Overvalued Timber REITs: Why Timber Investing Isn’t What It Used To Be

by David Fessler, Advisory Panelist

Ten years ago, it would be hard to imagine a more stable investment than timber, or those Real Estate Investment Trusts (REITs) that bought millions of acres of harvestable trees.

The 1990s were an ideal period to have timber as an investment:

Housing was doing well, and growth was beginning to take off in major cities. The world was still pre-digital, and business still relied heavily on shuffling paper. Electronic news was still a novelty; magazines and newspapers were still going strong.

What a difference a decade makes…

Housing is in the dumper, with no clear sign of a resurgence on the horizon. Business has embraced the smartphone and has gone digital, shunning paper. The world is increasingly getting its news in electronic form, as evidenced by the number of newspapers that are no more.

This shift

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For quite some time I was interested in recommending that my readers invest in Russia. I still had concerns about some political issues and organized crime in the country.  Most experts out there tell people to stay away from Russia, so I knew I had to do further research myself.

One day I told my lovely wife to get her passport ready because we were going to Moscow.  She was quite excited because Moscow is a shopping mecca with many historical sites to see.  But, I assure you—I was there for business.

We traveled to Russia in December of last year and I saw firsthand how the country operates.  I observed that the Russians are a hard working and productive people that just want the best for their families.  Russians are striving for a better quality of life just like anyone else.  I knew right away that the country offers investor’s high

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The saga on the high seas continued… As much of the world continued to monitor the story of the American cargo ship that was captured by Somali pirates and held its captain hostage, the increase in piracy has sparked a fascinating conversation. 

It involves the use of innovative products that enable shippers to defend themselves from pirate attacks.

While it may not seem like a lucrative business, the uptick in high seas shenanagins over the past year or so threatens to become more prevalent if it’s not addressed. And with millions of dollars worth of cargo traveling by sea every day, both the shipping industry and the companies whose cargo they’re hauling hardly want to see the trend become a full-blown epidemic.

At the moment, however, only the Department of Defense and various small private companies are responsible for “mobility denial systems.” Described as an “oil slick in a can,” these weapons make

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Although there weren't a ton of comments left on yesterday's video post it appears that quite a few people seem to be on the road to giving up on the stock market.If you are thinking about that, aside from my thinking that long term that is a catastrophic mistake, I would say to wait until the market makes back a meaningful chunk of what it dropped and while you're waiting try to figure out how to save more money.Barron's really outdid itself this week with a couple of very interesting articles.First up was an interview with Donald Coxe from BMO Financial Group. He outlined several longer term themes. He likes all things food as part of the ascendancy theme (this is a term I have been using for a while but he did not use that word). Each ...

A few items this morning.First up is a book review in Barron's of Peter Schiff's latest book called The Little Book of Bull Moves in Bear Markets.According to Barron's the book has plenty financial fire and brimstone and some very specific investment advice on Canada, Norway and Australia--turns out he likes them. Me too.A reader left a link to a new fund from PIMCO called the PIMCO Global Multi Asset Fund (PGAIX). It is a fund of funds but can own other things too. The literature says the fund integrates optimized asset allocation, relative value strategies and hedging strategies. Well that all sounds vague but vague does not have to be bad thing. Anyone interested in hiring someone (by buying a fund) for active management might very well want that manager to have a lot of flexibility. ...

I can’t find many insider buys much more than $500,000 reccently, but BIG Insider selling continues for CEOs and Directors…again while the nation is under seige economically and the average joe gets nothing, these guys are selling millions for their rainy days.  Staples is a good one… the CEO pockets $25 million and the company’s performance is crappy.

Track CEO sales at:

http://trackthepros.com/stocks/category/661

SELLERS:

COMPANY NAME INSIDERS NAME TITLE $ VALUE NO. OF SHARES IN TRANS. RANGE OF VALUES TRANSACTIONS DATES Staples R. Sargent CEO $25,471,500 1,000,000 25.47 Sept. 19, 2008 Lululemon Athletica D. Wilson CB 6,002,016 237,800 24.40-26.13 Sept. 19, 2008 Amazon Com H. Valentine...

The selling by corporate insiders keeps going and going and going….

Track Insider sales at:

http://trackthepros.com/stocks/category/31

COMPANY NAME INSIDERS NAME TITLE $ VALUE NO. OF SHARES IN TRANS. RANGE OF VALUES TRANSACTIONS DATES Lazard S. Golub O $11,384,160 307,680 37.00 Sept. 9, 2008 Guess ? P. Marciano CEO 10,401,500 250,000 41.50-42.03 Sept. 9-10, 2008 Guess ? M. Marciano CB 10,401,500 250,000 41.50-42.03 Sept. 9-10, 2008 Fastenal R. Kierlin D 9,579,312 180,000 53.22 Sept. 10, 2008 Digital Realty Trust R. Magnuson D...

My recent post about Plum Creek Timber, client holding, was re-run on Seeking Alpha and a reader left the name of a stock I had never heard of before; Timberwest Forest (TWF-UN.TO in Canada and TWTUF on the pink sheets).Timberwest is one of these Canada listed products that ties in with some sort of resource and pays an enormous dividend, the hydro funds fall into this category.The chart goes back a year and compares Timberwest with Plum Creek Timber and Macquarie Infrastructure (MIC), which is also a client holding. Timberwest and Plum Creek are obviously both timber companies and Timberwest and MIC are both not so simply constructed businesses with high dividend payouts.An investor who bought MIC or Timberwest at the wrong time may not have necessarily known that this sort of stock would ...