{"id":29197,"date":"2012-04-20T13:06:21","date_gmt":"2012-04-20T17:06:21","guid":{"rendered":"http:\/\/countingpips.com\/forex-news\/2012\/04\/argentina-and-ypf-17-stocks-to-sell-immediately\/"},"modified":"2012-04-20T13:06:21","modified_gmt":"2012-04-20T17:06:21","slug":"argentina-and-ypf-17-stocks-to-sell-immediately","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/forex-news\/2012\/04\/20\/argentina-and-ypf-17-stocks-to-sell-immediately\/","title":{"rendered":"Argentina and YPF: 17 Stocks to Sell Immediately"},"content":{"rendered":"

Article by Investment U<\/a> <\/p>\n

\"Argentina<\/p>\n

If Argentina is willing to nationalize its leading oil company, YPF, which company (or companies) is next?<\/p>\n<\/div>\n

Ever wonder what happens when greed meets stupidity in the stock market? For a profound example, take a look at the recent free fall in Argentina\u2019s largest oil and gas company, YPF<\/strong> (NYSE: YPF<\/a>).<\/p>\n

The country\u2019s President Cristina Kirchner recently took a watershed step in expanding the state\u2019s grip on the economy, saying she will send a bill to Congress to nationalize the firm.<\/p>\n

Predictably, shares of YPF \u2013 and other Argentine stocks \u2013 gapped down on the news.<\/p>\n

Kirchner declared that this historic move must be made because the petroleum industry is of \u201cnational public interest.\u201d Of course, what industry isn\u2019t? Banking? Telecommunications? Manufacturing? Agriculture?<\/p>\n

Kirchner insists that YPF\u2019s low production is forcing the country to spend heavily on imported energy at a time when it is experiencing a scarcity of dollars due to capital flight. And why is Argentina hemorrhaging capital? Because of boneheaded moves like this one.<\/p>\n

YPF\u2019s majority shareholder, Spanish energy group Repsol, is not taking this theft lying down. The Madrid government has threatened swift retaliation. And Spain\u2019s Prime Minister Mariano Rajoy stated the obvious when he said the Spanish company\u2019s controlling stake in YPF \u2013 which Repsol was planning to sell to China\u2019s Sinopec \u2013 was being expropriated \u201cwithout any justification.\u201d<\/p>\n

Given that most successful developing nations are privatizing industries rather than nationalizing them \u2013 and given that investment capital always flows where it is treated best (and conversely flees those countries where it is treated badly) \u2013 why would Kirchner do this?<\/p>\n

One answer is stupidity. The other is hubris.<\/p>\n

There is absolutely no reason to think that a bunch of politicians and bureaucrats \u2013 or their appointees \u2013 could run YPF better than Repsol, one of the world\u2019s leading energy groups. (Just as there is no reason to think the U.S. government can do a better job than private equity groups of backing speculative solar companies like Solyndra.)<\/p>\n

And if Argentina is willing to nationalize its leading oil company, which company (or companies) is next? Here\u2019s a potential hit list, 17 Argentine companies that trade on the NYSE or Nasdaq. If you\u2019re holding any of them, sell them immediately.<\/p>\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n
ADR Name<\/strong><\/td>\nTicker<\/strong><\/td>\nIndustry<\/strong><\/td>\n<\/tr>\n
Alto Palermo<\/td>\nAPSA<\/td>\nReal Estate Inv&Serv<\/td>\n<\/tr>\n
Banco Macro<\/td>\nBMA<\/td>\nBanks<\/td>\n<\/tr>\n
BBVA Banco Frances<\/td>\nBFR<\/td>\nBanks<\/td>\n<\/tr>\n
Cresud<\/td>\nCRESY<\/td>\nFood Producers<\/td>\n<\/tr>\n
Edenor<\/td>\nEDN<\/td>\nElectricity<\/td>\n<\/tr>\n
Grupo Financiero Galicia<\/td>\nGGAL<\/td>\nBanks<\/td>\n<\/tr>\n
IRSA Inversiones y Representaciones<\/td>\nIRS<\/td>\nReal Estate Inv&Serv<\/td>\n<\/tr>\n
MetroGas<\/td>\nMGSBF<\/td>\nGas,H20&Multiutility<\/td>\n<\/tr>\n
Nortel Invesora – Series B<\/td>\nNTL<\/td>\nFixed Line Telecom.<\/td>\n<\/tr>\n
Pampa Energia<\/td>\nPAM<\/td>\nFinancial Services<\/td>\n<\/tr>\n
Petrobras Energia<\/td>\nPZE<\/td>\nOil & Gas Producers<\/td>\n<\/tr>\n
Telecom Argentina<\/td>\nTEO<\/td>\nFixed Line Telecom.<\/td>\n<\/tr>\n
Telefonica de Argentina<\/td>\nTEF<\/td>\nFixed Line Telecom.<\/td>\n<\/tr>\n
Tenaris<\/td>\nTS<\/td>\nIndust.Metals&Mining<\/td>\n<\/tr>\n
Ternium<\/td>\nTX<\/td>\nIndust.Metals&Mining<\/td>\n<\/tr>\n
Transportadora de Gas del Sur<\/td>\nTGS<\/td>\nOilEquip.,Serv.&Dist<\/td>\n<\/tr>\n
YPF<\/td>\nYPF<\/td>\nOil & Gas Producers<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

The tragic part of this power grab \u2013 which has undeniable populist appeal in some quarters \u2013 is that it will only undermine investor confidence and do lasting damage to the Argentine currency, the Argentine economy and, ultimately, middle-class Argentinians.<\/p>\n

This move is not just greedy. It\u2019s profoundly dim. But then, Ronald Reagan said it best:<\/p>\n

\u201cThe best minds cannot be found in government. If they could, the private sector would hire them away.\u201d<\/p>\n

Good Investing,<\/p>\n

Alexander Green<\/p>\n

\n<\/img><\/a> <\/img><\/a> <\/img><\/a> <\/img><\/a> <\/img><\/a>\n<\/div>\n

<\/p>\n

Article by Investment U<\/a> <\/p>\n","protected":false},"excerpt":{"rendered":"

Article by Investment U If Argentina is willing to nationalize its leading oil company, YPF, which company (or companies) is next? Ever wonder what happens when greed meets stupidity in the stock market? For a profound example, take a look at the recent free fall in Argentina\u2019s largest oil and gas company, YPF (NYSE: YPF). … <\/p>\n

Continue reading “Argentina and YPF: 17 Stocks to Sell Immediately”<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-29197","post","type-post","status-publish","format-standard","hentry"],"_links":{"self":[{"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/posts\/29197","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/comments?post=29197"}],"version-history":[{"count":0,"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/posts\/29197\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/media?parent=29197"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/categories?post=29197"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/tags?post=29197"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}