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TRE - Sino-forest put.


alertmeipp

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Why are you guys putting so much faith in Paulson?

 

Yeah, he's been a star for the last 2-3 years, but I wouldn't really call this guy a great investor. According to "The Greatest Trade Ever," he had a okay, but fairly mediocre track records before the subprime trades. He didn't even "discover" the trade. Someone else brought it to his attention.

When does anyone DISCOVER the trade we ALL are tail gating. I for one have some faith in Paulson in that he certainly has likely done a fair amount of due dilligence if a position is large enough. Chinese frauds are abundunt as a matter of fact MOST hot areas of the mkt have more than their fair share of supect investments IMO. I have been on the wrong side of a Chinese fraud through a company called Noble China which was  RTO in the 90's. Most of the fraud is either of the PUMP and Dump variety own the shares produce bogus financial results sell the shares to investors and hide in China where you are safe, these are the easiest to detect and the Short crowd has done a pretty good job of ferretiing these out and good for them. The investment bankers who brought these things public should be drawn and quartered IMO if IB's had to take 1/2 of their fees in shares which had to be held for 5 years perhaps these companies would never see the light of day which would be a very good thing. Risk capital is such a valuable and scarce resource it is a terrible shame that it is wasted on scams. It seems to me that only greedy Investment bankers and sharp short sellers and crooks are the only people who benefit when this crap gets on our public mkts and it pollutes the eco-system. If Sino Forest is a scam then it is a scam of a different variety it clearly is not a pump and dump, it has been around for many years . My radar is telling me this is a short and distort but all I have to go on are my spider senses.

 

Paulson had a mediocre track record before the subprime thing. I think it's a little naive to put so much faith into someone who could've very easily just been lucky. Buffett he is not.

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Interesting side effect of TRE selloff: from Jim Sinclair's website www.jsmineset.com -- Jim's company Tanzanian Royalty Explorations is TNX on Toronto, but TRE on NYSE.  Gather there has been confusion among some people who heard that "TRE" is (such-and-such).

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I've thought this for a long time, but now would be a good time to just say it: I respect a great many people on this board. But I also feel that way too many people here like to fellate Buffett and hold FFH as gods. Buffett is a great investor, and FFH is a great company. But not everything is JUST LIKE THAT ONE TIME BUFFET INVESTED IN THIS or THAT ONE TIME EVERYONE TRIED TO SCREW FFH.

 

Also, how many people here really gave a shit about Paulson before the little headline grabber with GS? I dont recall anyone here quoting him and how awesome an investor he is. All of a sudden he's become the guy that can do no wrong? Give me a break.

 

It's true, not a lot of people know MW. But is that really what the crux of your defense is? "MW could be lying because they are the new guys on the block". As if the established guys (big bank analysts) were doing such a great job in the first place.

 

I'm just really surprised how hard some people on the board, who I've known to otherwise be rational are trying to ignore the report that MW put out. I almost feel like someone else hacked your accounts and is posting on your behalf.

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I've thought this for a long time, but now would be a good time to just say it: I respect a great many people on this board. But I also feel that way too many people here like to fellate Buffett and hold FFH as gods. Buffett is a great investor, and FFH is a great company. But not everything is JUST LIKE THAT ONE TIME BUFFET INVESTED IN THIS or THAT ONE TIME EVERYONE TRIED TO SCREW FFH.

 

Also, how many people here really gave a shit about Paulson before the little headline grabber with GS? I dont recall anyone here quoting him and how awesome an investor he is. All of a sudden he's become the guy that can do no wrong? Give me a break.

 

It's true, not a lot of people know MW. But is that really what the crux of your defense is? "MW could be lying because they are the new guys on the block". As if the established guys (big bank analysts) were doing such a great job in the first place.

 

I'm just really surprised how hard some people on the board, who I've known to otherwise be rational are trying to ignore the report that MW put out. I almost feel like someone else hacked your accounts and is posting on your behalf.

 

Very well said.

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I am neither long nor short in TRE, but I remember in the previous incarnation of this board, the MSN board, there was quite some discussion on this company. 

 

I never did hold a position, but I am wondering whether any board members who invested in it and are more knowledgable about this company will be willing to discuss about it.

 

It seems that this is a situation where to invest in it, one needs to have confidence in the management.  Without access to the company's book, it seems that confidence can be gained by 1) having invested in it for a long time and thus observed in great depth how the management actually performed or 2) having some sorts detailed background checks on the members in management. 

 

Any old members care to share their thought?

   

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Guest Hester

Definitely well said Libor.

 

Like who? I don't see anyone ignoring the report. If one were to ignore it, one would be buying hand over fist Friday.

 

Ignoring the substance of the report? Yes. This has been 9 pages of replies arguing about John Hempton and the history of MW. There has been more mentions of Fairfax than Sino. There has been maybe one comment about the specifics of the report. Which is fine, I just hoping nobody is basing investment decisions this.

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What do you think about the two errors TRE points out in their PR? It's a fine report but doesn't seem top notch to me. it has lots to details that one cannot really verify by reading through the filings.

 

 

I think if TRE can only point out two errors in a 40 page report, then TRE is in a lot of trouble. I expect their to be a larger report out rejecting MW soon, then I expect MW to release a report rejecting what the management said. This will probably go on until TRE gets delisted, or MW loses all their hard earned reputation because they wrote a report that was completely false and TRE's management proves it. I think the former is far more likely.

 

The reason I think it's top notch is because it includes a lot of work that you can't get through reading the filings. I've some disclosures in chinese filings that make my head spin, but when I tell my friends about them they say "well, it might be a bad company, at least they disclosed it." 

 

So I really respect people who put on their shoes and dig up their research. They find material that wasn't disclosed to the average shareholder and should have been.

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If you are willing and able to read Chinese, Muddy Water did provide additional material other than the report as supporting evidence.

 

One Chinese material (A5) appeared to be about complains from local governments about TRE not honoring the agreements.  I wonder whether this is just a running dispute with a local government or not.

 

One Chinese material shows lots of transcations that are related-party.

 

I actually wonder why TRE did not respond to these other issues. 

 

I don't have a position in this but I think the company's respond appear to be weak.

 

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I've thought this for a long time, but now would be a good time to just say it: I respect a great many people on this board. But I also feel that way too many people here like to fellate Buffett and hold FFH as gods. Buffett is a great investor, and FFH is a great company. But not everything is JUST LIKE THAT ONE TIME BUFFET INVESTED IN THIS or THAT ONE TIME EVERYONE TRIED TO SCREW FFH.

 

Also, how many people here really gave a shit about Paulson before the little headline grabber with GS? I dont recall anyone here quoting him and how awesome an investor he is. All of a sudden he's become the guy that can do no wrong? Give me a break.

 

It's true, not a lot of people know MW. But is that really what the crux of your defense is? "MW could be lying because they are the new guys on the block". As if the established guys (big bank analysts) were doing such a great job in the first place.

 

I'm just really surprised how hard some people on the board, who I've known to otherwise be rational are trying to ignore the report that MW put out. I almost feel like someone else hacked your accounts and is posting on your behalf.

I suppose it's a lot easier to "outsource" the research process than doing it yourself.

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If you are willing and able to read Chinese, Muddy Water did provide additional material other than the report as supporting evidence.

 

One Chinese material (A5) appeared to be about complains from local governments about TRE not honoring the agreements.  I wonder whether this is just a running dispute with a local government or not.

 

One Chinese material shows lots of transcations that are related-party.

 

I actually wonder why TRE did not respond to these other issues. 

 

I don't have a position in this but I think the company's respond appear to be weak.

 

 

My thinking is the 2 points they respond are most critical re: assets value and re: sales.

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What do you think about the two errors TRE points out in their PR? It's a fine report but doesn't seem top notch to me. it has lots to details that one cannot really verify by reading through the filings.

 

 

I think if TRE can only point out two errors in a 40 page report, then TRE is in a lot of trouble. I expect their to be a larger report out rejecting MW soon, then I expect MW to release a report rejecting what the management said. This will probably go on until TRE gets delisted, or MW loses all their hard earned reputation because they wrote a report that was completely false and TRE's management proves it. I think the former is far more likely.

 

The reason I think it's top notch is because it includes a lot of work that you can't get through reading the filings. I've some disclosures in chinese filings that make my head spin, but when I tell my friends about them they say "well, it might be a bad company, at least they disclosed it." 

 

So I really respect people who put on their shoes and dig up their research. They find material that wasn't disclosed to the average shareholder and should have been.

 

 

If it has 2 errors (and they are not small), then I can't say it's top notch but for sure it has lots of details.

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I have no dog in this fight, but Block's interview left me far from impressed.  I have no idea if TRE is a fraud or not, but I can tell you that if you've got Herb Greenberg and John Hempton mentioned in the same interview, I have as many doubts about the legitimacy of any accusation, as I would about the legitimacy of who has been accused.  That was a pretty softball interview by Greenberg...oh wait, all his interviews are like that!

 

For those that think Byrne is a lunatic, feel free to ask him that question to his face, as he may attend our Fairfax Shareholder's Dinner next year at my invitation.  Seven years ago they called Prem a fraud and crook.  Five years ago they called Patrick "tinfoil hat Byrne".  Funny how virtually every SEC investigation on insider trading these days revolves around SAC.  There may be legitimate traders at SAC, but it's the culture that's highly suspect, and that starts at the top. 

 

How many Fairfax employees, former or present, have been indicted?  How many employees, former or present at Overstock.com have been indicted?  I think we've lost count how many former or present SAC employees have been indicted!

 

Finally, as far as research is concerned, John Gwynn and Mathew Cantrell put out some pretty sophisticated, voluminous reports on Fairfax.  They obviously seemed to have done their due diligence.  Many people felt that their comments were irrefutable.  Yet, somehow we managed to refute every point. 

 

If TRE is a fraud, then I hope they've gotten caught.  But if they aren't, I would hope that they would put Muddy Waters completely out of business.  Regardless, this should not end well for one party or the other in this dispute!  Cheers!

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This is too much like deja vu. The level of collusion it would take to drive a stock down like TRE's was is immense. This was an orchestrated attack, no doubt about it. 

 

If the report is fraudulent the perps have made their fortune.

 

One of the things that I dislike most about the report is the casting of doubt using the corporate structure of the company. The company has many subsidiaries or holds assets in other jurisdictions this is transalated into a "complicated structre" and "difficult to analyse". 

 

All you have to say is a girl is a slut and she's a slut. In this sort of corporate situation millions upon millions are made and no one is ever brought to justice.

 

As an aside it seems TRE is defending itself more vigorously today.

 

 

http://www.newswire.ca/en/releases/archive/June2011/06/c2925.html

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Someone mentioned that the company has been around for like 14 years or what have you...so was Enron. I have no stake in this one either way. It is way beyond my circle of competence.

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Estimated Profit,  I hear you...Should Sino be correct, and honest then there will be buckets of lawsuits and Muddy Waters will be toast permanently and Carson Block will be out of business permanently.  At worst it is an exercise in transparency that will benefit Sino in the end.  They will be forced to go above and beyond.  It is too bad that Sino is not listed in the US where the SEC would have jurisdiction over MW and Sino.

 

If Muddy Waters is correct then they will have made their reputation (and their money).

 

There were roughly 20 m shares sold short.  Assumming MW held 15 of these then he has made somewhere between 100 to 150 m.  That's alot of incentive to produce a report of 40 pages in length with appendices.  The outflow from that would also give the 'infomants' of MW alot of incentive to fake reports and results.

 

Time will tell on this one. 

 

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I have no dog in this fight, but Block's interview left me far from impressed.  I have no idea if TRE is a fraud or not, but I can tell you that if you've got Herb Greenberg and John Hempton mentioned in the same interview, I have as many doubts about the legitimacy of any accusation, as I would about the legitimacy of who has been accused.  That was a pretty softball interview by Greenberg...oh wait, all his interviews are like that!

 

For those that think Byrne is a lunatic, feel free to ask him that question to his face, as he may attend our Fairfax Shareholder's Dinner next year at my invitation.  Seven years ago they called Prem a fraud and crook.  Five years ago they called Patrick "tinfoil hat Byrne".  Funny how virtually every SEC investigation on insider trading these days revolves around SAC.  There may be legitimate traders at SAC, but it's the culture that's highly suspect, and that starts at the top. 

 

How many Fairfax employees, former or present, have been indicted?  How many employees, former or present at Overstock.com have been indicted?  I think we've lost count how many former or present SAC employees have been indicted!

 

Finally, as far as research is concerned, John Gwynn and Mathew Cantrell put out some pretty sophisticated, voluminous reports on Fairfax.  They obviously seemed to have done their due diligence.  Many people felt that their comments were irrefutable.  Yet, somehow we managed to refute every point. 

 

If TRE is a fraud, then I hope they've gotten caught.  But if they aren't, I would hope that they would put Muddy Waters completely out of business.  Regardless, this should not end well for one party or the other in this dispute!  Cheers!

Your words reflect my thoughts entirely. There exists an asymytry in outcomes IMO if one uses Enron as an example the period from the discovery of the crime until guilty verdicts were delivered against major players was relatively short if we use the FFH example we have no official consideration of a crime even having transpired and civil remedies years away from being resolved.Stock prices its an escalator up and an elevator down fear is a more powerful emotion than greed.
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Estimated Profit,  I hear you...Should Sino be correct, and honest then there will be buckets of lawsuits and Muddy Waters will be toast permanently and Carson Block will be out of business permanently.  At worst it is an exercise in transparency that will benefit Sino in the end.  They will be forced to go above and beyond.  It is too bad that Sino is not listed in the US where the SEC would have jurisdiction over MW and Sino.

 

If Muddy Waters is correct then they will have made their reputation (and their money).

 

There were roughly 20 m shares sold short.  Assumming MW held 15 of these then he has made somewhere between 100 to 150 m.  That's alot of incentive to produce a report of 40 pages in length with appendices.  The outflow from that would also give the 'infomants' of MW alot of incentive to fake reports and results.

 

Time will tell on this one. 

 

 

Hey, if I could trade my reputation for 10m - 100m in my 30s... I might just do that.  That's a pretty high pay grade for temporary negative press that main street will never hear about. Also, then he writes books and gets taken on as a consultant in future frauds like Hempton.  All this FFH stuff hasn't stopped him from doing business.

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a piece on TRE is also on the TOP NEWS page on Bloomberg terminals... People are out for blood on either Sino or MW

 

Latest update: Sino office temporarily closed:

http://is.gd/ggN2Rw

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