UnThreaded | Threaded | Whole Thread (16) | Ignore Thread Prev | Next
Author: persistentone Two stars, 250 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 35392  
Subject: Re: Juicy high yield trading idea Date: 3/21/2012 12:45 PM
Post New | Post Reply | Reply Later | Create Poll Report this Post | Recommend it!
Recommendations: 0
In a normal MLP, the incentive of a general partner who holds significant units in the partnership is to maintain the health of the partnership. You do that by increasing earnings per unit, book value per unit, and keeping debt at a manageable level. If you fail to do those things and push the company into bankruptcy, then your units become worthless and you lose a lot of money.

In Stonemor's case, who cares if they push the company into bankruptcy? After all, it's your money that they are going to lose. Stonemor's management loses nothing if they push the limited partnership into bankruptcy. So what a great deal for management. Heads they win and you win. Tails they win and you lose. They have no risk. They put all of the risk on you.
Post New | Post Reply | Reply Later | Create Poll Report this Post | Recommend it!
Print the post  
UnThreaded | Threaded | Whole Thread (16) | Ignore Thread Prev | Next


Pencils of Promise - Back to School Drive
"Pencils of Promise works with communities across the globe to build schools and create programs that provide education opportunities for children."
Post of the Day:
Macro Economics

Implications of the Ballad of Ted Plotz
What was Your Dumbest Investment?
Share it with us -- and learn from others' stories of flubs.
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Community Home
Speak Your Mind, Start Your Blog, Rate Your Stocks

Community Team Fools - who are those TMF's?
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and "#1 Media Company to Work For" (BusinessInsider 2011)! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.