Reachsb

Oil: Despite Decline, A 'Must-Have' Profit Play

I've been accumulating oil as a currency hedge as well as from a supply shortage stand-point. There has been a dramatic drop-off in the output from Oil fields recently. Mexico's largest oil field may be tapped out by 2010. At these depressed prices, a lot of oil from Canadian Tar sands as well as the deep sea drilled oil will start coming off from the market. Shell will look for excuses to cap their Nigerian operations, Chevron can't be making any money from their offshore operations in civil war torn - Angola at these price. Ditto for the Russians drilling in perma-frost Siberia, So we are facing the imminent possibility that more than 75% of the world's oil production will be sourced from a very volatile Gulf region. The entire gulf oil has to pass through the Straits of Hormuz in front of Iran. You'd be foolish to assume that the Iranians won't their best to get on the bad side of Israel to incite the oil markets. I'm sure that the Iranians are hurting with oil at these depressed levels and are having difficulties in balancing the budget.

I believe the markets are being too complacent in the underpricing of oil. The Iran premium seems to have vanished all together. Supply disruptions anyone?

First Call of the Crisis: Peter Schiff Could Be Video of the Year

Peter Schiff deserves to be applauded for sticking his neck out and taking on various psuedo-economists in the media. He has been harping on the upcoming unraveling of the US financial system for the past 3 years to anyone, who'd care to listen.

If you have some time to spare, you should definitely watch the series of clips on youtube.com on Peter addressing the Mortgage Bankers Association way back in 2006 (those heady days), warning them about the impending sub-prime debacle. Off course, they laughed him off at that time.

Here's the link to the first segment on youtube. Look for the entire series on the right hand side.

www.youtube.com/watch?...

Why Oil and Gold Are Headed Much Higher

Good luck trying to buy the physical bullion on the street at the comex futures prices. The physical is out of stock. Someone's gaming the prices and it won't work for too long. The amount of liquidity unleashed by the Central Banks worldwide is unprecedented and consequently, gold has only one to way to go - UP. Now it's only a matter of waiting out all the hedgies - who are getting margin called left and right out of their desired gold positions.

Oil's headed up too. You have got to balance demand destruction with peak oil. The Iran premium has completely dissipated in this latest purge. Boy! Those Straits of Hormuz are pretty narrow!!