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Strategies & Market Trends : Value Investing
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To: TimbaBear who wrote (16277)1/26/2003 3:25:02 PM
From: Don Earl  Read Replies (1) of 78717
 
Timba,

At least a little bit of what I'm doing in the current discussion is thinking out loud, and maybe try to get some ideas (second opinions). The two assumptions I'm more or less working off of for the big picture are: 1. There will be a war in Iraq. 2. The economy won't recover before Bush is out of office.

My view (subject to change without notice) is if my assumptions are correct, then my best bets are likely to come from companies either mostly immune to weak economic conditions or companies where there might be a silver lining under current conditions. I'm not 100% sure the oil patch is the best place to look for bargains, or if it is, if seismic is the best place to look. Opening ANWR would be seismic's white knight since shooting a bunch of surveys would be the first step in any exploration activities, plus oil companies tend to invest more money in future production when commodity prices are high. Dale more or less covers some of my own misgivings about timing.

I wouldn't quite put seismic in the greater fool theory category though, because they really do make money when market conditions are good. About the best analogy I can come up with is they're a lot like the retailers who fight a holding action 3 quarters out of the year to be in a position to make a killing at Christmas time. Sort of like that with longer cycles and a certain amount of unpredictability about when the Holiday season starts. I do think there is some fundamental value there, but a big part of realizing that value comes from catching the right part of the cycle. Right now I suppose I'm mostly thinking of it as something that should be a good candidate for a watch list.
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