I'm a fan of Jim Rogers as you probably know by now so I certainly cannot miss sharing with you a Business Week article that I've found. A little old from 2004 but interesting nonetheless. If you are interested in Jim Rogers and his investment ideas, be sure to check this out.
Jim Rogers' Home Truths
Friday, March 25, 2005
Wednesday, March 23, 2005
Oil investments
By now you should have heard and seen the rising oil prices. As I write this, oil is at $56 a barrel. Some believe that oil is clearly overpriced while others feel it will go even higher.
No doubt high oil prices have a negative effect on the economy. Businesses cost more to run, people spend more money on gas and less in consumer products and overall sales and profits fall.
Oil bears argue that oil have risen too much based on speculation. Oil Bulls argue that although oil prices are high, it is still low historically on an inflation adjusted basis.
I am on the oil bull camp. Oil may have a short to medium term adjustment back to about $45 a barrel but it will never reach the $30 again. The reasons are many but for one, most of the 'easy to acquire' oil from the existing oil wells have been drained. The cost to acquire the remaining oil has risen to $22-$25 per barrel and new oil exploration has also diminished. Add the fact that China and India are fast becoming huge oil importers, buying up all excess capacity that used to act as a price cushion for increased demand in the west . The thirst for oil in China and India is expected to continue to increase for the foreseeable future.
As investors, where can we direct our investments? My advise is to invest selectively in oil stocks. An oil ETF (Exchange traded fund) I recommend is XLE with a very low expense ratio (0.27). XLE has large holdings in many oil stocks such as Exxon Mobil and Chevron Texaco. It has risen over 20% already in 2005. It is trading above $43 and I would start to accumulate below $38 on a pull back.
An adjustment in oil price is normal and expected by about June when the US government will make available some of the 700 million barrels of reserves to help curb prices. They however cannot fight the underlying fundamentals for long and the trend in higher oil prices will continue to increase in the long run.
I will share with you about other oil investment possibilities in my next blog entry.
Good luck investing!
No doubt high oil prices have a negative effect on the economy. Businesses cost more to run, people spend more money on gas and less in consumer products and overall sales and profits fall.
Oil bears argue that oil have risen too much based on speculation. Oil Bulls argue that although oil prices are high, it is still low historically on an inflation adjusted basis.
I am on the oil bull camp. Oil may have a short to medium term adjustment back to about $45 a barrel but it will never reach the $30 again. The reasons are many but for one, most of the 'easy to acquire' oil from the existing oil wells have been drained. The cost to acquire the remaining oil has risen to $22-$25 per barrel and new oil exploration has also diminished. Add the fact that China and India are fast becoming huge oil importers, buying up all excess capacity that used to act as a price cushion for increased demand in the west . The thirst for oil in China and India is expected to continue to increase for the foreseeable future.
As investors, where can we direct our investments? My advise is to invest selectively in oil stocks. An oil ETF (Exchange traded fund) I recommend is XLE with a very low expense ratio (0.27). XLE has large holdings in many oil stocks such as Exxon Mobil and Chevron Texaco. It has risen over 20% already in 2005. It is trading above $43 and I would start to accumulate below $38 on a pull back.
An adjustment in oil price is normal and expected by about June when the US government will make available some of the 700 million barrels of reserves to help curb prices. They however cannot fight the underlying fundamentals for long and the trend in higher oil prices will continue to increase in the long run.
I will share with you about other oil investment possibilities in my next blog entry.
Good luck investing!
Friday, March 11, 2005
Surprise--Gates is still world's richest person | CNET News.com
Want to see who the billionaires are according to the latest data from Forbes? Maybe our investments will take us there some day....;)
Surprise--Gates is still world's richest person | CNET News.com
Surprise--Gates is still world's richest person | CNET News.com
Tuesday, March 08, 2005
Rejection, argument, anger and finally acceptance
I'd like to share an excerpt with you today:
".....I am reminded of the various stages of grief: rejection, argument, anger, and acceptance. It is true of terminal disease and the progress of great ideas as well. When somebody first comes up with a new idea, everybody ignores it. Then people ridicule it, coming up with vehement arguments against it, before arriving at acceptance and support. Then not only do they find themselves explaining why it is a good idea; they go on to say, 'Yeah, I thought of it.' It has been proved to be true though out history and is true of politics, economics and warfare. General Billy Mitchell was drummed out of the service in the 1920s for claiming the aircraft carrier was the wave of the future. Nobody remembers that now, of course, certainly not the people in the armed forces".
-Jim Rogers, in 'Adventure Capitalist'
Why is it that new and great ideas are always met with ridicule and rejection? History is laden with great men whom introduced radical new ideas, only to be shamed and accused of heresy.
Galileo, in the early 16th century, proved through his scientific research that the Sun did not revolve around the earth. Instead, he proposed that the Sun is in the centre while the Earth rotates on itself and moves around it. We all know this today as common sense but Galileo was found guilty for proposing such heresy and condemned to lifelong imprisonment.
When people hear a new idea that doesn't affect them, they greet it with indifference. However, if it does affect them, they greet it with rejection and argument because it changes their world. It is unfamiliar and it makes them uncomfortable. It creates a feeling of insecurity.
These emotions are followed by anger. An emotional reaction against the person whose idea has threatened to disrupt their world (as in the case of Galileo condemned guilty).
Finally, after the evidence is undeniable, the once radical idea is accepted as fact. In some cases, the same people who most violently rejected the idea now claim the idea to be theirs. It is too bad that this type of human behavior keeps repeating itself. Would we ever change? I often have to fight my natural tendencies to reject new ideas and instead to keep an open mind. How open minded are you?
".....I am reminded of the various stages of grief: rejection, argument, anger, and acceptance. It is true of terminal disease and the progress of great ideas as well. When somebody first comes up with a new idea, everybody ignores it. Then people ridicule it, coming up with vehement arguments against it, before arriving at acceptance and support. Then not only do they find themselves explaining why it is a good idea; they go on to say, 'Yeah, I thought of it.' It has been proved to be true though out history and is true of politics, economics and warfare. General Billy Mitchell was drummed out of the service in the 1920s for claiming the aircraft carrier was the wave of the future. Nobody remembers that now, of course, certainly not the people in the armed forces".
-Jim Rogers, in 'Adventure Capitalist'
Why is it that new and great ideas are always met with ridicule and rejection? History is laden with great men whom introduced radical new ideas, only to be shamed and accused of heresy.
Galileo, in the early 16th century, proved through his scientific research that the Sun did not revolve around the earth. Instead, he proposed that the Sun is in the centre while the Earth rotates on itself and moves around it. We all know this today as common sense but Galileo was found guilty for proposing such heresy and condemned to lifelong imprisonment.
When people hear a new idea that doesn't affect them, they greet it with indifference. However, if it does affect them, they greet it with rejection and argument because it changes their world. It is unfamiliar and it makes them uncomfortable. It creates a feeling of insecurity.
These emotions are followed by anger. An emotional reaction against the person whose idea has threatened to disrupt their world (as in the case of Galileo condemned guilty).
Finally, after the evidence is undeniable, the once radical idea is accepted as fact. In some cases, the same people who most violently rejected the idea now claim the idea to be theirs. It is too bad that this type of human behavior keeps repeating itself. Would we ever change? I often have to fight my natural tendencies to reject new ideas and instead to keep an open mind. How open minded are you?
Wednesday, March 02, 2005
'Buy quality, and cry once'
I'm in the process of buying a new laptop PC. It is not an easy task to make a choice amongst the myriad of models available. Choosing between different configurations, CPU speeds, memory sizes, LCD sizes, LCD resolutions, wide screen, weight, style, dimensions and robustness. I shall not continue down the list.
I have narrowed down my choices to an IBM Thinkpad. I have always been impressed by the Thinkpads. Ever since I worked for an authorized distributor of IBM, Compaq and HP computers in my first summer job. My responsibilities included installation and occasionally fixing problems. That was not an easy job...but I digress.
For my laptop, I've decided that a 14" display is optimal. Together with a Pentium Centrino M 1.7G CPU, 512M RAM and at least 40GB of Hard disk space. The IBM T42 has this configuration and all in a compact 1" thick sub 5 pounds package. I'm also going to settle for a regular XGA 14" LCD. The higher resolution SXGA+ 14" LCD would be luxurious but I shall not indulge at this time.
Even without the SXGA+ display, the laptop still tops $1500 USD. Ouch. Certainly more expensive than comparable models from competitors. That's the price to pay for the quality of an IBM.
I read a great quote from a user at an IBM Thinkpad forum. A Thinkpad owner, he justified his purchase with a quote that his father taught him when he was young:
"Buy quality, and cry once'
I love this quote.
I have narrowed down my choices to an IBM Thinkpad. I have always been impressed by the Thinkpads. Ever since I worked for an authorized distributor of IBM, Compaq and HP computers in my first summer job. My responsibilities included installation and occasionally fixing problems. That was not an easy job...but I digress.
For my laptop, I've decided that a 14" display is optimal. Together with a Pentium Centrino M 1.7G CPU, 512M RAM and at least 40GB of Hard disk space. The IBM T42 has this configuration and all in a compact 1" thick sub 5 pounds package. I'm also going to settle for a regular XGA 14" LCD. The higher resolution SXGA+ 14" LCD would be luxurious but I shall not indulge at this time.
Even without the SXGA+ display, the laptop still tops $1500 USD. Ouch. Certainly more expensive than comparable models from competitors. That's the price to pay for the quality of an IBM.
I read a great quote from a user at an IBM Thinkpad forum. A Thinkpad owner, he justified his purchase with a quote that his father taught him when he was young:
"Buy quality, and cry once'
I love this quote.
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