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EUROPE’S ENERGY CRISIS IS KEEPING ENERGY PRICES AND INFLATION HIGH
America leads the world in oil and gas production. We believe midstream energy infrastructure offers predictable cash flows to investors..
Blackstone and Tallgrass Further Discredit the MLP Model
To be an SEC-registered asset manager is to submit to extensive rules of behavior, all with the objective of protecting the clients. Where a portfolio manager invests personally alongside her clients, creating a desirable alignment of interests, regulations require that the client’s interests are placed ahead of the manager’s. The asset manager has a fiduciary […]
Private Equity Sees Value in Unloved Pipelines
Last week the Financial Times wrote about the dwindling conviction of believers in the Shale Revolution (see Why US energy investors are experiencing a crisis of faith). Religion is an appropriate metaphor – secular values such as Enterprise Value to EBITDA or forward free cash flow yield have offered scant protection. To invest in energy […]
Hopes for a Trade Deal Slipping
Article I of the U.S. Constitution gives Congress the “…Power to lay and collect Taxes, Duties, Imposts and Excises…” Congressional control over tariffs has never been so strong since. The Reciprocal Trade Agreement Act of 1934 granted President Roosevelt the authority to adjust tariffs and to negotiate bilateral trade agreements without prior congressional approval. Other […]
Pension Funds Keep Interest Rates Low
The Equity Risk Premium reveals that stocks are cheap relative to bonds (see Stocks Offer Bond Investors an Opening). A corollary of this insight that bonds are expensive is that you can replicate the return on $100 in ten year treasury notes with a combination of stocks and cash. It relies on a few assumptions, […]
Bond Buyers Should Buy Pipeline Stocks
Yields on McDonalds’ Euro-denominated bonds recently joined European sovereign debt in negative territory. It’s a headline writers dream (juicy burgers, not yields…customers and investors pay to do business, etc). $17TN in publicly traded debt now yields less than zero – 30% of the entire investment grade market. Debates rage about what this means. Bond investors […]