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

To: MIRU who wrote (190680)	5/18/2015 1:17:14 AM
From: Elroy Jetson	2 Recommendations Recommended By CommanderCricket dvdw© Read Replies (1) \| Respond to of 206347

Quite a number of very thorough business school studies over the decades have consistently shown the airline industry has never made a cumulative net profit since it began in 1914. That's really startling when you stop to think about it. The airline industry exists only due to the cumulative bond and stock losses incurred by investors. A one time you could say their costs were front-end loaded, and that was part of the explanation, but today virtually all of that equipment is leased.

To: MIRU who wrote (190680)	5/18/2015 3:20:41 PM
From: 30 Years Plus	1 Recommendation Recommended By isopatch Respond to of 206347

Everybody's model was falling costs, improving well results, and higher prices. We were going to learn how to do it cheaper, faster, better and prices were going to hockey stick in the future. It was all part of the consultants playbook - the consultants that were hired to show companies how to transition to unconventional. Those consultants remarkably could also help with the reorganization and the financing. Some of it happened, but nobody thought there was going to be much reservoir variability (not all shales are created equally) and nobody thought production in aggregate could rise so quickly that it would sewer the price. Except of course, the sum of everybody growing added up to the oversupply we are dealing with now. I think it could be a viable industry, but the recipe for that is an increased cost of debt. We are now dealing with a textbook case of mis-allocation of capital.