material guy

Will Natural Gas Be the Next to Rally?

Liquefaction plants cost a boatload of cash and take several years to build. The only LNG plant in the U.S. is in Alaska...we won't be exporting Texas or Arkansas gas through there! In the lower 48, there are several LNG import facilities, but those just evaporate and compress gas to get it into a pipeline and cannot be just turned around to export.


On Jun 08 10:15 PM Freya wrote:

> There is also the possibility of being able to export same. LNG doesn't
> have to be a one way street if supplies are ample.

Homebuilder Stocks

And your point?

Natural Gas: Weakness Borne of Strength

Very timely. Will be interesting to see if his $2/mcf natural gas fears comes to pass; there's already been substantial laydown of rigs in the Barnett and Fayetteville shale areas, though the other 2 plays he noted are still going strong. One further point is the recent increase in pipeline capacity from the Rockies to the Midwest, creating more competition for both Gulf Coast and the mid-continent shale gas producers. Maybe Obama will do the industry a favor and cut back on Rockies drilling permits on environmental grounds...

Is Merger Arbitrage Going the Way of the Dodo?

Interesting summary of academic work; but your last 2 paragraphs tell the real story. With credit tight, spreads have been "tasty" as you say on several all cash or mostly cash deals in the last few months. A current deal that still has a decent spread is the takeout of Nova Chemicals (NCX) by IPIC for $6/share all cash. I am long NCX, FWIW.

Nervous About MLPs

MLPs are required to pay out a large proportion of their earnings to owners in order to qualify for their favorable tax treatment. Since they can't retain earnings, most MLPs use leverage to grow. Therefore, lack of liquid bond and credit markets crimps their business, in some cases forcing managements to scramble to finance their equity share of projects already under way. The leverage and increased uncertainty over future payouts are the main risks here.

Time to Buy China, Copper, the Canadian Dollar and Oil

I'm only talking about Rogers' commodity calls, which I believe have been unwaveringly bullish, based on his views on China. He apparently bought into the decoupling nonsense being spouted a year ago. When you're as arrogant and self-congratulatory as Rogers is in his books, its tough to look past big mistakes.

Getting a big call wrong (like he's done on commodities) can offset a lot of good work elsewhere. When you lose that much of your capital, the arithmetic says it takes a loooong time to get back to break-even. On financials and such I prefer to listen to Marc Faber, who hit the TBT trade at the same time.


On Mar 05 09:38 AM User 338595 wrote:

> I don't know what you have been watching, but I recall Jim Rogers
> telling people to short the us markets in Jan of 08, I recall him
> saying fannie/freddie will colapse, to sell the financials (well
> before bear/lehman collapse) and just a few months ago he said us
> treasuries are a bubble waiting to collapse..said to buy tbt.. at
> that time tbt was trading 36, today it's 48..he might not be acurate
> all the time but he's made some great calls too..and if china is
> down 75 % in 20 years i hate to see where the united states is headed
> !! oh wait that's right we are going to spend our way to recovery
> !!!

Time to Buy China, Copper, the Canadian Dollar and Oil

I've read Jim Rogers on and off since "Investment Biker" of 1994. His writing gives the impression of a blowhard with little intellectual depth. And while he made a great call on China early this decade, he appears to have walked into the current downturn totally oblivious. Give me Nicholas Taleb any day.

As far as the next 20 years are concerned, if you lose 75% of your capital in six months (which people owning fertilizer stocks have done), you're going to need all of those years to make it back!


On Mar 05 09:06 AM User 338595 wrote:

> I'm sure Jim Rogers has a much better track record then you do !
> If you actually listened to what Jim Rogers said, it's a play for
> the next 20 years, not a trade for 6 months.

Time to Buy China, Copper, the Canadian Dollar and Oil

The Story of Dr. O: long ideas for masochists.

More seriously, 20 mm unemployed Chinese went to their villages for New Year and aren't coming back to the factories anytime soon. How much meat you think they'll be eating this year? Maybe Jim Rogers knows.

Potash Corp.: Poised to Soar Once Hedge Fund Worries Subside

Yes, POT is the best company in the fertilizer industry. But the notion that a global economic slowdown would not affect fertilizer demand is false. People still eat, of course, but they can't afford as much meat. It is the quality of their diets which is the real driver of demand. If you don't believe me, just go back 10-12 years, when POT and other fertilizer stocks were on a similar tear. It was all derailed by the "Asian contagion" of '97-'99.