The Perpetually Blooming Crocus

Once again, I find myself watching the NDP handle business matters with a level of trepidation usually reserved for watching my children trying to be all grown up by using “big people” glasses or dishes. While you want to support their efforts, you can’t help but wonder what is going to get broken in the process. Unfortunately for Manitobans, our capital markets can’t be fixed or replaced as easily as smashed kitchenware.

From Sunday’s Free Press:

On Saturday, Selinger several times cautioned reporters there are two distinct issues that should not be confused -- the possibility Crocus foresaw in 2000 of future cash flow problems, and, as a separate issue, the value of the fund's investments, which Selinger emphasized were not under discussion in 2000.

The Blackberry Addicts, quick to vilify Hugh, added:

That the opposition is happy to confuse the liquidity and pacing issue with the actual problems with the value of Crocus's investments that led to shares stopping trading in 2004 is not at all surprising.
They want the confusion.
But that Manitoba news outlets are happily following along, confusing the issues is doing their public a great disservice.
In effect, they are lying to Manitobans.

Confusion? Lies? Unfortunately for Today’s NDP, liquidity is inextricably linked to valuation no matter how much our esteemed orange-scarfed investment gurus may argue otherwise. If investors were extended the courtesy of being made aware of liquidity concerns with Crocus, same would have eroded their confidence in the fund. This in turn would affect the price they would be willing to pay, regardless of “valuation” gamesmanship. For an illustration of just how important liquidity is in any business, click here.

The NDP are supposed to be the stewards of our capital markets. What do they think is happening to investor confidence in said markets if they keep making a mockery of them? While shell games belong on street corners, they don’t belong on the corner of Broadway and Osborne…