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  • Why OPEC Will Cut Production  [View article]
    Kurt, $140 oil will create the very same incentives for another fossil fuel revolution, substitutes and alternatives. You have little knowledge of Berkshire, they own ISCAR/Nebraska Furniture Mart/the largest multi-state auto dealership and so much more. You just can't buy into these on your own. You have to have a long time horizon and hold Berkshire Class A or Class B shares.

    On the hand kissing, it took years for the Saudi's to regain the lost market share after their ill-fated supply/price fixing, which turn out to be a unilateral move on their part, as other OPEC producers cheated on their agreement.

    I'll bet you Berkshire recovers way before the oil patch does. It's called opportunity cost. I recall being able to buy Berkshire Class A at $10K a share years ago, I had the cash at hand to buy seven shares. Those would be worth over a million today, despite their lack luster performance as of late.

    Lastly, Kurt we have to see that Wahhabism is a state sponsored ideology in Saudi Arabia, for eons.

    http://to.pbs.org/1RDCUZr


    Just like the economy (micro-macro-global), geopolitical events have many moving parts and affect the asset-ed people. However, we can and do adjust to conditions and/or fail in the preservation of capital.

    http://bit.ly/1NvQPk8
    Feb 13, 2016. 12:43 PM | Likes Like |Link to Comment
  • Why OPEC Will Cut Production  [View article]
    People buy oil futures and the producers are at the mercy of these commodity futures buyers. Then they can hedge, which they did, yet the supply is too much. These commodity cycles are super cycles, lasting years. These are fundamentals, other than the refiners, the MLP's and others have been taken for a ride. These MLP's were to be dividend payers and these dividends are at risk.

    OPEC is but a cartel and cartels cheat on one another. The Saudi cut backs on production historically have been futile, in that it took years for the Saudi's years to get back that market share. OPEC isn't DeBeers and thereby have little of no pricing power. They are in a competition with Russian fossil fuel for market share, more so in China.

    The demand side is also weak and explains that multinational race to get part of the China and India big bets on future demand have gone sour. I've been to Midland/Odessa and Pioneer has 20,000 holes in the ground and another 2,000 in the Eagle Ford which aren't marginal producers, but rather, like the Saudi's low cost producers. Your looking at the prices that these nations need to maintain their standard of living. Thereby, the chart of break even is factoring in giant welfare states. Your chart also old in that the West Texas is on its way down to $25 a barrel, which many thought was insane, yet I predicted it over a year ago.

    This is a fool game to assume that the long and protracted commodity super cycle is going to turn in a year or two. The $100 a barrel, predicted to climb more has economic effects of creating an incentive to produce more and drill more. Then a substitution/alternative are also have an incentive. You can't defy economic laws/principles, these are fundamentals.

    The sovereign wealth funds, MLP's and hedge funds have taken a beating, more so if they are leveraged. You can see them selling as these sales include partial shares, while most retail investors sell in whole shares. So there is a void in the market in that without capital, loans and/or floating new issues (selling stock) isn't easy as it was during the higher prices. So the players with weak balance sheets have to merge or go into bankruptcy. We can/have seen the high yield/junk bonds funds, holding energy bonds have serious exposure, thereby holding JUNK.

    Tar sands are an extremely costly to refine, so that Keystone pipeline delay is a heaven sent blessing. Just as the Dakota oil is the marginal producer in America. So it's great for the consumer/end user and as I stated before fossil fuel was putting in a ceiling, rather than a floor a year or two ago.

    When the congress allowed the export of LNG, they should have banned the import of crude. This would have delayed the US producers pain and made the US self sufficient. Yet the rigs can always be erected again if price increases. However, we miss the point that these foreign producers have economic ties to domestic production. They are multinationals who counted on China and India, 30% plus of the earths population. We are buy 5% of the worlds population and consume 24% of the energy.

    It was Goldman Sachs who made the bold prediction of $135 a barrel and started this fossil fuel revolution. Some how we see it in print and it's gospel? That holds true for all of the multinationals in many industries who made a big bet on China/India demand. Hedge funds, MLP's and others are looking to spread their pain. BEWARE of shorts covering, value traps and other means they use to spread their losses.

    In ending we have to see the market in a supply and demand of any stock. So someone has to make up for the out going money from the stock market. So even the best companies are being used as a source of funds to pay debt which is typically a dollar denominated debt . So, it stands to reason that less money will be chasing these stocks and a re-calibration/recapit... is going to happen/happening. The only saving grace is that US markets and rates are more attractive worldwide. Hence, capital may flow back into our markets and thereby dampen these out flows of capital from the US capital markets.

    I too have been waiting for the wash out and see the worse case scenario being the ill-fated Lost Decade which Japan undertook. Their capital markets took a beating and have never been the same since the QE which they undertook. I'm long the TLT and gold.
    Feb 13, 2016. 12:00 PM | 1 Like Like |Link to Comment
  • Chevron - Buy The Drop  [View article]
    Chris, it's timing, your too early. There will be winners coming out. maybe?

    The fundamentals are still a supply exceeds demand issue, you have more sellers than buyers, however it's an over sold condition.

    The changes in the space may not be like before. They might be setting a ceiling and not a floor. Alternative energy, technological advances and other factors show the entire commodity/industrial sector are in recession. Yesterday one firm quit redemption's for high yield/junk bonds. This is commodity debt and their big bet on China demand continuing. Most multinational who made big bets in China are feeling the pain. Some will have to do M&A and/or go bankrupt, since they have to service their balance sheet debt.

    Dec 11, 2015. 11:42 AM | Likes Like |Link to Comment
  • Why EOG Resources Is A Buy In The Current Oil Scenario - In 5 Charts  [View article]
    We now have more sellers than buyers, are in an over sold condition. Yet the economic fundamentals are bad, as supply exceeds demand. Their assets are close to the shares outstanding in a so so balance sheet. Then they are losing $1 million on each of their 3000 employees this year.

    " Ditto Che - don't trust company presentations and analysts this is just a starting point for the research "

    KMI "the dividend is safe" cut by 80% and share price down 60% plus.

    Today a firm isn't redeeming high yield/junk bonds, the debt from commodities is in these.

    The fundamentals are we have too much supply and too little demand. However. this is still too expensive.
    Dec 11, 2015. 11:30 AM | 1 Like Like |Link to Comment
  • Kinder Morgan: The Sharks Have Begun To Circle  [View article]
    So any word about the drastic cut in the dividend? Or should we talk about the 60% plus loss of share price. The MLP's aren't sleeping well these days? High yield/junk bond redemption's have been halted in one fund now. Is this the omen of things to come?
    Dec 11, 2015. 11:16 AM | Likes Like |Link to Comment
  • Smith & Wesson Powers Up Heading Into Holiday Sales - Further Upside Ahead  [View article]
    It does have more buyers than sellers, isn't over bought and has plenty of room to run. Yet 140% in the past 52 weeks, tells us we missed some of it?
    Dec 11, 2015. 11:03 AM | Likes Like |Link to Comment
  • Guess What Happened The Last Time Junk Bonds Started Crashing Like This? Hint: Think 2008  [View article]
    No redemption are now be honored at a high yield/junk bond fund is the latest. An omen of things to come? That black swan?
    Dec 11, 2015. 10:57 AM | Likes Like |Link to Comment
  • Guess What Happened The Last Time Junk Bonds Started Crashing Like This? Hint: Think 2008  [View article]
    jhooper

    You aren't serious? We have a K Street lobby payola machine which distorts markets. Healthcare is certainly represented? As an industrialized nation we pay about $5K per person, twice that of other industrialized nations for healthcare and our metrics are worse. Then the bloated inefficient government operates the Medicare/Medicaid at a 14% admin, while the ever so efficient private sector has a 33% admin expense. These are people who don't treat and/or cure patients. The very reason single payer is seen as the lowest hanging fruit on the healthcare reform tree. The ACA/Obamacare was industry written, other than no cherry picking and universal coverage. How else does this landmark legislation get enacted? Since the lobby money is in the pockets of both parties. We can only hope it is a foot in the door for future meaningful healthcare reform?For three years after the Fidelity Selects bio-tech/pharma/health... delivered astonishing returns. Sorry if you missed it.

    Industry Total
    Pharmaceuticals/Health Products $3,201,510,687
    Insurance $2,234,393,387
    Electric Utilities $2,040,702,304
    Electronics Mfg & Equip $1,853,271,085
    Business Associations $1,842,908,662
    Oil & Gas $1,750,255,336
    Misc Manufacturing & Distributing $1,442,304,755
    Education $1,419,264,645
    Hospitals/Nursing Homes $1,332,519,332
    Telecom Services $1,291,783,209
    Securities & Investment $1,287,877,075
    Civil Servants/Public Officials $1,235,147,415
    Real Estate $1,233,235,907
    Health Professionals $1,221,036,450
    Air Transport $1,144,829,349
    Misc Issues $947,286,635
    Automotive $905,452,098
    Defense Aerospace $902,567,485
    Health Services/HMOs $880,161,913
    TV/Movies/Music $867,424,016
    Feel free to distribute or cite this material, but please credit the Center for Responsive Politics. For permission to reprint for commercial uses, such as textbooks, contact the Center: info@crp.org

    http://bit.ly/1zy0miw
    Dec 11, 2015. 10:48 AM | Likes Like |Link to Comment
  • Smith & Wesson Powers Up Heading Into Holiday Sales - Further Upside Ahead  [View article]
    I saw that too, it was gospel from a truck stop restroom wall rantings.....lol
    Dec 10, 2015. 04:46 PM | Likes Like |Link to Comment
  • Chevron - Buy The Drop  [View article]
    Is that after of before he said "the dividend is safe"? 80% dividend decline to the fix income person and a 60% lost on principal, was it worth it? I warned people, these dividend investors have thick skulls. We need to recall US Steel was that widely held position eons ago, today they are in single digits. Exxon replace them, now Apple is that widely held position.

    This QE is new to us, yet Japan did QE before the lost decade or more like two lost decades. Multinationals have invested in these emerging markets and the high yield/junk bonds are a bubble waiting to bust.

    Just wondering if our markets could experience a lost decade or two?
    Dec 10, 2015. 04:37 PM | 1 Like Like |Link to Comment
  • Guess What Happened The Last Time Junk Bonds Started Crashing Like This? Hint: Think 2008  [View article]
    Can we connect the dots? These brilliant money managers lost the Millennials defined pension plan back in 2008 at the Sub-Prime Casino. Historically and traditionally the market returns funded these pension plans, now that companies have to pay billions into them, they rather do away with them. That puts the onus on the Millennial to plan for that worse case scenario of outliving their retirement savings.

    It gets better as the try to show concern for future debt to our offspring, yet they wish to make the word entitlement mean some form of alms. Something you paid and/or are paying into, which any prudent person would expect something of value in return for. It was a social insurance policy, lost at the Sub-Prime Casino.

    Yet if you look at all of the special interest money/lobby payola, it's equal to the national debt, with change left over. These K Street people distort markets and expect a return on investment, make no mistake about that. They corrupt our elected Representative's with K Street lobby payola money.

    Industry Total
    Pharmaceuticals/Health Products $3,201,510,687
    Insurance $2,234,393,387
    Electric Utilities $2,040,702,304
    Electronics Mfg & Equip $1,853,271,085
    Business Associations $1,842,908,662
    Oil & Gas $1,750,255,336
    Misc Manufacturing & Distributing $1,442,304,755
    Education $1,419,264,645
    Hospitals/Nursing Homes $1,332,519,332
    Telecom Services $1,291,783,209
    Securities & Investment $1,287,877,075
    Civil Servants/Public Officials $1,235,147,415
    Real Estate $1,233,235,907
    Health Professionals $1,221,036,450
    Air Transport $1,144,829,349
    Misc Issues $947,286,635
    Automotive $905,452,098
    Defense Aerospace $902,567,485
    Health Services/HMOs $880,161,913
    TV/Movies/Music $867,424,016
    Feel free to distribute or cite this material, but please credit the Center for Responsive Politics. For permission to reprint for commercial uses, such as textbooks, contact the Center: info@crp.org

    http://bit.ly/1zy0miw
    Dec 10, 2015. 04:25 PM | 1 Like Like |Link to Comment
  • Guess What Happened The Last Time Junk Bonds Started Crashing Like This? Hint: Think 2008  [View article]
    Hedge funds and activist investor need to be outlawed. The ETF's are not only beating the actively managed funds, they are taking it to the hedge funds. On average hedge fund are on track to do -5% this year. Yet you have better and worse, Citadel in Chicago was 12% and you don't want to know the worse............lol
    Dec 10, 2015. 04:14 PM | Likes Like |Link to Comment
  • Guess What Happened The Last Time Junk Bonds Started Crashing Like This? Hint: Think 2008  [View article]
    Reminds me of the Lost Decade, or was that two lost decades in Japan when they tried QE?

    Given that further increases in interest rates would have made that many fewer buyers in, lets say housing, and price being but a rationing mechanism in capitalism. Thereby housing prices would have further declined and the strategic foreclosures increased? That was the perfect storm fro Great Depression II?

    The fiscal side had one infusion of money, which was also bail out money. That was too small a stimulus and the monetary side had to do more. Ironic, in that at lower interest rates we as a nation didn't begin a public works program?

    Asset prices/commodities are down due to the down turn in China. our industrial and commodity sectors are in recession. QE did cause capital to be allocated into emerging markets. This idea of globalization is now coming back to haunt the multinationals. They saw in China and India, 33% of the planets population/future consumers. China has surpassed Japan and Germany as a consumer nation. Yet cheap capital was allocated by the multinationals into the space, blinded by greed. The FED didn't twist their arm and/or hold a gun to their head. This holds true for those who were involved in the sub-prime casino game, yet their risk was borne by the taxpayers. Modern pseudo capitalism, we buy wealthy people stadiums/arenas and they risk nothing, yet do indeed take the profits?

    The end game, I hope isn't that of Japan's lost decade? You certainly won't want back in if this becomes a prolong crisis? There is an asset bubble in the high yield/junk bond market in dollar domination. These investors need to take their medicine, they certainly would have taken the profits?

    The discount rates, reserve requirements and QE are tools which absent of the private sector investment, are at the hands of the FED policy makers.
    Dec 10, 2015. 04:07 PM | 2 Likes Like |Link to Comment
  • Guess What Happened The Last Time Junk Bonds Started Crashing Like This? Hint: Think 2008  [View article]
    jhooper, your talking about another era, when the Rockefeller's oil company was the one and only. There was no foreign oil and Standard Oil was taken down as a monopoly.

    http://bit.ly/1Z1XmHr

    We have a naval fleet and a base for Saudi Arabia to protect that royal family and keep them in power. Nixon did have wage and price controls to fight inflation, that caused shortage/surplus problems. They had embargoed our nation helping of Israel. Both Nixon and Carter came along offering incentive for new oil to domestic producers as an incentive to produce more.

    Your forgetting that those were American oil concerns, which were nationalized by OPEC and even Mexico. We are 5% of the planets population and use 24% of the energy.
    Dec 10, 2015. 03:44 PM | Likes Like |Link to Comment
  • Smith & Wesson Powers Up Heading Into Holiday Sales - Further Upside Ahead  [View article]
    I've seen poor quality guns, my Belgian made Browning 9MM is now made in Japan. It has burrs and the feed ramp needs further polishing. Junk is junk and it does sell, yet I've two friends who rue the day they brought a gun into their home, their offspring used them to check out horizontally. Not to mention all of the accidental shootings, crimes of passion/temporary insanity and manufactures defects.

    http://cnb.cx/1Z1UMl1
    Dec 10, 2015. 03:23 PM | 1 Like Like |Link to Comment
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