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Hold onto BIOGEN

0 (0%)

Sell BIOGEN to reinvest elsewhere

0 (0%)

Sell BIOGEN to create a new Biotechnology company(100% owned by Peak)

2 (50%)

Sell BIOGEN to buy up several weaker, well run companies

2 (50%)

Total Members Voted: 4

Voting closed: February 14, 2012, 09:35:34 pm

[Deadmeat1471]

I wish I had taken more advantage of it, but every company was in freefall and I only just held onto what I had.
By the time I got my wits about me and the economy stabalised again I  used all the cash I had to keep the companys I have afloat from the losses they suffered

Goddam recessions!

[Zrk2]

Goddam recessions!

How do they work?

[Goron]

What version are you playing?

Dump your struggling companies. Grab what cash you can out of them and think of the future!
 You should buy up long term calls on the recession hurt industries like capital goods - diversify between maybe three or four companies.dont leverage your calls at all since they will surely drop in value before going up and no one likes a margin call.  But if you can ride out the recession those pained companies will eventually recover a bit and bring their book prices up... As well as the value of your calls. Then sell for profit! Don't bother exercising the calls, unless you want to be stuck long in a (my opinion) crappy industry.
Alternatively, liquidate what you have now and go hardcore into bonds, what is the prime rate? If high buy up undervalued government bonds. Wait for rates to drop, sell for fun and profit.
I find recessions to cost more to ride out than to just drop the companies that struggle and use recession tactics.

This makes me want to find my old I play w$r game and continue it... ( http://www.bay12forums.com/smf/index.php?topic=63825.0 )

[gimlet]

Goddam recessions!

How do they work?

They're pretty much like real world recessions - economic indicators drop, corporate earnings drop, stock prices tend to go down, interest rates tend to go up...

[mainiac]

Goddam recessions!

How do they work?

They're pretty much like real world recessions - economic indicators drop, corporate earnings drop, stock prices tend to go down, interest rates tend to go up...

Don't interest rates go down in a recession?

[Goron]

Goddam recessions!

How do they work?

They're pretty much like real world recessions - economic indicators drop, corporate earnings drop, stock prices tend to go down, interest rates tend to go up...

Don't interest rates go down in a recession?

I find that high rates tend to CAUSE the recession, so... No?
And then, it is often difficult for banks and other financial institutions to operate with rates low, so sometimes the fed may push them HIGHER... Problem is, half the banks own insurance companies, which ultimately need low rates... So the bank takes a hit from their holdings anyways...
Whatever the causes are, the effects are pretty clear, and of you can get a decent chunk of cash it is possible to make some good money


EDIT it is obvious I messed up the quote tags. EDIT 2 fixed now?

[Deadmeat1471]

In my game, the interest rates went to 17% when peak oil hit, and the GDP receeded at about 17% a year or something crazy.

It was evil.

[Goron]

In my game, the interest rates went to 17% when peak oil hit, and the GDP receeded at about 17% a year or something crazy.

It was evil.

That is like my pipe dream. I'd sell everything I own that is not able to support itself and use that cash to buy up long govt bonds. Heck, rates that high I'd risk shorting some sure to fail stocks to get some extra spending cash and hope to god that I don't get a margin call.

[Deadmeat1471]

In my game, the interest rates went to 17% when peak oil hit, and the GDP receeded at about 17% a year or something crazy.

It was evil.

That is like my pipe dream. I'd sell everything I own that is not able to support itself and use that cash to buy up long govt bonds. Heck, rates that high I'd risk shorting some sure to fail stocks to get some extra spending cash and hope to god that I don't get a margin call.

Yeah I didn't think it would drop so much, I was waiting for the stock to rise abit so I didnt get totally screwed, but it dropped to near 0. I really got hit hard by it.

[Deadmeat1471]

Snipped from the manual, I love the writing of the manual it just makes me chuckle.

GREENMAIL--A practice made popular in recent years by certain
corporate raiders who take a large position in a target company's stock.
Management of the target company, fearful of a takeover that would cause
them to lose their jobs, stock options, chauffeured limousines, palatial
homes, ski chalets, Learjets, high-maintenance mistresses, and other Godgiven
birthrights, quite consistently find it to be in the company's best
interest to buy back the raider's stock holdings for a price well above
current market prices, in exchange for a promise by the raider to go away
and pick on some other company. The money extracted from the target
company is frequently referred to as "greenmail," perhaps due to the
uncanny resemblance of such a payment to its only slightly less savory
cousin, blackmail.

[Deadmeat1471]

Romney strategy

Let's have em. How can we destroy jobs and companys for profit.

Idea A) Buy company in fucktroubles, sell a bunch of their assets then pay off debt or whatnot and get the company making moneys. Sell it. Ok not the most dubious plan there is, pretty tame.

How can we really screw over companys for moneys?

[Deadmeat1471]

Fuck..... I just scanned through my loans at the credit ratings for NatWest and froze a company from borrowing more. Only to realise it was our BIOGEN, sad times. 

2025.. I finally dumped BIOGEN. Its a debt ridden nightmare on its way down. Also I recalled my 2 billion dollars I invested to keep it afloat, those fuckers are going down the toilet now.

Peak holdings now only has natwest bank, but the bank is going strong.

[Goron]

Hold that bank while rates are high, hopefully you sold off bonds before they got too high, cuz now is the time to buy buy buy. Plus your bank should be seeing some nice stock value to cushion any negative impact from bad loans, maybe. But if the recession is THAT bad, any benefits from high rates may be completely negated by bad loans and/or under value bonds if you didn't drop them at first sign of rising rates.
I personally hate banks because they buy and sell bonds automagically. Annoys the shit out of me.

But, if you are sitting on two billion... Here is a nice strategy in line with your idea of buying struggling companies... Buy a struggling company with issued bonds and a high tax loss carryover. Make sure the bonds are available for purchase.
Liquidate just a little of the assets and use the cash to buy back some of its bond at discounted rates.
Make a cash capital contribution to new company (not an advance, so it shows as new equity) in small amounts as needed to continue buying bonds back; and if you can, buy back discounted bond with loan money before doing any capital contribution. If you do it right, you should be able to buy back the bonds at a huge discounted rate, I'm talking like 50-70% of value. As you buy back the bonds your paper balance sheet will improve immediately. You should be able to turn a company you bought for ~1billion into a 2 or even close to 3 billion dollar company easily. The income it makes off buying its bones back should be sheltered by its tax loss carryover, too. Pure profit.
If it was me, I'd then sell off its corporate assets and use it to repeat the process on a new company.
And if you want to be really tricky, you can buy some of the company bonds with your personal account before buying them back with the company, you'll see a small profit from that too.

[Deadmeat1471]

I'm not to sure on how bonds work, I need to read up on it again.

The recession is over however, the economy is now rising above the 2012 levels again and growth is slowing down again to normal standards.
The oil companys is going absolutely insane due to the oil problems that have been happening.

I like your idea though, I will definitely do that I think.

Example.

Hyundai Bonds:
14.25% of 1863 million dollars due 2033. Callable at 105% face value. yield to maturity price 12.33%.


From what I understand, the yield to maturity means the % interest i receive(14.25%?) will actually decrease as it gets closer to 2033?
What determines the face value?

Current prime rate 8.25%
Short bond 7.04%
Long bond 7.41%

The face value of bonds usually represents the principal or redemption value. Interest payments are expressed as a percentage of face value. Before maturity, the actual value of a bond may be greater or less than face value, depending on the interest rate payable and the perceived risk of default. As bonds approach maturity, actual value approaches face value.

How does this relate to the purchase price of buying B or C bonds? the interest paid should be higher... but err what determins the face value?[/s]

I get it now.

[Deadmeat1471]

Goddam recessions!

How do they work?

They're pretty much like real world recessions - economic indicators drop, corporate earnings drop, stock prices tend to go down, interest rates tend to go up...

Don't interest rates go down in a recession?

Note, it wasnt a regular recession, peak oil came and totally fucked the economy. I don't know the economics of what should have happened though.