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Michael Fitzsimmons is a Top 100 Commentor
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Crude Sell-off: Solid Entry Point into U.S. Oil Majors
10 year returns (annualized):
Index 500 (S&P500): 2.81%
Energy: 20.30%
Precious Metals: 26.48%
this data clearly shows the S&P500 has not only been dead money, but if one considers inflation and the 50% drop in the US dollar over this period, an investment made in the broadly diversified S&P500 has lost you in the neighborhood of 10-12% per year. take the energy and precious metal components out of the S&P500 and the point of my diversification article is even more stunningly evident.
on the other hand, energy and precious metals, as you can see, have not only kept up with the falling dollar and inflation, but actually returned gains back to the investor and increased his or hers net worth. and it's not even close, its by a
***FACTOR OF 10 over 10 years! ***
that is astoundingly evident proof that my advice to get out of the S&P500 and NOT diversify was good advice indeed.
investing is a long term proposition. i am surely not going to change my investment philosophy because of a 6 week sell-off in spite of fundamentals that are obviously very strong. if you are not comfortable unless you are broadly diversified, then hey, go for it and sleep well. for me, i am glad as hell i got out of the S&P500 and similar broadly based diversified investments. besides, even with the recent correction in energy related stocks recently, i am still out-performing the S&P500 year-to-date, and the year isn't over yet....
WingNPrayer: good idead i agree! in fact, since the states have a say in divying up the royalty streams from their offshore resources, the states should demand a cut for their local energy endeavors, and the Feds should get a cut for countrywide efforts (for instance, building out the energy grid, nuclear, wind, and solar).
Crude Sell-off: Solid Entry Point into U.S. Oil Majors
longoil: exactly! that said, the US had better make significant headway by 2015, as that is d-day according to the CEO's at COP, RDS, and Hess in terms of when worldwide oil production will cease to meet worldwide demand...so, who knows what the top of oil will be when that happens (skies the limit). i mean, we have $120/barrel of oil today and there are no shortages. the US, importing 70% of its oil, will be naked in desert when this happens if we don't have alternatives to the gasoline powered auto.
CT: no, i understood you..i was just chimming in there.
Fedman: and you could be right, oil was down a lil bit more today after the inventory report.
Pseudonym: COP a sell? hmm...let's see, they will earn over $13/share this year, pay 2.3% dividend, are the largest nat gas producer in the US, and are expected to earn $14+/share in 2009 and they are selling at $80 and change? ok, you sell, i will buy.
naked: right on, Pickens is the man! notice however, he's getting no support. where are bill gates? buffet? the google guys? how come obama and mccain aren't inviting Pickens to meet with them? the silence is deafening isnt it?
Jimbo: god i hate labels like "greenies". if we had listened to the "greenies" we'd have more solutions in place today and a cleaner planet. look, the US imports 15 million barrels a day out of 20 million barrels of consumption. sure, alaska and offshore could yield maybe another million or 2million barrels a day of production and sure it would help. but that means we'd just be importing 13 million barrels a day instead of 15 million barrels a day. the point is, we cannot drill our way out of this problem and we need to make the transition AWAY from gasoline powered internal combustion engines or it won't matter what the energy stocks do on wall street because the entire financial system is going to come tumbling down along with the economy. glad to hear you are embracing solar, wind, and nuclear - we need them all, now. wrt anarchy and revolution, if we continue to see the US dollar shrink at its present rate, we will see anarchy and revolution because the economic realities of oil will simply sink the US. i hate labels, especially when they are so wrong. like bush being a "conservative&quo... nothing is further from the truth. he's a radical fascist and his economic and military policies prove it. labels mean nothing these days - they just polarize and are divisive. i would suggest making your points without using labels.
pockyclips: agree with most of your comments except re nuclear. i used to be against. that said, with the energy challenge facing the US, we're gonna need every bit of non-oil energy we can get, including nuclear. you're not gonna run non-gasoline based autos without some percent of those autos being electricity based.
BSchecker: at first i thought your name was "BS checker", which some of the people who disagree with me would love to see :) that said, i now realize you might be "B Schecker", correct?
Lazy Al: yup, i called for COP to trade over $100 this year and it made it to what, $95 before this latest celebration over oil falling all the way down to $119/barrel? COP is a screaming buy, and so are many of the energy service companies.
Why Gold Is the New Currency
Crude Sell-off: Solid Entry Point into U.S. Oil Majors
Ishortyou: i will assume your comment is sarcastic in nature...
redbaron, truth: thanks!
CLH: i hope you are right about the US dollar's turnaround, but I kind of doubt it. yes, the dollar has rallied 3% or so in recent months, but it is still down ~3% for the year. what is the basis to be bullish on the US currency? bush doubled the US fiscal debt in a mere 8 years. the US government is bailing out Bear, Freddie, and Fannie by trading toxic debt for US treasuries. this is socialism for the rich wall streeters (or, as i believe, actually fascism). meanwhile, the FDIC has shot 15% of its wad on IndyMac, while there will probably be hundreds of banks which will go under as the financial crisis plays out. meanwhile, the Fed can't hike interest rates because the economy and employment is so anemic. how does that lead to a strong US dollar turnaround? i believe the opposite, that it will continue to weaken until we get "leaders" in washington, and i don't see either obama or mccain as "leader" material.
Fedman: yes there has been a big price movement in oil, but as the article states i dont see big supply/demand fundamental changes. yes, there is more investment, but as the last few years' data shows, oil exploration spending is increasing drastically just to keep up with existing major oil fields' depletion rates. that is why i still maintain oil service stocks are the single best investment idea for the coming decade.
jjason: sorry, i don't buy the speculators argument for why oil prices are where they are. they certainly are part of the reason, but the reason they jumped into oil as an investment was two-fold: supply/demand fundamentals, and a place to hedge against the weak dollar policies of the Bush administration.
CT: i agree with you on the dollar (see my above comment to CLH). also, i'm not sure it's time to bail on ag and commodities. i recently bought more DBC as a hedge here. it all has to do with the US dollar and supply/demand fundamentals. i remember hearing the CEO of pepsi talk about how billions in india and china are going from one meal a day to two meals a day. that's alot of food...meanwhile, the idiotic ethanol mandates are causing huge distortions in the food chain. time will tell...
Gold and the Demise of the American Dream
thefitzman.blogspot.co...
A secondary factor is the financial mismanagement of the country's finances by the Bush administration, who has doubled the country's fiscal debt in the last 8 years. This has led to a 50% drop in the country's currency, leading to yet higher oil prices and inflation close to 10%. Thus, the standard of living for the middle-class is quickly being eroded - not to mention the wealth of anyone investing in the S&P500, which has done nothing since Bush was elected and is bigtime negative if one takes into account the falling dollar and inflation. I dont even want to get into how the "Christian" right has corrupted our government even when our Constitutional framers made it clear that separation of church and state was a primary goal.
The only way the US can get itself out of its economic black hole is:
1) adopt an energy policy (see above link)
2) adopt fiscal responsibility and strengthen the US dollar
both of these points will take political leadership and require the American people to make some sacrfices. I don't see either happening because we have become a weak country with weak leaders, and we neglect science and strategy in favor of Rush Limbaugh and Larry Kudlow.
Why I'm Anti a 'Windfall Profit Tax' on Big Oil
thefitzman.blogspot.co...
Impact of GM Destroying the EV1
your point that profit is a strong motivator is exactly what i have been trying to tell you. one reason GM (and other makers) didnt want to make an electric vehicle was that they are CHEAPER to make and CHEAPER to service. you keep bringing up the cost of a vehicle when its total run rate was 200. what do you think the cost of a Hummer would be if they made 200? An Escalade? give me a break man. GM wanted to sell expensive higher-profit margined SUVs. period! due to their poor quality, they also want to see transmissions, drive trains, and other parts not to mention oil filters and air filters, etc. etc. so, profit margins were one of the points of the article: short-term profits versus long term strategic positioning. that was the point: the economic impact of GM's EV1 program. watch the CNBC special tonite "Saving GM" and perhaps they will discuss their history and decisions. i cannot believe i am having a debate on this obvious issue.
Oil, Gas, Electric Cars, the Market and the Economy
thefitzman.blogspot.co...
Impact of GM Destroying the EV1
"We have a name for companies that refuse to accept consumer wants and market reality: Bankruptcy. We don't respond by congratulating them, but by shorting their stock."
hopefully your pro-GM bias didn't keep you from shorting GM stock on its downward slide from $40 to $10 based mostly on the huge losses in North America. be sure to watch the special on "Saving GM" on CNBC tomorrow night.
miken: well, the facts are GM fought the electric car and lower emission vehicle iniatives in California with everything they had. their response was a move to put a priority on huge gas-guzzlers with higher (short-term) profit margins. despite the current financial crisis that GM finds itself in, and the effect that their moves have had on the US economy and reliance on imported oil, you disagree with me. that's fine, although i find it hard to believe the obvious is so hard for some to comprehend.
the main point of the article was to stress how important long-term **strategic policy** making by both US government and industry is to the health of the economy. you guys apparently disagree. again, that's fine. however, it's interesting to me that you guys want to talk about facts, but when i list the facts about what our dependence of oil has done to the US economy, i don't get a debate on this on a fact-by-fact basis. instead, i get personal attacks and label dropping name calling. when i respond to this, then i get attacked for making it personal when all i am doing is defending myself and giving it straight back!
so, let's agree to disagree and all tune it to watch "Saving GM" on CNBC wednesday night. i can't wait to see how my hard earned tax dollars will go to support the management of GM who continues to prosper mightily while the rank-and-file get laid off around the US. should be a real uplifting show. hopefully they will spend some film footage showing the dealer lots chock-full of GM hummers and SUV's. i can't believe you guys don't find this disturbing. i find it exasperating and sad.
as far as ethanol, i don't mind ethanol per se. what i mind is mandated quotas (again, by the supposedly "free market" conservative republicans). all this has done is cause huge dislocations in the beef, pork, and chicken markets causing many small guys to exit that business. wait until you see the prices of these products next year after the current glut (caused by the farmer's selling out) is over. it also keeps gasoline artificially low, prolonging our 70% addiction to foreign oil.
Impact of GM Destroying the EV1
Impact of GM Destroying the EV1
Impact of GM Destroying the EV1
1) doubled the fiscal debt in a mere 8 years
2) grown the size of the US government by 30%
3) presided over a 50% fall in the value of the US dollar
4) cut taxes to the rich while fighting 2 wars
5) caused an inflation rate which must be close to 8-10%
6) presided over equity markets that have done nothing in 8 years
7) presided over Fed takeover of Bear Stearns
8) nationalizing the nation's mortgage market
9) now has Bernanke and Paulsen federalizing the nation's banking and financial systems
10) oh, yeah, and oil went from $30-$150...
all these are fascists (not socialist) policies. yet, rush limbaugh uses gay marriage, labels like "greens" and "liberals" to convince the uneducated that Bush is "the man" and that Republicans are going to save you from "the government" at the same time Bush has the government doing the steps listed above. so, they DO pretent to cherish and love the country without looking at what is REALLY happening right before their eyes. it's easier to bash liberals or gays or greens or whoever....meanwhile, Bush robs the country blind.
you say not to make attacks personal, which i don't until i get attacked personally first, then i respond. ironic that you then go on to tell me how to live my own personal life.
i criticized GM because the article as about the EV1 and, no surprise, GM was the manufacturer. it was a CEO of GM that stated before Congress that "as GM goes, so goes the United States". GM was the biggest US car maker. so, those are the reasons why. unfortunately, there was a grain of truth in the CEO's statement, and we are definitely seeing that in the US economy today as well.
wind wasn't "ready" (yet Germany, Spain, the UK, and many parts of Scandinavia have found a way to implement it), solar wasn't "ready" (yet it can and is being deployed economically today), high speed trains weren't "ready" yet Japan, Europe, and many countries in Asia somehow made it happen. the point of the article is LEADERSHIP. the point of the articles is that the US imports 70% of our oil and therefore we should be LEADERS in alternatives. yet, we continue to allow the industrialists to call the shots for their own short-term profit motives, and US citizens follow along like sheep toward the cliff.
funny i am having this discussion with you as you then go on to tell "liveoilfree"... that you'd like to see the US get off oil.
as far as monday morning quarterbacking goes, here is the energy policy i have developed and been pushing for the past 6 years, a campaign i started before oil breached $50/barrel:
thefitzman.blogspot.co...
if you want a detailed list of the iniatives i have taken to get the country's "leaders" to pay attention to the fact that worldwide oil supply/demand realties are the biggest threat to the US economy, national security, and our way of life, let me know - i'll send you a personal email detailing the entire effort.
oh, thanks alot for not making it "personal". you're as hypocritical as bush, limbaugh, kudlow and all the rest. take the high moral ground in word only, not in deed.
Impact of GM Destroying the EV1
"Because electric motors are far simpler than internal combustion engines and steel-on-steel vehicles do not need the elaborate sprung suspensions of rubber-tired vehicles traveling on asphalt, streetcars themselves are actually much cheaper to maintain than buses and are far more durable."
bingo!
Impact of GM Destroying the EV1
Impact of GM Destroying the EV1
www.cnbc.com/id/259672...
GM posts $6.3 billion (with a "b") loss. Factor in the "charges" and the loss goes to $15.5 billion (!). The majority of the loss came in North America (what a surprise). GM long term debt was selling at $0.47 on the dollar this morning.
IXLR8: at the time the EV1 was made available, i was not living in california, and did not even know the car existed (again, covert marketing by GM to kill the car they never wanted to produce in the first place, and wouldn't have if not for the CARB mandate). I never said Toyota was infallible - they have to compete in the US market that has historically been dominated by GM+Ford. That said, they do have a quality car like the Prius, and many other quality small fuel-efficient cars. I have owned Toyotas since the 1970's. I was not happy with Toyota's move to the Tundra and the bigger Tacoma, and I wrote them and told them so, and that it would bite them on the butt when oil went up. That said, look at Toyota's financials and stock price versus either GM or Ford and then we can continue the debate, that is, if you still want to.
Juan: if you are happy with the Bush & Cheney energy plan, their focus on oil, our 70% addiction to foreign oil, our present economic state due to it, our falling US currency, and our tanking stock markets, hey, vote for mccain and perhaps we can get the S&P500 under 1000 (3 zeros, not 4...) after his 8 years. good strategy!
User: you're right, JD Powers used to be reputable, but now they have been bought out by big oil and big auto and Americans read that crap and buy it just like they do larry kudlow and rush limbaugh. GM's financial performance and stock price speak for itself and I am still amazed at this entire debate considering America's current economic state, but it just goes to show how important it is for the government to educate and prod industry and citizens in the right direction when they just don't get it.
it's like the CO2 analysis in this article and how "wrong" i was. CO2 is exactly that, 1 "C" and 2 "O". the oxygen comes from the air intake and combines with the carbon in the gasoline. that is why the CO2 output per gallon weighs more than the gallon of gasoline by itself. but, you can't tell these morons anything because they don't listen to science...they listen to heroin addict rush, who is making millions of dollars every year to push the bush doctrine on to them and they take the bait hook, line, and sinker. sad commentary on a country that used to be the world's leader in technology and science. now, we lead the world in false and hypocritical ideology. even as GM tanks, lays off people, and has suburbans and hummers sitting on their dealer lots that will never be sold, people still want to argue about it. amazing.