Sunday, November 29, 2015
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Sold Out Of ALDW For $25.77

So far for 2015, it has proceeded very much like the end of 2014 in both scope and suffering endured by my person. Summer is coming to a close and it is time to make some preparations.

I wanted more cash; watching everything that is unfolding, and knowing the frequency of recessions in the United States, I have this horrible fear that we are not done going lower yet. China is teetering on the edge of ruin; a silly place that encourages a 5:4 male to female ratio, that likes to build huge train transit systems to everywhere but where they need to be, and that loves constructing entire Potemkin cities utterly devoid of people.

So I sold entirely out of ALDW. This is exactly what it looks like; selling winners and holding on to losers. I took my almost 40% gain and walked.

The trouble is that this 40% is counterbalancing some pretty ruinous action on the other half of my portfolio. HCLP has sunk lower that I ever believed HCLP could sink. BAS is a smoldering pile of ruin. VOC…don’t even talk about it.

The oil trade is dead, brought to the end in a most severe fashion. It is hardly the only tale of sorrow, but it is perhaps the worst.

And if we see Recession 2015: Welcome The Fuck Back materialize (trademark), well then…

Oil would stay down and ALDW and all fuel ventures would join them overnight. No thank you.

At this junction, betting we don’t go into a recession is equivalent to just betting on oil. I don’t need complicated hedges, thank you very much. They’re more likely to strangle me at inconvenient moments than actually help here.

If the recession fears don’t pan out, then make no mistake everything will be going much higher very soon.

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New Position ALDW

This morning I purchased a full 10% position of ALDW for $18.73 per share. The company is on fire from cheap crude oil and a wide crack spread. Prices for refined products like gasoline have firmed up noticeably in the past month or so, and the company’s 2014 numbers were solid.

I have a full write up on ALDW coming in the next edition of the Income Investment Report (to be released this weekend) and will be releasing the analysis of this company as a freebie to the masses, as a token act of goodwill.

My cash position is down to 30%.

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Started A New Position In TIS

I purchased shares of TIS for $25.57, bringing my cash position down to 50%.

TIS is a smaller scale North American company that specializes in toiletry paper products. They have good financials and a reliable little operation. A nice little cash generating machine which, as of today, is available at an 8% discount to yesterday.

Not exciting or interesting at all, yet well positioned.

I’ve also got a hunch that companies like TIS will have surprise growth ahead. As I look at more or less the complete dissolution of an entire economy in South America, I can’t help but think that this kind of boring business will have some interesting opportunities over the next few years.

Venezuela is not going to stabilize without outside help. Maduro is too stupid to pull this off alone; the bus driver is going to need to allow some major imports of foreign goods at market prices to stabilize his economy. Or, more likely, whichever successor is first to be found standing over Maduro’s lifeless body will. An entire country is not going to be supplied by any one source, so I’d put good odds that manufacturers of basic products like this, all over North and South America, will stand to profit as supplies redirect southward.

Venezuela may be the worst, but hardly the only party here. There are a handful of similar styled countries in South America that have looming problems and will likely end up becoming ripe targets for North American supply.

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Put 25% Cash To Work

Okay today is strong. There are dark spots, like the dollar and bonds. I know I said I would wait, but if I apply just 25% cash at these levels, I could get back to even quickly enough.

So I bought BAS, HCLP, and some VOC.

75% cash.

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