Saturday, August 18, 2012

Weekend Links

Payment processing: "Connecting the bank accounts of buyers and sellers will never be as valuable nor defensible as connecting buyers and sellers. Google delivers customers at the top of the funnel, and payment companies serve the prosaic, but necessary, task of shuffling funds at the end."

Gary North with a theory on the government priority of payments, i.e. what they will default on first: "The U. S. government has promised more than it can deliver. There will come a point when it will have to renege. It will start at the top of the income brackets and work down. Politicians will seek to delay an across-the-board reduction of payments. But the magnitude of the unfunded liabilities is so vast that Congress will be trapped. It will default in stages, but it will default."

DRACO broad spectrum antiviral: "Currently there are relatively few antiviral therapeutics, and most which do exist are highly pathogen-specific or have other disadvantages. We have developed a new broad-spectrum antiviral approach, dubbed Double-stranded RNA (dsRNA) Activated Caspase Oligomerizer (DRACO) that selectively induces apoptosis in cells containing viral dsRNA, rapidly killing infected cells without harming uninfected cells."

Apparently the Russians have an effective antiviral that we've never heard of?: "In 1990, ARB was approved for treatment and prophylaxis of influenza A and B infection and since then has been widely used in Russia. [... S]ound prophylactic effect of ARB had been demonstrated in numerous clinical studies of various sizes. Daily oral administration of 200 mg doses of ARB in pockets of respiratory infections (e.g., families, hospital wards) during the epidemic outbreak of influenza B reduced the number of diseased by 86.3%."

ATP finally files: "Ravi Kamath, high-yield analyst with Global Hunter Securities, has been bearish on ATP for years and had a sell rating on ATP debt since early 2011, when it was trading at 104 cents on the dollar. It’s fallen to 29 cents now. Kamath says ATP’s problems reach far beyond the moratorium. He keeps a spreadsheet with 105 instances from the past decade where he says ATP has overpromised and then underdelivered."

ATP CFO declaration in support of first day motions: "[T]he Debtor stipulates that as of the Petition Date, the value of the collateral securing the First Lien Credit Facility exceeded the aggregate amount of the obligations thereunder. The Debtor believes that the obligations owed to the lenders and the swap counterparties under the First Lien Credit Facility are fully secured based on at least three indications of value. First, immediately before the Petition Date, the Company's equity was trading at a positive value. Second, it is my understanding that the Debtor's Second Lien Notes are currently trading on the secondary market in the range of 30 to40 cents on the dollar. Third, the Debtor's proved PV-10 on the Telemark and Gomez wells is$2,419,771, which after deducting the burden of the net profit interests and overriding royalty interests and, even if heavily discounted, reflects a value for the mortgaged property well in excess of the obligations."

Uh oh for QE3: "Fed 'Hawks' Weigh In Against More Action"

WSJ pro-nuclear piece: "The great tragedy of the Fukushima accident is that Japan shut down all its nuclear reactors. Even though officials have now turned two back on, the hardships and economic disruptions induced by this policy will be enormous and will dwarf any danger from the reactors themselves."

Bailout bettor distressed debt funds got jammed: "Witness the budding trade in GSE junior preferred shares for instance, betting on the tail event of the GSEs returning to sufficient, independently-managed profit to reinstate payments on them. Not just the senior. 'Some of the smartest funds in the world are very long Freddie prefs in a very big way on a notional basis, and have been for some time,' as Distressed Debt Investing put it. Well, the bet had blown up spectacularly on Friday – which to be fair was the 'lottery ticket' nature of the trade."

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