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Market Update: The US Market is Stable and Producing Cash Flow

|Includes: The AES Corporation (AES), APA, APC, CHK, CVX, KMI, KMI, MRO, OXY, RRC, WMB, XOM

Energy Commentary from Karl Miller - Read Bio and More info

July 16, 2010 ( energy newswire) - ( energy newswire) -, a leading investor research portal updates investors with morning market update and previous commentary from Senior Energy Executive Karl Miller on the current status of the US Economy and the Energy Industry.

On May 20, 2010 Mr. Miller made the call and reported to readers that “The US Market is Stable and Producing Cash Flow”. Thus far, corporate earnings reports for the second quarter of 2010 have been strong, with more companies due to report next week.

In speaking to Mr. Miller this morning, he reconfirmed his view that indeed the US market has structurally stabilized, which is evidenced by the record amount of cash stockpiles being held by US Corporations and Financial Institutions.

Mr. Miller advised that the perceived “systemic risk” has passed, and we will see Corporations begin to deploy the massive cash reserves they are holding on strategic acquisitions and growth targets across all sectors, especially in the energy sector given the substantial market fragmentation prevalent in that sector.

Mr. Miller sees this morning’s market sell off as a major buying opportunity across all market sectors, despite consumer sentiment proving to be a challenge for investors. We feel that Mr. Miller’s May 20, 2010 market conclusions were worth reprint, given their sound reasoning and logic:

Here is a recap of some of Mr. Miller's key analytical and market thoughts:

  1. Stay the Course: Nobody ever went broke buying energy and infrastructure companies that generate substantial and dependable cash flows
  2. Investors Should Thank the Hedge Funds and other Hot Money for Dumping Energy Assets Cheap
  3. Separate your mind from the noise in the system in Europe and Asia. There will always be some volatility in the global market; this is the way of the world. If you sell now, run and hide and capitulate, you are effectively "giving your money to the robber Barron's", for less than a 100% of its value.
  4. The Euro is "not going to fail". Some of the weaker countries in the EU may ultimately be removed from the Euro economic base, but they never should have been there in the first place.
  5. For just as quickly as the Hedge Funds, Hot Money, and Ambulance chasers dumped energy and infrastructure stocks, they will come back into the sector in full force of a thundering herd of water buffalo struggling to cross a river infested with crocodiles when they grow tired of their latest chase, the Euro. Why will they do this you may ask, well despite the well informed investors reasons for owning natural resources outlined above, Hot Money has no choice. They must chase the trade for a living, and energy and infrastructure is a "trade in perpetuity", you must own it if you manage money.
  6. Energy is the Ultimate Global Currency, as did several other leading executives, and it was time to "call in the markers on institutional money managers" wreaking havoc on the US Markets.
  7. "When you are explaining, you are losing". I see a lot of money managers trying to explain right now.
  8. The US Market is Stable and Producing Cash Flow

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Karl Miller Disclaimer:
Energy Commentary from Karl Miller is the opinion of Karl Miller. Content found in the articles is subject to the terms found in the disclaimer and does not represent a recommendation of investment advice by Mr. Miller. Investors should seek the advice of a qualified investment professional prior to making any investment decisions.

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Disclosure: Long US Energy Companies