BCE - Thanks now I can't afford Christmas

[blahblohblah]

The BCE deal might not go through as promised due to "Solvency Issues"

Read more about it here
http://www.howardforums.com/showthread.php?t=1464449

I have been holding on to 500 shares which I bought at $29.50.
I was going to get $42 on Dec 11 when the privatization was going to finish.

BCE closed at $25.25 today
This means that I have lost a potential $16.75 per share
This means I have lost an actual $4.25 (real money)

I would have had $8,375 (before capital gains tax) to spend on Christmas and vacation - I have lost this.

What hurts the most is that I have now lost $2,125

Bah Hum Bug - BCE = Grinch that Stole My Christmas

[onetruguju]

The BCE deal might not go through as promised due to "Solvency Issues"

Read more about it here
http://www.howardforums.com/showthread.php?t=1464449

I have been holding on to 500 shares which I bought at $29.50.
I was going to get $42 on Dec 11 when the privatization was going to finish.

BCE closed at $25.25 today
This means that I have lost a potential $16.75 per share
This means I have lost an actual $4.25 (real money)

I would have had $8,375 (before capital gains tax) to spend on Christmas and vacation - I have lost this.

What hurts the most is that I have now lost $2,125

Bah Hum Bug - BCE = Grinch that Stole My Christmas

welcome to the world of investments...
when investing, markets dont only go up. to make the 56% gain, you need to be ready for a 56% loss....

More the risk, more the return...

Good luck on your other stocks... I need it!

[anycee]

Undiversified risk is bad...

[CeoOfKFC]

Undiversified risk is bad...

AIG, Fannie Mae, Freddie Mac, GM, Ford

An ALL-IN amongst this group would be diversification.
Look what happened yesterday and today.

[vistaliving]

You put all your eggs in one basket, someone drop that basket....

Edit: Christmas is not about money, you can always afford it.

[phomp]

IMO, bad financial planning on your part. You prehaps should have put aside some cash aside for Christmas instead of throwing the capital into a bearish market where there the short term risk for depreciation of the value is high.

BCE is not to blame, you are.. :lol:

It does suck for you, but you should also not be throwing all your eggs into one basket.

[ppcuser]

Man is this thread a magnet for cliches or what?

[Sepiraph]

Is that supposed to be a lot of $ :?:

[CSAgent]

I wasn't aware Christmas was something you buy... I thought it was a celebration of Christ's birth.

[anycee]

AIG, Fannie Mae, Freddie Mac, GM, Ford

An ALL-IN amongst this group would be diversification.
Look what happened yesterday and today.

Actually, that is a pure play in "I believe I'm smarter than the market".
Diversified would be a mix of debt and equity etfs, both small and large cap, and perhaps some real estate exposure.
The above may have done badly, but that doesn't mean it wasn't the best option.

When you speculate on a merger as liquid as BCE, you might as well be betting on football (except the BCE merger was likely priced more efficiently than football matches and the football betting spreads may be slightly higher).

[Byrns]

I don't see how you lost anything? Did you sell your shares? If not you still have your 500.

[heat]

IMO, bad financial planning on your part. You prehaps should have put aside some cash aside for Christmas instead of throwing the capital into a bearish market where there the short term risk for depreciation of the value is high.


:lol: Yea OP that sucks. Should've sold it when you had the time to do so.

I bought an oil ETF yesterday, up a nice 5% today:) .

[phomp]

I wasn't aware Christmas was something you buy... I thought it was a celebration of Christ's birth.

I do not believe in celebrating Christ's birth though :evil: We still do Christmas though.

[angel_wing0]

well got to make the credit card your best friend :D

[g0lden0rchard]

I too am a BCE investor and I can see the OPs PoV. BCE has constantly been telling us that the deal is a go. I too kept my shares because from what we have been told the stock was a safe bet.

Citigroup got federal money and just yesterday we were told the privatization was still good to go.

It is quite odd that this sort of liquidity information would come at this late stage of the game and the stock experiencing a 34% price drop.

Whatever is happening it is mighty odd.

[Barayolayosa]

I don't see how you lost anything? Did you sell your shares? If not you still have your 500.

[UNREALISTIC BUSINESS EXAMPLE]

Actually his investments would be classified as "held for trading" financial assets and thus would be revalued on his reporting date and the loss would be then recognized on his income statement.

[/UNREALISTIC BUSINESS EXAMPLE]

:lol:

[NewDad5]

This deal is not dead....the day by day info. coming out on this is un-real.way to many trigger happy investors out-there. any negative news was going to send this stock tumbling...I actually increased my position today. fingers crossed...if anything I own a great company.

[exstasie]

This deal is not dead....the day by day info. coming out on this is un-real.way to many trigger happy investors out-there. any negative news was going to send this stock tumbling...I actually increased my position today. fingers crossed...if anything I own a great company.

You and apparently quite few other high-profile investors did as well!

Been watching the news and quite a few people bought BCE at the low today. They are expecting a nice dividend return at the beginning of year since all the shareholders will be screaming mad for it!

[i6s1]

At $25 BCE is yielding almost 6%...they retained thier last earnings, but the dividend should resume if the deal gets called off. So really, ignoring the deal, this stock is a bargin. BCE shouldn't be hit that bad by an upcoming recession. Just wait until the rumors start that Telus is going to buy them.

[g0lden0rchard]

If you are interested in dividend yield then look into Bell-Aliant Income Trust

http://finance.google.ca/finance?q=ba.un

Price now = $22.66
Dividend = $0.24 per month = $2.88

yield = 12.7%

[setell]

I sold my BCE shares in my fake portfolio on Monday and made a good 13% return! Didn't wanted to be too greedy as the shares could have gone sour like it did today. All in all, I still think BCE is a great stock on own. Just that the deal is giving it a rippling effect!

[Frankie3s]

Why not write to McGuinty and ask for a bailout?

[g0lden0rchard]

From what everyone is saying maybe the new BCE price should have been put into the Hot Deals forum.

BCE = Black Friday price cut

[slotscanada]

Sounds to me like a good time to buy, if you plan to hold the stock for a while.

[g0lden0rchard]

If you look at long term history of BCE share price from 2002 to 2006 you will see that the stock price fluctuated around an average of $28 with no real appreciation for those four years. BCE still has no real competitive advantage in market.

SlotsCanada - why do you think that BCE is a good long term hold?

[jda]

Sorry to put salt on the wound but you actually loss more than that since BCE has suspended its dividend indefinitely this summer.

[florch]

Welcome to equities, can I call you a Wah-mbulance?

[Nuprapture]

AIG, Fannie Mae, Freddie Mac, GM, Ford

An ALL-IN amongst this group would be diversification.
Look what happened yesterday and today.

haha.. i actually have money in ALL of these (except freddie mac) on my fantasy stock pool... I'm actually smiling over these last few days :)

ford and GM are giving christmas back in my real account too!

[Thalo]

haha.. i actually have money in ALL of these (except freddie mac) on my fantasy stock pool... I'm actually smiling over these last few days :)

ford and GM are giving christmas back in my real account too!

Add Citigroup at Friday's price and you're smiling too.

Is there still any chance of the privatization happening? I hope not. This absolves TD and C from any involvement and they're not penalized for backing out of the deal.

[William W]

Is there still any chance of the privatization happening?

Staging demonstration and protest at KPMG's Head office in DT Toronto? :D

I think this deal is pretty much done. As an investor, I'm just upset that BCE have ever raised this as a potential issue. I'm sure there were plenty of discussion between the auditors and management prior to reaching the auditor reaching their opinion.

BTW, KPMG also does audits for Citigroup and Deutsche Bank. These are big multi-national banks where the audit fees is probably in the multi-million range. Wonder if KPMG with these banks are up for renewal this year, and whether these guys who are eager to get out of this deal has put any pressure on the partners at the firm.

[exstasie]

Sorry to put salt on the wound but you actually loss more than that since BCE has suspended its dividend indefinitely this summer.

Yes, they did suspend them, but that was before of this solvency issue.

A lot of speculators out there believe that there is a great chance that they will be giving out Dividends again in the New Year to at least make the shareholder's happy (as there might be a few angry ones out there right now. Just a few).

[aww1970]

I betcha that TD's Ed Clark was dancing in his office when he read KPMG's report. I did not look, but I heard that TD spiked up slightly on the news. Everyone (on the funding side) wanted a way out and now they have it.

Bummer for the guys who bought @$35ish just waiting for the cheque. My advisor "advised" me to buy in the summer and I declined. My advisor told me the loan was funded and the deal closes in December- as close to money in the bank as you can get. Things that sound too good to be true usually are....

[AllWheelDrift]

Bummer for the guys who bought @$35ish just waiting for the cheque. My advisor "advised" me to buy in the summer and I declined. My advisor told me the loan was funded and the deal closes in December- as close to money in the bank as you can get. Things that sound too good to be true usually are....
I think the market has been pretty efficient at pricing BCE stock appropriate to the level of risk based on all the information available at any given time. Anyone thinking it was a "sure thing" should have asked themselves if it was so certain, why was there such a big spread between the market price and negotiated sale price. The "big boys" would have taken advantage of any mispricing to make a buck.

[dark169]

of course all summer you could have sold your stocks for close to $40 with no problem.
Or anytime all year for $35
Perhaps your greed for an extra few bucks a share is to blame :confused:

[HammerRFDer]

Two questions:

1. If they do decide to pay out all of those dividends they suspended, what will the ex-dividend date(s) be? Would they all go to someone that holds the stock sometime between now and the future? Will they go to who was holding the stock over that time? Can they even retroactively declare ex-dividend dates?

2. How soon will the lawsuits start? They've been involved quite a bit so far, and likely will continue to be...

[gilboman]

AIG, Fannie Mae, Freddie Mac, GM, Ford

An ALL-IN amongst this group would be diversification.
Look what happened yesterday and today.

um..NO it wouldnt be..not even close. it's not even diversified in terms of sector, certainly not geography and certainly not asset classes.

[pitz]

1. If they do decide to pay out all of those dividends they suspended, what will the ex-dividend date(s) be? Would they all go to someone that holds the stock sometime between now and the future? Will they go to who was holding the stock over that time? Can they even retroactively declare ex-dividend dates?


No they can't retroactively declare dividends. So yes, they would go to holders at the date of record of the dividend, sometime between now and the future, if the Board decides to reinstate the dividend.


2. How soon will the lawsuits start? They've been involved quite a bit so far, and likely will continue to be...

Very soon. Some class action lawyer is probably organizing a class and drafting documents as we type. Maybe even a SEC action for securities fraud and failure to disclose material facts could arise out of this, if it was alleged that the Board or management hid information from the public markets innappropriately.

[sonypcs]

Its NOT just you that you cant afford this christmas but for most of the people this year. How can you expect those so called Analysts, Auditors, Big Boys are doing the RIGHT thing for shareholders. Look at those firms that got BAILOUT from the government worldwide, they all got pumped UP by fraudulent numbers and accounting methods in order to keep the corp. alive !!!

If you all keep trusting what those BIG 3 accounting firm, S&P, DBRS & Moody, you will all get smoked because their existence is NOT for us but for the BIG BOYS who can get these people to package their firm nicely in order to RIG money out from share and bondholders...

If you are wondering how bad is business outside on MAIN STREET instead of BAY STREET, here is the TRUTH :

I went out for dinner in Markham and I went to that same place 3 times before already and that restaurant was busy when I was there 1st and 2nd time.

Yesterday, that restaurant was serving with ONLY our table, I thought I should be proud of myself because we are paying only $ 45 to have him cook for us but i do felt very sad for that rest. owner because I never thought business was that bad out there and we sat from 8pm until closing (10pm), NO ONE comes in to dine and his only REVENUE was our table. As I went to these restaurants many times and many rest. owners has been expressing the worrisome about their business, I can imagine how many restaurants and shops will be CLOSED down after christmas..

[dlander]

The BCE deal might not go through as promised due to "Solvency Issues"

Read more about it here
http://www.howardforums.com/showthread.php?t=1464449

I have been holding on to 500 shares which I bought at $29.50.
I was going to get $42 on Dec 11 when the privatization was going to finish.

BCE closed at $25.25 today
This means that I have lost a potential $16.75 per share
This means I have lost an actual $4.25 (real money)

I would have had $8,375 (before capital gains tax) to spend on Christmas and vacation - I have lost this.

What hurts the most is that I have now lost $2,125

Bah Hum Bug - BCE = Grinch that Stole My Christmas


Two possibilities:
1) You knew that investing in the stock market carries a risk of loss and you understood that takeover deals do not always close. In this case you knowingly put your money at risk and have only yourself to blame.

2) You had no idea that investing in the stock market carries a risk of loss and you thought that every deal is guaranteed to close. In this case you did not know what you were buying and have only yourself to blame.

[urameatball]

between a global credit crisis, the stock market dropping close to 50% in the last few months, and an impending recession... who would have thought your portfolio would tank???

I guess that's what happens when you expect 50% gains in possibly the most hostile economic environment in history.

Consider yourself one of the lucky ones.

[thefleet]

I think the market has been pretty efficient at pricing BCE stock appropriate to the level of risk based on all the information available at any given time.

:arrowu:

BCE was cheap (29.50 purchase price) because it carried the appropriate amount of risk

[at1212b]

To the naive that thought there was such thing as a safe and guaranteed thing in life.. hip hip hooray!

Hip Hip Hooray.. to the Jollly good fellow.. to the jolly good fellow who believed in greed and a sure thing and immediate profit based on the greed of others... hip hip hoooray.. Hallajuaaaah!!!!

[f00kie]

Why does everyone (only here on RFD, of course) think making a little extra money as greedy? I think there's something wrong with that line of thought...

And yes, I bought recently and now have a paper loss. I only have myself to blame, but I wouldn't say I was greedy just because "I wanted to make a quick buck". The risk was priced in, and now I am paying for it.

[dlander]

Why does everyone (only here on RFD, of course) think making a little extra money as greedy?

I have no problem with people who invest and make a little extra. But the OP is a DUMBASS. In the middle of a recession and a credit crisis, he kept Christmas money that he wanted to spend over the next one month in the stock market. And now that the particular stock went down he does not realize that he brought the misfortune upon himself.

[el_diablo007]

I have no problem with people who invest and make a little extra. But the OP is a DUMBASS. In the middle of a recession and a credit crisis, he kept Christmas money that he wanted to spend over the next one month in the stock market. And now that the particular stock went down he does not realize that he brought the misfortune upon himself.

Gotta agree with this, also, BCEès stock price was hovering around the $37-39 range for a while, why not lock in your profitsÉ thatès a solid 30% gain...

[kneevase]

You bet your Christmas on BCE alone? Talk about dumb! You deserve what you get... You should be ashamed to be on RFD whining about it/ >:(

[eliteblaze2]

umm my question is given the merger clauses were out there... in fact it was a key part of the bondholder suit... why didn't anyone do their own solvency test (Add up assets, liability, use public multiples ) to see if the company was solvent?

[liorsyncro]

The BCE deal might not go through as promised due to "Solvency Issues"

Read more about it here
http://www.howardforums.com/showthread.php?t=1464449

I have been holding on to 500 shares which I bought at $29.50.
I was going to get $42 on Dec 11 when the privatization was going to finish.

BCE closed at $25.25 today
This means that I have lost a potential $16.75 per share
This means I have lost an actual $4.25 (real money)

I would have had $8,375 (before capital gains tax) to spend on Christmas and vacation - I have lost this.

What hurts the most is that I have now lost $2,125

Bah Hum Bug - BCE = Grinch that Stole My Christmas
It's ok, it's alright, I got something that you gonna like, lalala...

Oh crap, I'm really into that tune. Anyways, I wouldn't worry about it too much. Bell is a huge company and its stock price will rebound eventually. Right now the market is brutal if you're looking to make quick cash. But technically, this loss is your fault. Why? Very simple. You know the banks who were financing this deal? Citibankibanki, which just received a $20 billion infusion from the Treasury and guarantees for over $300 billion of its debt, RBS, which is now partly owned by the British taxpayer thanks to all the morons who stir that ship, Deutsche Bank, who may too tap into emergency reserves set by the German government, and TD, which just recently announced a further $350 million in write offs and had its share price tanked. With all these banks being in such, err, terrific shape, do you honestly think them financing $32 billion in debt in these economic times would constitute a wise decision? Sometimes you have to look at the bigger picture. I wouldn't have bet on this merger, and there were rumours that it was in jeopardy for the past month or so. But who knows? Maybe they'll end up merging with Telus. All speculation at this point, but I don't think this will happen either. One company controlling the entire telephone network in Canada and 60% of the wireless market? HA!

[chicadam]

Many experience investors made the call that this deal would go through, so I don't blame the investor for waiting, especially being this close. The stock price was also picking up. The really messed up thing is this, why would someone put a clause like “If a third-party accountant concludes that the purchasers paid too much for BCE’s assets when they are bench marked against current market prices at the time of closing, then the company is insolvent and the deal collapses.” ? hehe... now that I think about it BCE's management group are monkeys, first they drive the company into the ground, now this.

"If the deal is consummated, then some$52-billion in cash is put into the hands of the current shareholders.They will presumably invest it, spend it or pay down debt, which will give a real boost to the “real economy” and help recovery. The federal government will also stand to gain some $3.5-billion in capital gains tax, which in turn will reduce the 2009 deficit."
Christopher Walker
Solvency clause hurts BCE shareholders

For the next time, after a huge gain you should take at least 1/3 off the table, you started to count your chickens which is never good as an equity investor.

[someguy91]

Heh.. people are getting really worked up in this thread.

Simply put, OP didn't understand the risks of merger arb. Harsh way to be taught a lesson... but he'll remember it.

[angel_wing0]

You only gamble on extra money...seeing that u want to use it for christmas/vacation, i wouldnt count that money as "extra".