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Technology Stocks : Cisco Systems, Inc. (CSCO) -- Ignore unavailable to you. Want to Upgrade?

To: RetiredNow who wrote (67754)	4/29/2005 8:22:32 AM
From: RetiredNow	Read Replies (2) \| Respond to of 77400

HI all, When I posted my optimistic forecasts for the next several years, my two biggest caveats were oil and terrorism. I've been watchin both closely since then. I am beginning to believe more fervently than ever that oil is going to derail this economy. It hasn't shown up in the numbers yet, but there are a couple developing factors that have me very unhappy: 1) China just announced that it will be filling its own strategic petroleum reserve and that will add another large amount to demand every day. 2) Oil demand according to T Boone Pickens is at 38 billion barrels a year, yet supply is only capable of producing 34 billion barrels per year. 3) In addition, there hasn't been a 1 billion barrel oil field discovery in the last 5 years, according to Pickens. 4) Analysts believe we'll see $3 gas by next year. 5) Bush's energy plan has been stalled in the Senate and even if it does get passed it is an inconsequential piece of legislation. There is no long term energy strategy in this country worth a pinch of salt. 6) Growth in India and China outside of their strategic reserves is going to continue to be staggering over the next 5 years. That will lead to massive new oil consumption as a whole new generation can suddenly afford cars in markets where clean air isn't legislated. All of this is going to continue to ratchet up gas prices. Many analysts believe we'll see $3 gas by the end of this year and maybe $4 by end of next year. Those analysts also believe that oil won't fall below $50 anytime within the next several years. This oil situation alone is going to deliver continuous body blows to our economy. Already, we've had remarkable growth in the economy last year and this year, despite the dramatic rise in oil. That was a testament to the strength and breath of our economy. But even a big man can be brought down if you hit him enough and that is what is happening to us brought on by high oil prices. I believe this soft patch will turn into a recession by the beginning of next year and our stock market will go nowhere at best, or go even lower at worst. All this means Cisco won't be going anywhere fast either, as businesses everwhere feel the impact and clamp down on IT budgets. I hope all these analysts are wrong. Otherwise, we're in for a hell of a mess.