CrossProfit

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Thu Nov 13th 14:27 PM
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Rating: +2 0

Commented on:
The IEA Annual Report: A Dire Picture of Energy Supply and Demand

The IEA constantly changes its outlook. Based on reviewing several years of 'annual reports' it seems that the general trend calls for higher consumption though the projected growth rate seems to be constantly adjusted to a lower actual rate.

There could be two reasons for the inaccuracy in the forecasts:
1) IEA analysts don't compensate for technology improvements for both production/consumption and pollution.
2) IEA analysts can not allocate government interventions that have yet to take effect.

When all is said and done, oil at $50 to $65 is where it should have been all along as stated in articles about a year ago. The 'financial crisis' is just an excuse for it to come down now that GS can no longer pump it up to $140.

As for the future; the next time we hit $140 it will be for real and won't come down again. Unless a viable substitute is developed, it is just a matter of time. Will it be 2030? It is hard to say as it may be well before.

Just like oil above $85 today threw the U.S. economy into recession (before the financial crisis hit), likewise should oil fall below $35 it will ignite a backlash that will cut off production and prices will spike.

Too high is no good and the same holds true for too low. Perhaps now Chavez, Putin and others will start listening to the Harvard educated Saudis' who were constantly warning about oil going over the $100 mark. The Saudis' attempted to 'talk' the price down. It's too late for this time, but let's try to remember for the next time!

CrossProfit
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Thu Nov 6th 03:36 AM
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Rating: 0 0

Commented on:
Toronto Stock Exchange Displaying Strength

Way too early for the inflation cycle to hit. As such, good theory but for the time being the TSX will move in tandem with the rest of the world markets.

As for the volume paradox; congrats on noticing this, however, conclusion is a bit off. Sometime 2009, oil will retest the $100 mark or thereabouts. Recession or no recession, it's going to happen for a number of reasons. How and when is dependent on so many variables that stating a possible scenario now is equivalent to buying a lottery ticket. The TSX is reflecting this and basically has turned into a giant option put/call machine with an emphasis on oil and gas with other commodities playing second fiddle.

When it finally happens, then and only then will the TSX part from following the rest. (Australia is similar yet very different components, also less dependent on U.S. economy.)

Be careful how you place your bets as options have a tendency to expire worthless!

CrossProfit
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Thu Nov 6th 03:17 AM
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Rating: +1 0

Commented on:
Asian markets drop as investors refocus on the economy: Nikkei -6.5%. Hang Seng -6.8%. Shanghai -2.5%. BSE -3.9%.

As stated in a pre-election comment, the Nikkei is following NYSE, not a leading indicator.
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Tue Nov 4th 07:01 AM
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Rating: +2 0

Commented on:
As other Asian markets show little movement today, Japan's Nikkei rises 6.3% to a two-week high as investors buy back exporters in the face of a softer yen and show relief over a quiet three-day weekend.

Futures are saying a strong open. Assuming that you are day trading (we are not), the afternoon session is critical to determine if this will be an extended rally or not. Without progress from Treasury, it is hard to visualize a medium term sustainable rally at this stage.

The market is fully aware of the fact that no matter the outcome of the election, nothing starts to change until January 17, 2009. Even then it will take two to three months for the new President to set priorities and direction. Then, and only then will we get the markets true reaction to the new President.

In short, nothing has changed...this is still a traders market.

On Nov 04 04:20 AM Y.I. wrote:

> V helpful comment, CrossProfit -- thank you. What are your thoughts
> on today's US market?
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Tue Nov 4th 03:41 AM
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Rating: +4 0

Commented on:
As other Asian markets show little movement today, Japan's Nikkei rises 6.3% to a two-week high as investors buy back exporters in the face of a softer yen and show relief over a quiet three-day weekend.

The Nikkei 225 6.3% gain was a follow through, not a leader. Japan's markets were closed on Monday and had to catch up to the rest of the world markets, reflecting NYSE (Thursday in part) Friday and a stable Monday (2 days).

The percentage gain actually indicates caution, as if to say we are not out of the woods yet. Had the Nikkei flown to 9700, then you would have a leading indicator. It didn't happen.
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Mon Oct 27th 08:01 AM
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Rating: 0 0

Commented on:
More on TARP and the Insurance Industry

Nice article.

As an aside, there are two new competitors on the block, Buffett and Citadil. If ABK's future is the reason for your 'spike and leave' conclusion, it may be premature to make such a call.

CrossProfit
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Sun Oct 19th 19:00 PM
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Rating: 0 0

Commented on:
Picking Some Stocks to Survive This Market

You may want to consider changing your overall strategy for the time being. For now it may be best to focus on short term gains to make up part of what you lost over the past six weeks.

Once there is more visibility or stability (as in a lower VIX), then going back to a long term horizon would seem to be more sustainable. However, if you really do intend to stick with your previous strategy, then perhaps you should be looking at companies that have already taken advantage of this mess and are doing so with a longer time horizon in mind.

A good example would be comparing BAC with JPM. BAC has taken a long term approach, whereas JPM has taken the quick return approach. Not saying that banks are up your alley, just pointing how two companies seem to be taking advantage of the current situation and the different ways they do so.

Should you decide to be more short term focused, as we believe is currently advisable, then an attempt to find the short term winners of the 'national bailout' should prove very lucrative. One possibility is some of the Monolines. Perhaps some energy stocks that have been beaten down so much that their future earnings at - shall we say - $50 a barrel are going to eventually force a 30% PPS increase. Be careful though as not all will jump after reporting earnings.

Besides, there is a very good chance that oil will be up 20% sometime in 2009. The logic is simple. If the 'national' and now 'global' bailout succeeds to stabilize the markets and world economy, then as evident throughout the downturn, every time there was a hint of a recovery, oil started to regain lost ground. On the other hand if the bailout fails, then no stock on the stock market is safe. In other words, if your buying anything, you are betting on the success of the bailout. If such is the case, then why not bet on the stocks that have already proven that they go up when the future is promising?

Notice how the term 'bet' is used and not 'invest'. Reflecting current market conditions is a contagious 'healthy' approach!

As an aside, you must find it ironic that Mr. Buffett advises to buy stocks now (or miss the spring as he put it) as he himself is doing. Now if only Merkel and every other investor could buy preferred with a guaranteed 10% coupon...we would all probably say the same!

Good luck.
CrossProfit
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Thu Oct 16th 17:27 PM
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Rating: 0 0

Commented on:
DRS Update: The Company's Acquisition Could Be Sensitive

@real M&A hound,

Not a bad guess for the closing date. Based on today's info, this could close before the end of October if all the financing gets done in time.

One other item: These types of transactions are immune to markets falling as they are pretty much insulated from market swings and recession. It takes forever to put this type of a deal together and the time horizon (expected return) is over a decade, not 'three years and sell' that private equity deals work on. It's always nice to have a government (Italian in this case) interested in the deal going through.

The dip to $75 two weeks ago was an ARB's wet dream (pardon our Italian!).

Seeking Alpha

CrossProfit

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Latest Comments 572 Comments

The IEA Annual Report: A Dire Picture of Energy Supply and Demand

Toronto Stock Exchange Displaying Strength

Asian markets drop as investors refocus on the economy: Nikkei -6.5%. Hang Seng -6.8%. Shanghai -2.5%. BSE -3.9%.

As other Asian markets show little movement today, Japan's Nikkei rises 6.3% to a two-week high as investors buy back exporters in the face of a softer yen and show relief over a quiet three-day weekend.

As other Asian markets show little movement today, Japan's Nikkei rises 6.3% to a two-week high as investors buy back exporters in the face of a softer yen and show relief over a quiet three-day weekend.

More on TARP and the Insurance Industry

Picking Some Stocks to Survive This Market

DRS Update: The Company's Acquisition Could Be Sensitive

Latest Comments
572 Comments