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Dennis Gartman turns bullish on coal stocks as natural gas prices rise, expecting to see coal...

Dennis Gartman turns bullish on coal stocks as natural gas prices rise, expecting to see coal prices "move rather nicely, slowly, gently higher. This is not fast money. This is warm money." Stephen Weiss is skeptical, as much of the switching to nat gas was driven by environmental regulations "because coal can’t become clean enough." Coal stocks get a reality check today after analyst downgrades (I, II).
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Comments (4)
  • BTM
    , contributor
    Comments (420) | Send Message
     
    I'm not sure the coal bulls understand the impact of governmental regulation and enforcement on the industry. See this link for an interesting read on how environmental groups and regulatory agencies prevented a coal fired electric plant from investing money to *reduce* its emissions. http://bit.ly/Td6qFA

     

    The government wants completely eliminate coal as a fuel for electricity generation in this country under the current administration. Investors need to come to grips with this.
    12 Oct 2012, 03:34 PM Reply Like
  • gdonelson
    , contributor
    Comments (36) | Send Message
     
    And Goldman today recommended selling out of NatGas positions and take the 100% profit on the trade as they see the price having peaked.
    12 Oct 2012, 03:39 PM Reply Like
  • BTM
    , contributor
    Comments (420) | Send Message
     
    Unless energy consumption goes down dramatically, its gotta come form something. My guess is nat gas for the near and medium term. Like the link I posted suggests, it won't be coal IMO. At least in the USA. Long term maybe nuclear and renewables will be the answer.
    12 Oct 2012, 04:04 PM Reply Like
  • Mike Maher
    , contributor
    Comments (2733) | Send Message
     
    Electricity usage in the US has been falling. Nat gas will benefit from continued switching from coal to gas, but unless theres a switch to nat gas as a transportation fuel, I think prices for both will be trapped around current levels for the next few years, until nat gas export facilities begin to open.
    12 Oct 2012, 04:13 PM Reply Like
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