JJB: Shorts don't pay taxes only if the stock goes to zero. If they cover for a gain, they pay taxes. But that is fairly symmetrical with longs who hold onto a stock that goes way up and never sell it - they can gain a lot of the benefits of the increased value by pledging the stock as security for a loan, for example, and not pay any taxes until the stock is sold.
I never said that I don't think SOLV should exist. I am glad that it does, since I find this thread so entertaining. (Now if SI went out of business, then maybe SOLV shouldn't exist, but I will worry about that then.)
But I think your point is well taken about the the tremendous subsidy in the form of defense expenditures that foreign oil receives. If we had all the oil we needed here, would we care if Iraq invaded Kuwait? I doubt it.
I am playing the same concept by being long a stock called Energy Research (ERC on the A.S.E.) that is the leader in developing fuel cells for stationary power (utility) applications. Fuel cells were in the news a month ago because of Daimler-Benz putting a bunch of money into Ballard Power(BLDPF,) which is working on developing a fuel cell engine for vehicles. Fuel cells convert hydrocarbons into electricity by chemical means (like a battery) without having to burn them. This makes them vastly more efficient and almost pollution free.
Of the two of them, ERC is by far the better value, with a market cap of about $40,000,000 compared with $600,000,000 for BLDPF. ERC will have its product on the market much sooner, and also owns an impressive battery technology that has been licensed by Corning. Unlike probably 99% of all development stage companies, ERC has always been at least slightly in the black, so the number of shares have barely risen at all in the five years it has been public. The problem with the stock is that the company is run by honest scientists who are anti-promotion, so it sits there quietly and barely trades. If anyone cares (sorry for getting so off-thread) its website is ercc.com |
