Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Gold/Mining/Energy : Canadian REITS, Trusts & Dividend Stocks -- Ignore unavailable to you. Want to Upgrade?

To: Lorne Larson who wrote (855)	3/29/2001 8:43:06 AM
From: stan_hughes	Respond to of 11633

Agreed that the energy trusts are heavily discounting a return to so-called "normal" commodity prices, particularly NG. Viewing this last commodity rise as just another in a long line of ups and downs is to be expected from analysts, especially since they've been trained to make forecasts by looking backward. Only this time I'm afraid they've got it wrong. Recession notwithstanding, NA will keep on sucking the juice to run this newly wired society of ours, and they are burning NG to do it. Almost all newly built generation facilities utilize NG, as is also the case with those to be built in the next 5-10 years not to mention on the drawing board. The California experience illustrates that even last winter's nosebleed NG prices can't reduce the cycle time required to supplant NG with something else, assuming a cost effective alternative even exists. Meanwhile out west this spring, the snow pack in the mountains is sufficiently low that there will be little, if any, displacement in the US of NG-fired electricity generation by hydroelectric power. Add to this the fact that NA NG inventories are currently 37% below last year's already tight supply figures, and you have a recipe for strong NG prices for probably at least another two years. Toss in a hot summer to put a load on the air conditioning demand and we could even see a winter-style spike in the middle of summer this year. But hey CIBC, don't listen to me - WTFDIK Of course, the NG supply-demand imbalance could probably be corrected by having a depression, but if that happens, I think the market price for Canadian royalty trust units will be the least of our problems. We'll be living in caves beside our wood fires. Maybe we should diversify into forest stocks?