubco's business in the long run. Third, at a forward price-to-earnings ratio of just 4.4, according to Jehangir Siddiqui, it trades at a significant discount to the Karachi market”
Pakistan government had never honored the contract from day 1 of Hub operation until WAT started, and US rescheduled Pakistani debt, and Britain tagged along with some moral support. Hub has many international institutional shareholders, controlled by International Power of Britain, and owes 49 international banks a bundle of money.
The business model of Hub is simple: the US deploys its troops, the Japanese pumps in its money, Russia offers its verbal support, China chucks in its acquiescence, Britain proffers its shoulder, India shouts threats, Iran does whatever, Hub Power gets paid its contractual tariff rate for power generation, and a Trini in Hong Kong can thus fund more platinum watches.
What do I know about Pakistan? Nothing
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(b) I spoke to my friend who instigated this:
Message 17205256
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March 16th, 2002
I have decided to buy into the real estate syndicate scheme I spoke about yesterday, buying up a basket of ground level shops in the busiest, and therefore unaffected, shopping district in Hong Kong surrounding a planned up-market two city block development of hotel, office, and shopping center, with lots of parking (precious HK commodity). The complex should be up in 24 months (HK builds really amazingly fast) and mature within 12 months upon completion.
The fund will be leverage 1:1, totaling USD 40 mm. The funds will be committed and drawn upon as needed, with the first 25% down.
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The syndicate has just purchased more retail space, including a premise currently leased out to a brothel, a possibly recession-proof tenant.
My friend is (a) excited about the values we have picked up, and (b) the values that will yet materialize.
Chugs, Jay |
