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Gold/Mining/Energy : Big Dog's Boom Boom Room -- Ignore unavailable to you. Want to Upgrade?

To: Dennis Roth who wrote (113576)	11/15/2008 6:38:32 AM
From: Berk	Read Replies (1) \| Respond to of 206151

I don't think that this has been been posted here before so forgive me if this is now the second time. It shows what one of the greatest value investors thinks about COP and oil by inference. My guess is that the stock price was somewhere in the low 70's. Note that it appears to be common stock, not special preferred with 10% dividend or any of the other Buffett style hedges and that it substantially increases Berkshire's stake. It also is coincident with Richard Rainwater's temporary return to the group. As an aside I've been unconvinced of the immediacy, not reality of the peak oil thesis largely because high prices bring out actions/alternatives which push price down, something that Gary Shilling observed back in the oil crisis of the late 70's. Anyway, fwiw: Buffett's Berkshire Boosts Stake in ConocoPhillips (Update1) By Erik Holm Nov. 14 (Bloomberg) -- Warren Buffett's Berkshire Hathaway Inc. increased its holdings in oil producer ConocoPhillips and took a stake in hydraulics maker Eaton Corp. in the third quarter, expanding the firm's portfolio as markets tumbled. Berkshire had more than 83 million shares in Houston-based ConocoPhillips as of Sept. 30, compared with about 17.5 million on March 31, the company said today in a regulatory filing. Buffett, the world's preeminent stock picker, has said he's also spending his own money to buy U.S. stocks as prices decline amid the worst financial crisis in 75 years, switching his holdings from government bonds. Berkshire, where Buffett is chief executive officer and head of investing, spent about $3.94 billion on stocks in the quarter and sold shares for about $300 million, according to separate filings. ``Most major companies will be setting new profit records 5, 10 and 20 years from now,'' Buffett said in a column in the New York Times in October. ``If you wait for the robins, spring will be over.'' Berkshire was the largest shareholder of companies including Coca-Cola Co. and American Express Co. as of Sept. 30, with a portfolio worth $76 billion. Berkshire has been increasing investments in the past year in banks, including U.S. Bancorp and drugmakers such as France's Sanofi-Aventis SA. Buffett, named America's richest man by Forbes magazine, built Berkshire from a failing textile manufacturer into a $155 billion holding company by investing premiums from insurance subsidiaries such as Geico Corp. in out-of-favor securities and buying businesses whose management he deemed superior. To contact the reporter on this story: Erik Holm in New York at eholm2@bloomberg.net.

To: Dennis Roth who wrote (113576)	11/15/2008 9:39:25 AM
From: Ed Ajootian	1 Recommendation Read Replies (1) \| Respond to of 206151

Dennis, as CS says its gonna take some more time for the rig count to come down. Also, most of the announced cap ex cutbacks have been for '09, not '08. Lastly, if what happened in Canada recently is any clue, there will be a fairly significant lag between the point where rig counts come down and the point where production decreases. So the production will come down, but I wouldn't hold my breathe waiting for it to. BTW, that latest CS piece refers to another note they put out last week called "A Look at Producer Financial Health and Liquidity”. Could you share that one with us also, thanks kindly in advance. I believe if December is much colder than normal it would create enough demand to soak up all this extra supply coming on, and should bring natty prices back up somewhat. A cold December is much more helpful than, say, a cold February, since the LDC's have the whole balance of the winter to worry about. Not sure what the latest December forecasts are, but at least it looks like November is going to end on a cold note at this point. I'm actually starting to feel better about natty than crude at this point. Natty's price has been nearly as volatile as oil when you look at the daily swings, but when you look at the last 3 months or so, natty's price has been more stable. The near-month Nymex contract averaged $7.49 for Sept, $6.73 for Oct., and through 11/13 it averaged $6.83. Quite a difference from oil, which averaged $104, $77, and $63, for Sept, Oct., and through 11/13, respectively.