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Politics : High Tolerance Plasticity -- Ignore unavailable to you. Want to Upgrade?

To: JungleInvestor who wrote (211)	2/24/2001 1:58:30 AM
From: cnyndwllr	Read Replies (2) \| Respond to of 23153

Jungle inv. Michael, Sharp, Metal, and John T, thanks for your thoughtful posts today. For what it's worth, I also see stormy seas ahead. As I believe Jungle investor indicated, however, I would expect the oil sectors to outperform almost all other sectors. The question is whether they will outperform cash? I guess that depends on how far and how fast the general market drops. Ed

To: JungleInvestor who wrote (211)	2/24/2001 7:33:13 AM
From: kollmhn	Respond to of 23153

Jungle- I'm in your camp that there is still a "lot of meat left on that bone" (the O&G area). Oil may be a bit higher than is usually is and NG is clearly higher but the absolute total amount of decline in demand is rather limited, IMO. While people can turn down their thermostats and businesses can curtail production during pricing extremes, they can't do without it, in the end. What will have to happen, quite simply, is that something else in people's budget will have to be reduced to enable them to pay higher energy prices. I won't spec on what that is but you can be sure they'll find it. OPEC has to have gotten smarter this time around than they were the last time. If it takes a 7%,10% or even 15% reduction in output to maintain pricing then they can and should do it. If Joe Puke has to trade in his 5,000lb SUV and buy a Mazda Miata to get around, then that's the way it will be. Buying the low multiple small caps like RRC, seems to be a no brainer. Even in a $4 NG environment they are selling at less than 2 times cashflow. Not very risky, is it? NBR will drill while E&Ps stand in line for a rig, whether NG is $8 or $$3. This cycle is far from over, IMO. We're only two from when we had the last bottom. I'll bet we see at least another two years of good times.