MQG - Macquarie Group

[barnz2k]

Re: MBL - Macquarie Bank

again wishing got out when it cracked the $100!

Hopefully will recover from this to at least positive from my buy in!

Dang - a few words and this happens.

 

[reece55]

Re: MBL - Macquarie Bank

How can the guy mark similarities between Mac and Enron? Does he have proof of fraud? Because that's what happened at Enron.

Mime
I suggest you take a long hard look at MBL financial's - I have said it millions of times, the level of disclosure in their financials makes it impossible to properly assess the risks the business undertakes on a daily basis and many of the mark to market treatments are extremely subjective, particularly the investments they have in their satellite funds.

I'm not saying they are frauds, I am saying that the accounting regulations allow them to be artistic.

I honestly feel sorry for anyone who bought in the last couple of days hoping for a recovery, because it has been a much bigger blood bath than I ever could have imagined.

Interesting times...........

Cheers

 

[Ken]

Re: MBL - Macquarie Bank

One of the more spectacular days for MBL...

Some serious money lost in the last couple of days...


And I suspect today the asx factored in a fall in the dow overnight..

So we may see more red tommorow.

No late surge...

5900 all ords???

 

[mime]

Re: MBL - Macquarie Bank

Reece the reason Enron's problems wernt detected was because they committed fraud to conceal their debts. Saying to same about the Mac is a very serious statement. I don't care how much it drops as I sold out at $89 I'm just wondering when/if to buy again. The Mac bank could be the blue chip buy of the year at this price.

 

[Uncle Festivus]

Re: MBL - Macquarie Bank

Reece the reason Enron's problems wernt detected was because they committed fraud to conceal their debts. Saying to same about the Mac is a very serious statement. I don't care how much it drops as I sold out at $89 I'm just wondering when/if to buy again. The Mac bank could be the blue chip buy of the year at this price.

It wasn't that long ago that NAB traders covered up their trades too. It's good that you have such optimism for the 'House Of Cards', but how do you know when it's undervalued, as you haven't said how you are valuing them? Technical analysis? What price will you be buying at, or should we average down?
Are you buying this 'blue chip' at these 'bargain' prices?

 

[reece55]

Re: MBL - Macquarie Bank

Reece the reason Enron's problems wernt detected was because they committed fraud to conceal their debts. Saying to same about the Mac is a very serious statement. I don't care how much it drops as I sold out at $89 I'm just wondering when/if to buy again. The Mac bank could be the blue chip buy of the year at this price.

Mime - have a good look through my post again mate.......

I didn't say anywhere within my post that I thought MBL were frauds...... Plus, Jim Chanos wasn't saying MBL were frauds, he simply said they had severe related party issues and complex off balance sheet debt structures that had the potential to cause issues in the future as they were not properly disclosed with the body of the Companies financials. These are all true facts - draw your own conclusions.

I know the Enron story pretty well (hence my avatar), at the end of the game they (Enron) were fraudulent, but the factors that lead their accounting team to come up with the dodgy strategies in the first place (i.e. Raptors limited partnerships, etc) was actually a legal accounting treatment - mark to market valuation of their deals via a DCF model. The SEC and their auditors signed off to the treatment initially. Have a look at MIG - isn't this exactly what they are doing, revaluing assets using AASB 139 and 132 whilst the group bleeds through cash like no tomorrow.....

Look, you don't have to listen to me - I would say the chart tells you more than I could....

All the best
Reece

 

[mime]

Re: MBL - Macquarie Bank

I herd on the news that one factor in the big fall was that one of their property funds lost 25% because of the credit crunch.

 

[Mofra]

Re: MBL - Macquarie Bank

I herd on the news that one factor in the big fall was that one of their property funds lost 25% because of the credit crunch.

Yes, US listed fund had a portfolio drop of over 4% however as it is a leveraged fund it equates to a 25% drop in fund value, of course translating to a drop in the management fee paid to the parent company. Would have to be effecting sentiment towards MBL as a whole, as capital tightening will effect their ability to both draw management fees from funds & conduct the M&A activity which is a core earnings driver.

Have to wonder if there were people who actually gearing into a geared fund specialising in US property in the middle of a sub-prime lending meltdown

 

[mime]

Re: MBL - Macquarie Bank

Talk about volatile. The stock was up around 5% or so and closed the day at a loss. Anyone game enough to buy in yet?

 

[waz]

Re: MBL - Macquarie Bank

MBL is now sitting on a P/E ratio of 12.44x
thats based on last years figures, not forward looking.

thats the lowest i can ever remember it. so even if profit drops by 20% (300mil ????), its still on a good earnings multiple, keeping in mind we are looking at the earnings multiple, not EBIT. Banks are normally valued on EBIT.

Can anyone explain why BNB and AFG with higher multiples went up today?
Doesn't make sense. Unless people are still thinking about that article that came out 2 days back.

This is looking like a good pairs trading combination over the next few days.

 

[UPKA]

Re: MBL - Macquarie Bank

MBL is now sitting on a P/E ratio of 12.44x
thats based on last years figures, not forward looking.

thats the lowest i can ever remember it. so even if profit drops by 20% (300mil ????), its still on a good earnings multiple, keeping in mind we are looking at the earnings multiple, not EBIT. Banks are normally valued on EBIT.

Can anyone explain why BNB and AFG with higher multiples went up today?
Doesn't make sense. Unless people are still thinking about that article that came out 2 days back.

This is looking like a good pairs trading combination over the next few days.

i think its mainly because a lot of the hedge funds r not out of hte dark yet, we r yet to know the full damage of the subprime trouble, over the coming weeks more dirt will be digged out. since Macq has the most exposure to US out of the banks in Aust. ppl r getting worried. alot of them r sitting on quiet a juicy profit if they invested few yrs back, so prob its time to "profit take".

 

[chops_a_must]

Re: MBL - Macquarie Bank

Can anyone explain why BNB and AFG with higher multiples went up today?
Doesn't make sense. Unless people are still thinking about that article that came out 2 days back.

I think it's because BNB are a little more prepared to disclose information. MBL couldn't say what their debt levels actually were and at their press conference at the AGM said they had NO exposure to US sub prime...

 

[mime]

Re: MBL - Macquarie Bank

I think private equity could be in major problems in future if interest rates rise and profits drop. Can only wait and see.

 

[Miner]

Re: MBL - Macquarie Bank

MBL is an interesting story. I wish Enron could say more on his research on Enron and MBL.
The Enron man who spoke in ABC radio about two months back saw a strong similarity between MBL and Enron . MBL revaluates its assets and then expands its equity. The process is just like housing bubble. The same house gets revalued again and again. The bank is happy to lend loan against that. So is MBL does. I am not suggesting to call them any thing else but taking the best advantage of the legal loop holes.
Even MBL gets recovered as their supporting agencies like Citi will keep buying to ramp the share up and emotion will work.
It will be interesting watch however for next one month if market euphoria does not subsidise then watch for your investment in Macquarie including super. It will be a domino effect as there are large no of funds who kept their investment on Macquarie as if a sacred cow.
I will revisit what I said in about a month.

Happy Investing

Miner

 

[vishalt]

Re: MBL - Macquarie Bank

Yeah I think Chanos (the guy who compared MBL to Enron) scared the balls out of a lot of people.

I'm scared to get into it myself, even though its looking really cheap fundamentally D:!

 

[It's Snake Pliskin]

Re: MBL - Macquarie Bank

How can the guy mark similarities between Mac and Enron? Does he have proof of fraud? Because that's what happened at Enron.

There is a website being sued by a bank in the states for libelous comments regarding the subprime issue.

 

[theasxgorilla]

Re: MBL - Macquarie Bank

I am not suggesting to call them any thing else but taking the best advantage of the legal loop holes.

Its not even legal loop holes, its part of the game...the debt to equity game. The shareholders are secondary...primary are the winners who work for the bank and who invent the schemes and make them happen. Who cares if MBLs equity is made out of thin air when you just used your bonus to pay off your house in Double Bay? By the time whatever it is that will eventually catch up with the likes of MBL actually catches up with them when you have no debt and you're being paid pension money out of super each month via some well secured annuity, tax free, until you die? So long as the ship don't sink before you've reached your goals it's going to become someone elses problem when you're gone.

 

[Mofra]

Re: MBL - Macquarie Bank

MBL is an interesting story. I wish Enron could say more on his research on Enron and MBL.
The Enron man who spoke in ABC radio about two months back saw a strong similarity between MBL and Enron . MBL revaluates its assets and then expands its equity. The process is just like housing bubble. The same house gets revalued again and again. The bank is happy to lend loan against that. So is MBL does. I am not suggesting to call them any thing else but taking the best advantage of the legal loop holes.
Even MBL gets recovered as their supporting agencies like Citi will keep buying to ramp the share up and emotion will work.
It will be interesting watch however for next one month if market euphoria does not subsidise then watch for your investment in Macquarie including super. It will be a domino effect as there are large no of funds who kept their investment on Macquarie as if a sacred cow.
I will revisit what I said in about a month.

Happy Investing

Miner

Miner,

The revaluation of assets rarely (if ever) occurs on the parent company balance sheet. Most of the infrastructure is partitioned off into seperate funds or listed entities, the revaluation occurs for the parent company to include the revaluation in growth statistic upon which management fees are drawn. Regardless of what they are involved in (everything from airports, hotels taxis, etc), MBL remains by and large a management & consultancy company
as much as a fundie. A burst asset bubble will wipe of the management fees but the parent compant is safe.

Now, with a massive restructure on the cards they will almost certainly another layer of protection between assets & the parent entity. This is a company governed more by growth & risk analysis than a standard organisation, which is why they have been able to so ably profit from the bullish economic conditions in recent times. The interesting part will be to see just how they change their structure in anticipation for the more difficult economic conditions ahead.

 

[reece55]

Re: MBL - Macquarie Bank

Hrmm.... the parent Company would be safe from harm if the asset bubble affected their sattelite funds..... Lets have a think about that....

1. Revenue impact - Revenue from fee and consulting commissions to associates and JV's for 2007 was over 1 Billion. Lets say that costs associated with such advisory was half (500 Mil). If their fee income was gone from associates, that would be 1/3 of net profit - sounds fairly material to me.....

2. Asset impariment - Net assets are 7.5 Bil, investments in associates 4 Bil - I think an impairment here would greatly affect their collateral.

Everyone needs to have a good look at what MBL actually is - the biggest deck of cards on the ASX. The Company restructure is not about asset protection, it's about getting around the Capital requirements of having banking licence for the investment banks head Company. It will actually increase risk, because the prudential requirements won't hold them back ....

In saying all this however, MBL have lasted this long ripping everyone off with their spin outs, so perhaps if the bank roll continues, everything will be ok..... I've heard this story before......

 

[reece55]

Re: MBL - Macquarie Bank

Its not even legal loop holes, its part of the game...the debt to equity game. The shareholders are secondary...primary are the winners who work for the bank and who invent the schemes and make them happen. Who cares if MBLs equity is made out of thin air when you just used your bonus to pay off your house in Double Bay? By the time whatever it is that will eventually catch up with the likes of MBL actually catches up with them when you have no debt and you're being paid pension money out of super each month via some well secured annuity, tax free, until you die? So long as the ship don't sink before you've reached your goals it's going to become someone elses problem when you're gone.

You've hit on the head ASX.G........

This is exactly the premise that MBL's is built on - if you really have a good think about the entire business model (and people did about a year and a bit ago), it is fundamentally flawed, because it is impossible for group to act in the best interests of:

1). The shareholders of MBL
2). The shareholders of their sattelite funds
3). The investors in their unlisted funds that conduct business with 1 and 2

In the end, who do they act in the best interest of? Themselves, because of the material level of bonuses the Company forks out.....