Killer new business thread!

[Robin]

Do you need to increase your bottom line?

In the 90s us 'Crusties' used to invest our earnings in Tech Stocks. And we did really well.

After the bubble burst I bet not many of us do now. Well, there's a new bubble... Energy Stocks. If you do the research you'll see that many people think that around Thanksgiving day this year we'll have used 50% of all the crude oil there is.

Now, it doesn't matter if it's true or not. The thing is that the markets believe it is. Gasoline will be $4.50 by next July, and maybe $6 by next Christmas.

At the moment energy stocks are soaring at 60% in just 3 months. But there are 100s, no thousands of them.

My business idea is get an E*trade or similar account and buy some Energy Stocks. In 1996-9 everyone would be saying "buy AOL" or "Buy Amazon". And they were right - we made a pile in those years!

But now it's all energy.

I made a 5% return last month. I won't say how much I have invested, but that's 60% a year - and it's rising.

My advice? - research Energy Stocks very seriously indeed.
If this interests you, you may wish to peruse my investing blog (I only just started it and am only analyzing the shares starting with the letter B so far).

Anyway it's at: http://amateurenergyinvestor.blogspot.com

- Robin.

(Has decided he is now out of adult for good)

[Nickatilynx]

Originally Posted by Robin

Do you need to increase your bottom line?

In the 90s us 'Crusties' used to invest our earnings in Tech Stocks. And we did really well.

After the bubble burst I bet not many of us do now. Well, there's a new bubble... Energy Stocks. If you do the research you'll see that many people think that around Thanksgiving day this year we'll have used 50% of all the crude oil there is.

Now, it doesn't matter if it's true or not. The thing is that the markets believe it is. Gasoline will be $4.50 by next July, and maybe $6 by next Christmas.

At the moment energy stocks are soaring at 60% in just 3 months. But there are 100s, no thousands of them.

My business idea is get an E*trade or similar account and buy some Energy Stocks. In 1996-9 everyone would be saying "buy AOL" or "Buy Amazon". And they were right - we made a pile in those years!

But now it's all energy.

I made a 5% return last month. I won't say how much I have invested, but that's 60% a year - and it's rising.

My advice? - research Energy Stocks very seriously indeed.
If this interests you, you may wish to peruse my investing blog (I only just started it and am only analyzing the shares starting with the letter B so far).

Anyway it's at: http://amateurenergyinvestor.blogspot.com

- Robin.

(Has decided he is now out of adult for good)

Hey Robin

You do know Serge will bookmark this thread and bring it up in 4 weeks /2 mths/6mths etc if it all turns to shit?

;-))

[Robin]

Originally Posted by Nickatilynx

Hey Robin

You do know Serge will bookmark this thread and bring it up in 4 weeks /2 mths/6mths etc if it all turns to shit?

;-))

I *really* would like to see Serge's opinion. He was a very smart investor. Don't know if he invests so much these days.

But if you research 'Peak Oil' at Google you will start to see what potential there is in Energy Stocks. Forget Hurricanes Katrina & Rita. They are just blips compared to the rises that may come.

Still, If I am wrong, doesn't matter. I have Stop-Losses set on all my shares

[Mike AI]

Robin I think you are about a year too late.

http://finance.yahoo.com/q/bc?s=VLO&t=1y

http://finance.yahoo.com/q/bc?s=CHK&t=1y

2 I recomended 3-4 months ago, would have nailed 25% return in that time.

[Robin]

Originally Posted by Mike AI

Robin I think you are about a year too late.

http://finance.yahoo.com/q/bc?s=VLO&t=1y

http://finance.yahoo.com/q/bc?s=CHK&t=1y

2 I recomended 3-4 months ago, would have nailed 25% return in that time.

Hi Mike,

I disagree, I think the ride has only just begun, You appear to have got in at the start - excellent. But there's still plenty further to go in my view.

[Winetalk.com]

Originally Posted by Robin

Hi Mike,

I disagree, I think the ride has only just begun, You appear to have got in at the start - excellent. But there's still plenty further to go in my view.

I am with MikeAI,
I think the easiest money have already been made in Energy.

[Winetalk.com]

Robin,
if you wanna exchange links,
we have 100's wine related sites and I'll gladly put links to your blog at 2:1 ratio,
2 links for every link you put back to WT

[Robin]

Originally Posted by Winetalk.com

Robin,
if you wanna exchange links,
we have 100's wine related sites and I'll gladly put links to your blog at 2:1 ratio,
2 links for every link you put back to WT

Hi Serge,

I'll get a link up to winetalk.com this morning! (unless you prefer a different site).

Cheers!

[Rolo]

Production cost for oil is $2-$10 per barrel, so the current price is highly speculative. Also there will be much more talk in the news to get the oil price down - things like:

Sept. 27 (Bloomberg) -- Saudi Arabia's oil minister and the president of Exxon Mobil Corp. said world petroleum reserves are enough to last for decades, seeking to ease concern about supplies and near-record prices.
Saudi Arabia, the world's largest oil producer, will ``soon'' almost double its proven reserve base, said Oil Minister Ali al- Naimi. That will add 200 billion barrels to the current estimate of 264 billion, he said. Exxon Mobil President Rex Tillerson said the world may still have more than 3 trillion barrels from conventional oil fields, oil sands deposits and other sources.

``There will be plenty of oil available to meet future demand,'' al-Naimi said today in Johannesburg. Prices are high now because ``the petroleum industry faces infrastructure constraints and bottlenecks that are causing market volatility and restricting its ability to bring oil from the ground to the consumer

http://quote.bloomberg.com/apps/news...A3A&refer=home

Then you got possible slowdown of world economy due to the high oil price, which will lower the demand for oil. And lets not forget news from the technology sector about better production, better consumption and even other energy forms, which could increase available oil.

Personally I would love to see a high oil price, because it will make investments in other energy areas possible (less depended on the middle east + creating local jobs), however I do not think that the oil price will rise in double digits per barrel in the next years, unless some major terror or revolt in saudi arabia.

"it will make investments in other energy areas possible (less depended on the middle east + creating local jobs"
That would be the tar sands in Canada. The largest oil reserve on the planet. Other energy sources are so far removed from the possibliites the tar sands offer. So be nice to Canada. Most of America's oil comes from Canada, not Saudia.

[Rolo]

Originally Posted by Unregistered

So be nice to Canada. Most of America's oil comes from Canada, not Saudia.

All you have to do is ask

Yeah, blue eyed Arabs.

Originally Posted by Unregistered

Yeah, blue eyed Arabs.

But much smarter.

[Rolo]

Originally Posted by Unregistered

Yeah, blue eyed Arabs.

I think thats the norwegians - http://www.eia.doe.gov/emeu/cabs/topworldtables1_2.html

Top World Oil Producers, 2004
7) Norway 3.18 million barrels per day

Top World Oil Net Exporters, 2004
3) Norway 2.91 million barrels per day

[Robin]

Originally Posted by Rolo

however I do not think that the oil price will rise in double digits per barrel in the next years, unless some major terror or revolt in saudi arabia.

If we are at 'Peak Oil' then the easiest oil has been produced. From now onwards less and less will be produced and demand will far outstrip supply. The thing is, though, everyone needs energy, so there will always be enough demand for however much oil remains. The price is not based on production cost but on limited supply.

Also, the Arabs have inflated their reserve figures by up to 400% for years because their OPEC agreements only allow them to produce proportionally to their reserves, so they lie to be able to sell more oil. And they all do it. Don't listen to what the Arabs or any politicians say. Listen to what the scientists are telling us.

[Dravyk]

Invest in hydrogren.

[DannyCox]

Is this the Robin I'm thinking of?? Same last name as a dead president? If so, the old timers have been just crawling out of the woodwork lately

[Dravyk]

Originally Posted by DannyCox

Is this the Robin I'm thinking of?? Same last name as a dead president? If so, the old timers have been just crawling out of the woodwork lately

Yup, it's Mr. Nixon alright.

[Winetalk.com]

Robin,
I am not as good an investor as you give me credit for,
I am still down $350,000 from 1999

You are onto something with energy plays,
with new demand from China and India,
the once "sleeping giants", energy is not internet bubble, IMHO.

I don't invest much and preffer "sleep well at night" CD's and government bonds over all other forms of investments, but...still play a little here and there, and this includes the energy sector as well,
I did make a few buck on BP, writing calls and collecting dividends.

To those who say the price of oil is based on speculation because the cost of producing is $10-$12,
all I have to say is:
The price of producing 1st Growth Bordeaux is..$15-$20 a bottle, which doesn't prevent the buying public from paying $50-$1200 a bottle.

Have a nice trading

[Rolo]

Ofcourse the world will need more energy, but that doesn´t automatically mean that oil prices will continue to rise into infinity, because at some point other energy sources will be able to compete and stabilize the "fear" that we are running out of energy.

So if thinking the oil price will continue rise due to fear in the market, then you must also be ready, if that fear never "peaks". If you base your reasoning on numbers of oil peak, then you also got to remember that if the world is facing major difficulties, then normal market forces are put out of play, and replaced with regulation.

The high oil price set by the market is accepted as long the world economy continues to grow...

[Robin]

Originally Posted by Rolo

Ofcourse the world will need more energy, but that doesn´t automatically mean that oil prices will continue to rise into infinity, because at some point other energy sources will be able to compete and stabilize the "fear" that we are running out of energy.

So if thinking the oil price will continue rise due to fear in the market, then you must also be ready, if that fear never "peaks". If you base your reasoning on numbers of oil peak, then you also got to remember that if the world is facing major difficulties, then normal market forces are put out of play, and replaced with regulation.

The high oil price set by the market is accepted as long the world economy continues to grow...

Some interesting points. I would counter with...

1) Oil will continue to rise in price until a) there are sufficient alternatives and b) there is not much left that can be efficiently extracted. I would argue it will take a minimum 20 years to develop solar, wind and all the other technologies required to replace oil to the level where they are more than 50%. Today alternative energies are 1%. So you are correct in what you say, but I think we have a long period ahead of us before your first point applies.

2) The only regulation that can replace pricing would be by force. In other words, if the US or China siezed control of certain supplies. Without that oil will continue to be sold to the highest bidder.

3) I disagree that "The high oil price set by the market is accepted as long the world economy continues to grow..." I would turn that statement on it's head and would say that world economies will continue to grow as long as there is affordable oil. Right now oil is cheap as chips. The Europeans pay $7 for gasoline without blinking. So can Americans. In fact $15 for a gallon of gas will still allow industry to progress if we have hybrid cars and only make essential trips.

However, I would say there is one fact that most analysts discount. Oil is *NOT* subject to standard supply and demand economics in the same way as gold and other commodities. This planet has 6 billion people ONLY because of oil. The oil has given the energy to grow food, the fertilisers and pesticides and the energy to farm the food. People NEED to eat.

Therefore people, countries and companies will pay almost ANY price for oil - it will be a matter of survival. Oil is totally unique in this respect. I predict $500/barrel oil within 5-10 years.

[Rolo]

Originally Posted by Robin

Therefore people, countries and companies will pay almost ANY price for oil - it will be a matter of survival. Oil is totally unique in this respect. I predict $500/barrel oil within 5-10 years.

There will not be one big solution to the oil problem, instead there will be many different areas, which will ease the oil problem, before any major damage happens. Everything from better technology to better consumption, and other + new energy sources.

I think the oil price is already getting close to, when other energy sources starts to make a good investment objects - ofcourse their EROI will not be anything like oil, however that is not important, because the price of oil will make them attractive. Add tax breaks to the mix, and this might kick start engery production, which again will help to stabilize the oil price.

How did you get the price of $500/barrel... why not $1000/barrel or $100/barrel?

[Robin]

Originally Posted by Rolo

There will not be one big solution to the oil problem, instead there will be many different areas, which will ease the oil problem, before any major damage happens. Everything from better technology to better consumption, and other + new energy sources.

Yes, many different solutions. Oil has traditionally given a 60:1 ratio return on energy. Ie for every unit of energy invested you get 60 out. This is why you can have 250 horsepower cars. You would need 1,000 people to pull your car with that much force. That's how much power is packed into oil.

On the other hand The coal sands yield 1.5 - 2 times because of the huge amount of power required to boil the water to release the tar from the sand. The oil is there but it will be at a HUGE price. Likewise, wind and solar only return about 2-3 times their energy cost. BUT they are renewable so, over time, renewable resources compare very well with oil. But you have to look at a 20-30 year time frame (the life of a wind turbine or solar array).

To build the coal tar extraction facilities, to place solar panels on every rooftop and wind farms near every city. This is a thing that will take 20 years. And that's from the day the project is started. That's how much energy you need to replace oil.

Originally Posted by Rolo

I think the oil price is already getting close to, when other energy sources starts to make a good investment objects - ofcourse their EROI will not be anything like oil, however that is not important, because the price of oil will make them attractive. Add tax breaks to the mix, and this might kick start engery production, which again will help to stabilize the oil price.

Oh you bet. Finally people feel investing in solar and stuff is becoming affordable. But we won't see oil prices stabilized because of the sheer huge numbers of alternate resources that have to be built. Building them will take time, loads of money and, wait for it, huge amounts of ever more expensive oil for energy and manufacturing.

Even if we built 200 nuclear power stations to replace our natural gas ones, it would still take 10 years to plan them and 10 years to build them at current projections.

So, any way we slice the pie, we still see a shortfall of at least 20 years between oil becoming short supplied and other sources replacing it. Those will be 20 lean years during which you might be able to invest in energy stocks to make enough money in the early years to see you through the later ones fairly comfortable: warm house, air conditioning and so on. Most people won't be able to afford these luxuries for quite a while...

Originally Posted by Rolo

How did you get the price of $500/barrel... why not $1000/barrel or $100/barrel?

Try continuing the curve yourself...

[Robin]

By the way, since I mentioned natural gas I had to post the following chart...



80% of our electricity in the US is natural gas powered.

Graphs like this make paying $40,000 to place solar panels on your roof seem cheap.

Well, I actually did that. I used to pay $1,000/month here in south Texas for electricity. That's $12,000/year. With power costs rising down here at 15-20%+ a year I will be paid off in less than 3 years and in year 4 will save $20,000 (assuming 20% increases for the next few years).

[Rolo]

Originally Posted by Robin

Try continuing the curve yourself...

You are talking about almost 8 times the current price within 10 years - do you think there will even be a place to trade, if that happens? Sounds more like Madmax ;-)))

Again, ofcourse the oil demand will be higher, and ofcourse the saudis and oil companies do not want to increase their production or refining capabilities to a point where it will seriously hurt the price (no reason to kill the golden goose), however they must still keep the ecnonmy going, because without a working world ecnonmy oil demand will halt.

So for your $500/barrel might work on a chart, but oil/energy as you said is like no other product out there... wars have been started for less ;-))

[Winetalk.com]

don't you think that your last statement and your signature conflict with each other???


The high oil price set by the market is accepted as long the world economy continues to grow...
__________________


"Chaos is the law of nature, order is the dream of man."
~Henry B. Adams (Historian) 1838-1918

[Rolo]

Originally Posted by Winetalk.com

don't you think that your last statement and your signature conflict with each other???


The high oil price set by the market is accepted as long the world economy continues to grow...
__________________


"Chaos is the law of nature, order is the dream of man."
~Henry B. Adams (Historian) 1838-1918

No, because mankind will try and adapt... I did not say they would succeed ;-)

[Winetalk.com]

Originally Posted by Rolo

No, because mankind will try and adapt... I did not say they would succeed ;-)

which I translate into King James English as...

blah-blah-blah

[Winetalk.com]

Robin,
you are in

http://winetalk.com/blog.html

[Robin]

Originally Posted by Winetalk.com

Robin,
you are in

http://winetalk.com/blog.html

Thanks Serge,

So are you!

http://amateurenergyinvestor.blogspot.com/

[Winetalk.com]

Originally Posted by Robin

Thanks Serge,

So are you!

http://amateurenergyinvestor.blogspot.com/

as I promissed:
2:1
http://cotac.com/
(still gets traffic after all those year!

If you have more sites to add WT link,
I have more sites to add yours too!

[TheEnforcer]

Nice to see you around here Robin. :>)) Good thread.