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  • Oil Prices Will Rise Based On Fundamentals And Geopolitics [View article]
    Re: "no "glut" of oil in the longer term"

    The problem with these assertions are that unlike many other commodities such as coal, iron ore, copper, uraniam, gold, etc there is actually no scientifically based data proving your view to be the truth vs mine, which is that there is an increasing oil glut, through the vast supply chain that "feeds" off the oil eco-system.
    Dec 14, 2014. 03:06 AM | Likes Like |Link to Comment
  • Oil Prices Will Rise Based On Fundamentals And Geopolitics [View article]
    Every piece of data, statistics, analysis and conclusions therefrom on China must be treated with deep suspicion. From what I observe, China no longer needs to take "advantage" of low prices to rush to import oil for its needs for the following reasons:
    a) it has singularly cornered for itself oil supplies from its owned oil wells in countries such as Nigeria, Angola, Mozambique that "price no longer matters";
    b) through various geopolitical events, all in its favour it would seem, major energy supplies, not just oil, but also nat gas, has fallen snugly into its lap. By this, I mean that China is now the singular, assured buyer of any oil and gas that Iran, Russia, Venezuela can produce. In buying their products, China has effectively entered into a barter system, whereby it exports all manner of Chinese manufactured products in exchange for oil, gas with prices agreed off a world market system;
    c) I would not at all be surprised if China in fact buys a lot of the oil in excess of its domestic requirements, from the above countries and sells it on to 3rd countries, refined or otherwise, in exchange for other resources it may need;
    d) China's strategic oil reserve must now, I believe, be so full, it could well be 'overflowing'.....with its own economy moribund, and practically every producer, incl. Saudi Arabia lining up in front of China's ministries of energy, trade, finance, etc to sell it oil, it is quite possible that the world oil markets no longer are able to "count" (and therefore, report accurately) actual supply and demand, as the entire "inventory pipeline" from producer, refiner to retail & distribution" is choked with excess oil.

    FWIW, this terrible situation was a long time coming to an uninformed bystander like me, as I watched the oil price above USD 100 some 6 months ago, and used to ask myself, "how come it is so high", when everywhere I saw, people were driving newer, so hugely fuel efficient cars, practically everywhere, i.e. Europe, Asia...yes, just 2 out of 5 continents, but it was telling for me.

    I suspect oil will find its natural balance at c. USD 50 in the not too distant future.
    Dec 13, 2014. 10:13 PM | Likes Like |Link to Comment
  • The Collapse In Oil Prices Rocks The Markets [View article]
    Excellent cautionary article and it seems the markets' behaviour worldwide on Friday confirm your caution.

    As both demand and supply for oil are going in the wrong directions to support even current prices, I believe the world is on the cusp of major, permanent economic and social changes that will reflect this new normal.

    While this development is clearly a negative for oil producers, it may somehow be a long overdue blessing for many permanently energy-starved countries such as India, many parts of Europe, Africa and Latin America. While the investment opportunities from a 'world turned on its head so suddenly and deeply' are still not showing up as shoots, my cursory look at stocks in several transparent markets in both emerging, developed as well as frontier markets tell me they are worth a more serious look. Another big surprise performer could well be the most maligned market of late, China.
    Dec 13, 2014. 08:50 PM | Likes Like |Link to Comment
  • Oil Prices Will Rise Based On Fundamentals And Geopolitics [View article]
    I just read your article with great interest, as it seems, at mid-Dec, entirely counter intuitive to the goings on in the global oil market. But without any quantitative analysis, but simple "world travelling and looking around", I feel:
    a) any discussion of oil prices must consider demand at least as much as the supply side of the equation;
    b) there must be deep analysis done on exactly where oil products become refined into, and an understanding laid out as to how each component of the derivative products (such as gasoline, aviation fuel, heating oil, chemicals, etc) is facing demand/supply pressures globally;
    c) one of the major derivatives, gasoline, I would like to submit is actually facing lower demand going forward simply because developed markets' auto demand is falling, while developing markets' auto demand is just about stable. Yet, the market vastly underestimates the consumption efficiency of today's autos vs even those of some 5 years ago;
    d) I am convinced that gasoline demand worldwide will decline to an entirely 'new normal' over the coming years, for a variety of reasons, but principally to the 2 factors per (c) above;
    e) when I think of the other major oil derivatives such as heating oil, I feel more and more permanent displacement from the likes of natural gas as well as electricity from nuclear and renewable sources are in order.

    In sum, oil price is more likely to be determined by an entirely 'new normal' in demand for its major derivative products than supply movements.
    Dec 13, 2014. 08:23 PM | 2 Likes Like |Link to Comment
  • Apple: Facing A Challenge From Google's Android [View article]
    Why is it that no one has yet written an article explaining why Xiaomi is succeeding so well, including in some ways against Apple loyalists, when so many others, including Samsung are falling wayside?
    Dec 7, 2014. 07:31 AM | Likes Like |Link to Comment
  • Intel: What To Expect [View article]
    There could be a logical scenario where, at least as far as the consumer market is concerned, the aspirational sector will veer naturally towards the Apple eco-system while the mass market for the wallet conscious, just-getting-by consumer market will head towards an eventual Intel eco-system.

    The Apple eco-system for the consumer segment will be very much how Apple alone wants to define it, possibly running on an ARM architecture from top to bottom, while the Intel one will be one defined at its "core" by the X86 ISA.

    For Intel, it will increasingly use its power to em/imbed 3D NAND memory (and all manner of known and unknown adjacencies) across its product spectrum, covering the key cost, battery life, power dimensions. Its willing partners: both Microsoft and Google.

    An unintended winner could well be MU, as it not only supplies but also, most importantly knows only too well how to em/imbed both 2D and 3D NAND as well as DRAM alongside logic chips as well as adjacenies across both the X86 as well as the entire ARM eco-system from Apple to the lowly Chinese mobile product manufacturers.

    As for IoT, MU comes trumps again....
    Dec 7, 2014. 07:23 AM | Likes Like |Link to Comment
  • The Prisoner's Dilemma Facing OPEC And Investors [View article]
    To me, the current deep pressures in the system affecting the entire crude oil "eco-system", including the likes of prices of palm oil, natural rubber, nylon, chemicals, etc has ramifications not only in the upcoming weeks, months but for years to come.

    OPEC simply did not do its homework, when even to a layman, it was patently clear that dramatically lower oil prices were on the cards, so that say, $50 per barrel was the 'new normal' OPEC countries (and Russia) should have been budgeting to, for the following reasons:
    a) the awesome rise of US shale/fracked supply;
    b) China's permanently slower economic growth path;
    c) eye-popping energy use efficiencies in popular use areas, such as automobiles;
    d) Europe's permanent dimmed growth prospects, and generally, lower disposable income available to middle classes everywhere, including USA, Europe, Japan, Middle East and of course, Latin America.

    Staff at OPEC's pristine headquarters in Vienna was likely taking itself out for long, lazy lunches during this glorious late summer that they forgot to look at the ever speeding, but highly correlated, entirely negative macro and micro statistics that should have been glaring at them on their computer screens!

    For the poor, innocent and always maligned people in countries such as Iran, Venezuela, Nigeria this is a tragedy that is just unfolding, and yet, speeches from the likes of Nicholas Maduro only seems to convince one that there is continued sinking of their heads in the sand, or more appropriately, dense, heavy crude.

    On the other hand, for the world at large, it is good that a "cartel" no longer is a sustainable model for managing the supply of a key commodity in the world. Without the cartel, I would expect, in the not too distant future, political leaders in all manner of OPEC countries, esp. the likes of Venezuela, Iran, even Saudi Arabia are held accountable to the political, social and economic fortunes of their own populace, without excuses. Hopefully, this leads these countries to transition their populace from living off a de facto welfare state, and instead, to one where people are forced (and begin to appreciate) the joy of going to work, earning a decent living, building things or servicing people or things, which is something people of Venezuela have for too long been weaned by their by now, discredited politicians.
    Nov 29, 2014. 02:04 PM | 4 Likes Like |Link to Comment
  • Intel: My Take On The Intel Investor Meeting [View article]
    In addition, I suspect the anti-trust equivalent politicians in China, EU as well as the FTC would probably have a lot to say on the merger.
    Nov 29, 2014. 01:13 PM | Likes Like |Link to Comment
  • Micron Could Hit $50 In 2015 [View article]
    Well timed article on MU's near and long term prospects. Some surprise aspects to the upcoming Q1 earnings are:
    a) it is a 14 week quarter, which could well trip "up" revenue and earnings;
    b) depending on how well they covered their FX exposure, it could well be a tremendous +ve, as the JPY collapsed against the USD in the last few days of Oct, and even more so going into Nov;
    c) Apple's heavily dependent on MU for both DRAM and I suspect, NAND too, and Apple's IPhone 6 and 6+ astounding success could well bring great news for MU;
    d) Intel was tooting the horn loud and clear at its recent Investor Day on its 3D NAND readiness to ship early, and with its huge, singular mojo in Data Center and Cloud computing, MU will be a direct beneficiary of Intel's R&D. In addition, MU is the likely the singular, preferred and highly "optimised" DRAM supplier to all the upcoming Grantley servers during Q4 and all of 2015; and finally,
    e) as Samsung looks to supply itself and leverage to the full its highly diminished prospects in smartphones and tables by subsidising its DRAM supplies to its own mobile products (and of course, Apple), I wager that the Chinese, most aggressive players like Xiaomi, Lenovo, Huawei and ZTE have no one to turn to but MU for their DRAM supplies, esp when things start going a little crazy before the upcoming X'mas, New Year and most significantly, the Chinese New Year (of the always prosperous bringing "Pig" Year in 2015.
    Nov 29, 2014. 01:11 PM | 19 Likes Like |Link to Comment
  • Intel: My Take On The Intel Investor Meeting [View article]
    Alas, the article's summary of the book contains so many useful, but as always, difficult-to-follow mistake-avoiding lessons.

    Still, I celebrate Rule 7 and 7 alone, as, for most of us on this 'thread' of life, Russ Fischer has been singularly the harbinger of "Great Success = a little more talent + a lot of luck".

    If I were honest, when it comes to Intel, Ashraf was pounding the table so many moons ago, but few dipped into the then treacherous waters. But along came Russ, with his "this time it's really different" mantra on MU, and as they say, he became the "piper". Then, all of a sudden, a change of mind, he played Intel's tunes, and the by now crowd followed. Some like me, daring to second guess him, have stuck on MU, we'll see if the other rules of the book were ignored, hopefully before mid-Jan 2015 passes. So many investor presentations next week, and then the Q1 earnings release in early Jan....

    As for Intel, everything seems so compelling, everytime I "fear to tread", I simply look up Apple's market cap and tell myself "it can't be so bad with playing Intel, with so much talent, knowledge, factories, reach" with its market cap <4 times of Apple.

    We all really really need a lot of luck....using talent seems easy, and for the retirees among us, hard work is such joy, esp when it comes to sharing, questioning, pondering and then, every once in a while, "moving".....
    Nov 29, 2014. 12:09 PM | 3 Likes Like |Link to Comment
  • My Favourite Value Stock: AGCO Corporation [View article]
    To my mind, CAT picked off AGCO's (previously Lucas Verity) crown jewel, Perkins Engines. I doubt very much if CAT would be interested in any of AGCO's complex array of practically everything, from products, manufacturing sites, R&D structures, its "legacy" personnel spanning many parts of the globe, and of course, yet another disaster-in-waiting, a manufacturing site in China.
    Nov 29, 2014. 11:36 AM | 1 Like Like |Link to Comment
  • Further Observations Regarding The HP Server Debacle [View article]
    The answer to your lengthy article could well be a simple one, i.e. Intel is finding many ways to sell direct to large customers worldwide, and this trend will only increase in the months to come. In addition, Intel servers will now have so many adjacencies with their own IP that HP will find itself being simply "cut off", as a lowly middleman.

    So, in short, HP's loss may not be Intel's loss, in fact, as time goes, increasingly, it will be Intel's gain....on revenues, the vaunted GM, and of course, OP!
    Nov 28, 2014. 12:13 PM | 3 Likes Like |Link to Comment
  • Amazon Gaining Customers [View article]
    As always, you write insightful articles, and this is another one. What worries me about retail stores, even on-line ones, is consumers keeping more and more in their pockets, and just not spending.

    This phenomenon is visible not only in the US, but also Europe and indeed, all over the world.

    How would this affect Amazon's prospects, esp Q4?
    Nov 28, 2014. 02:34 AM | 2 Likes Like |Link to Comment
  • Intel: My Take On The Intel Investor Meeting [View article]

    With so much going good for Intel, are you or is there anyone who knows enough about the ARM architecture as well as the ARM players such as TSMC and Samsung to write up a critique on the pros and cons of X86 vs ARM and why the former is going to get further and further ahead of ARM.

    With so much compelling news on Intel, one naturally ponders what's driving so many reputable companies such as HP, Dell, Qualcomm to decide to plunge big investments in developing chips based on ARM? And are there reasons to "fear" that they might get things right in a couple of years?
    Nov 27, 2014. 10:46 AM | 1 Like Like |Link to Comment
  • My Favourite Value Stock: AGCO Corporation [View article]
    Sum total of this article is to be cautious:
    Nov 27, 2014. 10:39 AM | Likes Like |Link to Comment