jamino1

GE Capital: Next CIT?

Globalization is a mixed bag. Sure it takes away jobs but it also provides cheap durable goods stripped of the huge and crazy embedded costs of labor and capital that exist here. Further with the greater availability of CNC machining worldwide you get quality controlled knockoffs at a fraction of the price. For instance I bought an axle for a 96 Toyota recently for 177 retail. I needed it because the stupid mechanic who replaced a split boot for me two years ago did not seem to care that when a boot splits, the grit gets right in and starts to grind. Anyway, if it were not for globalization I would have payed multiples of what I did for an OEM axle. This goes on everywhere you look. Strip out all the BS embedded overhead we have to deal with in production, encourage MBAs to go back to studying production instead of everyone trying to make it in finance and we may have a shot. As it is the only shot we have now is the one aimed at our head.


On Jul 29 10:10 AM Warm_Paw wrote:

> It's good to get a source of info that strips away the usual song
> and dance that all is well and although we're spiralling down, we're
> spiralling down "less quickly THIS month."
> While work has been offhsored to India, China and Mexico, we at home
> have been living on home equity loans on housing overinflated by
> empty profits in derivative trading.
> Now we take a trillion dollars of tax payer money (the govt's home
> equity loan) and create a "JOBLESS RECOVERY"
> Without jobs, bills don't get paid. Without bills getting paid, the
> masses cannot consume. Durable goods do not get sold.
> It's a real easy concept to grasp.
> I realize Obama's been handed this mess, but it's time he realize
> there was a reason US administrations in years past became protectionist.
>
> Globalization is good...for China, India and Mexico.
> Will someone explain how globalization further's the USA's interests?
> Call me narrow minded, but I'm loyal to the home team. I don't see
> the visiting team jumping in and handing the USA a large bailout
> to stabilize it's economy. Hell, Asia hasn't let the US sell cars
> in the east for how long? Some globalization!

Deepwater Drillers: Not in a Very Deep Hole

I own a block of RIG and had owned GSF as well before the merger. While there are certainly risks going forward and these shares can certainly go lower, they are in my opinion low enough to begin accumulating now. One factor that needs to be considered is that capitol intensive industries such as oil service have an advantage in a capital constrained world. It is difficlt and expensive to build these things and none will be ordered or built in this economic environment. THe worst thing about the fall in the price of oil may turn out to be a good thing. ANd that is the price fall was very rapid. IT has more to do with the continued deleveraging going on than the acknowledged demand destruction. Prices may return to higher levels sonner than most people think even as they can still go lower in the short run. RIG is my favorite. Like XOM, they know what they are doing and they know how to survive in the hard times and make tons of money in the good times. IT is good to remember that oil has enduring and constant utility. World currencies do not and what the world is doing to paper money right now almost assures we will see another oil spike in the not too distant future. Buy low; sell high. Keep leverage low or non-existent so you cannot be taken out against your will.

The Economic Meltdown: Dismantling, Yes; Doom, No

THe war may turn out to be a very expensive piece of misplaced ideology; more or less a retaliation for 9/11 but it is certainly not the prime reason for the financial problems that are occurring now. Now were the tax cuts which freed up large amounts of capital for investment.. More likely it was the unwillingness of central bankers around the world to allow for corrections to take place as should have occurred after the investment excesses of the dot com era.

THe idea that AMerica will be left on the outside looking in, diminshed forever in its influence and power is more a wish on the part of those who believe that America must fall in order for them to ascend. The structural problems in the rest of the world are evrey bit as deep as those in America. THe difference is that America has long demonstrated a sort of resilience and transformational ability that the rest of the world envies but cannot match. THe dollar may or may not fall but the fact that is did not when the crisis was most clearly defined and recognized shows that the rest of the world may not like America but they are loathe not to follow it. You can make money in the short run betting against America but the idea that you can successfully short America in the long run is done at your own risk. I will take the other side of that trade until it is clearly shown to be wrong and again this is just your wish and not any immanent "reality."

Canadian Oil Sands Barely Affected by Syncrude-Alberta Agreement

It's my understanding that the new agreement taxes the value of the bitumin extracted and not the higher prices finished light crude so this would make it appear to be a push even assuming tht the floating currency rate deviations even out to zero over time.