Dear Mr. Berko:
We own four MLPs that you recommended, and we are happy with the good income (all paid over 9 percent) and their increase in market values. We have about $7,000 more to invest and, again, we would like you to recommend an oil/gas MLP paying over 9 percent. We need another favor: Our son owes $16,000 on his credit cards. We heard about American Debt Solution company on Sirius Radio. They advertise that they can eliminate all the credit card debt or reduce it by at least 75 percent. Our son is 23 and we’ve helped him out of debt twice before. If this company doesn’t help him then our son will have to declare bankruptcy. My wife wants to pay off his debts so he can avoid bankruptcy but I don’t think this is a good idea.
P.E., Vancouver, Wash.
Dear P.E.:
I won’t answer any more questions about those debt-settlement companies that advertise on Sirius radio. According to the Federal Reserve, scatterbrained American consumers owe nearly $3 trillion in consumer debt and can’t pay it off. I’ve watched Americans credit card their Big Macs and six-packs, haircuts and 7UPs, Kindles and sandals, iPhones, cigarettes and iPads, then charge up a storm for those wacky apps and then can’t make the minimum payment at the end of the month.
As a result, thousands of debt-relief carpetbaggers ooze from the woodwork offering to erase your debts forever or reduce them by a huge amount. Most of these crooks who will suck you dry advertise on Sirius, which is a most popular entertainment medium for Americans with IQs between 55 and 90.
These debt-relief companies are scourges, and the Government Accountability Office, as well as the Federal Trade Commission, can’t shut them down so they are spreading like a genetic clap. Suffice it to say that if you hear about it on satellite radio, it’s almost certain to be a rip-off.
Your accountant or attorney may be able to refer you to an ethical provider. However, your 23-year-old son lacks the discipline to get his finances in order, and if you pay off his debts again, you’ve become an enabler. This kid needs a credit diet, and bankruptcy is a good teacher. Your son is a loser, and your wife is helping him to perfect that skill.
Consider Martin Midstream Partners LP (MMLP-$30.10), which stores and distributes petroleum and petroleum byproducts primarily along the United States Gulf Cost region. Reuters rates MMLP, which pays a $3 dividend and has a 9.7 percent yield, as “outperform.”
MMLP has been in business since 2001 and paid its first dividend of $1.81 in 2002, which has been increased every year since. And since paying that dividend, MMLP’s share price has ranged from a high of $43 to a low of $14 per share in the market crash of 2008.
During the last seven years, book value and cash flow have more than doubled, and revenues have more than tripled. MMLP has plenty of cash and a strong balance sheet.
Next year, the Street earnings should grow by 40 percent to $1.48 on a 2 percent increase in revenues to $925 million. And while I don’t expect the shares to grow significantly in value, I do expect the dividend to increase by 5 percent to 7 percent per year. A position of 200 shares would be Jim Dandy.
Please address your financial questions to Malcolm Berko, P.O. Box 8303, Largo, FL 33775 or e-mail him at mjberko@yahoo.com. Visit Creators Syndicate Web site at www.creators.com.
© 2010 Creators Syndicate Inc.
