Member Info for Guitarsolo

On right on cue, they are redeeming $250m next month.

It's a sensible strategy and one that has been clearly signalled. Doing what you say you are going to do is a good thing!

Lending/ Eccles/ Captain,

Happy New Year to you all!

I concur with all of that about accounting standards. What was suppposed to make things better has made it worse (imo) for insurers. Still, that has presented some opportunities I guess.

The only thing I would add is that insurers (of all flavours) are very different to banks when it comes to bonds/ gilts. Banks can suffer a run on deposits (i.e. liabilities) which require them to sell bonds (assets) to cover the cost. If those bonds have temporarily fallen at that precise moment a bank can be temporarily insolvent and go bust.....just like Silicon Valley Bank. In my professional work I have some involvement with runs on banks and they can start so innocuously in the social media age, hence I shun most banks for investment! But insurers are different. You don't get a run on insurance policies! It's not to say insurers are exempt from all risk, they hold huge assets after all, but the short term value of those assets needs to be assessed without the alarm of a mark to market approach. In my opinion anyway!

Guitarsolo

Captain: "for companies like L&G are devilishly difficult to utilise, because of the 'E' in PE. And according to accounting standards how is the 'E' calculated!!!"

Quite! If LGEN made £2bn operating profits but had to write down the value of its bonds by £2bn, is its profit really zero? Conversely, if the bond values increased, did it make £4bn if it is still holding those bonds to maturity? As you put it.....it's how is the "E" calculated?

Captain, it's the Waren Buffett/ Charlie Munger argument of "Hold to Maturity v Available for Sale". Do you mark to market all the time on the balance sheet? (WB and CM think you should btw). Google will find you some good interviews with them.

However, if I recall they were specifically referring to the value of bonds/ treasuries (gilts for us in the UK) held by banks (Bank of America probably knowing Buffett). In that regard it is worth remembering that insurance companies, particularly life insurers and pension providers, will buy bonds/ gilts to match their long-term liabilities and hence will fall into the "hold to maturity" bucket where the mark to market values are less relevant.

Notwithstanding that, the value of bonds/ gilts/ treasuries need to be carefully watched as it took down Silicon Valley Bank (and others) which wasn't exactly small.

Guitarsolo

Hello Sam,

Thanks for the correction re 1929 overturning a 200-seat majority....I didn't know that (wasn't around at the time!). I presume it was triggered by the Great Depression. Perhaps it needs an event of that magnitude to overturn such a majority, with our electoral system anyway. But like MrG, I think Reform would be the only party to really threaten the green agenda. Any party that wants to have a broad-based appeal to people under the age of 50 has to take climate change seriously. Anecdoctally, every single interview I conduct turns to our company's green policy at some stage, and I don't work in a related industry!

Anyway, Merry Christmas all. Let's hope 2025 is a better year for this sectory.

Guitarsolo

One would think so Trotsky. I'd also add that most incoming governments do not seek to renege on a previous government's agreements (even if they disagree with them) because it would completely undermine future projects. For example, Labour in opposition objected to new North Sea licenses but said they wouldn't cancel them if elected. Why? Because if they did anyone contracting with a present government would have to build in a margin for the risk that a future government would renege on the agreement. It is highly inefficient and therefore it is better to allow prior agreements to proceed, especially as it is easy to blame somone else.

The only thing is, if there is one leader who wouldn't care about that or the consequences, it's Trump!

67Sam/ AVI,

I think predicting the path of politics at the moment is folly and most likely is a projection of one's own views (bearing in mind BBs on investment sites are largely an echo chamber and capture only a small % of the population). Historically, overturning a 200 seat majority has never been achieved in one election, but politics is not normal any more. Anyway, my point was that we currently have a government that is supportive to the work of NESF/BSIF/GSF etc and that should remain for 4.5 years at least. But politics is possibly/probably one of the main risks to this sector in my view. It will be interesting to see if there is correlation between the share prices of the green energy sector and the relative popularity of the current government.

Guitarsolo

JCB "A total of 52.6pc lived in households that received more from the state than they paid to the Treasury last year, according to the Office for National Statistics (ONS). Imagine what it will be like in another 10 years without changes."

In 2012 it was 52.5%. Source, the same Office for National Statistics. So it's actually improving!

Finley, I've never asked you to rate my opinions! You made a statement that "the markets don't like Labour" but I don't agree. I would say they are indifferent to the colour of any government. But with your ability to spot a "wrongen" you must have been busy for the last 20 years! I simply offered some balance to your claims that are personal but you tried to suggest represent the consensus. Nothing more, nothing less.

Have a good day now.

Ok, a couple of days later there was a corrective RNS and the approved figure is 76,000,000 shares in the blocklisting..... it's still big, just not as big!

Oh dear Derby and Mole, imagine living your lives a year behind actual events!

If you actually did some research you would find that Aviva's board is 50/50 male/female and is 93% white!

But let your prejudices be triggered by GB News whenever they feel like it!

Are you talking about me or the Prime Minister?!

Rob, I've been on 9 (to 13 countries) since 4th July..... and I only run a small company, not lead the government of the 6th largest economy in the world! What's your point? He shouldn't be doing it?!

Stop projecting people!

Thanks Legs, I can empathise when you're holding a stock that depreciates and "newcomers" benefit from a lower price with everyone saying nothing has changed.....apart from the value of your portfolio! The same thing happened to me with REITs.

But if NESF (and BSIF) can keep their income and dividend where it is, then surely this will revert to more normal ratios. That's all they should concerntrate on.

When considering investing I tried to think of the biggest threats and it occurred to me that one is political....If the next government was one to abolish all subsidies, cancel net zero targets etc. But that's 4.5 years away and would require overturning a 200 seat majority! Stranger things have happened I guess.

As for the goings on in the US.....perhaps we have bigger things to worry about than NESF's share price!

Finley, you say "The markets don’t like Labour, and why because the electorate have changed their mind and want them out.". But on 5th July 2024 the FTSE was at 8205.....almost exactly where it is now.

"There is no confidence in this government end of story, go talk to businessman, people like me." I'm also a businessman and don't share your pessimism, but that could be due to all sorts of factors. I'd also note that if government policy followed the preference of business, then Brexit would never have happened (and the LSE boards are certainly loaded with many leave voters).

I would suggest it it not "the market" that doesn't like Labour, nor does the population have no confidence or want to change (most don't care), that is a reflection of your thoughts - which you are entitled to obviously, but not to claim that is a consensus when it is not.

Something to think about!

Hello Legs, it's a strange old world out there at the moment...... certainly no santa rallies in sight! The discounts to NAV are staggering for income generators and, in my opinion at least, it is overdone (I hope!). NESF, and to a lesser extent BSIF, are being priced for a collapse of their income/ dividend. So if that doesn't happen, and if interest rates do fall, the theory is that this will revert to more typical yield, P/E etc.

I've added a third tranche at 65p.

Agree Silverblade, it is perplexing! It's like the market doesn't seem to value reliable income!

As it dropped below 120p today I have dived in with an opening position. Time will tell if that was auspicious, or too soon.

Guitarsolo

Silverblade, there is definitely no santa rally to speak of this year! It's very hard to know where the bottom is for the infras (a bit like the renewable energy market, REITs, you name it!). I've not got a holding in INPP yet, but I do have a lot of BBGI as a cornerstone investment for income. That has suffered similarly. Interest rates are often cited as the cause, increasing the discount rate etc. However, the reason we have high(er) interest rates is because we had/have high(er) inflation and the likes of BBGI and INPP have a lot of their income inflation-linked. So what's negative on the one hand is positive on the other..... sort of!

Meconopsis, how arbitrary do you feel the CSMs of insurers are? Not necessarily just MNG, but others like LGEN, PHNX, CSN, AV. etc. I don't mind the principle of the value of long-dated insurance contracts being attributed to profits over all years of the product, rather than just the sale year. However, could we see revaluations of those CSM from year to year resulting in significant change? It feels like we have to put a lot of faith in the figures (and I do, otherwise I wouldn't invest here).

I do get annoyed with the tone of NRR's results. It's all hyped up....significantly this, great that.... "our operational performance has been excellent"......And then you read the details:

- EPS down

- Dividend down

- LTV up

The only saving grace is that asset values haven't reduced again.

Remember, this share used to be over 300p and paid a 21.6p dividend!

The situation doesn't warrant the congratulatory language by Allan Lockhart.