Oil drops to $43 a barrel

While I agree it is a good idea, the problem is that the Saudi's see this a threat to their revenue stream. They CAN, with a turn of a valve flood the market to manipulate the world price. They have little incentive for us to promote alternatives. Interestingly enough, they are beginning to invest quietly in RE with some of their petro $$.

Icarus

 

oh there is no doubt that there is plenty of middle east money in several solar and wind energy companies in the US

 

If I found oil in my back yard I would be investing the profits in renewables as well as other gold chip investments.
One wonders what the arab world will do when the oil money runs out. I think it will turn really ugly.

 

I don't know if that's actually true anymore. They can turn the value the other way and affect the price, but I don't think that they have the capacity to flood the market to drive prices down.

 

"Ugly" doesn't begin to describe it

 

Now that oil is "cheap" again, I hear no more serious mention of Energy Independance. What we will see are dramatically increased oil imports

We will also see Ft Mac turn into a ghost town within a year, especially if the economy worsens and the price of oil decreases. I would not be surprised if the economy worsens and the price of oil decreases

What is now happening in Iceland will easily happen here

 

yeah. All the hard to get oil will stay in the ground. Imports for Canuckland will drop. American production will drop (all that 99% water/1% oil that comes out the ground in Texas will dry up) too. This will mean that more oil will have to come from overseas. The oil exporters are going to be under cosh too. They've gotten quite used to expensive oil and fat cheques. They are going to be hit very hard by declining revenues of the only product that they've got going (because they can't be arsed to learn how to do anything else when oil is expensive).

 

Yes, almost all production will shift to "cheap" sources, eg Middle East. I rather doubt we will pay to keep the expensive domestic production going.

Though you never know. What with trillion dollar stimulated packages in the US, and an outright spending orgy here in Canada, no doubt a few billion will be thrown to oil producers here

 

I'm seeing lots of brand new SUVs on the road since the drop in oil price. This can't be good for pollution, short term energy independence, or the health of the person in a small car in an accident with an SUV. However, it bodes well for the US automakers, steel makers, and car salesmen. I guess we all put our Prii up on blocks and join in the party until the next whipsaw.

 

well its easy to be tempted since some are being offered at $10,000 off sticker. people rationalize with current gas prices not understanding that cheap gas is VERY temporary

 

I would put it in bank stocks. I've had such good luck with them over the last year.

Tom

 

Not around here. It's easy to drive by a Big Three lot and find row upon row upon row of unsold pickups and full size SUV's.

Also a huge inventory of Tundra's and Sequoia's at the Toyota places. OTOH the Corolla's and Yaris's are flying off the lots

 

Don't even get me started

:rant:

Even with my very conservative investment attitude, my effective rate of return is around zero.

 

i'll take it!!!

on my supposedly cant lose, slow growth stuff, i lost 14%

on my fast growing investments, i lost 34%

on my stocks, i lost 41%

on the latter two, if i hadnt made so much money on them previously i would be really pissed, as it is, its mostly money out of my pocket over that last 5-10 years at little or no growth...not even inflation

 

Made 4+% last year off of my investments...basically fixed/money market accounts/CD's. :whoo: What's frightening is that this was phenomenal performance. :shocked: (But I did miss out on paper gains in the last half of '06 and much of '07 because I got out early and stayed out--haunted by the adage that "pigs get slaughtered.")

I rode out the last recession in stocks and swore I would never make that mistake again. I'm waiting for signs of fundamental economic recovery before getting back in to mutual funds. Hopefully, I'll be late rather than early. I would rather leave some on the table than risk hard earned gains. I figure exiting a bull market early and re-entering a new bull market late (waiting in fixed funds in the interim) should have better returns and less risk than exiting during the early phases of a bear and getting back in before the bear has gone back into hibernation.

 

i had on CD paying 4.5% and another paying 4%, but i dont consider either one investments. they are short term (3 years and 1 year) and used basically for planned purchases...the one paying 4.5% was supposed to be used to buy my highway capable EV.... it matures July 2010... now granted had to make this guess in 2007... still hoping, still hoping

 

CD's are just as much investments as anything else. Difference is they are backed by the FDIC so your principal is safe. Stocks and bonds are competing with CD's. They've been working hard to make it undesirable to buy CD's and force people into stocks...but it isn't working yet...or perhaps I should say those who have been taking the bait in each rally are getting cleaned out.

 

I've been very skittish about stocks since '01. Money markets and CD (esp inside of a Roth IRA) for me. It's not high growth... but it's growth. With mutual funds at least you get more shares per installment, so when (if) things recover you should be in good shape. I wouldn't want to be investing in individual securities right now, unless they pay good dividends (you can't fake good dividends. You can lie all you want about earnings and "growth").

 

tripp,

Unfortunately, you can fake dividends right up until you are completely bankrupt. Some folks even borrow money to pay dividends. Banks have been "great" dividend stocks...and refused to cut their dividends even as they were becoming insolvent from bad loans. (Their reasoning was that they could not gain access to capital/new investment if they cut dividends...which was true in a Catch-22 sense.) We've been "bailing out" these nice person clowns who were still paying bonuses to themselves and dividends to shareholders even though they were insolvent.

Even dividends won't attract me until we've sorted the living from the dead who simply refuse to fall down. Right now, I can't tell the difference.

If the Federal govt. had not agreed to back money market funds so that they didn't "break the buck" I suspect the whole house of cards would have come down. If folks couldn't park money someplace safe the only alternative was full withdrawal. Game over.

In chess terms the last several months have been a series of forced moves to avoid mate.

 

that's interesting. I agree that we need a complete overhaul of the banking and securities industries. Institutions that are built on trust need to be well regulated... just like Ronnie Raygun said, "trust... but verify". It's certainly shaken my confidence. I've stayed away from securities because I don't believe a word those nice person hats say (to use a different "nice person" term). Over the past couple of years we've focused on removing debt from the equation because debt is certain, investment is speculative. I'm glad that that's the route we took (paid off the Prius, for example, instead of investing a small pile of cash I had). Live simply and enjoy the simple things in life (like juggling a football). I don't need an HDTV or a hot tub to feel I have a high standard of living. I suspect a lot of other folks will come around to that POV over the coming months.