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Gold/Mining/Energy : Strictly: Drilling and oil-field services -- Ignore unavailable to you. Want to Upgrade?

To: Ronald J. Clark who wrote (3819)	11/25/1997 5:06:00 PM
From: The Perfect Hedge	Read Replies (1) \| Respond to of 95453

Gotcha.Problems for the machine and equipment stocks too?GD

To: Ronald J. Clark who wrote (3819)	11/25/1997 6:01:00 PM
From: drsvelte	Respond to of 95453

This is a good point. My understanding is that the Saudies are tired of keeping within their quota while the others routinely exceed theirs. On the other hand, one of the large brokerage houses (I forget which one), today projected an average of $18.00/barrel out 2 years. Even with this decrease from current levels, those knowledgeable in oil economics claim that it is still profitable to maintain exploration and drilling programs due to the impact of technology on productivity. Also the talk of the purported slowdown in demand due to the SE Asia crisis maybe is a bit overblown. I'm speculating, but I'm sure the Thai's, Koreans, Indonesians, etc. will have to rather dramatically curb their consumption of Gucci's, cell phones, beepers, Mercedes, et al but they will still need to buy oil. Also, I have heard no talk about decreasing consumption from China or India who I suspect are the big consumers. Anyway, IMHO its plain and simple profit-taking that's at the root of this rout (I like that!) with some FUD thrown in for good measure. The fundamentals for earnings may not be quite as bright, but still better than almost anything else, and the prices make these very attractive buys. Where will Fidelity and the others put the big $$$ now that they have hammered the oils and techs? Retailing? They'll be history by the 1Q. Durable cyclicals? Not with the slightly slowing US economy and Asia. Tobacco? Too scary. Utilities? hardly. Consumer? Maybe, but KO, G, still overvalued. Again, IMO, they will be back; maybe started already (if the talk on the street is that Fidelity is selling, then they're probably finished). Personally, have sold only LSS so I could add BDI as it got "cheaper faster." drsvelte (sorry for the long post)