Peak Oil Primer Link

Ever notice that the scientists that advocate the “peak oil” theory never seem to hold appointments at universities you need to take the SATs to get into?

Yeh, and what degree does Boone Pickens have? He only made 1.5 Billion last year. That’s with a CAPITAL B. Probably highest earning trader on the planet. Betcha he believes in “peak oil.” I’d guess nobody gives a c**p about his degree. 

Trading is about measuring perception, not predicting facts.

Here’s a “FACT”. For every ONE (1) bbl. of oil found, the world consumes THREE (3). Denial is a river in Africa.

No, I am not in denial.

I agree that oil, like any natural resource, is finite. I am, however, inclined to accept the conservative end of the scientific concensus that oil production will peak in 2030 (which assumes that there is a 3% growth rate in consumption between now and then - a VERY aggressive assumption.)

The "Peak Oil Theory" asserts (as I understand it) that we have already peaked in oil production and that untold riches are to be found in investment strategies that recognize what those of us in "denial" do not - that the end of modern human civilization is coming.

I see tremendous conflicts of interest in anyone who furthers this position. There are too many political, economic and social agendas that share the same objectives as peak oil advocates. I am suspicious of the fact that peak oil advocates don't generally publish their views in academic journals, but tend to express their views in public forums where they aren't compelled to answer questions posed by other scientists.

Like most very complicated issues, I look to the reputable academic community and the process of peer review to provide insight on these matter. This is how policy - energy or investment - has generally best been produced.

In my short investment career I have seen many projections of environmental or technological disaster (e.g. ozone layer, Y2k, the 'peak oil' claims of the early 80s) made and NONE ever come to pass. What I have seen is people spend a lot of their savings on bomb shelters, oil futures and the like only to enrich others and impoverish themselves. I don't feel too sorry for these people because their greed led them to bet against human accomplishment and administrative wisdom but I would like to confront those who made these extreme predictions and were proven wrong, however, they aren't famous any more and tend to keep a low profile.

I’ll sell you some of my oil stocks (small e.p. cos./drillers/canroys/U.S. royalty trusts) WHEN you become convinced this is not some “evil scheme” perpetrated by the oil cos. I’m old enough to remember the “50 MPG carburetor” that the oil companies “paid off” Ford to keep it off the mkt. Conspiracy theories are always with us. Read some of Stephen Leeb’s work if you want the s**t scared out of you. (Leeb-Phd.if you need some “academic” work) BTW, I personally don’t worry about conflicts when my clients and I are making $$ investing in energy.   

You know how to tell if it’s a bull market?..It makes new highs.

Yup…new highs and I’m making some Cha Ching baby!  So much for us conspiracy wacko’s huh?

[quote=dude]Yup.......new highs and I'm making some Cha Ching baby!  So much for us conspiracy wacko's huh? [/quote]

Dude, good to see you back.

Say, you're not suggesting that oil's moving on "peak oil" concerns instead of Iran and Nigeria concerns, are you?

Nope

[quote=mikebutler222]

[quote=dude]Yup.......new highs and I'm making some Cha Ching baby!  So much for us conspiracy wacko's huh? [/quote]

Dude, good to see you back.

Say, you're not suggesting that oil's moving on "peak oil" concerns instead of Iran and Nigeria concerns, are you?

[/quote]

I believe that the potential of Peak Oil is having more of a long term influence as the growth of demand outpaces the growth of supply.  The recent short term explosion in oil prices is certainly the issues you noted, although I'd propose that the result of the supply/demand imbalance certainly has some influence albiet more sublime for now. 

My comment about us 'conspiracy wackos' was just a sarcastic passing comment.

[quote=Revealer]You know how to tell if it’s a bull market?..It makes new highs. [/quote] Read above quote, please.

[quote=Revealer][quote=Revealer]You know how to tell if it's a bull market?.......It makes new highs. [/quote] Read above quote, please.[/quote]

Well, I guess if you want to buy today because it's higher now than it as before, that's a great mantra 

I do enjoy (and this isn't just you, Revealer) the calls of triumph when a commodity hits a new high flowed by the sound of crickets from the bulls when the commodity the slumps. Jimmy Rogers is a master of this sort of cheer, then hide stuff. I heard it summed up well by a candid analyst the other day on CNBC. The subject was gold. The guy said “Remember the Doctors who were buying gold at $700 and sold at $570? Well, they’re buying again”….<?:namespace prefix = o ns = "urn:schemas-microsoft-com:office:office" />

flowed = followed

[quote=mikebutler222]

[quote=Revealer][quote=Revealer]You know how to tell if it's a bull market?.......It makes new highs. [/quote] Read above quote, please.[/quote]

Well, I guess if you want to buy today because it's higher now than it as before, that's a great mantra 

I do enjoy (and this isn't just you, Revealer) the calls of triumph when a commodity hits a new high flowed by the sound of crickets from the bulls when the commodity the slumps. Jimmy Rogers is a master of this sort of cheer, then hide stuff. I heard it summed up well by a candid analyst the other day on CNBC. The subject was gold. The guy said “Remember the Doctors who were buying gold at $700 and sold at $570? Well, they’re buying again”….<?:namespace prefix = o ns = "urn:schemas-microsoft-com:office:office" />

[quote=Revealer][quote=mikebutler222]

[quote=Revealer][quote=Revealer]You know how to tell if it's a bull market?.......It makes new highs. [/quote] Read above quote, please.[/quote]

Well, I guess if you want to buy today because it's higher now than it as before, that's a great mantra 

I do enjoy (and this isn't just you, Revealer) the calls of triumph when a commodity hits a new high flowed by the sound of crickets from the bulls when the commodity the slumps. Jimmy Rogers is a master of this sort of cheer, then hide stuff. I heard it summed up well by a candid analyst the other day on CNBC. The subject was gold. The guy said “Remember the Doctors who were buying gold at $700 and sold at $570? Well, they’re buying again”….<?:namespace prefix = o ns = "urn:schemas-microsoft-com:office:office" />

[/quote] That's ok. You don't have to believe if you don't want to. I would suggest however that 2 rules that should always be kept in mind.....(1) Don't fight the tape. (2) Don't fight the fed.[/quote]

Fine, here are two rules for you that should always be kept in mind.... (1) Trees don't grow to the sky. (2) When everyone is onboard with the concept of "higher prices", what ever is being discussed has already peaked

[quote=san fran broker]

No, I am not in denial.

I agree that oil, like any natural resource, is finite. I am, however, inclined to accept the conservative end of the scientific concensus that oil production will peak in 2030 (which assumes that there is a 3% growth rate in consumption between now and then - a VERY aggressive assumption.)

The "Peak Oil Theory" asserts (as I understand it) that we have already peaked in oil production and that untold riches are to be found in investment strategies that recognize what those of us in "denial" do not - that the end of modern human civilization is coming.

I see tremendous conflicts of interest in anyone who furthers this position. There are too many political, economic and social agendas that share the same objectives as peak oil advocates. I am suspicious of the fact that peak oil advocates don't generally publish their views in academic journals, but tend to express their views in public forums where they aren't compelled to answer questions posed by other scientists.

Like most very complicated issues, I look to the reputable academic community and the process of peer review to provide insight on these matter. This is how policy - energy or investment - has generally best been produced.

In my short investment career I have seen many projections of environmental or technological disaster (e.g. ozone layer, Y2k, the 'peak oil' claims of the early 80s) made and NONE ever come to pass. What I have seen is people spend a lot of their savings on bomb shelters, oil futures and the like only to enrich others and impoverish themselves. I don't feel too sorry for these people because their greed led them to bet against human accomplishment and administrative wisdom but I would like to confront those who made these extreme predictions and were proven wrong, however, they aren't famous any more and tend to keep a low profile.

[/quote]

I'm in 100% agreement....

[quote=mikebutler222][quote=san fran broker]

No, I am not in denial.

I agree that oil, like any natural resource, is finite. I am, however, inclined to accept the conservative end of the scientific concensus that oil production will peak in 2030 (which assumes that there is a 3% growth rate in consumption between now and then - a VERY aggressive assumption.)

The "Peak Oil Theory" asserts (as I understand it) that we have already peaked in oil production and that untold riches are to be found in investment strategies that recognize what those of us in "denial" do not - that the end of modern human civilization is coming.

I see tremendous conflicts of interest in anyone who furthers this position. There are too many political, economic and social agendas that share the same objectives as peak oil advocates. I am suspicious of the fact that peak oil advocates don't generally publish their views in academic journals, but tend to express their views in public forums where they aren't compelled to answer questions posed by other scientists.

Like most very complicated issues, I look to the reputable academic community and the process of peer review to provide insight on these matter. This is how policy - energy or investment - has generally best been produced.

In my short investment career I have seen many projections of environmental or technological disaster (e.g. ozone layer, Y2k, the 'peak oil' claims of the early 80s) made and NONE ever come to pass. What I have seen is people spend a lot of their savings on bomb shelters, oil futures and the like only to enrich others and impoverish themselves. I don't feel too sorry for these people because their greed led them to bet against human accomplishment and administrative wisdom but I would like to confront those who made these extreme predictions and were proven wrong, however, they aren't famous any more and tend to keep a low profile.

[/quote]

I'm in 100% agreement....

My mistake. Actually posted 4-3-06. (I looked @ join date not post date.) Corrected to…WTI 66.80, S&P 1298, 10 yr 4.87. Not nearly as dramatic, eh? 

[quote=Revealer]My mistake. Actually posted 4-3-06. (I looked @ join date not post date.) Corrected to....WTI 66.80, S&P 1298, 10 yr 4.87. Not nearly as dramatic, eh? [/quote]

Don't sweat the error, it happens, but what point were you trying to make by it? Oil prices could climb a great deal and he could still be 100% right if the reasons for the climb have nothing to do with your belief in peak oil, right?

[quote=mikebutler222]

[quote=Revealer]My mistake. Actually posted 4-3-06. (I looked @ join date not post date.) Corrected to....WTI 66.80, S&P 1298, 10 yr 4.87. Not nearly as dramatic, eh? [/quote]

Don't sweat the error, it happens, but what point were you trying to make by it? Oil prices could climb a great deal and he could still be 100% right if the reasons for the climb have nothing to do with your belief in peak oil, right?

[quote=Revealer][quote=mikebutler222]

[quote=Revealer]My mistake. Actually posted 4-3-06. (I looked @ join date not post date.) Corrected to....WTI 66.80, S&P 1298, 10 yr 4.87. Not nearly as dramatic, eh? [/quote]

Don't sweat the error, it happens, but what point were you trying to make by it? Oil prices could climb a great deal and he could still be 100% right if the reasons for the climb have nothing to do with your belief in peak oil, right?

[/quote] Yep. Could be. So could I. In the meantime about only thing working is energy "stuff." BTW, any comparison to tech bubble is incredibly off base. One of my current favs. is a driller selling @ 11X earn and 8X estimate. 6.6X cash flow. 80/20 equity/debt ratio. Any tech names from 99-00 fit that description? [/quote]

The p/e ratios are certainly different, but the enthusiasm and universality of opinion is very much the same. BTW, I’m long most every name in OIH, so it’s not like I’m shorting…<?:namespace prefix = o ns = "urn:schemas-microsoft-com:office:office" />

[quote=mikebutler222]

[quote=Revealer][quote=Revealer]You know how to tell if it's a bull market?.......It makes new highs. [/quote] Read above quote, please.[/quote]

Well, I guess if you want to buy today because it's higher now than it as before, that's a great mantra 

I do enjoy (and this isn't just you, Revealer) the calls of triumph when a commodity hits a new high flowed by the sound of crickets from the bulls when the commodity the slumps. Jimmy Rogers is a master of this sort of cheer, then hide stuff. I heard it summed up well by a candid analyst the other day on CNBC. The subject was gold. The guy said “Remember the Doctors who were buying gold at $700 and sold at $570? Well, they’re buying again”….<?:namespace prefix = o ns = "urn:schemas-microsoft-com:office:office" />

[quote=Revealer][quote=mikebutler222]

[quote=Revealer][quote=Revealer]You know how to tell if it's a bull market?.......It makes new highs. [/quote] Read above quote, please.[/quote]

Well, I guess if you want to buy today because it's higher now than it as before, that's a great mantra 

I do enjoy (and this isn't just you, Revealer) the calls of triumph when a commodity hits a new high flowed by the sound of crickets from the bulls when the commodity the slumps. Jimmy Rogers is a master of this sort of cheer, then hide stuff. I heard it summed up well by a candid analyst the other day on CNBC. The subject was gold. The guy said “Remember the Doctors who were buying gold at $700 and sold at $570? Well, they’re buying again”….<?:namespace prefix = o ns = "urn:schemas-microsoft-com:office:office" />

[/quote] What do we do now?[/quote]

Depends on what "we" think is moving prices currently. Given that I think prices are up due to the most recent flair-ups in the Middle East and Nigeria and not some systemic depletion or coming shortage, I'm considering taking some money off the table here.

My point with the above CNBC comment (and the point of the guy making the comment) was that this is just the sort of time when "dumb money" (no offense to anyone here, he and I are talking emotion driven nonprofessionals) comes rolling in and a consenus is reached that prices can only go higher.

What do you think?

[quote=Revealer][quote=mikebutler222]

[quote=Revealer][quote=Revealer]You know how to tell if it's a bull market?.......It makes new highs. [/quote] Read above quote, please.[/quote]

Well, I guess if you want to buy today because it's higher now than it as before, that's a great mantra 

I do enjoy (and this isn't just you, Revealer) the calls of triumph when a commodity hits a new high flowed by the sound of crickets from the bulls when the commodity the slumps. Jimmy Rogers is a master of this sort of cheer, then hide stuff. I heard it summed up well by a candid analyst the other day on CNBC. The subject was gold. The guy said “Remember the Doctors who were buying gold at $700 and sold at $570? Well, they’re buying again”….<?:namespace prefix = o ns = "urn:schemas-microsoft-com:office:office" />

[/quote] What do we do now?[/quote]

buy on weakness- which is not now.

I was referring to gold, not energy. I know what to do with energy.

[quote=Revealer]I was referring to gold, not energy. I know what to do with energy.[/quote]

oh-

buy on weakness- which is not now.