MQG - Macquarie Group

[Julia]

Having made some good money out of MQG, I've been out for several months.
The SP largely represents the caution felt by the market at large, the reasons for which have been well provided on this thread.

It doesn't seem too long ago, less than a year I think, that there was speculation about who would reach the $100 SP first: MQG or RIO.
Not much of a contest now, huh!

 

[Gekko]

Having made some good money out of MQG, I've been out for several months.
The SP largely represents the caution felt by the market at large, the reasons for which have been well provided on this thread.

It doesn't seem too long ago, less than a year I think, that there was speculation about who would reach the $100 SP first: MQG or RIO.
Not much of a contest now, huh!

Yeh, theyve really moved in opposite directions. MQG has had an incredible rebound, but i get the feeling it will get tested at least once more. Their still exist major constraints in debt markets and macquarie are going to find it far more expensive to borrow, service and repay their thousands of infrastructure assets

 

[Gekko]

Took some shorts out today with a tight stop at $65.50. Im going against the trend here but if things turn against the financials again, the shorts will drag it down.

 

[Mofra]

Mofra, the issue is they are and have for a long time been taking out cash well in excess of the actual flows generated from the assets themselves. Even with the mature assets such as Sydney Airport, EBITDA doesn't cover the distribution, borrowings fill the gap.

However, I will happily concede that the parent is unlikely to crumble due to the way they have set up the structure - the majority of the risk resides in the satellites, MacBank do shelve assets on their balance sheet, but most are either the cream of the crop or intended for resale.

The other point I would make is that MacBank did do the smart thing with their satellites by cashing most of them up before the crash - notably MIG and MAP have large cash reserves at the present stage. They might need it when they re-finance though, no wonder they haven't re-invested the dough!

Cheers

You've summed up well the point I was trying to make. A false economy of higher earnings is supported by an ever-growing debt level that risks hurting underlying cashflows as servicing the debt becomes a greater proportion of underlying cash-flow for each seperate sun-off entity. Even if the parent entity is protected from any default, they are not protected from a loss in earnings/management fees in the unfortunate event of even defensive action having to be taken.

They are possibly the most interesting company on the ASX (or really, group of companies, as Mac Group divisions tend not to talk to each other very much). Reasonable track record (the low-ball offer for the FTSE was classic, and whilst everyone slated them for it, they took out London Water. Classic diversionary tactic) and solid working business model, just overly reliant on credit to keep profititibility at current levels.

 

[Gekko]

Took some shorts out today with a tight stop at $65.50. Im going against the trend here but if things turn against the financials again, the shorts will drag it down.

Choose the right day to short yesterday. Down 2.7% today. I actually added a few more with a stop loss at 65.5 this morning. Great management, other factors may bring it sub 55-60 again.

 

[Macquack]

The Holey Dollar Story

The Macquarie Bank/Group's corporate logo has always puzzled me.

"In 1813 Governor Lachlan Macquarie overcame an acute currency shortage by purchasing Spanish silver dollars (then worth five shillings), punching out the centres and creating two new coins - the 'Holey Dollar' (valued at five shillings) and the Dump (valued at one shilling and three pence). This single move not only doubled the number of coins in circulation but increased their total worth by 25 per cent and prevented the coins from leaving the colony."
This is a quote straight from Macquarie Groups own website.

Taking this principle forward into the twentieth century Mr Moss, Moore & Co. set about cutting the heart, I meant to say centre out of all newly acquired coins for themselves. They then sell off the remainder of the coins (with a hole in them) to unsuspecting investors for their face value (or more if a bonus is involved).

And the geniuses at the MacHouse of Cards proudly adopt this symbol of banking fraud as their corporate logo.

Does anybody else see the irony in this?

 

[stoxclimber]

Now now Macquack. While your name suggests you may have a bit of a tiff with Macquarie, it's a long bow to draw to call the official action of the governor of the colony "banking fraud". Why, if you said such a thing back at the time, it no doubt would have been off with your head.

The Holey Dollar is meant to symbolise financial innovation.

 

[Macquack]

Now now Macquack. While your name suggests you may have a bit of a tiff with Macquarie, it's a long bow to draw to call the official action of the governor of the colony "banking fraud". Why, if you said such a thing back at the time, it no doubt would have been off with your head.

The Holey Dollar is meant to symbolise financial innovation.

More like finacial illusion.
Mr Mossy is in fact, a world class illusionist.

Whats this crap about a minimum 100 characters?

Macquack

 

[reece55]

They are possibly the most interesting company on the ASX (or really, group of companies, as Mac Group divisions tend not to talk to each other very much). Reasonable track record (the low-ball offer for the FTSE was classic, and whilst everyone slated them for it, they took out London Water. Classic diversionary tactic) and solid working business model, just overly reliant on credit to keep profititibility at current levels.

Definitely agree Mofra, a complex beast of a companies that is most interesting on many levels. The low bid for LSE was a stroke of genius! I think their business model however is hopelessly flawed on the infrastructure side of the equation, because it's a black box approach (trust us, the assets are worth X - we just find it hard to demonstrate why by using normal financial valuation methods!).

More like finacial illusion.
Mr Mossy is in fact, a world class illusionist.

Whats this crap about a minimum 100 characters?

Macquack

Macquack, the 100 char rule is to encourage people to make meaningful posts. And on that subject, do you want elaborate on why Mr Moss is a world class illusionist, or is this just a passing comment? If it is, perhaps add it to a post with more substance?

Cheers

 

[Macquack]

Macquack, the 100 char rule is to encourage people to make meaningful posts. And on that subject, do you want elaborate on why Mr Moss is a world class illusionist, or is this just a passing comment? If it is, perhaps add it to a post with more substance?

Cheers

Firstly, How do you say "I agree with You or yes" in 100 characters, without restating a comment?
Secondly, I'm on your team here, so why are you questioning my comment when it is largely based on all your posts in this forum.
Your Avatar would suggest you are also suspicious of financial engineers/creative accountants/money magicians which create short-term gains at the expense of long-term survival.

 

[reece55]

Firstly, How do you say "I agree with You or yes" in 100 characters, without restating a comment?
Secondly, I'm on your team here, so why are you questioning my comment when it is largely based on all your posts in this forum.
Your Avatar would suggest you are also suspicious of financial engineers/creative accountants/money magicians which create short-term gains at the expense of long-term survival.

Mate, I don't have a vendetta against MQG here! What I have posted on the MQG thread is analysis of their business model, specifically their infrastructure business, on a high strategic level and numbers level. This is to express my frustration at the lack of transparency in the business, which is frustrating and to educate investors about what the company is actually doing.

I'm not questioning what you've written in your post, I asking you to elaborate - simply saying that Mr Moss is an illusionist doesn't have much depth, I'm after an informed debate, not simply having a go at the Company.

Cheers

 

[Macquack]

Mate, I don't have a vendetta against MQG here! What I have posted on the MQG thread is analysis of their business model, specifically their infrastructure business, on a high strategic level and numbers level. This is to express my frustration at the lack of transparency in the business, which is frustrating and to educate investors about what the company is actually doing.

I'm not questioning what you've written in your post, I asking you to elaborate - simply saying that Mr Moss is an illusionist doesn't have much depth, I'm after an informed debate, not simply having a go at the Company.

Cheers

OK you got me, I am over generalising, but just one more.
I translate your term "lack of transparency" to read "smoke screen created by illusionist to trick audience".

 

[Gekko]

Mate, I don't have a vendetta against MQG here! What I have posted on the MQG thread is analysis of their business model, specifically their infrastructure business, on a high strategic level and numbers level. This is to express my frustration at the lack of transparency in the business, which is frustrating and to educate investors about what the company is actually doing.

I'm not questioning what you've written in your post, I asking you to elaborate - simply saying that Mr Moss is an illusionist doesn't have much depth, I'm after an informed debate, not simply having a go at the Company.

Cheers

looks, lets cut to the chase, financial engineering is about taking out debt on debt on debt on debt and making the marginal gains above the costs of debt (ir) to make gains. in a environment where the cost of that debt service is cheap, it is highly profitable, but in an environment where that cost rises, margins are squeezed and it becomes a lot harder profit.

Financial engineering is to company's, what margin lending is to investors.

i am still short MQG but admire Alan Moss immensely

 

[Macquack]

i am still short MQG but admire Alan Moss immensely

Kind of a contradictory statement.
If you admired Allan Moss so immensely (I gather for doing such a great job with investors funds), why would you short MQG?

 

[Mofra]

Kind of a contradictory statement.
If you admired Allan Moss so immensely (I gather for doing such a great job with investors funds), why would you short MQG?

The smart a**e reply would be because he is the outgoing boss

For mine, he has basically turned an outpost small company Hills Samuel into a global player. Regardless of what I think about their valuation models or their methodology of setting management fees for infrastructure funds, he has grown the company enormously and did have the foresight to raise $6b before August 07 credit rumblings.

 

[Macquack]

The smart a**e reply would be because he is the outgoing boss.

Fair comment, Mofra, but is Allan Moss the only smuck at Macqaurie Bank with the immensely admirable skill of rorting the masses?

 

[nick2fish]

At least Alan Moss & Co are capable of organizing a bridge to be built to....
Get Over Things I am fine with criticism of the Mac bank set up, but one line slanging move to another thread.

 

[ThingyMajiggy]

Nevermind

 

[Gekko]

Choose the right day to short yesterday. Down 2.7% today. I actually added a few more with a stop loss at 65.5 this morning. Great management, other factors may bring it sub 55-60 again.

I closed out all my MQG shorts today. I dont see much value shorting from these levels. The recent damage has been done.

 

[Macquack]

Macquarie Group, Columbus Capital, RHG: Australian Bond Alert

By Laura Cochrane

May 27 (Bloomberg) -- Macquarie Group Ltd., Columbus Capital and the Victoria Government lead companies considering selling bonds in Australia.

Sales of corporate bonds have reached A$30.9 billion ($29.7 billion) in Australia this year, up from A$28.2 billion in the same period in 2007, according to data compiled by Bloomberg. About A$2 billion of asset-backed and structured finance bonds have been sold this year.

The following is a description of pending sales of corporate and other bonds in Australia.

Asset-Backed

MACQUARIE GROUP LTD., Australia biggest investment bank, is gauging investor interest in a sale of about A$250 million of bonds backed by low-documentation loans as part of its PUMA securitization program, according to three investors familiar with the discussions. Matthew O'Hare, group treasurer at Macquarie in Sydney, said the firm is in constant talks with investors about issues and gauging levels of interest in new deals. Low-documentation loans require less income proof than standard mortgages.


MACQUARIE GROUP LTD., Australia biggest investment bank, plans to sell A$650 million of bonds backed by leases to European and Australian investors under its SMART Trust program, said Paul Bide, head of debt markets at Macquarie in Sydney. The European portion of the bonds will likely price to yield about 130 basis points more than the three-month Euro interbank offered rate, said a person familiar with deal, who declined to be identified.