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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: Umunhum who wrote (11642)	4/10/2004 10:39:36 AM
From: re3	Read Replies (1) \| Respond to of 110194

<<<the market is in serious denial about oil peaking in the next few years. i agree with this comment, the issue though for me is the timing and allocations to this sector. any suggestions as to rock bottom % allocations to this sector ? what i've done recently is go long about 30-40 % to energy and hedge this with shorts/puts - homebuilders/retail/financial/tech/internet it does truly amaze me to hear how people can blather on about how "prices will come back down" for an ESSENTIAL commodity and yet these same people will rarely or never discuss how or why a NON-ESSENTIAL commodity like a share of whatever dot com might "come back down" at the very least shouldn't it dawn on people when they have to pony up big time to fill their SUV's that it might be prudent to do some personal hedging to protect their own pocketbook by buying some energy shares ??

To: Umunhum who wrote (11642)	4/10/2004 10:42:25 AM
From: Wyätt Gwyön	Read Replies (3) \| Respond to of 110194

thought the same way when I was buying silver futures a year ago and so I only bought about half of what I really wanted imo, it is better to have speculator's remorse where you made good money but not as much as if you had been irresponsible; than to have been irresponsible and lost all your money. i know too many people who got hurt real bad by margin. also, as you know, the far out contracts are very illiquid, so it would be hell to get a margin call on them. i guess my attitude is, i would like to save all that buying power in case i am wrong on the timing, and we DO have a drawdown to $15 or whatever (unlikely as that may seem). The only fly in the ointment would be the crack up boom that Russ is predicting could possibly slow economic activity down so much as to seriously impact usage and therefore prices. like everything else, crude seems to have an anti-USD carry trade speculative element, and i don't want to be on the business end of the ugly stick when Mr. Market whacks this trade. but that's just me--everybody has to work within their own risk tolerances, and mine are rather low, especially for instruments that i view as essentially untradeable for a few years (like 09 crude and NG). i also own and am accumulating natural gas futures with the same idea. I have read too many books about peak oil to let this opportunity pass me too. speaking of which, it seems there is now a cottage industry of "Me Too" peak oil books, including some rather schlocky ones of late. i thought "Out of Gas" was a waste of money, though not a waste of time in total--well worth a free read at the bookstore and a cup of coffee to see you through it. i saw "The Oil Factor" at the book store and had to laugh at its patheticness. also i was none too impressed by "The 2030 Spike" and will return it to Amazon. for a general outline of the situation for the lay reader, i think "The Party's Over" is still the best all around. "Hubbert's Peak" by Deffeyes is interesting from a petro-geek perspective, but lacks in readability and could have used a better editing. i got a special order book by Colin Campbell from England called "The Essence of the Oil and Gas Crisis" or something. a decent collection of his essays, and i have his latest on order. which ones do you like? The fact that we can buy oil sub $30 two to six years out says the market is in serious denial about oil peaking in the next few years. I believe we are near the top of the plateau and so production increases are going to be relatively small if non-existent. i agree, i'm just not willing to risk bankruptcy to prove the point :). but i still like oil better than gold or anything else. the world would not stop turning without gold, but a 2% oil shortage is a serious crisis. as for oil stocks, i do not claim any prescience there. i just try to spread it around. current holdings (descending order of value) are: XLE, TLM, ECA, DVN, APC, VLO, COP, APA, NXY, EAC, TNT, BR, REP, NE, BP, TOT, PZE, UCL, CNX, NHY, YARIY