Goldsmith comment: Porter is busy finishing up his latest issue of PSIA, so I'm handling The Digest.
If you're bearish on natural gas relative to oil, you might want to look at shares of Enterprise Products Partners (EPD). Enterprise is one of the largest players in the business of separating natural-gas liquids from pure natural gas through a process called fractionation.
As long as natural gas prices stay cheap relative to oil, EPD will make a killing. Its shares have risen steadily as natural gas plunged. As a side note, EPD was a longtime holding in the Inside Strategist portfolio. Readers made more than 60% on the trade.
The company is currently running its facilities for processing natural gas liquids near maximum capacity, as petrochemical producers are using more natural-gas byproducts to make plastics... "What we produce will be the preferred feedstock for the petrochemical industry for the foreseeable future," Enterprise Chief Commercial Officer Jim Teague told the Wall Street Journal.
Even if the natural gas/oil ratio contracts, which is likely considering it is at record highs, Enterprise should still fare well... And shares are yielding a whopping 7.9%.
We wrote it, did you short it?
In the end, Corus' future hangs in the balance of an incredibly overbuilt and fraud-ridden downtown Miami condo market. Anyone interested in buying the stock? Not me. – Porter Stansberry's Investment Advisory, January 2008
Almost two years ago, Porter detailed the massive problems Corus would have as a major condo lender in all of the overbuilt areas in the U.S. – Las Vegas, Atlanta, Miami, etc...
Since then, shares of Corus have fallen from more than $10 to around $0.25 – a 98% drop. And yesterday, the New York Times picked up on the Corus debacle. The story highlights Corus' reckless lending – like financing two adjacent, downtown Miami condo buildings, the Ivy and the Mint. According to Florida real estate analyst Jack McCabe, it was "like building two Wal-Marts next door to each other and thinking you would double sales."
It also mentions the oddly timed – and we suspect fraudulent – special dividend Corus paid in July 2007, which netted the controlling Glickman family around $25 million, while depleting the bank of much-needed capital.
Now the bank is close to extinction – regulators have ordered Corus to either sell itself or raise capital. It can do neither. Corus' capital base has been wiped out. The bank's auditors – Ernst & Young – quit. And Nasdaq is threatening to delist its shares.
In his latest issue of PSIA, due out tonight, Porter recommends an energy company trading for less than 30% of book value. Someone could buy this company outright, sell all of its assets, pay off its debts, and still make 200% returns.
We expect to make even more hanging onto these assets, and so do two of the best investors in the world, who have been buying this stock hand over fist. To gain access to Porter's latest pick, click here...
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Another win for deflation... The world's largest consumer-products company, Procter & Gamble, is lowering prices to fight sluggish sales. "We've been lagging the competitive average for some time," CEO Robert McDonald told attendees at a conference. "That is unacceptable."
P&G has resisted cutting prices because of high commodity costs and a fear of tarnishing its premium image. But consumers are predominantly buying lower-cost options. McDonald said P&G will cut prices or increase promotional spending on about 10% of its business, including its Tide and Cheer laundry detergents.
New highs: Seabridge (SA), Hatteras (HTS), Cresud (CRESY), Market Vectors Gold Miners ETF (GDX), Visa (V), QLT (QLTI), Silver Wheaton (SLW), Silvercorp Metals (SVM), Kinross Gold (KGC), Sino Gold (SGX.AX), Eldorado Gold (EGO).
In the mailbag, why you should never move to Illinois... Where else should we avoid? feedback@stansberryresearch.com.
"I spent my career in international banking. Each month when the U.S. trade deficit with China was announced, I would divide the number by the average price of a house, or sometimes by the value of an average-sized commercial building. I would sometimes calculate how long it would take China to buy up certain U.S. cities with their trade surpluses. It became very apparent to me that our economic model was a train wreck just waiting to happen. A country cannot base its economy on retail sales, when all the items being sold are supplied by other countries. I read in the S&A Digest that China is now actually starting to buy up our country. I hope they are good landlords." – Paid-up subscriber LPL
"Stay out of Illinois. If you were my neighbor, my wife would never see me. Seriously, stay away from here. We elected Rod Blagojevich twice. George Ryan before that. We keep electing Little Napolean... errr... uhhh... Mayor Daley. We've got Dick Durbin. Had Carol Mosely Braun for how long? President O-bummer is from here. Need I continue? We're idiots! But on the other hand, my liberal neighbors hate me; and it is kinda fun." – Paid-up subscriber Matt
Regards,
Sean Goldsmith
Baltimore, Maryland
September 11, 2009The stock to buy if you're bearish on natural gas... Porter's latest pick, a 200% gainer... How to get 90% off your restaurant bill... NYT on the Corus debacle... Another win for deflation... Don't move to Illinois...