I am a supportor for Centro. around my living place, there are two Centro shopping centers, the Brandon park SC and the Glen SC. I trust Centro's business because I can see how well their business is everyday. before I invest in cnp, I read every post of this forum and talk with a friend trading share for years. of course I also check advice from my brokers like etrade and nab online trading. at the beginning, I bought small stake in cnp at 55c, shortly after, I feel the price could go down further. then I quit and wait until it reach 30c, and it came a big decision to me when I see I can afford to buy 1 million Centro shares. after thinking by all of my knowledge for weeks, I gradually accumulated 1.6 m shares and hold until 5th of May. so I hope you can feel how serious I am as a Centro holder. I give those Centro supportors my reasons to buy cnp according to my semi-professional acadamic background.
from the general economy point of view, the U.S recession is part of a political stratagy to depreciation the US dollar. because US has a huge financial deficit, a weak currency policy can save tremendous liability for the whole US ecomomy. that's why the US banks did the writen off their debts so easily, you know who is the biggest investors in US bonds and those credit securities? countries have great funds reserve like China and Japan. US Banks do occur big loss, but it get comensation from the government. See what happens to Bear Stream? this is not the case in Australia, we are not going to share any cost for the US economy. So you wont see major banks wind up Centro so easily. beyond this, Centro is also a perfect take over target to anti recession because of its ability to hold value. if you are sacred because US properties are losing value, then tell me something can keep value better than properties like shopping centers. rember, SC has big block of land and can generate stable rental incomes.
As to accounting perspective, we need to understand a "book value loss" is not as severe as a revenue loss. Centro's cash flow statement didn't show any operation problem. the book loss wont be a real loss until the company go bankrupt. I guess the assets written off actully give banks less incentive for a wind up.
for the valuation thing. the truth is that every valuation you see from anywhere is just a estimate. for such a comprehensive entity like Centro, value only apears after it is sold as a whole. if you think Centro cant leave any value to shareholders. then just dont trade BHP or WOW as well, they definitly gonna leave nothing to shareholders if you check their price and the assets back.
of course Centro is risky. we know the banks have the right to wind it up at any time. that's why I sell 90% of my shares before any ann. and buy back after that. I know normally the ann is "good", because cnp or cer priced at the worst senario. it could only go better. and if you cant take risk, cer is less risky because its direct ownship over shopping centers. you need to have a very long view on Centro. to repay debts, Centro may not pay any dividend in 1 or 2 years. how long you can afford to hold? if no one come to buy a large enough stake in Centro, the price will stay low for years.
If nothing worse happened, Monday will see another extention until the end of the year. we need a little bit faith here to be with Centro. If Centro survive, it's a big achievement for aussie ecomomy. because, only because Centro is in Australia, it get the hope to stand.