Malthusian in Chief
In a 2008 Speech in Lansing, Michigan, presidential candidate Obama was all doom and gloom about oil, advising: “We cannot sustain a future powered by a fuel that is rapidly disappearing.”
Then in 2010 from the Oval Office he solemnly declared: “We’re running out of places to drill,” and he jeered that the oil and gas industry might want to start pumping for oil near the Washington Monument.
Then during a speech at Georgetown University, he pontificated: “The United States of America cannot afford to bet our long-term prosperity, our long-term security on a resource (oil) that will eventually run out.”
By the way this discredited Malthusian belief that we are running out of oil is still widely believed by many scientists and pundits as well. Paul Krugman of The New York Times wrote in 2010 that “the world is fast approaching the inevitable peaking” of global oil production and that “world commodity prices are telling us that we’re living in a finite world.”
These stupid predictions of the end of oil have been going on for most of the last century. Just over 100 years ago, the U.S. Bureau of Mines estimated total future production at 6 billion barrels, yet we’ve produced more than 20 times that amount. In 1939 the Department of the Interior predicted U.S. oil supplies would last 13 years
Peak oiler Gail Tverberg just a week ago still claims that Peak oil is happening now. She claims that the symptoms of peak oil are a glut of supply, and prices are far below the cost of production. Many commodities besides oil are affected; these include natural gas, coal, iron ore, many metals, and many types of food.
So she is saying high prices mean peak oil and low prices mean peak oil.
Apparently the prescription is always massive amounts of solar and wind power.
Stock Picking Advice is Usually Bad
Marketwatch's Brett Arends indicates that stocks that were recommended most highly at the start of 2015 by the highly trained, highly educated, highly paid experts on Wall Street did worse this year than a bunch of stocks picked at random.
And they did worse — a lot worse — than the stocks those same experts told you to avoid.
Stop me if you’ve heard this one before.
According to data provided by Thomson Reuters and FactSet, the 10 stocks that Wall Street analysts rated most highly last January collectively have lost 7% so far this year, even including dividends.
Meanwhile the 10 stocks those analysts rated worst have actually gained 3%, beating the S&P 500 SPY.
There is some method to this madness. Unpopular stocks find it easy to beat expectations, because the expectations are so low. By the same logic, highly rated stocks find it hard to beat. And Wall Street analysts’ main job isn’t to make investors rich but to keep their job as analysts, so they have every incentive to run with the herd.
Caveat investor, as always. There is no substitute for thinking for yourself.