Blogspot
was “read only” yesterday and for much of today (no posting due to technical
issues). Here’s yesterday’s post.
“If
we cannot end subsidies to the five biggest, most profitable corporations in
the history of the planet, that come from the federal taxpayers, then I don't
think anyone should take us seriously about deficit reduction,” said Sen.
Claire McCaskill (D) of Missouri
It
always amazes me how the politicians claim “Big Oil” is making huge profits. Their profit margins are about 10%. Apple’s profit margin is 20% but you don’t
hear anyone claiming Apple’s profits are too high. Exxon Mobile’s total profits are large
because they sell a lot of oil. 10% is a
reasonable profit per unit sold.
I
saw Senator Chuck Schumer stating that oil subsidies should be eliminated for a
savings of 21 billion…over 10-years.
That’s 2B per year folks or about 1000 times less than the budget
deficit. I agree that the subsidies
should be eliminated, but why pretend that the amount of money is significant?
Now
here is what is really amazing. The sum of
earnings before interest, tax, depreciation and amortization (EBITDA) of just 2-oil
companies, Exxon Mobile and Chevron, is about 100-Billion per year; so
2-Billion is even a small number for the oil companies. In the
end, the entire hearing is a political farce…completely meaningless; the amount
of money isn’t worth arguing about. It’s
all political posturing on both sides.
The oil companies are just worried if they lose the subsidies the
politicians (Democrats) will take more next time around.
The
Navigate the Stock Market analysis switched to BUY on 20 April and it is HOLD today
I
went 65% long in the trading account yesterday using a 2x long S&P fund. My
trading account is roughly 15% of the long-term account. I am positive on the market since we just
finished a period of turmoil; the trend is up; new money is coming in; the
dollar should get stronger; a stronger dollar will reduce commodity cost
lowering inflation risk; a strengthening dollar will attract foreign investors. Longer term…I am very cautious and will be
ready to get out quickly if the market hiccups.
When everyone piles in, it will be time to get out.
I
remain 100% long in stocks in the Long-term portfolio. (See the page How to Use
the NTSM System). That is way too
aggressive for most people and I don’t recommend it unless you have a high
tolerance for risk.
