Elitemaster

Natural Gas: Long-Term Bull, Short-Term Bear (Part 2)

HT Love, great great article. . very technical, with a ton of supporting documentation and sound logic. I agree with you technically that UNG will begin next week with either a vicious down trend or a temporary uptrend and I think then for sure collapse by weeks end. I am going to watch Mondays stats very sharply and exit at the smallest sign of down trend but if small temporary uptrend happens in the middle of the day, going to sell when I think its reached its 'peak'.
I do have to disagree with you on the oil argument; I think that oil has just paused because all of the sudden influx of confusing/contradictory news on the global economy as regards energy consumption/production... and next week oil will continue its upward march albeit on a slower pace (especially after the Tuesday summit). I would have to say that the alleged correlations with Nat gas and oil and other commidities is weak other than the general psychological assumptions about the future economy in investors minds. You are right on the money though with the outlook for Natural Gas.
User44674, I think that because of the cost benefit analysis of using gas as an export commidity is negative, (because it costs more to ship it over seas than to just take it out of the ground in your home country), nat gas will probably never be used as a world commidity like oil. However, with some of the newer techniques, like 'fracturing' etc, nat gas excavation has gotten cheaper - which is another reason why the US should begin using it more as our primary energy source (cheap, abundant and easy to acquire), like HT Love said.. nice analysis, great article, good reading.. thx

Transocean in Troubled Times - But Not for Long

yepper, I have almost half of my portfolio in shares of RIG.. great company and poised for major uptrend in the coming years.. as long as you put your blinders on with the volitile jumps in prices caused by fluctuating day rates, over a long period of time this stock has an insanely great valuation - currently trades at ~$80/share, just wait until the next year or two when the global economy is in full gear, oil is back up at $140/barrel and RIG share price upwards of ~$160/share - I'm gonna be laughing all the way to the oil slicked bank.. nice article

Commodities Today: The Correction Has Arrived

yea ok go ahead and buy up some puts on oil and make me and a bunch of other people rich when late august oil is upwards of $75/barrel and you have to cover your 'tired' positions. Right on the mark with natural gas but oil ? wrong forecast my friend.. china and other BLIC nations are moving away from the dollar, removing their US debt (Tbonds) and cooperating on increasing import/export moves between each other and leaving the US on the sidelines - why do you think Russia earlier in the week boasted about the dollar.. they knew it would give it a temp burst up to give it momentum for an eventual collapse (total obvious BS); sound strategy against the inevitable fall of the weak dollar.
demand for oil decreasing ?! did you actually read the energy report this week? we were off the mark as regards oil consumption by almost FOUR times the amount (in millions of barrels a week).. so what that we have a little more stock piles than we thought, we are burning through it faster than we can say 'the dollar is falling hard'.. my advice, invest in OIL NOW asap before it skyrockets in the next few months and the dollar falls .. or better yet, invest in oil service companies with global positions (like drillers RIG/DO/etc) because China and Russia don't want to have anything to do with the dollar anymore, they are looking to the ruble now (wait until the reports start flooding in on Tuesday about the summit)..
cheers

US Treasury Bonds and Oil

wow, what a great concise explanation of the US and global factors influencing bond rates and how they are related with the future of the energy sector. I myself have almost half of my portfolio invested in RIG and other offshore drilling companies who stand to benefit greatly off of the decline of the US dollar and rising oil prices .. GREAT article

Stocks Will Fall 37% or Gold Will Rally 60%

Ok, first of all, gold is just metal from the earth and money is just paper, so they are both just devices/vehicles for currency exchange. Yes, gold has industrial uses but if eventually the only value to humans became its industrial uses (and of course back to the stone age when humans valued it because of its shine), then we will be already in a worst case scenario (time to head for the mountains with your shotgun and canned foods); moot argument.
Now, the 'ratio' argument in the article seems to forget one major problem with the use of statistics - the spread/deviation/beta of the metrics used. For a given time interval (lets say 5 years), we have an unknown ratio in a box and until we open it to see how the metrics compare, we have to attribute a variance to it (beta); the reason it is unknown at any given time interval is because of a crucial point - there is no meaningful to make correlations between metrics from events/configurations of matter and/or minds and the macro/micro-games that were played decades ago versus now or any other time interval. So if you were to compare the ratio btw 1919-1924 for instance to what the ratio is going to be in 50 years (to 55 years) from then (if you were living in that time frame), you would have to multiply the beta with the ratio; further, you would have to take this multiplier (which also changes) and apply it to all of the future 5 year intervals up until the point in time which you are discussing (now). The problem is over decades and decades, the beta*ratio begins to grow and grow until you have a meaningless range of possible ratios which denote NO correlation (for instance a small beta of -2 to +2 and the given ratio of 5.4 for the very next interval, say from 1925-1930 would be -7.4 to +7.4 then from 1930-1935 it would already be -9.4 to +9.4 and that is assuming a linear relationship with the multiplier - it could be and probably is more like logarithmic); by the time you reach the present, you are dealing with a statement like --> "oh, the ratio may be any number between -37.4 to +37.4".. wow, great man, that really tells us a lot about the correlation btw gold and stock metrics. <-- sarcastic
Not to mention the fact that looking at numbers only, every separate game period must be given a brand new range of probable outcomes which are in no way dependent on the outcomes of the past (flipping a coin once and lands on heads does not mean that the next flip will be tails just because the math dictates a 50:50). Last point is you can look at the situation in these terms: gold is a form of backup ammunition, paper currency is a newer modern laser (greater advantage) weapon in the modern battlefield (game/market space), you use the laser because it is based on a greater number of more complex sub game systems and so provides a greater advantage and you use the more simple (gold) ammunition as a backup in case the more complex system breaks down, but you don't begin forcing your commander to put more energy in creating more rocks to throw at the enemy just because you lose some (or even most) of the energy you need to power your laser. Only if the laser completely breaks, you start throwing rocks at the enemy.. make sense? But if we are both on the battlefield trying to make gains, please, by all means, go ahead and stop putting energy into fixing your laser and start throwing rocks at me, by the time you have built up a huge mountain of rocks to throw at me, I have my laser back up and functioning at full power against you. Good luck!