Tuesday, November 18, 2014

"Hedge Fund Monarch Said to End Talks on RadioShack Loan" $RSH

Story:

"Monarch Alternative Capital LP abandoned negotiations to take over a $140 million loan to RadioShack Corp. (RSH) as the electronics retailer struggled to reach a deal with lenders on a turnaround plan, according to two people with knowledge of the matter."

11 comments:

Stagflationary Mark said...

RadioShack Stock Price: $0.80

It was roughly 100x that at the peak of the dotcom bubble. I guess we're still working through some of that.

Procrastinator's dream. The longer you wait, the cheaper it gets. Sigh.

jHurt said...

Did you play this at all?

whydibuy said...

What happened to the bad Christmas selling season theory?
I see Target is up nicely as are most of the retailers on signs that sales are brisk already.
HMMMM. So much for those charts indicating collapse,lol.

Anonymous said...

http://www.creditbubblestocks.com/search/label/RSH

Stagflationary Mark said...

whydibuy,

Can I take it from your upbeat attitude that you are counting on the Fed to offer us all a soft landing? Good luck on that.

Soft Landings vs. Hard Landings

This smooth parabola is absolutely guaranteed to fail. The longer the failure is put off, the more spectacular the failure will be.

Stagflationary Mark said...

This is why the landing matters.

If You Think Real GDP per Capita Growth Sucks Now...

...then just wait until the unemployment rate is no longer falling. I've claimed this in the past and this post provides the evidence.

Anonymous said...

Mark, don't you realize that it's just as intellectually lazy to be a perma-bear as it is to be a perma-bull?

You can cite all the studies that you want. The fact is that you've missed out on a bull market for the last 5 years.

Maybe it will all fall apart tomorrow and you'll finally be proven right...who knows. You're not any different than the guy that was bullish in 2007 and then claims he was right because the market went up in 2010.

Stagflationary Mark said...

whydibuy,

I see Target is up nicely as are most of the retailers on signs that sales are brisk already.

Target sales were brisk?

Target’s sales rise as U.S. consumers spend more

Fantastic headline. I'll give you that.

In the U.S., overall sales climbed 1.9%, while same-store sales were up 1.2% and better than the expected range of flat to 1% growth. The same-store sales growth was driven by an increase in the amount consumers spent, while the number of transactions that Target recorded decreased.

Inflation was up 1.7% in the last year. So same store sales were actually down about 0.5% in real terms, which would make sense since the number of transactions actually decreased.

But hey, to each his own.

Stagflationary Mark said...

Anonymous,

You're not any different than the guy that was bullish in 2007 and then claims he was right because the market went up in 2010.

I am?

I turned permabearish in 2004. I watched the stock market roar on past me then and I'm watching it roar on past me now. No big deal.

Over entire business cycles, I haven't missed out on anything. My long-term bonds have performed extremely well in spite of all the bulls claiming that the "strong recovery" could only send interest rates up.

January 1, 2012
Why are bonds outperforming stocks over long term?

The fact bonds have topped stocks over such a long period shakes up preconceived notions and further insults stock investors, who have endured historic volatility as they got lower returns.

Perhaps you are the one missing out, over full business cycles anyway.

We should all be very concerned that bonds really have beaten stocks over such a long period.

Will bonds continue to outperform? We'll see what happens when the next recession hits (whenever that is). I strongly suspect that the answer will be yes. Time will tell.

Anyone using long-term data before the 1970s should probably factor in a few things. Women entered the workforce. They are here now. Taht growth engine is over. We fell off the gold standard due to financial instability. We've embraced debt and it is now clamping down on real growth.

Those expecting a permanent return to the glory days will more than likely be very disappointed. That's just an opinion of course. Your opinion clearly varies.

Stagflationary Mark said...

This was my last big trade and I will be holding to maturity.

February 2, 2011
More Dangerous Advice from Jeremy Siegel

Risk abounds? If we buy the 30-Year TIPS and hold it until maturity then we will earn 2.08% over inflation. That's the current rate. No matter what rates do this is what we will earn going forward. As a retiree who values safety, I am completely fine with that. I'm locking it in. I'll be buying the 30-Year TIPS this month in the auction.

I backed up the truck on that one. Other than a small emergency savings account, I've got nothing left I can deploy.

As you can see, I am definitely not an active trader.

Today's 30-year TIPS yields just 1.06% over inflation. I'm getting 1% more return each and every year for the next 26+ years than investors buying today will be getting.

You think I'm not any different than the guy that was bullish in 2007 and then claims he was right because the market went up in 2010.

If I am not any different, then where are/were my losses?

Anonymous said...

A better analysis to do would cover how the Radioshack CDS spreads move as a result of this news and any future material events.