Comments on Domenic J. Strazzulla's articles RSS Syndication from SeekingAlpha.com http://seekingalpha.com/author/domenic-j-strazzulla/articles http://seekingalpha.com/article/132535-diamond-offshore-drilling-is-a-good-oil-play?source=feed#comment-476838 476838 Sat, 25 Apr 2009 07:26:24 -0400 http://seekingalpha.com/article/132535-diamond-offshore-drilling-is-a-good-oil-play?source=feed#comment-476117 476117 Fri, 24 Apr 2009 13:56:15 -0400
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This seems to be a very good long play as the price of oil increases and demand follows suit. Also, the future of oil is in deep waters, IMHO.]]> http://seekingalpha.com/article/132535-diamond-offshore-drilling-is-a-good-oil-play?source=feed#comment-475301 475301 Fri, 24 Apr 2009 03:32:13 -0400
No it isn't. Deepwater drilling is an entirely different ball game within the oil service sector. With the exception of Middle East and Brazil there hasn't been any major onshore or shallow water oil discoveries in the recent years( though plenty of natural gas discoveries), deepwater however has provided number of significant oil discoveries in the GOM, West Africa and Brazil.

Thanks to the credit crunch "the economic moat"( a new deepwater semi-submersible costs at least $500 million) that surrounds the deepwater drilling sector, has become much deeper and wider and should ensure high margins for the drillers in the near and midterm. ]]> http://seekingalpha.com/article/107551-if-the-u-s-is-in-a-financial-crisis-why-is-the-dollar-rallying?source=feed#comment-352945 352945 Mon, 12 Jan 2009 01:21:38 -0500 http://seekingalpha.com/article/112771-microsoft-a-solid-investment-in-technology?source=feed#comment-343607 343607 Thu, 01 Jan 2009 15:36:26 -0500
1) MS-DOS - a program it bought for around $50k, which it used to gain exclusive rights as the OS of choice on PCs.

2) Windows - an OS concept it "borrowed" from AAPL while it was floundering. It utilized this type of platform in a market that had no competition - the PC OS market.

3) Internet Explorer - MSFT's entry into web browsing, pioneered by Marc Andreeson and Netscape. MSFT essentially (and legally) applied monopolistic powers against Netscape, giving away IE, and forcing Netscape into bankruptcy.

4) MS Office - Utilizing its OS monopoly as a springboard, it essentially copied concepts utilized by smaller, less capitalized companies like Lotus and WordPerfect and outspent its competition.

What are its failures?

1) XBox - Instead of scrappy tech startups, the XBox pitted MSFT against Sony and Nintendo. Although it continues to make inroads, the deep pockets and innovations of its competitors have ensured deep red for MSFT

2) Zune - AAPL was a resurgent company by the time MSFT tried to compete with it on consumer electronics. A complete failure.

3) Vista - Wow, when MSFT tries to innovate, it fails hard. Nothing is on Vista that hasn't been seen elsewhere, and the myriad of issues...my IE crashed while I was writing this. I still can't get Flash Player to work. My Canon printer is incompatible with Vista (no backwards compatibility).


My conclusion is that whenever MSFT has to compete against companies that are sufficiently big enough to withstand the flood of cash from the OS cow, it fails miserably to profitably adapt and face its competition through innovation. It amazes me how Gates can brag about finding "supersmart" people and then have them produce next to nothing that can be credibly "new".

The only way this company will find that next big hit is if it finds an industry that is sufficiently small enough to muscle, and yet sufficiently game-changing enough to make a dent in its cash flow. In every effort in the last 10 years, it has failed in this regard.

Like a sheep led to the slaughter, or a dairy cow being milked for every drop, so will go MSFT. It will take time though for us to eat enough of the carcass before that last bit of value disappears.]]> http://seekingalpha.com/article/112771-microsoft-a-solid-investment-in-technology?source=feed#comment-343088 343088 MSFT is a cash machine. The problem is that management is enamored > with developing the next giant hit and pisses the cash hord away. > Shareholder distributions from this cash machine are miniscule. > As competitors and pirates eventually erode MSFTs profitability, > shareholders suffer further as management burns cash in an attempt > to find "the next big thing." Replicating the financial home run > of "Windows" and the associated "Office Suite" will be next to impossible, > even if tens of billions of dollars go out in pursuit of this elusive > fantasy. > > The stock has gone from $90 to $20, after all kinds of buy recommendations > at $35. Mr. market agrees with me that a cash cow is no good if > the cash doesn't flow out to the shareholder, but instead is wasted > tilting at windmills. If the YHOO fiasco doesn't give one pause > to consider the quality and intent of MSFT management, nothing will. > > > Strong sell.]]> Wed, 31 Dec 2008 22:36:25 -0500

On Dec 31 08:45 PM Bobco23 wrote:

> MSFT is a cash machine. The problem is that management is enamored
> with developing the next giant hit and pisses the cash hord away.
> Shareholder distributions from this cash machine are miniscule.
> As competitors and pirates eventually erode MSFTs profitability,
> shareholders suffer further as management burns cash in an attempt
> to find "the next big thing." Replicating the financial home run
> of "Windows" and the associated "Office Suite" will be next to impossible,
> even if tens of billions of dollars go out in pursuit of this elusive
> fantasy.
>
> The stock has gone from $90 to $20, after all kinds of buy recommendations
> at $35. Mr. market agrees with me that a cash cow is no good if
> the cash doesn't flow out to the shareholder, but instead is wasted
> tilting at windmills. If the YHOO fiasco doesn't give one pause
> to consider the quality and intent of MSFT management, nothing will.

>
>
> Strong sell.]]> http://seekingalpha.com/article/112771-microsoft-a-solid-investment-in-technology?source=feed#comment-343025 343025 Wed, 31 Dec 2008 20:45:16 -0500
The stock has gone from $90 to $20, after all kinds of buy recommendations at $35. Mr. market agrees with me that a cash cow is no good if the cash doesn't flow out to the shareholder, but instead is wasted tilting at windmills. If the YHOO fiasco doesn't give one pause to consider the quality and intent of MSFT management, nothing will.

Strong sell.]]> http://seekingalpha.com/article/112771-microsoft-a-solid-investment-in-technology?source=feed#comment-342655 342655 Wed, 31 Dec 2008 12:15:23 -0500 http://seekingalpha.com/article/112771-microsoft-a-solid-investment-in-technology?source=feed#comment-342526 342526 Wed, 31 Dec 2008 10:58:46 -0500 http://seekingalpha.com/article/111405-opec-cuts-oil-falls-something-s-not-sustainable?source=feed#comment-333698 333698 Fri, 19 Dec 2008 06:46:18 -0500
Hint: Research the investment required to produce one megawatt of "alternative energy". How much capital would be required to meet just 10% of the US electricity needs ? What is the internal rate of return assuming various interest rates and a range of non-renewable ( natural gas or coal ) energy prices?

The amount of capital needed will astound you. This amount of capital invested in energy production may raise interest rates to levels that will eliminate any possibility of a return. So, who will make this investment?

That is the heart of the issue. That is why we have no choice but to use military means at this time.

Conservation through human behavioral change offers the hope of reducing the cost of energy by reducing demand. However, any reductions here are more that offset by growth in other developing nations.]]> http://seekingalpha.com/article/111405-opec-cuts-oil-falls-something-s-not-sustainable?source=feed#comment-333466 333466 Thu, 18 Dec 2008 17:38:35 -0500 http://seekingalpha.com/article/111405-opec-cuts-oil-falls-something-s-not-sustainable?source=feed#comment-333460 333460 Thu, 18 Dec 2008 17:31:50 -0500
Hey everyone, he is not saying going to war with India, China, or Russia to plunder their oil, he is saying unless we come up with an alternative to oil we will be waring against them (and they against us) for what oil is left, no matter who is on top of it.

Booba, I must say you done good today, your boss at the KGB or whatever it is called today spent a few good rubles.

There is a third option and that is we curtail (at our option or otherwise) oil dependent activities and never ever forget, oil is about more than energy and serves as the raw material for medicines, plastics, fertilizers, etc etc etc.

I think those who say we didn't go to war in Iraq or wherever on account of oil are just as barmy as those who say it was the sole reason (or any one of a number of other kooky ideas - e.g. to avenge the foiled assassination plot against HW). Oil elevates what would otherwise be a wasteland to vital importance, as I say above, so much of our modern lives depend on it. The difference is there are a whole set of reasons oil being one of them.]]> http://seekingalpha.com/article/111405-opec-cuts-oil-falls-something-s-not-sustainable?source=feed#comment-333380 333380 Thu, 18 Dec 2008 15:59:40 -0500 http://seekingalpha.com/article/111405-opec-cuts-oil-falls-something-s-not-sustainable?source=feed#comment-333346 333346 Thu, 18 Dec 2008 14:58:57 -0500
Maybe you should try to use your brain instead of your leftist politics. We didn't go to war for oil!! We actually found out that the U.N. wanted to prevent us going there because it would break up the nice little oil money siphoning program some UN officials were involved with!! Look up "Food for Oil scandal"...time to quit repeating the tired, leftist, failed, anti-America drivel of the last 8 years.]]> http://seekingalpha.com/article/111405-opec-cuts-oil-falls-something-s-not-sustainable?source=feed#comment-333091 333091 > I am sure glad he put the word "today" in this comment. I'm not really worried about "today".... I'm thinking more about "tomorrow". "Tomorrow" oil prices will be ruled by shifts in the supply curve...(downward).]]> Thu, 18 Dec 2008 11:10:50 -0500 >

I am sure glad he put the word "today" in this comment.
I'm not really worried about "today".... I'm thinking more about "tomorrow".

"Tomorrow" oil prices will be ruled by shifts in the supply curve...(downward).]]> http://seekingalpha.com/article/111405-opec-cuts-oil-falls-something-s-not-sustainable?source=feed#comment-333069 333069 Thu, 18 Dec 2008 10:57:05 -0500 yeah, as most Americans this guy is good when it comes to economy, but looks so, sorry, stupid when it come to something outside of baseball "World" series :)
1) Ok, you defeated China and India, so what's next? They are NOT suppliers of oil, my dear "expert"! All you can do is to prohibit them to consume oil, if you can occupy them! :)
2) Fight Russia? I don't want even mention fate of Napoleon and Hitler after they tried to do that. I just want to let you know, my dear "expert", that Russia can annihilate America in 1 hour. Literally! Russia preserved the Soviet era nukes completely.
If you don't know that, too bad!
Stupid Bush And Co., instead of supporting puppets (that BTW don't obey its master!) like Saakashvili, would rather establish good ties with Russia!
If they don't know how to do that they can ask American astronauts and NASA guys that work successfully with Russians since 1975 in space!
Anti-Russian propaganda in America in its peak now, although all Russian leaders, whatever you hear of them from CNN and AP, keep calling America "our partner" and keep saying that all they want is to have good relationship with us!
It is America that does whatever it can to worsen relationship with Russia by being arrogant, ignorant and just plain stupid sometimes!
I hope Obama and Co. will finally stop confronting Russia and make it our ally!
]]> http://seekingalpha.com/article/111405-opec-cuts-oil-falls-something-s-not-sustainable?source=feed#comment-332997 332997 Thu, 18 Dec 2008 10:08:02 -0500
The time to act really is now when we have a chance - but, what is the solution?

Some would say tax petroleum products at a higher rate to force conservation. That is not an intelligent solution as it may help conservation but it will also worsen the financial/economic crisis and will just provide more of our money for the gov. to spend unwisely.

Some would say fund a massive research program - again, a waste of taxpayer money. There is plenty of company/private research and gov. funded research in the past has not been productive. And, there are plenty of potential processes available to commercialize now.

The real issue is the volatility in crude prices - which makes investing in newer processes/technology difficult when investments would be on the order of $20 billion for the equivalent of 300,000 bbls/day of products - the output of a large refinery.

Long term, our energy will need to come from solar or biofuels from algae (the only two sources large enough). Nuclear could work but there is currently no acceptance of that route by the public.

So, how do we bridge the gap (until solar or biofuels are viable)? Congress could easily pass a bill to set a floor price for all renewables, alternatives or unconventionals at say $65-70/bbl equivalent. That would allow companies to invest the large sums necessary and would ensure that the best processes were commercialized (rather than having the gov. mandate - via subsidies - solutions which are morally and socially unacceptable - including food to fuel).

]]> http://seekingalpha.com/article/111405-opec-cuts-oil-falls-something-s-not-sustainable?source=feed#comment-332905 332905 Thu, 18 Dec 2008 09:06:39 -0500
Fight Russia for oil? Do you really mean that? Nobody in their right mind would fight Russia for anything. What about China and India? Frankly, that sounds like a bad idea. It might also be interesting to point out that Russia has plenty of oii, and even more gas. In fact their reserves of gas are probably sufficient to allow them to do what T. Boone Pickens thinks - erroneously - that the US can do with that resource. According to my logic, Russia is also liable to go along with a large cut in their supply of oil,

As for OPEC being desperate. I don't believe that, although this might be true in the future, and perhaps even the near future for a few of those countries. However the last couple of years have provided most of those countries with a nice bit of cash, and if they are careful they can easily get by until the next global macroeconomic upturn.

Ferdinand E. Banks

]]> http://seekingalpha.com/article/107551-if-the-u-s-is-in-a-financial-crisis-why-is-the-dollar-rallying?source=feed#comment-315786 315786 Wed, 26 Nov 2008 15:25:47 -0500
I try to foment dissent by design. Brainstorming on hypotheticals takes focus. I rarely take umbrage simply because I instigated it in the first place. I may get preturbed when I see something particularly inane but I try to maintain focus and, I'm occasionally successful.

Happy Holiday to all.]]> http://seekingalpha.com/article/107844-why-chicago-bridge-iron-is-cheap?source=feed#comment-315636 315636 Wed, 26 Nov 2008 12:51:12 -0500 http://seekingalpha.com/article/107844-why-chicago-bridge-iron-is-cheap?source=feed#comment-315100 315100 Tue, 25 Nov 2008 19:41:34 -0500
Add to this management short sight in trying to gain market share in the LNG Terminal business at the cost of margins--in fact, as we have seen, both UK projects have accumulated huge losses--both in money and in reputation, due to the large delays.

The balance sheet is anything but pristine. The Sep 08 report shows short term liabilities exceeding short term assets by over $850 million--larger than the company's current market cap.

There is probably money to be made--but this company is not for the cautious investor. ]]> http://seekingalpha.com/article/107844-why-chicago-bridge-iron-is-cheap?source=feed#comment-314712 314712 Tue, 25 Nov 2008 12:29:21 -0500 http://seekingalpha.com/article/107844-why-chicago-bridge-iron-is-cheap?source=feed#comment-314596 314596 Tue, 25 Nov 2008 10:24:04 -0500 http://seekingalpha.com/article/107551-if-the-u-s-is-in-a-financial-crisis-why-is-the-dollar-rallying?source=feed#comment-314172 314172 Mon, 24 Nov 2008 21:03:24 -0500
You may have me on the accelerated demand and price thing. But commodities are priced in dollars, so I'll need another cup of coffee to work it out how this will play with a stronger dollar. According to forex forecasts, the euro is only about half way through it's depreciation cycle.

"No nation has ever devalued its way to prosperity." (Unknown) And such devaluation has been a big problem in recent years. Since 2006, we have seen the dollar lose 30% of it's value, and more since 2002. Something is wrong, someone did something sneaky. I suspect it's those same people who are (not really, but should be) paying the price.

Yes, in my view too, very interesting times.

Carey, okay, sorry if I got your tone wrong. I need to work on mine, I am not laughing much...LOL (Well, sometimes...) I just can't help being a little torqued off over the scope of this thing. Maybe looking up that satirical work will help.

Socialism, naaa...a little bit, though. Nothing unusual. What I am worried about is a return to (not so) free markets. One might argue (in fact 'one' is gonna argue) with the influence of the lobby crowd, insurance companies raking in money and refusing to pay out, and Wall Street sticking it to the little guy, our free markets have been so skewed one can argue their existence.

We've (when I say 'we', I mean 'they') have sold off our homes to make money for the credit markets. This means you and I 'feel' richer because we can spend money we don't have...while 'they' actually are richer. Yes, the money supply has grown immensely in the last decade(?) or two, so where's the inflation? In China. One of our biggest exports is inflation.

So, the economy tilts a bit more. Money rolls into wall street's coffers and regulators turn a blind eye. No one complains when one has a Hummer in the driveway and prices are relatively stable. I am arguing we will not go back to that system.

I also realize I am a bit too optimistic. There is just too much power and money seeing to it we do get back to business as usual...easy credit for all Americans. But, it'll be a long time before anyone buys into our (or any) housing market, again, even with transparency.

Well, sorry for the disjointed thoughts, just a bit worn out this morning.]]> http://seekingalpha.com/article/107551-if-the-u-s-is-in-a-financial-crisis-why-is-the-dollar-rallying?source=feed#comment-313947 313947 Mon, 24 Nov 2008 15:10:00 -0500 http://seekingalpha.com/article/107551-if-the-u-s-is-in-a-financial-crisis-why-is-the-dollar-rallying?source=feed#comment-313937 313937 Wow, Carey_Jim...LOL...pret... harsh. Having a rough day? :) Me, > too. > > I think you hit something on the head. To be the leader in a post > recovery economy, we will have a lot of work rebuilding not only > our social reputation, but our financial one. This is a big reason > not to get back to business as usual: unregulated derivatives and > easy credit. Bravo...good point. > > But, socialism? Ahhhhhh...dunno. I am not a conspiracy guy.]]> Mon, 24 Nov 2008 14:53:09 -0500
If anything, I'm being optimistic because I think America is the LEAST tainted of all the large economies.

And I don't think socialism will ever come to America. When the rest of the world are all very tame pussycats living under the domestic peace of socialism, their citizens will tour America in bullet proof tour buses and wont even be allowed to get off the bus except in heavily guarded zones.

They'll watch us shooting it out in the big city streets, battling for drugs turf and sex.

Aldous Huxley painted a very funny picture in Brave New World which was largely a satirical study of America.

Don't forget Huxley's post-post modern designation of calender years using AF instead of AD, where the AF stands for "After Ford"

I think it's better to laugh than cry because I don't have time for bad days and besides that, they're boring.




On Nov 24 12:37 PM Asbytec wrote:

> Wow, Carey_Jim...LOL...pret... harsh. Having a rough day? :) Me,
> too.
>
> I think you hit something on the head. To be the leader in a post
> recovery economy, we will have a lot of work rebuilding not only
> our social reputation, but our financial one. This is a big reason
> not to get back to business as usual: unregulated derivatives and
> easy credit. Bravo...good point.
>
> But, socialism? Ahhhhhh...dunno. I am not a conspiracy guy.]]> http://seekingalpha.com/article/107551-if-the-u-s-is-in-a-financial-crisis-why-is-the-dollar-rallying?source=feed#comment-313855 313855 Mon, 24 Nov 2008 13:34:50 -0500
This will result in much higher price levels than previously seen. While the stimulus package(whatever it may be in the US), is being implemented, we will still be suffering from the current crisis. The Fed will be unable to raise interest rate levels.

Should prove to be interesting. IMHO]]> http://seekingalpha.com/article/107551-if-the-u-s-is-in-a-financial-crisis-why-is-the-dollar-rallying?source=feed#comment-313794 313794 Mon, 24 Nov 2008 12:37:56 -0500
I think you hit something on the head. To be the leader in a post recovery economy, we will have a lot of work rebuilding not only our social reputation, but our financial one. This is a big reason not to get back to business as usual: unregulated derivatives and easy credit. Bravo...good point.

But, socialism? Ahhhhhh...dunno. I am not a conspiracy guy.]]> http://seekingalpha.com/article/107551-if-the-u-s-is-in-a-financial-crisis-why-is-the-dollar-rallying?source=feed#comment-313777 313777 Mon, 24 Nov 2008 12:22:01 -0500
America is an A historical country which is beneficial and detrimental at the same time. But from time to time, we need to think about history.

Russian Communism collapsed and the Soviet Union fell apart.

The Chinese and Indian economies are emerging from hundreds of years of paralysis and colonialism.

Europe has suffered from hundreds of years of war culminating in two world wars which almost destroyed European civilization completely.

Japan was crushed by American military might and its economy exists at the pleasure of Americans who could start "buying American" if they think it necessary for the health of our economy.

We Americans see our own faults only too clearly, as is true for any family member who sees the faults of his own family because he lives with them, but we don't see the problems of other countries.

So it isn't only about military might but also about two hundred years of business activity that brought the world modern technology.

We are hated by much of the world for our unscrupulous business practices both in the past and in the present but the world will never deny our superiority in business until our economy collapses completely and we are forced to become a socialist country.

When that happens, American Incorporated will no longer exist and the question of currency values will be answered by committees. Until then, even currency traders will give the nod to history and bet on the dollar.]]> http://seekingalpha.com/article/107551-if-the-u-s-is-in-a-financial-crisis-why-is-the-dollar-rallying?source=feed#comment-313768 313768 Mon, 24 Nov 2008 12:13:52 -0500
If you're right, and the dollar starts to fall on inflation while simultaneous, global bail out packages begin doing their things...well, that's rather precise timing, don't you think? I just think that's not gonna happen so precisely in that manner.

Yes, we will begin to see inflation pick up at some point, but I believe it will be long after other significant packages have already hit their respective markets. Our recovery is likely to be prolonged, not June 09. Though, spring or summer is not out of the question, just yet.

But, I believe, this author has (or others have) even said we're likely to be in a slump through all or most of 2009. With the rest of the world following us down, they will have acted to fight recession before any real signs of recovery begin at home. Well, that's one consensus, admittedly.

I just do not think we will get back to business as usual, even though we're trying hard to free up our credit markets. As ill advised as that may be, we have to, really. We cannot dump our financial system over night.

But, we probably will transition out of it through new regulations. We've learned a lesson on easy credit and derivative dangers. Our money supply will recover slowly and, I assert, under more Fed control.

MZM growth has been plummeting for some time. Much less money out there to drive the dollar down as strongly as before, in my view. And when inflation begins to rear it's ugly head, I'll bet you'll see the Fed stomp on the brakes.

I will concede the dollar does have some downward pressure, though. That's disconcerting. And it will certainly lose some value as we pull out of this nose dive. But, 40? Yea, if we get back to massive derivative selling and easy money...back to business as usual...sure. But haven't we learned anything? Hasn't the wasp stung us?

Again, it's all about confidence when dealing with fiat currencies. So, will commodities or equities take center stage? Good question. I imagine that depends on many things I am not ready to list here. Maybe you two can elaborate. But, I have listed some details on the dollar I believe are likely to come into play next year.

Remember, it's fashionable to bash the dollar, er, the US peso. It always earns me a "thumbs down." LOL

I wonder if Mr. Warren "Can't get out of the dollar fast enough" Buffet is not playing on the dollar's strength right now. Maybe he can make some of his money back after his bank stock purchases (not clear on what he bought, sorry...and sorry, don't mean to bash Mr Buffet. It just shows that even the smartest people are prone to getting it wrong from time to time.)]]>