Myth465

I have no idea what will happen. I think at some point we will have a spike due to less drilling, but either way that supply is there. Any spike will resume drilling, killing prices. Drillers have not been very disciplined and everyone in the US and Canada is itching to drill. I see a sea saw like effect, until we find a way to mop up that excess supply with some sort of game changing shift. I dont see a shift over the next few years, so I think we will see low prices, cured by low prices, only to see more low prices. You can probably work the cycle and pick your spots to ride the upside. To me its easier to play oil. We have a secular boom going on and have several ways to win and only 2 ways to lose (A large discover or cheap oil, and world wide economic collapse). Excess supply is being sucked up each day with the growth of China and India.

Lol who in Wallstreet was truly kicked out and hasnt found another gig? Failure is simple awarded in America, public and private (if you are high enough).

I tend to agree with Ward, I see a drop off in rig count but think gas is going to be in the dumps for the long term (3-5) years without some sort of fracking ban or new use / demand coming online.

Thanks for the comment. This year has been great, I have to keep that Munger quote in mind though. If you’re a duck on a pond, and it’s rising due to a downpour, you start going up in the world. But you think it’s you, not the pond.” Interesting times, it seems that every other day brings some new crisis or piece of great news. Mr. Market is really a manic depressive kinda guy.

You guys are lucky. I am still making my rookie mistakes :). I am curious though, and wonder what it was like to be in the market in the late 80s - the 90s. Must have been nice.

I dont know Bronco she is not too bad. You guys made me google her to see what yall were talking about. The maxim pic further down is not too bad. http://www.google.com/images?q=erin+burnett&oe=utf-8&rls=org.mozilla:en-US:official&client=firefox-a&um=1&ie=UTF-8&source=og&sa=N&hl=en&tab=wi&biw=1280&bih=798 I cant blame Buffett, I would probably prefer to talk to Becky Quick vs Joe or some of the other guys.

I have always seen CNBC as financial porn. With guys like Kudlow, Cramer, and shows like Fast Money its amazing anyone takes them seriously. I think Buffett just wants a mass audience. At least thats what I hope.

Ok??? Your above statement is a true fact. Listen, I'm not going to sit here and debate with you a point I agree with you on. However, that still has nothing to do with the 2 simple points I was making. I made 2 points above, and you are trying to make statements like this quote, and statements about my supposed ideology as if they are counterargument for the 2 points I have made above. Don't take this the wrong way, but if you don't hear back from me on this or any other topic its because (a) I have a full time job to tend to (b) time outside that job is scarce and I'd rather be researching stocks, and © while philosophical/ethical/legal debate interests me, a "debate" presupposes both parties are debating the same topic. Fair enough. I simple agree and move on, if I feel I am in agreement with the other person. I do think we however have a fundamental disagreement, but its probably not worth either of our time to discuss it. Discussion on SKX would probably be more worthwhile and potentially profitable.

Lol I am not putting words in your mouth. My reference is to Greenspan (if he doesnt believe - the you in the sentence was directed towards his thought process not literally you). Its me making a reference / comment about his thoughts, though perhaps poorly worded. My basic point is we will always have a mixed economy, and have always had a mixed economy. Every developed country where people want to live is a mixed economy and free markets have never existed in civil society. Its simple a thought exercise / ideology which is impractical, similar to communism (and inmo destructive for the US). Anyway I have addressed your comments, you prefer not to engage mine which is understandable. So we will let that be that.

Watsa you got me on that slight distinction. I should have checked my source and said fraud first. But if you dont believe fraud should be prosecuted than that says alot about your thoughts concerning enforcement. He believes Madoff should be fine, because he would be shunned by the market now. I think thats retarded. Greenspan and Rand are different (never claimed they were one in the same), but it says alot about how practical her philosophy is. Ideology is interesting, we just discard those who werent pure enough. The CFA Institute seems like a fine one, and probably isnt crazy. Though this doesnt require much rationalization or legalize. It just makes good sense for people not to allow people to trade on private inside info. Allowing so weakens trust in the market, I would simply say its not fair, draw up some arbitrary rules (similar to what we have now) and move on with life. So much hamper wheeling to justify whats simply logical. I prefer Munger to Rand. Lets just do what makes sense. With that said I think you missed my greatest point. We are all just drawing lines. You included. Somewhere out there (similar to the original post) is a person (a true believer) who feels your markets lack the freedom you so cherish (they want child labor, no IP, and other freedoms you cringe at) . They think you have lost your way and your lines are a bit too restrictive. The fact that there is a debate among those who get it, shows that they too are just drawing lines. You can have ideology. I will stick to logic and rational thought (Similar to Buffett and Munger).

Aw Rabbit, in the interest of saying something witty, I completely missed your point. It too was quite witty also. twacowfca, it sounds like something Bronco would say, he has had quite a few one liners, and you are correct. Stealing is tough, its hard to pick the good ones. Many stole Wamu and AIG from prominent value investors and were left holding the bag.

Yes. As long as you do your homework who cares if you copy. That doesnt make much sense but you know what I mean. As Lynch would say, It all spends the same. The real question is do you have any ideas worth stealing?

Lol, interesting part. Whats funny is Greenspan who knew Ayn and was part of her inner circle said he didnt even believe in the enforcement of contracts, he said the market would sort it out. Sounds like you Watsa my friend are a free market pretender. The market you wish for doesnt seem so free. Umm...wrong. Cite your source. Heres mine: http://aynrandlexicon.com/lexicon/patents_and_copyrights.html Google ayn rand intellectual property rights and you'll see she was clearly supportive. The concept of any property ownership (physical or artificial) is a construct of man. I don't know where you get the statement "intellectual property in a free market system," but I would appreciate you citing a source of a reputable free market supporter. How exactly am I wrong? I said Greenspan did not, and mentioned he was close to her. I am wrong quite a bit, but cant see how in this case. http://www.pbs.org/wgbh/pages/frontline/warning/view/?utm_campaign=viewpage&utm_medium=grid&utm_source=grid Minute 16 - 18. If you care to listen. Greenspan is said to have said that he doesnt believe fraud should be prosecuted. He felt the market would take care of it. ------- Evidence that Greenspan knew and was close to Rand. http://en.wikipedia.org/wiki/Alan_Greenspan In the early 1950s, Greenspan began an association with famed novelist and philosopher Ayn Rand that would last until her death in 1982.[25] Rand stood beside him at his 1974 swearing-in as Chair of the Council of Economic Advisers.[25] Greenspan was introduced to Ayn Rand by his first wife, Joan Mitchell. Although Greenspan was initially a logical positivist,[33] he was converted to Rand's philosophy of Objectivism by her associate Nathaniel Branden. During the 1950s and 1960s Greenspan was a proponent of Objectivism, writing articles for Objectivist newsletters and contributing several essays for Rand's 1966 book Capitalism: the Unknown Ideal including an essay supporting the gold standard.[34][35] During the 1950s, Greenspan was one of the members of Ayn Rand's inner circle, the Ayn Rand Collective, who read Atlas Shrugged while it was being written. Rand nicknamed Greenspan "the undertaker" because of his penchant for dark clothing and reserved demeanor. Although Greenspan was once recognized as a proponent of laissez-faire capitalism, some Objectivists find his support for a gold standard somewhat incongruous or dubious,[citation needed] given the Federal Reserve's role in America's fiat money system and endogenous inflation. He has come under criticism from Harry Binswanger,[36] who believes his actions while at work for the Federal Reserve and his publicly expressed opinions on other issues show abandonment of Objectivist and free market principles. However, when questioned in relation to this, he has said that in a democratic society individuals have to make compromises with each other over conflicting ideas of how money should be handled. He said he himself had to make such compromises, because he believes that "we did extremely well" without a central bank and with a gold standard.[37] Greenspan and Rand maintained a close relationship until her death in 1982.[25] In a congressional hearing on October 23, 2008 Greenspan admitted that his free-market ideology shunning certain regulations was flawed.[38] However, when asked about free markets and the ideas of Ayn Rand in an interview on April 4, 2010, Greenspan clarified his stance on laissez faire capitalism and asserted that in a democratic society there could be no better alternative. He stated that the errors that were made stemmed not from the principle, but the application of competitive markets in "assuming what the nature of risks would be."[39] ---- Richard is also right. At the end of the day your ideology has a fundamental flaw. You are just like everyone else, you draw lines in the sand and say that anything that crosses "your line" is an attack on free markets. You want me to cite a free market source, as though free markets are "designed" by free marketers. How is that different than regular markets "designed" by stakeholders. Either way its "designed by men in suits" making rules which appeal to them. Central bank which sets rates, yes. Intellectual Property rights, yes. Enforcement of contracts / prosecution of fraud, yes. Child labor laws, yes (I guess its ok now but not back then). Sensible Regulation, no dont you dare thread on my free market. Requirements for Dr.s, CPAs, and Lawyers to be certified, no again dont thread on my free market. You push for intellectual property rights because it suites you, many countries dont because it doesnt suite them. We are all just drawing lines in the sand, and once everyone comes to terms with that we can select the best lines for society. Oh ya, lets forget all that and just let some crazy women from the 50s draw the lines. A true free market doesnt and has never existed. You guys just prefer different thinner lines.

Lol, interesting part. Whats funny is Greenspan who knew Ayn and was part of her inner circle said he didnt even believe in the enforcement of contracts, he said the market would sort it out. Sounds like you Watsa my friend are a free market pretender. The market you wish for doesnt seem so free.

Economic Darwinism types are quite funny. Why stop there, why not just social Darwinism. True survival of the fittest, instead of the nerdiest. That usually stumps them (she would be raped and killed in a matter of minutes in a no rules society). Everyone wants to pay the game they think they are wired to play. Interesting world.

LOL Bronco. You consistently have me laughing out loud.

Swizzed we need more guys like you on the board. I like the no style points comment, I may have to "borrow" that one. Speaking of stealing ideas, Twacowfca thanks again for LRE.

Thanks Tariq, its definitely at the end of the que. Speaking of lectures / interviews. The one with Einhorn on Wealthrack is pretty good .

I would actually like that. Cant imagine trying to sit down and read it. Found it online, thanks for the tip.

goldfinger - I agree but I think you miss one point. There is a glut of savings around the world that calmer for "risk free" low yield assets. How long that last is anyones guess. But every crisis increases demand.

Thanks. Interesting move.

Nat gas was $16 in 2005, now its $3 and some change. SD at that point was over 95% nat gas and its gas is not low cost due to having alot of CO2. Ward worked fast and switched to oil, I think he avoided a take under or bankruptcy but the stock still got crushed.

You are correct, this is the other BYD. The Canadian one that no one really knows about or cares about. EBITDA as you know is always higher than earnings, and distributable cash flow is usually in the middle (it too typically doesnt include depreciation, but may include a maintenance number). For DCF, they typically adjust EBITDA and try to figure out how much cash they can pull out of the business. MLPs, REITs, and Trusts tend to give this number. Typically they must reconcile it to a GAAP number but I am not sure what Canada requires now that everyone is going to IFRS. Here is Boyd's definition. For the nine months ended September 30, 2010, net earnings after discontinued operations were $7.1 million or $0.614 per unit (basic) and $0.602 per unit (diluted), compared with net earnings of $6.3 million or $0.538 per unit (basic) and $0.533 per unit (diluted), in the same period a year ago. In the first nine months of 2010, the Fund generated adjusted distributable cash of $11.0 million, which includes adjustments for the collection of additional prepaid rebates, cash flow used in discontinued operations, proceeds on the sale of equipment, and capital lease repayments. The Fund paid distributions of $2.7 million, representing a payout ratio of 24.8% for the period. ---- Payout ratio is typically a function of distributable cash flow. These things are typically audited or I guess reviewed for consistency to be a bit more precise. and I typically dont project much growth forward when I am paying for a company. The growth usually cancels out noise like the prepaid rebates, a lack of maintenance capex (though thats not much of an issue with this business), and asset sales.

Thats just mean.

Thanks for the link. Looking forward to reading. Tilson has really grown on me over the year.