Gadda's Garbage Truck

Well, double take and take two on almost everything.

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Location: Salt Lake City, Utah, United States

I am an amateur investor, playing with a little money on the side, and trying real hard to make genuine sense of the macro economic conditions, the Markets etc. Important Note: The writer of this blog is an amateur. I invest and write for personal enjoyment. I do not recommend stocks. I offer free consultation but you must be responsible for your own investment decisions!

Sunday, May 08, 2005

Thoughts on Oil, BRK and stuff!

Well, I am no soothsayer. But if you read my posts a week ago, you should have noted that I did expect this. The run up in the DOW and the NASD currently is a result of the decline in oil prices a while ago. The DOW and the NASD will continue to move up till this lagging indicator catches up. It has to. It is the fundamental nature of the markets, just as it is the fundamental nature of the folks at CNBC to give an opinion on almost everything - and not - what is relavant a.k.a. the news. Too bad we cannot call the pump and dump on them.

Traders worry gasoline demand will outstrip supply

Oil will have a toll on this market. Whatever President Bush does in his talks with the Kingdom of Saud might have some impact, but the bottom line is - no amount of diplomacy will override the fundamental supply-demand curve.

I dont want this to sound as if oil prices will continue to affect the market forever, but might do just the amount of damage enough to push us into a recession. Hopefully I am wrong. I for one seriously do.

Well, the lil bird on the wire tells me that there will be a run up in the DOW till the mid 10000's after which I would move into cash - and into only those equities which dont get affected by Energy. You might think there are many - but you will be surprised to know how few sectors there are that are not touched by energy prices at all.

Berkshire Hathaway - To Buy or Not to Buy

I am contemplating on buying a couple of Berkshire Hathaway shares - but I am worried on how volatile the stock might become in case either Munger or Buffet cease to run the company. The fear is well founded since both of them are 81 and 74 respectively. The only other reason I cannot get myself to make up my mind is that I dont understand exactly what BRK does. I know it is a conglomerate and I guess I better re read the company info section once more. But I do take comfort in the fact that Old Man Buffet has hedged against the dollar and diversified a lot internationally by investing in Petrochina (PTR) and buying more and more insurance companies - the one sector of companies which never lose money - ever.

Oil again.

Oil... Oil... Oil... Were people as worried and pessimistic as I am in the 70's when the oil shock happened? I did not look hard, but there was no ready documentation on the general sentiment of people there.

Misc

A couple of more things, I have been truly flattered by a couple of things - Barrons published an article called "A Bi-Polar Market?" just a day after I posted my post titled "Market Schizhophrenia?". Secondly, the topic of "Stagflation" was in this Weekend's Barrons again just a couple of days after I wrote about it. I know I ain't that good, but surely the guy at Barrons who is reading my blog can be my friend.

On another note, I got an email from New Zealand from an Old Gentleman who told me that my blog was refreshing and wished I would update it regularly - not daily , but regularly - as he could come to the blog to see something new when he visits. I did write back to him saying that this is a hobby and that I would do my best to have something up every 3 days, if my wife does not throw my computer out of the house

2 Comments:

Blogger chompi said...

Way to go dude. You're getting popular! :) By the way, I read it too - a "getting old fast not so gentle man from Utah". Keep it up and bring it on.

9:20 AM, May 09, 2005  
Blogger Ravi said...

Thanks P.

10:35 PM, May 10, 2005  

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