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  • Potash Heats Up: $1000 a Tonne?
    many oil stocks are priced for crude at $90/bl as the stock market has not yet agreed on a permanent $110+ oil price. stocks like POT REQUIRE a further rise to $1000/t and beyond to justify current lofty P/E ratios. as usual, people chase 'grwoth' and overpay for it, extrapolating 'trends' but those trends may turn any time. In turn, lower growth but more defensive stocks like oil and gas stocks get sold even further.
    gl with your POt/MOS positions - but to me there is simply too much downside risk. when the momentum folks and hedgies pile out, all of a sudden you will hear plenty of reasonable arguments why the stocks were too high. it#s risk-reward and to those citing the 'structural' argument with potash prices: structural arguments are always there. just perception change. $1000/t+ for potash prices? probable. but 2-3 years out? 1.500$ or 500$? makes the difference for a stock price of POT either at 280$ - or 80$/share.
    Jul 18 03:48 am |Rating: 0 0 |Link to Comment |View article
  • The Crude Oil Price Disconnect
    just look at big oil's real exploration budgets over the past 30 years and look at the low per capita oil usage in Chindia and you know why oil will stay high and will go higher for years to come. it's all basic supply-demand arithmetics and what many people do not seem to grasp is that both is highly inelastic in the case of oil. others here have pointed out great facts about why all this talk of huge new oil supplies hitting the market is phony and that those supplies will at best serve to somewhat curb the price increase by offsetting some of the additional demand.
    likewise, oil will probably decline at some point but not buntil huge technical innovations have been made to replace it as a source for fuel.
    my chemistry teacher back in the 1980s told me that it was a crime and plain stupid to burn oil for heating and eletricity generation while it was so much more important for chemical products and all sorts of useful stuff.
    that floor trader obviously hasn't seen at all the seismic shift in demand supply fundamentals that have occured over the past 10 years. floor traders don't always have a clue and when it comes to the Nymex, it is one of the worst exchanges out there. floor traders have a lot of options to make tons of money there on the back of investors, trust me, and they can do so without knowing a thing about oil, gas or gold...
    Apr 29 05:23 am |Rating: 0 0 |Link to Comment |View article

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