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China Trades Money and Arms for Oil in Venezuela and Brazil
Just as we see Russia combining military and energy deals in Venezuela and Cuba, China is doing the same thing with both Venezuela and Brazil, as the following report details. China has increased its importation of oil from Brazil, is cementing agreements to further that trend, and is doing military and oil deals with Venezuela as well.
With both Russia and China combining military and energy policy for national security purposes, Americans must ask what its government is doing to secure its energy future in the face of such obvious competition for what will ultimately be scarce and vital resources. To say that the Bush administration has been asleep at the switch (unless it deluded itself into thinking that its Iraq adventure was somehow an oil security program) is just stating the obvious. Let us hope the Obama people are not as naive.
Turning Oil Into Bullets Part Two
In 2004 China began angling for Brazil’s oil and gas resources; Sinopec signed a memorandum of understanding with Brazil to build the country’s longest natural gas pipeline. In 2004 Brazil exported to China only 1 million tons of crude oil, but in 2007 the total increased abruptly to 2.3 million tons.
by Andrei Chang
Hong Kong (UPI) Nov 7, 2008
Alongside their military deals, the People’s Republic of China and the South American nations of Venezuela and Brazil have been cooperating extensively in the oil industry.
In May 2008 the Venezuelan News Press reported that China Petrochemical Corp., or Sinopec, was signing a billion-dollar contract with Venezuela’s state-owned Petroleos de Venezuela — PDVSA. The contract provides for the joint establishment of a large refinery in China’s southern province of Guangdong.
In 2007 Sinopec and Petroleos de Venezuela announced they would jointly invest $10 billion to develop Venezuela’s Orinoco oil field. During his visit to China in 2006, Venezuelan President Hugo Chavez already signed an oil contract worth $11 billion with the Beijing government. It was after this visit that Chavez made the surprise announcement that he wanted to import J-10A fighters from China.
In 2007 China imported from Venezuela around 4 million tons of crude oil. Though this is not a huge quantity, it is part of China’s strategy to increase cooperation with Latin American countries and diversify its sources of crude oil. China already has obtained the rights to develop 15 oil fields in Venezuela.
Another South American country with which China has extensive dealings is Brazil. In fact, Brazil is China’s key supplier of remote-control satellites and digital photographic satellite technologies.
The Brazilian aircraft manufacturer Embraer and China’s Harbin Aircraft Co. have a joint venture to manufacture ERJ-145 feeder passenger aircraft, with Brazil owning a 51 percent share in the company. The plane incorporates Brazilian technologies, some of which are being applied in the research and development of the Chinese People’s Liberation Army air force’s airborne early warning and control platform.
In return, the Brazilian navy hopes to obtain the technology to build conventional and nuclear submarines. Brazil is currently discussing this with China.
The two countries have been cooperating in the space industry for 20 years. In 1988 they began joint development of an Earth surveillance satellite; to date they have launched three such satellites. In September 2007 China and Brazil launched the 02B high-resolution Earth resources satellite.
Brazil has provided China with technology obtained from Western countries, especially French digital image transmission technology, which is responsible for the greatly improved resolution of the 02B satellite. On the other hand, Brazil has obtained from China certain satellite and rocket technologies.
In 2004 China began angling for Brazil’s oil and gas resources; Sinopec signed a memorandum of understanding with Brazil to build the country’s longest natural gas pipeline. In 2004 Brazil exported to China only 1 million tons of crude oil, but in 2007 the total increased abruptly to 2.3 million tons.
An internal Chinese government document on the country’s energy plans discusses the strategic importance of Brazil for China, since it is the 15th largest oil-producing country in the world.
(Andrei Chang is editor in chief of Kanwa Defense Review Monthly, registered in Toronto.)
Tags: peak oil investments
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46 responses so far ↓
1 KV // Nov 11, 2008 at 6:08 am
So, what is the impact on us? Are Brazil and Venezuela planning to declare war on the US? Is China going to attack us? Conversely, are we going to attack any of these countries?
Why can’t we see it simply as a trade in weapons?
If you have concern about why are these two mostly poor south American countries spending on weapons instead of building infrastructures for better life, it would be legitimate, the rest is nonsense.
Somehow, we fail to see that we are really not a military power. Iraq war proved that we can do “shock and awe” but we can not control a thing and the world is not afraid of the big bad wolf any more. Time for diplomacy, dialog and rebuilding of our nation for productive stuff, not weapons.
2 robert essian // Nov 11, 2008 at 6:29 am
Good morning Professor, your last three posts didn’t surprise me since your post from a little while back regarding Russia pushing us to an energy policy.
I have been looking at anything thing that might back that previous post up and when I seen that Russia has been taxing their exports it gave me a clue that informally they were backing OPEC’s decision to control costs on crude. Other events that you have mentioned have been noticed too.
Some thoughts:
Looks as though the Monroe Doctrine will be tested in the Obama administration. Why not because we have our nose in their hemisphere so tit for tat is what I’m thinking.
I hope we are forward thinking now and get off our bully pulpit and collective asses to start mending fences, join the real world, start working with our enemies, keep them close and figure out how to nuetralize what will be a mess if we don’t.
Imagine what will happen to Europe when Russia gets pissed and slows the oil and gas to that region. Now that their the OLD Europe (Rumsfeld) I wonder if Russia by blackmail or otherwise could change Europe away from the U.S way of doing business.
This is looking more and more like something out of the Bible…Russia, China and the Eagle????
It’s a game of Risk and so far we are loosing. Looking at the World map above my desk shows all the oil and money reside in a tight little pocket of country’s bordered by China, India and Russia. We have 350 million people they have many billions. I think their concerns out way ours (in their collective minds). It’s like trying to feed, cloth and house 13 kids instead of two.
They want to prosper and survive too. As an emerging society they are moving up and feeling good. Eating meat is new to them, having a heated home, driving a car, etc… I don’t think as a developed society we will handle things well loosing some of our stuff yet that is what we should expect if we allow our economy to destabilze any further because of oil.
As an eternal optimist I will look for the US and Obama to hand out its marching papers and develope our economy to the electrical grid and take control of our lives again.
Without being a protectionist we must find a solution that free’s us from padding the pockets of our enemies.
China,Russia and OPEC if they work together (which seems likely ) could hurt us without firing a shot so we better start playing the game better or frankly our way of life is over. The hair on the back of my neck is telling me this is something we must really be concerned with.
President elect Obama has stated that “this won’t be easy” and that he won’t “lie to us”. I hope he man’s up and means it, trusts us and leeds us. Time to get to work.
To guess I’m thinking the U.S will be spending at least as much as China on a bailout package for the Country. Perhaps as much as 600 billion to 1 trillion dollars. Paul Krugman suggests that you would not want to short a recovery. So I’m thinking it would be better to be looking at the cash than for it…Peace
3 robert essian // Nov 11, 2008 at 7:28 am
Jim, one last thought.
As a society we have given away most of our manufacturing to the world and jobs. We did this because it was cheaper from a manufacturing stand point because the slave labors of China and India was too compelling from a corporate profit point of view. The issue wasn’t ours so long as we profitted. Yet we still want the biggest piece of pie regarding oil supply. That smacks me as glutonous (sp?). Frankly our piece of the pie is way too big.
As a Veteran of the Vietnam era War let me say thank you to the men and women who are serving and here’s hoping we bring you all home soon…Peace
4 KV // Nov 11, 2008 at 7:39 am
RE – Monroe doctrine is obsolete (c: 1823) today (c: 2008). We need a new doctrine and whether Obama is going to articulate or not is to be seen.
Why are we perpetually seeing the world as if we are with a bipolar disorder! I thought we had President who was bipolar challenged and he would be gone in two and half months.
We need to seek out cooperative relations everywhere, and these relations can’t be “military cooperative doctrine” or arbitrary claims of harms but those that enhances trade, cultures and other parts of the world just as desirable to live and prosper as we would like to see our own.
Robert, we must stop seeing the world as friends or enemies – if you consider Russia, China, India and other emerging countries as enemies, we are frankly doomed to your Bible readings. Let me see: for nearly 2000 years since those writings, nothing like that has happened, and neither such writings from other faith; as we await the end of the world because Mayan calendar ends in 2012; or the new age begins as we move to new constellation in the sky.
We need to address serious problems – beginning with over population in China, India and many other countries. If we do not help modernize these worlds through knowledge and trade, we are going to suffer much more from diseases and pollution than the wars.
By 2050, we will be TEN billions strong, and we can’t kill the half of them!
5 Robert Essian // Nov 11, 2008 at 8:30 am
KV, regarding the bible reference, this story has been told forever. It was just a statement of irony of the times we are in.
Personally the Bible is a script to help those who cannot help themselves and to that end it is good. Fact is if it helps someone get off drugs, alcohol, softens their lives I’m cool with that. That would be great.
I have no problems with any of the country’s stated above except if their intentions are to do us harm.
Utopia is my preference.
The Monroe Doctrine is not obsolete if we need to use it to sway the masses. I hope clearer heads always prevail.
KV, clearly we have friends and enemies. This will change like red states to blue states. To think otherwise…Is dangerous.
Fundamentally, we are not adversaries (you and I) but we have our differences. Like the world over it depends on how strongly we want to push our differences. I prefer a neutral and working relationship. One that is based on learning and acceptence. After all we are just talking to a computer screen and the reality of our lives will never be known by either one of us.
So perhaps we can by our examples show people how to communicate…Peace
6 mark // Nov 11, 2008 at 10:14 am
Contradictory……….
7 Robert Essian // Nov 11, 2008 at 12:00 pm
Isn’t everything…Yen and Yang
8 KV // Nov 11, 2008 at 12:21 pm
RE - My comment on Bible was to show that many believe such stuff and forget that it is not their decision.
Monroe doctrine per Wiki: stated that European powers were no longer to colonize or interfere with the affairs of the newly independent states of the Americas. The United States would not interfere with existing colonies or their dependencies in the Western Hemisphere. However, any attempt by a European nation to oppress or control any nation in the western hemisphere would be seen as an act of aggression and the United States would intervene.
I don’t know how does it apply to Chinese, Africans or Indians… We are really dealing with Bush’s doctrine today, which is invade first, and then say oops! If other countries adapted such nonsense…
We have used this friends and enemies stuff since WWII. Today, we are facing either a collapse of the civilization or a realignment of power, or both. We really need to get steady.
I agree, faster we start talking, better off we all be. As soon as we do that, we stop thinking in ying-yang, or friends-enemies. We did live with Soviets for nearly 40 years without blowing each other up.
9 mark // Nov 11, 2008 at 12:40 pm
Naive
10 KV // Nov 11, 2008 at 1:18 pm
mark, stupid.
11 Robert Essian // Nov 11, 2008 at 1:30 pm
KV, of all that you have stated above I have no disagreements with.
I understand the Monroe Doctrine, my point was it will be used (wrongly) should the government have issues with other country’s in our hemisphere. Weapons of mass destruction was used to enter Iraq so if we interfere in Venezuela or Cuba we will use this doctrine you mark my words.
China, Indian and Russia to state firmly is not my enemy. It would be my preference to be on friendly terms and all get along. I have not the sophistication to understand why we don’t. However, from both sides of the fence it seems as though we have thrown our garbage at each others my entire lifetime. Naturally I am concerned and express a very general opinion from my gut.
We are all Naive that is a certainty, every one of us. None of us have enough power or money to think otherwise…Peace
12 Robert Essian // Nov 11, 2008 at 1:51 pm
KV, Mark, stupid is funny. Maybe next time you might ask if he’s having a bad day and if he might expand on his thoughts…Still laughing…Peace
13 KV // Nov 11, 2008 at 2:18 pm
RE - Sorry, but could not resist!
14 Robert Essian // Nov 11, 2008 at 2:27 pm
still laughing…
15 paultaut // Nov 11, 2008 at 4:50 pm
I see that the idiot continues to drivel, South Africa has constructed a state of the art Cruiser which is headed toward China to show solidarity within the region. The Asean Zone is in the process of construction. The Gulf States are proceeding with their creation of a new currency for their part of the World. The US had its chance to create a North/South American Zone, too bad neither Party is committed to the future of its citizens.
KV, you continue to put out the same garbage and are a fount of misinformation. Instead of asking what people mean, you deride them.
You continue to do so.
Jim K.: how many people have stopped posting because of the Personal attacks by KV?
Look at old articles KV, look at how many people you have driven away.
My turn.
16 paultaut // Nov 11, 2008 at 5:10 pm
Hey, KV, I’m going to start by taking away some of your toys.
What other country in the Rest of the World has the same A. Type of Government (not like or similar but the same);B. Uses Humanitarian Aid as a way of imposing its will on the internal structure of other Countries; C. Imposes Trade constraints because our rules are not accepted as final.
The Military did not alienate the rest of the world, the attempt at imposing our way of life did. You did KV, just like you are doing on this site. Open your mouth and say AHH.
My Turn.
17 Jim // Nov 11, 2008 at 5:11 pm
Jim, in your opinion is this a prudent sign to start loading up on canadian energy companies ?
It appears like the US will be heavily reliant on our friendly neighbor Canada for future energy needs. Is PBEGF your favorite? Thanks
18 paultaut // Nov 11, 2008 at 8:14 pm
Monroe Doctrine, Wiki it you said, but you only quoted what you felt was suitable from your own narrow point of view.
“Not surprisingly, because the US lacked both a credible Navy and Army at the time, the doctrine was largely disregarded internationally(Britannica 269).
Mr. Essian, continued reading of the Wiki disgorges the following:
“In practice, the United States’ repeated reliance upon the Monroe Doctrine favored its short-term economic interests rather than definitively drawing a barrier against European interventionism.”
Your gut is correct.
It doesn’t matter whether we view one country or another as either friend or foe. What matters at this juncture is whether any country considers us as a reliable ally, with no strings attached.
19 paultaut // Nov 11, 2008 at 8:23 pm
Jim, PVX is probably the best CanRoy at this point in time because of the income generated from its transCanada pipeline, (think in terms of KMP), and because of Canadian Tax credits which may extend its life as a CanRoy to 2016.
I cannot verify the 2016 data. You will have to do that bit of research for yourself.
20 KV // Nov 11, 2008 at 10:12 pm
Paultaut - So you are back! And looks like you gathered all your round dice and put them back in your head.
21 rbblum // Nov 11, 2008 at 11:09 pm
It’s becoming ever more clear that there is an ongoing race towards dominating the global resources - which should be followed closely by a race towards dominance over food resources.
22 jkingsdale // Nov 11, 2008 at 11:21 pm
I think Russia and China are playing different games in oil. Russia is looking to leverage its oil supply role as a very key global producer and even more key distributor to Europe of oil and gas into political power, particularly in regard to Europe. China wants to wrap up a sufficient oil supply from any exporter anywhere to drive its economy until a transition away from oil can be accomplished - which they probably recognize is 10 - 20 years away. Meanwhile the U.S., which is more dependent on oil imports than any other country, has no energy policy at all - unless you think our global military presence is part of an energy policy, which I do not. At least not an effective one. So my point is that the U.S. needs to get smart on oil. Quickly. Let us hope Mr. Obama will lead us that way.
Re: the question about Canadian oil supplies - yes, Canadian supplies will become extremely important to the U.S. - but probably not for a few more years. Now the world is in an oversupply condition. That will probably get more over supplied for another 6 - 18 months depending on the length of this downturn. Meanwhile decline rates are increasing and when the global economy starts to grow again oil prices will rebound and oil will become scarce again. At that point Canadian producers will become very highly valued.
23 paultaut // Nov 12, 2008 at 1:32 am
Jim, Canadian supplies are important now, more so than before.
The costs of transmission via pipeline from Canada are quite a bit lower than transportation from any other external source. The world may be in an oversupply situation but the US is not.
Lets assume a really outrageous demand destruction scenario where the US no longer uses 21 million barrels per day but uses just 14 million. We will still be importing 7 million. Where will it as much as we can get come from? Opec or wherever via tanker or Canada via pipeline.
You should get a major pop to the upside sometime after mid-month. Two reasons, Market is very oversold and coordinated major stimulus packages globally. IMHO
24 paultaut // Nov 12, 2008 at 1:43 am
China is trying to repopulate. They have a massive male vs female imbalance. Sterilization of females after one female child was the norm for decades. Males were needed for their armed forces.
Children should be seen not heard.
25 KV // Nov 12, 2008 at 7:36 am
Jim K.
From IEA report:
The IEA has nearly doubled its forecast for the price of oil over the next twenty years, because of rising demand in the developing world as well as surging costs of production as oil needs to be sourced from more expensive offshore fields and state-run companies.
It hiked its forecast for the price of a barrel of oil in 2030 to just over US$200 in nominal terms, compared to its forecast last year of US$108 a barrel. Measured in constant dollars, it pegs oil at US$120 a barrel in 2030, up from last year’s forecast of US$62.
Over 2008 to 2015, it predicts the price to average $100.
http://biz.yahoo.com/ap/081112/eu_world_energy_outlook.html
26 robert essian // Nov 12, 2008 at 10:26 am
The IEA acknowledges demand destruction but are more concerned that the investments needed to maintain supply are just not there.
Their worry is supply destruction and that when the demand picks up around 2010 that we will see at least a repeat of what happened this summer.
I can only conclude that if this is true that the average cost of crude oil will be much higher in the near term. As an investor I have to decide if an anticipated rise in oil prices will equate to a $40.00 plus rise in crude prices near term from prices today is worth the risk of waiting too long in trying to time the market for the biggest bang for the buck.
For me the upside is to compelling and I have to start adding to my positions and just wait.
The stocks I have been in have made incredible profits, will withstand anything for 2009 so for me all seems cool.
For the other stocks that the Professor has recommended I see no down side at all. SQM for example will be huge going forward. I’m betting on it.
Any and all stimulas packages and there appears to be quite a few world wide will require a lot of oil. Infrastructure projects alone are going to be energy intensive. Employment will rise and these workers will absolutely spred their wealth around. So gasoline, therefore oil will be consumed in large quantities.
Inflationary pressures will begin right along with the massive spending world wide. We know that will drive down the price of the dollar at some point so the inflationary pressures and the falling dollar will only help crude stocks and probably Gold in a major way.
To finish thank you for reading what obviously is me thinking things through. Any critiques are welcomed, it’s how I learn…Peace
27 KV // Nov 12, 2008 at 12:36 pm
RE – A word of caution on IEA report. Their time horizon is to 2030, over 22 years. Our immediate, 1~3 years, horizon is scary at the best. I understand we can shrink the wealth number without significant impact, but we can not deal with shrinking incomes – happening now, or exponentially shrinking purchase power of the currency – hope, never happens, or both. I am becoming very apprehensive especially when you see nearly 2000 BILLIONS, (or nearly 140 miles high stack of 1000 dollar bills), have been given out and the Govt. will not tell who got in the line. American Express, probably the last of financial institution, is now a bank holding company and is in line for $3.5B. This financial debacle is unreal, and the real problems haven’t even begun.
Oil probably will go to $40 before it will go to IEA projections.
Paultaut – Old farts with no hearing fade away watching children.
28 paultaut // Nov 12, 2008 at 1:07 pm
huh?
Mr. Kingsdale, please control KV. I have not directed anything personally demeaning. If you allow this, I will retaliate in kind.
Inre, infrastructure stimulus, the earliest projects would be at least 3 months away and would not start where most needed until April.
The move I expect will realize that after some reflection. When GS reports, the Market will resume tanking.
Sub $50 oil is a gimme, the Possibility of a spike to $40 exists. What were RIG, SLB, HAL, SQM, TBSI selling at 5-6 years ago? Those should be your Buy and Hold targets. IMHO
29 KV // Nov 12, 2008 at 1:17 pm
Paultaut - Look at your comment #24. If you can’t take it do not dish out.
30 paultaut // Nov 12, 2008 at 1:32 pm
my comment #24 did not point to any specific person, nor did it use vulgarity.
Bob, if you absolutely must get into the Oil sector, there is a new ETF, ERX which can nibble on, trade, whatever.
Stay away from GLD, apparently the presumptive buyers of the gold baskets have yet to be identified. The 10k is devoid of who they are and what triggers a sale. Without identifiable counterparties, GLD could turn out to be a Ponzi scheme. IMHO
31 KV // Nov 12, 2008 at 1:46 pm
By not addressing anybody one can post anything, correct?
32 paultaut // Nov 12, 2008 at 2:27 pm
Incorrect, vulgarity is unacceptable on any site. Every other site has a little trigger “Report Abuse”. Many of your comments would be long gone.
IE. Your #25 in Off the Subject in late October was an unacceptable post. How many people left this site after that?
I will use common sense where necessary, provide info to the best of my knowledge but will not go out of my way to lash out at the beliefs of others. Stating an opinion is just that, your opinion which is worth no more or less than the opinion of others.
When Jim K. posts an article, he describes the subject matter. Responses should be relevant. The responses are opinions. If someone questions an opinion, it can be done without acridity, derision, ridicule, appllelations as to race, religion or gender.
You, however, use whatever hostility is available to ram it down everyone else’s gullet.
33 KV // Nov 12, 2008 at 2:55 pm
May be, people left the sight because they had better things to do then listen to your whines. Why did you not post in Oct for whatever grief you had.
You really do not want supreme court to rule on vulgarity on Internet, do you? By the way, what part of my comment 27 bothered you?
34 robert essian // Nov 12, 2008 at 3:33 pm
Paul and KV, I respect you both but honestly…
Do you know that your brewsing is to a computer screen!
Take a deep breath and teach. Both of you are strong willed individuals who have a lot to give so leed. Short of that get a room. Ha! Ha!
KV, I am following the ETF recommended. Gold is not in my portfolio but I do love the oil patch. Oil can go to $30.00 but when demand picks up again and it surely will then all is good. Oil is expected to reach $100.00 a barrel in 2009. That would represent a huge profit for the investments. Do I think $100.00 crude will happen, you bet. I’m of the belief that oil will be much higher and then some once this recession turns. I think the entire patch is a great growth industry. If I’m wrong I hurt no one except me. You won’t see me jump from anything if I’m wrong.
I doubt the Professor has lost anyone at this sight. He’s to good. If just to read what you guys have to say would be worth the visit. Ha! Ha!… Be nice…Peace
35 paultaut // Nov 12, 2008 at 3:47 pm
I did post an Oct. 19th Email. I sent it directly to JK informing him I would continue to read but would stay out of it. I would continue to forward items of interest via Email.
I have not been involved here since. Have read the articles and continued my Email contact.
I only came back with a post because of the sorry state this site has turned into.
See how you respond? Hostility. Sight? “Maybe people left the sight because they had better things to do then listen to your whines.”
I was gone before Oct. 24th, Take a look at all those articles without any posts whatsoever afterward.
Someone new comes in, you don’t care what is said, you don’t just post an opposite opinion. Oh no, not KV, you pound on the person who wrote the opinion as well.
Whines? What whines? Oh, you must mean the whines coming out of your mouth as you seek to defend yourself.
Or are you just one of those people that believes being offensive is better than being defensive?
36 paultaut // Nov 12, 2008 at 4:04 pm
rbblum, nice to meet you. You are absolutely correct but Global Resources includes food within its framework. China is investing Billions in Africa, all sorts of infrastructure with no immediate return. Two or three years down the road, they will receive the benefits. Roads, wells, bridges, irrigation projects, manufacturing facilities will exist to ship, refine, produce whatever resources are in the area. They help the country, the country helps them. Africa has lots of arrable land. China is planning for its future population’s food requirements at the same time as it looks for other resources.
37 KV // Nov 12, 2008 at 4:06 pm
RE - I am not going to respond to Paul anymore because I don’t think his dices rattle well. As you know, I do not advocate any investing in anything, but I do discuss what I am researching. GLD is my research interest, that is all. I, by the misfortune, to have worked all my life in analyzing trends and what-if scenarios, have been considering that one may have to invest in GLD to survive through whatever. It is my fear that in coming two and half months much damage may ensue, and I will be first happy person to be totally wrong.
Even JPM is saying that the coming recession may be much worse and that is not a good sign. Can we survive the deflating oil prices? Can we survive the deflating demand in oil? Oil price has eroded 61% in less than two months, and the next leg is for capital investments for drilling and moving (pipes) will go down taking the industrial base with it. Cars are not selling, and car companies are lining up for handout. I have an abbrevation for this all: WTF is going on?
38 robert essian // Nov 12, 2008 at 5:01 pm
Paul your post #36 is what I love about China. I have a sense their a mellow society. If the Olympics were any indication of where their headed I like it.
KV, WTF indeed…Peace
39 KV // Nov 12, 2008 at 7:07 pm
The technology sector in general is bracing for a prolonged slump. Cisco Systems Inc., the world’s largest maker of computer networking gear, offered a sign of the trouble last week when it reported that orders fell off abruptly in October. As the first major technology company to report results including October, Cisco’s grim forecast suggested that other tech companies will likely have to absorb major damage to their sales as well.
No oil, no car, no tech.
Also, GE got $140Billions in insurance from FDIC, so GE is also a bank. CAT and DE next!
40 paultaut // Nov 13, 2008 at 12:28 am
Annuities it turns out included yield enhancers to get people to buy them, 300 of the nations largest corporations have asked for suspension of payments into their pension plans, only for a year, sure I’ve heard that before.
Bob, agree on present unsure on outlook 10-20 years forwards. They have a very major, possibly insurmountable problem, clean toxic free water. Jimmy Rodgers voiced that this was his only major concern a few years back when the Chinese stock market was at 3000 on its way to 6000.
41 Jim // Nov 13, 2008 at 4:12 am
Would it be a better/safer bet to buy an ETF - USO, that tracks the price of oil, versus buying stock in an energy company? Which is better??
Thanks
42 robert essian // Nov 13, 2008 at 4:49 am
Paul, I understand that China is having problems with water and will spend part of their funds on it. How about reverse osmosus (sp?). I have a question that may seem silly because I just got up but are Sea’s salt water?
Suspensions of pension plans payments for a year if it keeps me in business and gainfully employed would be OK. It’s the times we are in, SURVIVAL MODE.
Jim (post 41), it is my understanding that the ETF’s are better if you don’t have the time to spend researching and tracking company’s (the fun part)…Peace
43 robert essian // Nov 13, 2008 at 5:13 am
Professor, anxiously awaiting your thoughts and numbers regarding the IEA report. Specifically how it relates to the mega project numbers. No hurry…This afternoon would be nice!…Peace
44 paultaut // Nov 13, 2008 at 5:58 am
When you invest in oil via USO, you are investing in the abilities of Oil Futures Traders.
I, personally, would rather go with RIG or some other top notch deep sea driller. Once upon a time there were options called LEAPS which were good for a few years. I don’t know if they still exist, will look. But if they do and one exists for RIG, HAL or a SLB, that would really be a cheap way to go.
Thanks, I had forgotten about them. Will look.
45 paultaut // Nov 13, 2008 at 6:13 am
Tons of LEAPS, RIG is available, no clue on prices. Did not dig that far.
http://www.cboe.com
46 KV // Nov 13, 2008 at 6:49 am
Jim - Read the last line from BusinessWeek story on Intel. If this guy is right, we are in for a major downturn, oil below $40. Whether you buy USO or any other oil stuff, it is still going down. It is called falling knife, and don’t try to catch it.
Intel stock dove in extended trading, falling almost 7% to 12.60, after the news was announced. Stock in rival Advanced Micro Devices (AMD) also slipped in extended trading. PC makers including Dell (DELL), Hewlett-Packard (HPQ), and Apple (AAPL) also dropped in after-hours trading, an indication tech stocks may be in for a rough ride Nov. 13. “If Intel isn’t a bellwether, I don’t know who is,” says Ashok Kumar, an analyst at Collins Stewart. “A drop in guidance this big is an ominous sign both for the tech sector and the wider economy.”
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