Financial Sense Newshour on Energy
Jim Puplava’s Big Picture: The Petro Business Cycle Equals The New Normal
The Price of Oil Is Impacting Monetary Policy
In this segment of the Big Picture, Jim looks at how the price of oil has affected the economy and growth over the past three years, and how his concept of the Petro Business Cycle looks like it will be the “New Normal” in the years ahead. He also references recent interviews with oil experts Dr. Robert Hirsch and Dr. Oliver Inderwildi who concurred with his analysis on the Petro Business Cycle. Jim also answers your Q-calls in this segment of the program.
Dr. Oliver Inderwildi: Oil Price Volatility – A Fundamental Barrier to Economic Growth
There is no energy silver bullet
Jim is pleased to welcome back Dr. Oliver Inderwildi PhD, Research Fellow at Smith School of Enterprise and the Environment, University of Oxford, UK. Dr. Inderwildi speaks to the high degree of oil price volatility over the past four decades, and its damaging and destabilizing effects on the global macro-economy. He discusses the main drivers of oil price volatility and how it has influenced both the level of inflation and the level of unemployment within economies affected by it. Dr. Inderwildi notes while there is no energy “silver bullet”, he discusses economic policies that could help prevent or minimize oil price volatility.
Dan Steffens: Natural Gas Prices Going Up
Natural gas inventories dipping below 5 year average
Jim welcomes Dan Steffens, the President of Energy Prospectus Group (EPG), a networking organization based in Houston, Texas. Dan publishes EPG’s newsletter, “The View From Houston”. Dan discusses his views on natural gas, and lays out the case for higher natural gas prices ahead. Dan and Jim also discuss the energy stocks, and Dan advises investors to look for companies that balance natural gas and oil production, and can switch back and forth as market conditions warrant.
Technician Shelley Moen: This Market Rally Has Legs - All Sectors Are Rising
Also, Ryan Puplava with the Market Wrap-Up, Erik Townsend on Commodities and Rob Bernard on Fixed Income
Jim welcomes back Shelley D Moen CMT, Senior Market Strategist at Vermilion Technical Research, LLC. Shelley tells Jim that this is the best she has felt about the market since the bottom in 2002. She notes the Dow Theory buy signal, and believes this market has room to move higher. Shelley mentions that the Technology, Energy and Industrial sectors are all undervalued and very attractive at current levels. Also in this segment, Ryan Puplava has this week’s Market Wrap-up, Erik Townsend discusses commodities, and Rob Bernard has the Fixed Income Report.
Joseph Dancy: Global Demand For Oil Is Growing Relentlessly
Energy producers have substantially underperformed the S&P 500 Index in the last 12-24 months
Jim welcomes Joseph Dancy, Manager LSGI Venture Fund, and Professor at SMU Cox School of Business in Texas. Joe sees a discrepancy between energy company performance and share prices, as most major oil producers have underperformed the S&P 500 Index. Joe notes that the global demand for oil is rising relentlessly through industrialization and growth in China, India and other developing nations. With record oil company revenues and growing global demand likely to continue, Joe sees a much more positive performance for the energy sector looking ahead.
Dr. Robert Hirsch: Middle East Waking Up To Peak Oil Reality
Doha - The first Peak Oil conference initiated by Gulf State oil producers
Jim is pleased to welcome back Dr. Robert Hirsch, Senior Energy Advisor at Management Information Services Inc. and an authority on Peak Oil. Dr. Hirsch has just returned from an historic peak oil conference in Doha, Qatar, the first ever initiated by Gulf State oil producers. Dr. Hirsch believes there will be a “sea change” coming to the Middle East, once peak oil is reached. The timing of its arrival is difficult to predict, but it will likely be sooner than the global economy is prepared for. He makes the point that most people don’t understand that peak oil is a “liquid fuel problem”, and thus wind and solar technology will never solve the problem. Dr. Hirsch also sees the current projections of future US energy independence as “pure fiction”.
Kurt Wulff: Exxon Is The Rodney Dangerfield Of Oil Companies
Energy stocks outside the US are down and opportunities abound
Jim welcomes back Kurt Wulff CFA, Independent Energy Analyst at McDep LLC. Kurt and Jim discuss energy equities today and Kurt sees Exxon as the Rodney Dangerfield of oil stocks, not getting the respect it deserves. He sees XOM as a must-own anchor of any energy portfolio. Kurt also discusses other energy equities, such as Encana and Suncor. He notes that Encana is a potential takeover target, perhaps by the Chinese. Energy stocks outside the US have been down lately, and Kurt sees many value opportunities in the energy sector.
Don Coxe: American Ingenuity Triumphing Over Government Interference
Bernanke’s Message to Investors: Get Out of Cash
Jim is pleased to welcome back Don Coxe, Chairman at Coxe Advisors LLP. Don sees an emerging shale oil and natural gas boom in the US, which will make it a cheaper place to do business. He sees American ingenuity overcoming government interference. As to commodities, he sees a rally in the dollar impacting commodity prices short term, but he lays out the fundamental case why commodity prices will rise in the longer term. Don doesn’t see the Euro as a viable alternative to the dollar, as Europe’s problems mount. Lastly he notes that Ben Bernanke’s implicit message to investors is “get out of cash”.
Jeffrey Brown on Global Net Oil Exports: Is It Midnight on the Titanic?
Available Global Net Oil Exports Continue to Decline, Outpacing Gains in US Oil Production
Jim welcomes Jeffrey Brown, Independent Petroleum Geologist, creator of the Export Land Model, and ASPO-USA Board Member. Jeffrey explains his Export Land Model, and reviews the major trends regarding availability of oil exports on the world market. Jeffrey also looks at the growing tension between oil production and the rising internal demand of oil-producing nations as well as China, India, and other emerging economies. His overall thesis is that the US oil industry continues to make a serious mistake by providing, in his opinion, wildly unrealistic scenarios for future US and global crude oil production.
Bill Powers: The Risk of Extrapolating Energy Discoveries
Many Shale Oil Plays Are Already Peaking
Jim welcomes energy expert Bill Powers back to the program. Bill notes that energy stocks are now getting a bid, and he and Jim discuss the significance of Freeport McMoRan getting back into the oil business. They also discuss the risks of extrapolating energy discoveries into the future, as many recent shale oil plays are already peaking. They also look at Daniel Yergin’s “Undulating Plateau” and how it may be taking place now, instead of decades from now.
Gail Tverberg: Our Energy Investment Sinkhole Problem
Energy, Efficiency and Financial Stress
Jim welcomes back Gail Tverberg to speak on energy, and they discuss her views on limits to oil supply limiting long-term economic growth. Gail believes the key issue is that global oil supply is not rising very quickly, no matter how much investment is made. Because of this “sinkhole” phenomenon, we are getting less and less back for every dollar invested; or declining energy return on energy invested. Gail argues that the ultimate impact for developed (OECD) countries will be a long-term contraction of their economies. The problem is that our current global financial system depends on long-term growth.
Jim Puplava’s Big Picture: Limits To Growth and The New Normal
Also, “The Gold Market: The Difference Between Gold Bullion and Paper Gold”
In this segment, Jim looks at two more Big Picture topics. In the first, “Limits to Growth and the New Normal” Jim discusses the Petro-Business Cycle, and how we are seeing anemic economic growth, little response to QE, and the future limitations to growth based on the price of energy. In the next topic, Jim discusses the key differences between holding “paper gold” versus holding physical bullion. Jim also answers your Q-Calls in this segment of the program.
Michael Kantrowitz of Wolfe Trahan: Rising Inflation In Second Half of 2013
Expect Record High Gas Prices By May
Jim welcomes back Michael Kantrowitz CFA, Director, Portfolio Strategy & Quantitative Research at Wolfe Trahan in New York. Michael sees the inflationary set-up as the big difference between 2012 and 2013. He expects record high gas prices by May, and sees Chinese economic growth leading to more inflation for US consumers. He mentions a steady stream of early signs of inflation. Michael discusses investing in areas that will benefit from massive central bank stimulation: energy, materials, industrials and technology.
Kurt Wulff: A Long-Term Growth Story In Natural Gas
How to develop your own royalty trust ETF earning 8%
Jim welcomes back Kurt Wulff CFA, Independent Energy Analyst at McDep LLC. Kurt discusses how Canadian energy stocks are at attractive valuations currently. Kurt and Jim also discuss the “war” between rail and pipelines in the transportation of oil and gas, and how pipelines are the much cheaper alternative. Kurt sees natural gas as a long term growth story and, also discusses how he would diversify an energy portfolio.
Jeff Rubin: How To Adapt To A World Of Slow (Or No) Growth
A Rebirth In American Manufacturing
Jim is pleased to welcome economist Jeff Rubin, and author of “Why Your World Is About To Get A Whole Lot Smaller”. Jeff discusses lower economic growth as the “New Normal”, along with high energy prices. He sees rising oil prices in the future making tar sands and shale oil plays economic to produce. Jeff believes OPEC countries will be a less important source of supply in the future as they consume more of their own oil. He sees the North American manufacturing sector as the best investment play, as a rebirth in manufacturing gets underway, reconnecting production to its consumer markets.
Joe Dancy: Saudi Arabia Cutting Back Oil Production
The cheapest place to find oil reserves is now on Wall Street
Jim welcomes back energy expert Joseph Dancy. Joe notes that Saudi Arabia is cutting back oil production, and the US is one of the few areas in the world where oil production is growing. Joe also sees more merger and acquisition activity ahead, as he believes the cheapest place to find oil reserves is now on Wall Street.
Bill Powers: Uranium Price at a Bottom- Last Year of Megatons to Megawatts Project
Rapid Nuclear Energy Development in China and India Will Also Drive Uranium Price Higher
Jim welcomes back Bill Powers, Editor of Powers Energy Investor. Bill believes the price of uranium has bottomed due to fundamental factors. This is the last year of the Megatons to Megawatts Program between the US and Russia, which provided a large supply of uranium into the market. Bill also notes rapid development of nuclear energy plants in both China and India, as well as plans in Japan to re-start the Fukushima nuclear facilities. Bill also sees tremendous value in small and mid-tier energy companies, and believes we will experience higher oil prices later this year.
Jim Puplava’s Big Picture: Navigating The New Normal – The Petro Business Cycle
Also, “Looking For Yields In All The Wrong Places”
In this week’s edition of the Big Picture, Jim’s first topic is “Navigating the New Normal – the Petro Business Cycle”. Jim looks at the best way to survive and thrive in a world with more volatility and rapid business cycles. His next topic is “Looking for yields in all the wrong places”. Jim discusses how to avoid the pitfalls of reaching for yield in a zero interest rate world.
Jim's Big Picture: Looking Back at the 2012 Stock Market
Also, "The Housing Sector Is Getting Stronger" and "Is Shale Oil the Savior of US Energy Woes?"
In this special year-end edition of the Financial Sense Newshour, Jim looks back at the 2012 stock market and evaluates its performance. In the next topic, Jim looks at the recovering housing sector and the reasons behind it. Lastly, Jim covers the topic of shale oil, and if it could be the savior for our energy woes.
Jim's Big Picture: How the Petro Business Cycle Affects the Economy
Also, "The New Economy Is Tax, Inflate, and Spend, But No Reform"
In this segment, Jim looks at the Petro Business Cycle and how it affects the economy in a significant way. In the next topic, Jim asseses the “new economy”. It will involve more taxing, inflating and spending, but likely little or no real reform.