{"id":1379,"date":"2007-10-29T22:26:53","date_gmt":"2007-10-30T02:26:53","guid":{"rendered":"http:\/\/www.prefblog.com\/?p=1379"},"modified":"2007-10-29T22:26:53","modified_gmt":"2007-10-30T02:26:53","slug":"october-29-2007","status":"publish","type":"post","link":"https:\/\/prefblog.com\/?p=1379","title":{"rendered":"October 29, 2007"},"content":{"rendered":"

Well! There I was, all set to attend David Berry’s contested hearing with RS<\/a>, having spent all weekend choosing overly ripe tomatoes to hurl at any disingenuous Scotia executives with the effrontery to show up … and now I find that it’s been postponed<\/a>! I have no idea what’s going on. Maybe RS has gotten a little embarrassed about being used as a pawn in a contract negotiation. Maybe somebody’s realized that if Jesus Christ Himself was subjected to the same level of scrutiny as Scotia has inflicted on Berry, then there’d be equal cause for firing, mudslinging and character assassination. Stay tuned!<\/p>\n

Possible Fed moves this week are being discussed<\/a> all over, with the consensus calling for a 25bp cut<\/a>\u00a0to 4.50% (and Bill Gross of PIMCO is calling for 3.50% in the near future<\/a>). There is more than one<\/a> report that the Fed is unhappy with such certainty<\/a>, but I’m not convinced that this is the case. The Fed is adept at manipulating opinion; if they were truly unhappy with the forecasters, they would send a few hawks out to make speeches about the dangers of hyper-inflation. Poole has been given a lot of attention in the past few months; the WSJ\u00a0has grilled him about his high profile<\/a>.<\/p>\n

The Super-Conduit debate continues, with a report that<\/a>:<\/p>\n

the banks will earn 1% on structured investment vehicles of less than $5bn, and 1.5% for SIVs over $15bn
\n…<\/strong>
\nThe prospectus also details what SIVs will receive for selling their assets to M-LEC. Qualifying SIV holders will be eligible for up to 94% of the value of the assets they sell in cash, or 89% cash and 5% in senior capital notes, in the form of medium- term notes, that will participate in part of the upside when the assets mature.<\/p><\/blockquote>\n

I have not yet seen this report confirmed by more usual sources – but I’m looking! I guess my reaction is dependent upon the interpretation of the word “value” in the above paragraph. If we can presume that “value” means “recent trading prices in small lots”, then I believe I have every right to refer to Super-Conduit as Vulture Fund<\/a> … but if “value” means something else, then we’re back to uncertainty. We shall see!<\/p>\n

Well … PerpetualDiscounts were whacked again today – and the Question Regarding BAM.PR.N<\/a> I received today makes me wonder if we have reached the point of self-feeding gloom-and-doom, otherwise known as capitulation. Long Term corporate bonds yield about 5.8%, according to Canadian Bond Indices<\/a> … at 5.65% Dividend, the perpetual discounts have an interest equivalent of 7.91%.<\/p>\n

Ah well. Remember why you bought them! In the absence of default – which, for the the companies in the indices, seems no more likely than ever – I’m willing to cash the dividend cheques for quite some time.<\/p>\n

\n\n\n\n\n\n\n\n\n\n\n\n
Note that these indices are experimental; the absolute and relative daily values are expected to change in the final version. In this version, index values are based at 1,000.0 on 2006-6-30<\/strong><\/td>\n<\/tr>\n
Index<\/td>\nMean Current Yield (at bid)<\/td>\nMean YTW<\/td>\nMean Average Trading Value<\/td>\nMean Mod Dur (YTW)<\/td>\nIssues<\/td>\nDay’s Perf.<\/td>\nIndex Value<\/td>\n<\/tr>\n
Ratchet<\/td>\n4.93%<\/td>\n4.88%<\/td>\n438,210<\/td>\n15.58<\/td>\n1<\/td>\n+0.4905%<\/td>\n1,049.2<\/td>\n<\/tr>\n
Fixed-Floater<\/td>\n4.88%<\/td>\n4.82%<\/td>\n99,789<\/td>\n15.74<\/td>\n7<\/td>\n+0.0588%<\/td>\n1,039.1<\/td>\n<\/tr>\n
Floater<\/td>\n4.51%<\/td>\n3.86%<\/td>\n68,880<\/td>\n10.69<\/td>\n3<\/td>\n+0.2241%<\/td>\n1,041.3<\/td>\n<\/tr>\n
Op. Retract<\/td>\n4.88%<\/td>\n3.76%<\/td>\n78,864<\/td>\n3.40<\/td>\n15<\/td>\n-0.0742%<\/td>\n1,025.5<\/td>\n<\/tr>\n
Split-Share<\/td>\n5.20%<\/td>\n5.14%<\/td>\n86,251<\/td>\n4.10<\/td>\n15<\/td>\n-0.0448%<\/td>\n1,037.8<\/td>\n<\/tr>\n
Interest Bearing<\/td>\n6.25%<\/td>\n6.33%<\/td>\n62,221<\/td>\n3.59<\/td>\n4<\/td>\n-0.1004%<\/td>\n1,057.9<\/td>\n<\/tr>\n
Perpetual-Premium<\/td>\n5.74%<\/td>\n5.66%<\/td>\n102,241<\/td>\n10.48<\/td>\n17<\/td>\n+0.0390%<\/td>\n1,000.9<\/td>\n<\/tr>\n
Perpetual-Discount<\/td>\n5.60%<\/td>\n5.65%<\/td>\n320,818<\/td>\n14.44<\/td>\n47<\/td>\n-0.2680%<\/td>\n901.0<\/td>\n<\/tr>\n<\/table>\n<\/div>\n
\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n
Major Price Changes<\/strong><\/td>\n<\/tr>\n
Issue<\/td>\nIndex<\/td>\nChange<\/td>\nNotes<\/td>\n<\/tr>\n
BAM.PR.M<\/td>\nPerpetualDiscount<\/td>\n-3.2812%<\/td>\nNow with a pre-tax bid-YTW of 6.29% based on a bid of 19.16 and a limitMaturity<\/a>. Closed at 19.16-35, 3×5, much higher than its pair<\/a>, BAM.PR.N, which closed at 18.35-40, 40×1.<\/td>\n<\/tr>\n
GWO.PR.I<\/td>\nPerpetualDiscount<\/td>\n-2.1608%<\/td>\nNow with a pre-tax bid-YTW of 5.86% based on a bid of 19.47 and a limitMaturity.<\/td>\n<\/tr>\n
BNA.PR.C<\/td>\nSplitShare<\/td>\n-1.7217%<\/td>\nNow with a pre-tax bid-YTW of 6.76% based on a bid of 20.55 and a hardMaturity<\/a> 2019-1-10 at 25.00.<\/td>\n<\/tr>\n
CL.PR.B<\/td>\nPerpetualPremium<\/td>\n-1.7154%<\/td>\nNow with a pre-tax bid-YTW of 6.19% based on a bid of 25.21 and a call 2011-1-30 at 25.00. OK, so now we’ve got a Pfd-1(low) (DBRS<\/a>) \/ P-1(low) (S&P<\/a>) issue, a PerpetualPremium, yielding 6.19%, which is 8.67% interest equivalent. Go figure. I just don’t know what to say. Remember when I couldn’t understand why they hadn’t been called<\/a>?<\/td>\n<\/tr>\n
ENB.PR.A<\/td>\nPerpetualDiscount<\/td>\n-1.6667%<\/td>\nNow with a pre-tax bid-YTW of 5.77% based on a bid of 24.19 and a limitMaturity.<\/td>\n<\/tr>\n
BAM.PR.N<\/td>\nPerpetualDiscount<\/td>\n-1.6086%<\/td>\nNow with a pre-tax bid-YTW of 6.57% based on a bid of 18.35 and a limitMaturity. 9.20% interest-equivalent. Is this capitulation selling<\/a>? See BAM.PR.M, above.<\/td>\n<\/tr>\n
BMO.PR.J<\/td>\nPerpetualDiscount<\/td>\n-1.2375%<\/td>\nNow with a pre-tax bid-YTW of 5.52% based on a bid of 20.75 and a limitMaturity.<\/td>\n<\/tr>\n
RY.PR.F<\/td>\nPerpetualDiscount<\/td>\n-1.2285%<\/td>\nNow with a pre-tax bid-YTW of 5.55% based on a bid of 20.10 and a limitMaturity.<\/td>\n<\/tr>\n
SLF.PR.D<\/td>\nPerpetualDiscount<\/td>\n-1.1990%<\/td>\nNow with a pre-tax bid-YTW of 5.47% based on a bid of 20.60 and a limitMaturity.<\/td>\n<\/tr>\n
BAM.PR.K<\/td>\nFloater<\/td>\n+1.0656%<\/td>\n\u00a0<\/td>\n<\/tr>\n
PWF.PR.L<\/td>\nPerpetualDiscount<\/td>\n+1.1364%<\/td>\nNow with a pre-tax bid-YTW of 5.76% based on a bid of 22.25 and a limitMaturity.<\/td>\n<\/tr>\n<\/table>\n<\/div>\n
\n\n\n\n\n\n\n\n\n
Volume Highlights<\/strong><\/td>\n<\/tr>\n
Issue<\/td>\nIndex<\/td>\nVolume<\/td>\nNotes<\/td>\n<\/tr>\n
RY.PR.A<\/td>\nPerpetualDiscount<\/td>\n95,000<\/td>\nScotia crossed 60,000 at 20.25. Now with a pre-tax bid-YTW of 5.52% based on a bid of 20.20 and a limitMaturity.<\/td>\n<\/tr>\n
RY.PR.G<\/td>\nPerpetualDiscount<\/td>\n88,800<\/td>\nNow with a pre-tax bid-YTW of 5.55% based on a bid of 20.30 and a limitMaturity.<\/td>\n<\/tr>\n
MFC.PR.B<\/td>\nPerpetualDiscount<\/td>\n84,850<\/td>\nNow with a pre-tax bid-YTW of 5.43% based on a bid of 21.65 and a limitMaturity.<\/td>\n<\/tr>\n
GWO.PR.G<\/td>\nPerpetualDiscount<\/td>\n70,570<\/td>\nNow with a pre-tax bid-YTW of 5.80% based on a bid of 22.66 and a limitMaturity.<\/td>\n<\/tr>\n
PWF.PR.L<\/td>\nPerpetualDiscount<\/td>\n61,150<\/td>\nNow with a pre-tax bid-YTW of 5.76% based on a bid of 22.25 and a limitMaturity.<\/td>\n<\/tr>\n<\/table>\n<\/div>\n

There were twenty-eight other index-included $25.00-equivalent issues trading over 10,000 shares today.<\/p>\n","protected":false},"excerpt":{"rendered":"

Well! There I was, all set to attend David Berry’s contested hearing with RS, having spent all weekend choosing overly ripe tomatoes to hurl at any disingenuous Scotia executives with the effrontery to show up …<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[15],"tags":[],"class_list":["post-1379","post","type-post","status-publish","format-standard","hentry","category-market-action"],"_links":{"self":[{"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/posts\/1379","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/prefblog.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=1379"}],"version-history":[{"count":0,"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/posts\/1379\/revisions"}],"wp:attachment":[{"href":"https:\/\/prefblog.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=1379"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/prefblog.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=1379"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/prefblog.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=1379"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}