Still Digging the Miners

Well, maybe Monday would have been the better day to start investing in coal miner stocks. Walter Industries (WLT), according to Forbes, is pulling a $1.55 billion loan refinancing package due to poor market conditions. Clearly, the market is seeing this as bad news for debt-laden WLT, which was also weaker today due to a report about falling coal prices. The stock had already been hit hard over the last few weeks -- it has continually appeared on the 52-week new low list.

Don't overlook the fact that Audley Capital Advisors has been pushing for changes at the company. I think we'll see a lot more in the near future from this activist shareholder as the price for WLT has moved even below the teens. WLT is now trading back to its lows of 2008-09. It has had an unbelievable roundtrip from $12 to $140 and back to $12. I have had a few folks asking for some hedging strategies on this and other coal numbers, but for now, I believe we'll have to see how the day shakes out. Volatility is surging, so put buying is going to come at a premium today.
It seems as if, unless you are pulling oil from the ground, then the market wants absolutely nothing to do with you. If you look at the miners -- whether coal or precious metals or even natural gas producers -- there is just little reason for investors to climb on. I scratch my head a bit watching these gold miners the last few days. Even when gold has held its ground, there would be an early morning pop followed by an all-day fade. I wouldn't be surprised if there is a long gold-short miners play being forced down the throat of the market by big money. Either that or funds holding gold miners have been hit by liquidation requests and continue to scale out of positions....90 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.

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