Canadian Dollars Blog

Jae Jun of Old School Value has an interesting take on the whole EMMS merger investing arbitrage situation . While he makes some valid points I disagree with some of them. First off let me disclose that I am still retaining my position in EMMS and have voted to tender the shares. Should the tender not work, I'm not seeing much further downside in this stock as the activists could very well be getting Mr. Smulyan to offer a higher bid. It's clear that Jeff Smulyan is very willing to take the company private - the question is are we reading his hand correctly? I believe that he is willing to pay more than the 2.40 if there is dissent from the activists. Of course this is merely speculation as we don't have a view of Mr. Smulyan's hand. Only time will tell but the tender deadline of August 2 is quickly approaching. I'm holding my shares and will ride this one out. The potential further upside is potentially huge. Disclosure: Author has a position in EMMS acquire...

I recently bought a condo and put down a sizeable amount of downpayment on the place. Then I was reading some Canadian Financial blogs and came across Frugal Trader's article about credit card arbitrage . While I agree with his assessment that taking a 10K and putting it into a high savings account is likely not worth the pain for the gain. I realized that i am in a slightly different situation and that if I borrowed the 10K (actually 12.5K in my case) to pay down against my mortgage (Aside: my mortgage lender will let me pre-pay up to 10% of my outstanding principle) I could get the money to work seriously well for me. I won't disclose my exact lending rate but basically if I can pay off 12.5K of my mortgage instantly and if I am diligent with saving 12.5K in 1 years time (not to hard to do), I will have an amazing after tax return. What do you think of this idea?