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Strategies & Market Trends : Booms, Busts, and Recoveries -- Ignore unavailable to you. Want to Upgrade?

To: elmatador who wrote (23101)	8/31/2002 3:37:25 AM
From: Kid Rock	Respond to of 74559

BBR: oil stocks still pay dividends Stock Yield BP 3.41 XOM 2.6 CVX 3.68 i hear a lot of discussion in here on gold and CDMA - what about oil? would you consider these stocks at 52 week lows good buy and holds?

To: elmatador who wrote (23101)	9/1/2002 12:18:54 AM
From: Maurice Winn	Read Replies (4) \| Respond to of 74559

<Billions of $ being taken out the US when Saudi-US relations are at its lowest?> Here we go again, recycling the old 1970s discussions about the problem of recycling the petrodollars. As I thought then, there is zero problem recycling petrodollars. Money auto-recycles. There is not much one can do with it. One either sticks it under a mattress, lends it or buys something. If the Saudis sensibly get their money outa there before the Feds nab it, there's a limited number of things they can do with it. The withdrawal doesn't cause a problem for the USA. What happens is that the US$ drops if they sell it for another currency and that improves USA exports which some in the USA consider a good thing. They like USA products and services to be competitive with those from other countries. If the Saudis sell shares to get their money out of the country, that will cause the sharemarket to drop, which is fine by me on the Buffett smorgasbord principle = it's better to buy shares when they are cheap and if Saudis are selling at low prices, then I'll be buying; so will Americans. They'll be able to get a bargain, which is a good thing. So no worries there. If the Saudis buy something with their US$, that's a good thing too [such as CDMA cyberphones, Lexus with CDMA cyberphones built in]. If they just stick it under the mattress, that's okay too. Uncle Al will gradually dilute it over the next few decades so that when they do finally get it out to spend it, they'll be disappointed with what they can get - gentle inflation is a cunning sleight of hand to rob those who mattress their money without even peeking under the mattress or knowing where it's hidden. If they lend it to somebody else, outside the USA, that's okay too. The borrower will use it to buy something, such as a new GSM1x network in China or 100 million cdma2000 cyberphones and that will help keep production booming along. If they swap it for Euros or Yen, that's fine too - that'll drive the US$ down and improve the USA competitive position and reduce imports. They could buy gold, which would make a lot of gold bugs happy. Jay would be rubbing his hands with glee at the prospect. I'm sure Jay would be happy to sell his gold to them at an extorquerationate price and use the proceeds to buy some nice cheap US stocks, or perhaps the latest cdma2000 cyberphone from Li Ka "Ching"'s Hutchison Whampoa to help monitor his riches while he whiles away the day in his hideout in Thailand or wherever it was, being massaged by beautiful women who would admire the cyberphone in his pocket and buy one themselves with his payments. They could burn the US$s in a bonfire to show contempt for the "In God We Trust" words written on the notes. That would be fine too. That would enable Uncle Al to print a whole lot more without causing inflation and he could hand the freshly printed dollars to King George II to buy a few more Tomahawks to sort out the Mad Moslem Head-Hackers. So, let's see the Saudis carry out their threat to punish the USA by selling anything with US$ written on it. Even funnier would be if they shut off the oil wells to punish the USA. The main losers would be those who normally collect the payments from the oil companies who buy the crude oil - which is those who would be doing the shutting down. Oooops!! But who would blink first? The price of oil would zoom up - maybe to $40 or $60 or $100 a barrel. The finished product prices would zoom up. CB would be gulping when confronted with the payment required to refuel the SUV. Traffic jams would dramatically reduce as people around the world started travelling on buses, trains, sharing cars [5 to a vehicle instead of 1]. Pollution would drop dramatically. People would find it quite enjoyable to get to know their neighbours or strangers. There would quickly develop a fee for transport system - so much per kilometre [people would become freelance taxi drivers]. SUV sales would drop. Small engines and vehicles would come back into fashion. Cyberphone sales would zoom as people looked for ways to get things done without actually going there. Russia and others would boost oil production and rake in $$umptybillions. As with most businesses, Saudi Arabia would be the loser by going on strike. A bit like Toyota refusing to supply cars to the USA wouldn't actually be all that much of a nightmare for the USA. Sure, plenty of Toyota dealers would be unhappy, but Ford and others would be thrilled. Utilitarian principles would mean total happiness in the USA would go UP, not down. Except that Toyota people wouldn't be able to afford cdma2000 cyberphones as sold by KDDI, which wouldn't be good. It's not good to have any economic disruption and unpleasantness, but if Saudis want it, they'll get it. A bunch of Saudis selected vast amounts of unhappiness and anger and conflict a year ago. Despite that and all the subsequent drama and the world's biggest stockmarket bust, the world's economies are tootling happily along and people are buying cyberphones flat out! Look at the growth rate: 3gtoday.com Whhhheeeeeeeeeeeeeee!!!!!!!! Recycling petrodollars is a breeze. Mqurice