Walter Morton's Comments RSS Syndication from SeekingAlpha.com http://seekingalpha.comuser/29409/comments http://seekingalpha.com/article/81838/comments?source=feed#comment-189753 189753 Sat, 21 Jun 2008 12:45:20 -0400 http://seekingalpha.com/article/81838/comments?source=feed#comment-188619 188619
1) An 830 Billion Trade deficit.
2) The falling value of the dollar since we left the gold standard in 1972.
3) Lack of investment in infrastructure and education in the USA.
4) Increasing world population demand of all commodities.
5) Dependence on oil in the face of declining oil production and rising exploration costs.
6) Outsourcing manufacturing, production, skills, and technology.
7) High USA per capita debt, low individual savings.
8) Increased competitiveness in foreign markets.
9) Growing debt from expenses of the Iraq war.
10) Aftermath of dotcom tech stock boom / bubble.
11) Aftermath of real estate investment boom / bubble.
12) Falling confidence in financial instruments & institutions (i.e. Bear Sterns)

You can look to the Wall Street Journal, The Economist, or The New York Times to find ample numerical support for these 12 issues and pressures on the economy. What you will not find is a "tried and true" investment strategy being argued by RBS or any of these authors for what to do in June 2008 because the world has never seen an economic scenario exactly like the current one. Analysts cite Bernanke and The Great Depression (1928-1933) and the "stagflation" of the 1970's but the global economy was not as dynamically linked in those earlier times by electronic media, instant trading, etc. Also, growth in population, manufacturing, and modernization has shifted strongly to Asia in the last 50 years. The food supply and energy supply has never been under greater demand pressure. A different world order is emerging and the USA's position of unchallenged dominance is unravelling.

What to do? Taking all your money into cash dollars in a safe in your basement is a bad idea, because in many scenarios (inflation, hyperinflation) the U.S. dollar will devalue radically never to return. Some would argue that investing in gold is the best safety play, but it is unclear whether this venerable instrument of antiquated wealth will respond as it has in the past by holding value while paper currency falls. Commodities seem a good safe haven since the world needs food & fuel and based on simple supply & demand metrics, there will be need for all commodities into the 21st century, but it is also possible a global depression could curtail growth and suppress commodity value. Another safe haven in the past has been the material security of real estate. But the real estate bubble continues to deflate and if a depression comes, real estate prices could be in free-fall for years to come, taking prices back to 1978 levels. Some (i.e. Peter Schiff) suggest that investing in diverse, growing foreign economies that are not tied to the USA is the best course. That could work if the global economy "de-couples" with Brussee likes TIPS, but TIPS rely on the US Treasury accurately calculating inflation to pay you back in (still a fiat currency) dollars.
Where does that leave the investor? Some ideas that appear sound are global diversification into assets that are either:

1) backed by a material resource (Gold, Oil, Wheat, etc.)
2) are required for human civilization (energy, food, infrastructure.)
3) technologies of increasing / emerging importance (solar, wind, bio.)
4) Not directly tied to the strength of the USA dollar.

Though it is one of the oldest common-sense rules of investing, there has never been a better time to remember: "Don't have all your eggs in one basket."




]]> Thu, 19 Jun 2008 14:16:29 -0400
1) An 830 Billion Trade deficit.
2) The falling value of the dollar since we left the gold standard in 1972.
3) Lack of investment in infrastructure and education in the USA.
4) Increasing world population demand of all commodities.
5) Dependence on oil in the face of declining oil production and rising exploration costs.
6) Outsourcing manufacturing, production, skills, and technology.
7) High USA per capita debt, low individual savings.
8) Increased competitiveness in foreign markets.
9) Growing debt from expenses of the Iraq war.
10) Aftermath of dotcom tech stock boom / bubble.
11) Aftermath of real estate investment boom / bubble.
12) Falling confidence in financial instruments & institutions (i.e. Bear Sterns)

You can look to the Wall Street Journal, The Economist, or The New York Times to find ample numerical support for these 12 issues and pressures on the economy. What you will not find is a "tried and true" investment strategy being argued by RBS or any of these authors for what to do in June 2008 because the world has never seen an economic scenario exactly like the current one. Analysts cite Bernanke and The Great Depression (1928-1933) and the "stagflation" of the 1970's but the global economy was not as dynamically linked in those earlier times by electronic media, instant trading, etc. Also, growth in population, manufacturing, and modernization has shifted strongly to Asia in the last 50 years. The food supply and energy supply has never been under greater demand pressure. A different world order is emerging and the USA's position of unchallenged dominance is unravelling.

What to do? Taking all your money into cash dollars in a safe in your basement is a bad idea, because in many scenarios (inflation, hyperinflation) the U.S. dollar will devalue radically never to return. Some would argue that investing in gold is the best safety play, but it is unclear whether this venerable instrument of antiquated wealth will respond as it has in the past by holding value while paper currency falls. Commodities seem a good safe haven since the world needs food & fuel and based on simple supply & demand metrics, there will be need for all commodities into the 21st century, but it is also possible a global depression could curtail growth and suppress commodity value. Another safe haven in the past has been the material security of real estate. But the real estate bubble continues to deflate and if a depression comes, real estate prices could be in free-fall for years to come, taking prices back to 1978 levels. Some (i.e. Peter Schiff) suggest that investing in diverse, growing foreign economies that are not tied to the USA is the best course. That could work if the global economy "de-couples" with Brussee likes TIPS, but TIPS rely on the US Treasury accurately calculating inflation to pay you back in (still a fiat currency) dollars.
Where does that leave the investor? Some ideas that appear sound are global diversification into assets that are either:

1) backed by a material resource (Gold, Oil, Wheat, etc.)
2) are required for human civilization (energy, food, infrastructure.)
3) technologies of increasing / emerging importance (solar, wind, bio.)
4) Not directly tied to the strength of the USA dollar.

Though it is one of the oldest common-sense rules of investing, there has never been a better time to remember: "Don't have all your eggs in one basket."




]]> http://seekingalpha.com/article/80804/comments?source=feed#comment-183320 183320 www.kepcorp.com/press/...
]]> Wed, 11 Jun 2008 10:47:34 -0400 www.kepcorp.com/press/...
]]> http://seekingalpha.com/article/80261/comments?source=feed#comment-180479 180479
So why is solar the most-favored option for long-term energy future? Coal-burning will accelerate climate destruction and pollution. Bio-fuels require a lot of energy "input" for very little gain. Wind-power is not feasible in most locations. Tidal power and hydroelectric limited to restricted locations. Nuclear is a potential option but the supply of nuclear fuel is limited (some estimates say exhausted in 30 years.) And we do not know how to build effective fusion reactors -- yet. New reactor designs may help, but humans are understandably a bit nervous about reactors, radiation, and maintenance after Chernobyl & Three Mile Island. If we built 500 new reactors, the odds are we'd see new accidents. NUclear fission can never be a perfectly safe technology.

The most workable answer for our future is solar (because it's free, unlimited, safe, clean) but the technology infrastructure to capture the sun's energy on mass scale is daunting. For a good review of what sort of mass program it would take to run America on solar, read Scientific American's article on a "Grand Plan" : www.sciam.com/article....]]> Fri, 06 Jun 2008 13:30:08 -0400
So why is solar the most-favored option for long-term energy future? Coal-burning will accelerate climate destruction and pollution. Bio-fuels require a lot of energy "input" for very little gain. Wind-power is not feasible in most locations. Tidal power and hydroelectric limited to restricted locations. Nuclear is a potential option but the supply of nuclear fuel is limited (some estimates say exhausted in 30 years.) And we do not know how to build effective fusion reactors -- yet. New reactor designs may help, but humans are understandably a bit nervous about reactors, radiation, and maintenance after Chernobyl & Three Mile Island. If we built 500 new reactors, the odds are we'd see new accidents. NUclear fission can never be a perfectly safe technology.

The most workable answer for our future is solar (because it's free, unlimited, safe, clean) but the technology infrastructure to capture the sun's energy on mass scale is daunting. For a good review of what sort of mass program it would take to run America on solar, read Scientific American's article on a "Grand Plan" : www.sciam.com/article....]]> http://seekingalpha.com/article/76569/comments?source=feed#comment-165467 165467 Any solar analyst needs to take into account the practical physics that are being exploited by various approaches to solar "tech." ESLR may not have gotten the Jim Cramers of the world raving about them, but their "String Ribbon" technology absolutely works, and is a dependable way to fabricate solar cells. While it is generally agreed that "thin film" solar cells are the most promising way to build cells and it is on this technology that FSLR has become an early leader (watch out if Nanosolar can deliver) their is no long-term deployment of the FSLR type thin film solar cells in use. What happens to thin film cells after they've been on your roof for 10 years? Do they degrade? Nobody knows. Conventional cells of the kind ESLR makes are reliable over 30+ year periods. With oil prices going up, solar in ALL forms will continue to be attractive.]]> Sat, 10 May 2008 12:05:09 -0400 Any solar analyst needs to take into account the practical physics that are being exploited by various approaches to solar "tech." ESLR may not have gotten the Jim Cramers of the world raving about them, but their "String Ribbon" technology absolutely works, and is a dependable way to fabricate solar cells. While it is generally agreed that "thin film" solar cells are the most promising way to build cells and it is on this technology that FSLR has become an early leader (watch out if Nanosolar can deliver) their is no long-term deployment of the FSLR type thin film solar cells in use. What happens to thin film cells after they've been on your roof for 10 years? Do they degrade? Nobody knows. Conventional cells of the kind ESLR makes are reliable over 30+ year periods. With oil prices going up, solar in ALL forms will continue to be attractive.]]> http://seekingalpha.com/article/72841/comments?source=feed#comment-153007 153007 en.wikipedia.org/wiki/... ) In any case, if you want to know whether you should believe Schiff’s analysis I suggest you buy his book, read it, and come to your own conclusions.]]> Fri, 18 Apr 2008 12:53:46 -0400 en.wikipedia.org/wiki/... ) In any case, if you want to know whether you should believe Schiff’s analysis I suggest you buy his book, read it, and come to your own conclusions.]]> http://seekingalpha.com/article/60533/comments?source=feed#comment-111362 111362
"All the easy oil and gas in the world has pretty much been found. Now comes the harder work in finding and producing oil from more challenging environments and work areas.”

— William J. Cummings, ExxonMobil's spokesman in Angola, Dec. 2005

So given that production is going to be increasingly difficult, and costly or actually in decline by as much as 4% annually (Simmons) it seems impossible that oil will "only" be $113 a barrel in 2030. It seems equally likely it will be $280 a barrel. The only thing that may prevent that is a recession / global depression where oil consumption drops dramatically but this seems also unlikely to depress prices much since demand in the emerging markets will remain strong enough to absorb any "surplus" as supplies decline. The conclusion to take away is we will never see "cheap" oil again. Ever.]]> Fri, 18 Jan 2008 11:22:45 -0500
"All the easy oil and gas in the world has pretty much been found. Now comes the harder work in finding and producing oil from more challenging environments and work areas.”

— William J. Cummings, ExxonMobil's spokesman in Angola, Dec. 2005

So given that production is going to be increasingly difficult, and costly or actually in decline by as much as 4% annually (Simmons) it seems impossible that oil will "only" be $113 a barrel in 2030. It seems equally likely it will be $280 a barrel. The only thing that may prevent that is a recession / global depression where oil consumption drops dramatically but this seems also unlikely to depress prices much since demand in the emerging markets will remain strong enough to absorb any "surplus" as supplies decline. The conclusion to take away is we will never see "cheap" oil again. Ever.]]> http://seekingalpha.com/article/43931/comments?source=feed#comment-93234 93234
1. Oil at $150 a barrel due to "peak oil scenarios" or expanding wars around the globe.
2. Global warming impacts to farming & agriculture, etc.
3. The dollar collapses against world currencies to a new low.
4. China replaces us as the "#1 superpower nation."
5. A serious plague, earthquake, hurricane, or terrorist strike in the continental USA.

Any of these, or a combination of them, could take the Dow down by half, to 6000. Personally, I am usually a bullish investor and have done well in the last year on Apple, Cisco, RIG, XTO, etc. but it is highly possible that a "perfect storm" of events could set the markets in the USA back for a decade or more of bearish trends. Where to stay safe? Who knows? Cash, CDs, foreign bonds, gold -- your guess is as good as mine.]]> Thu, 09 Aug 2007 10:18:50 -0400
1. Oil at $150 a barrel due to "peak oil scenarios" or expanding wars around the globe.
2. Global warming impacts to farming & agriculture, etc.
3. The dollar collapses against world currencies to a new low.
4. China replaces us as the "#1 superpower nation."
5. A serious plague, earthquake, hurricane, or terrorist strike in the continental USA.

Any of these, or a combination of them, could take the Dow down by half, to 6000. Personally, I am usually a bullish investor and have done well in the last year on Apple, Cisco, RIG, XTO, etc. but it is highly possible that a "perfect storm" of events could set the markets in the USA back for a decade or more of bearish trends. Where to stay safe? Who knows? Cash, CDs, foreign bonds, gold -- your guess is as good as mine.]]> http://seekingalpha.com/article/40276/comments?source=feed#comment-91287 91287 Mon, 16 Jul 2007 12:15:50 -0400 http://seekingalpha.com/article/40537/comments?source=feed#comment-90800 90800 Tue, 10 Jul 2007 11:47:21 -0400 http://seekingalpha.com/article/40468/comments?source=feed#comment-90692 90692 Mon, 09 Jul 2007 12:24:10 -0400 http://seekingalpha.com/article/40212/comments?source=feed#comment-90548 90548
1. The USA is stuck in an expensive war on the far side of the globe costing more than $100 billion a year at present. It seems unlikely we will be able to withdraw for some years. We will emerge with a lot of debt.

2. There is growing evidence that world oil demand in permanently exceeding supply, and no technology on the drawing boards (wind, solar, fuel cell, etc.) offers the efficiency and versatility that cheap oil has provided for the last 75 years.

3. Atmospheric CO2 is currently measured at 383 parts per million, whether you believe in “Global Warming” is a liberal media buzz word or not, something measurably new is happening to global climate, and the physics of a higher CO2 atmosphere will probably have major impacts on agriculture and regional economies over the next 10-500 years.

4. Between 2002 and 2006, USA housing prices have increased 73% creating an 8 trillion dollar “housing bubble” perched on low interest, and no painless soft landing for people who’ve bought in at the top. The American myth of "own your own home as the best, safest investment" may come seriously undone.

5. In 2006, the trade deficit reached $760 billion (6% of USA GDP) due to an overvalued dollar, which has suppressed foreign consumption of USA-made products.

6. There is no evidence that political leadership and will-to-change is forming in the US congress to adequately address any of the previous 5 issues.

All that said, I am bullish that selected industries will profit even in troubled times and that the 6 "problems" I note above can also be investment opportunities, seen from the right perspective.]]> Fri, 06 Jul 2007 12:04:44 -0400
1. The USA is stuck in an expensive war on the far side of the globe costing more than $100 billion a year at present. It seems unlikely we will be able to withdraw for some years. We will emerge with a lot of debt.

2. There is growing evidence that world oil demand in permanently exceeding supply, and no technology on the drawing boards (wind, solar, fuel cell, etc.) offers the efficiency and versatility that cheap oil has provided for the last 75 years.

3. Atmospheric CO2 is currently measured at 383 parts per million, whether you believe in “Global Warming” is a liberal media buzz word or not, something measurably new is happening to global climate, and the physics of a higher CO2 atmosphere will probably have major impacts on agriculture and regional economies over the next 10-500 years.

4. Between 2002 and 2006, USA housing prices have increased 73% creating an 8 trillion dollar “housing bubble” perched on low interest, and no painless soft landing for people who’ve bought in at the top. The American myth of "own your own home as the best, safest investment" may come seriously undone.

5. In 2006, the trade deficit reached $760 billion (6% of USA GDP) due to an overvalued dollar, which has suppressed foreign consumption of USA-made products.

6. There is no evidence that political leadership and will-to-change is forming in the US congress to adequately address any of the previous 5 issues.

All that said, I am bullish that selected industries will profit even in troubled times and that the 6 "problems" I note above can also be investment opportunities, seen from the right perspective.]]> http://seekingalpha.com/article/37191/comments?source=feed#comment-87664 87664 www.demos.co.uk/public...]]> Mon, 04 Jun 2007 12:36:43 -0400 www.demos.co.uk/public...]]> http://seekingalpha.com/article/36919/comments?source=feed#comment-87416 87416 Dr. Gray described 2007 as a very active season. He said there was a 74% chance of a major hurricane making landfall somewhere on the U.S. coast. There is a 50% chance of a major hurricane making landfall on the East Coast, including the Florida Peninsula, according to the new forecast; the long-term average is 31 percent.
The chance of a major hurricane hitting the Gulf Coast between the Florida Panhandle and Brownsville, Texas, is 49 percent; the long-term average is 30 percent. There is also an above-average chance of a major hurricane making landfall in the Caribbean, according to the forecast.]]> Thu, 31 May 2007 15:20:04 -0400 Dr. Gray described 2007 as a very active season. He said there was a 74% chance of a major hurricane making landfall somewhere on the U.S. coast. There is a 50% chance of a major hurricane making landfall on the East Coast, including the Florida Peninsula, according to the new forecast; the long-term average is 31 percent.
The chance of a major hurricane hitting the Gulf Coast between the Florida Panhandle and Brownsville, Texas, is 49 percent; the long-term average is 30 percent. There is also an above-average chance of a major hurricane making landfall in the Caribbean, according to the forecast.]]> http://seekingalpha.com/article/31772/comments?source=feed#comment-83905 83905 Tue, 10 Apr 2007 12:03:16 -0400 http://seekingalpha.com/article/25137/comments?source=feed#comment-80550 80550 Thu, 25 Jan 2007 12:52:01 -0500