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‘Silly Fool’ Sells NZU at $20, buys back CER at $13.50 and pockets $65,000

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Issue date: 
August 12th, 2011
Publisher Name: 
GHG Emission Trading BLOG
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Back in March 2011 a Carbon Monitor reader wrote to us with the quandary of what to do with his post 1989 NZU units (those with a surrender liability for loss or harvest) suggesting if he took the funds, invested in real estate then he would be ahead even with a future liability. Here is the latest update on his story.

He writes:

So sitting here today 7th August 2011 and the “silly fool” didn’t buy the building because he’s been dithering around, being scared off by the USA and Europeans et al being more in hock than he is! And that was before the melt down on Friday in the international markets.

But he’s just bought 10,000 CER for 13.50 or NZ$135,000. Leaving a profit of $65,000 or around 32.5% and zero liability and still 10,000 units to sell again on top of the next years growth.

Back on march 7th, 2011 when he first wrote, these CER’s would have been $23 ‘ish while he sold his NZU’s for $20

Meanwhile the forest has grown half of the years carbon adding that to the now “free of any liability” for future sale or otherwise.

Mmm rollercoasters and plans and budgets and professional advice, ye-gods I would hate to be trying to anylise my way into recommending an investment path in these times.

Why CER and not European units? Australia has been described as “a huge sandpit full of natural resource” and relatively, not that many people…… so ultimately its dollar will be stronger than most other currencies because they can just keep digging a bigger hole and selling the spoil. The Europeans on the other hand have millennia of culture and peoples, rules and regulations, subsidy mentality and other restrictions to overcome…. This will all conspire to keep that currency “limited”. NZ on the other hand is so small that one “wealthy” person or company can make our currency rise or fall at their whim, let alone all of the other factors.

NOW CAN WE HAVE SOME FOREST PROFESIONALS COMMENT? …. DISCUSSION?….SOME FARM FORESTY MEMBER COMMENT….. Or are you all just reading the certified stuff that has been accepted into peer review. Sorry but my qualifications are simply a heavy transport licence and an ability to make serious capital using my intuition.

So have I left a profit for someone else or have I got the bottom of the market? I always reckon to leave a profit either way. Only a fool tries for maximum all of the time….. wonder if this fool should have bought back in bits and spread the risk? Time will tell and it would make it to hard to relate on this post if the trades were in bits and pieces!

Silly Fool


Extpub | by Dr. Radut