Exxon Makes Giant Discovery
Research for Online Investors

by John Dalt

3/18/09

Wholesale prices rose in February, by 0.1%.  This was the second straight month of increase according to the Labor Department.  Producer Prices were led by an energy increase of 1.3%  As of the last 12 months, the PPI is down 1.3%

One of the market sectors I watch is ‘renewable energy’; you can be crucified if you think the money is easy.  I was reading a blog, about cap and trade, renewable tax credits and other government mandates and incentives. They gleefully pointed out, “ It will create a guaranteed market for clean energy and related infrastructure. The government is mandating it. It would be like if Congress guaranteed Coke an increased percentage of the soft drink industry or mandated that Apple maintain a certain share of personal computer sales. These are government-sponsored profits .” 

This makes me sick,  it highlights what is wrong with a state directed economy , this is “mommy may I” on a grand scale.  If you have not read “Atlas Shrugged”, better grab a copy.  I am putting up a sign in front of the house “Galt’s Gulch.”

Oil was trading down today after a great run up.  You may remember when PBR discovered the Tupi oil field off the coast of Brazil last year.  It was hailed as the Western Hemisphere’s largest discovery in 30 years.  News is coming out that Exxon and Hess oil, with PBR as a minority partner have made a giant discovery in deep water.  You can read the article here.  When the world economy recovers, we are going to face an oil shortage and price increases.  Discoveries like this are great news.  Most oil companies are pulling back exploration, Exxon is like the energizer bunny, and they just keep going and going.  Rather than be criticized they should be praised for their foresight, and execution.

My daughter was lucky enough to work for a great privately held resource company.  One of the richest men in the world owns it.  He made no secret of his admiration of Exxon as one of the great companies in America.  You could do worse than owning this company.  They are truly one of the backbones of America.  Sadly, Washington will do everything to paint them as the enemy, just because they make money!

We have posted a video with Alan Keyes on our site. It is located under Diversions. You can watch it here. Good stuff.

Check out the Nation Wide Tea Parties planned for April 15 This is Newt Gingrich’s American Solutions.  There is a growing discontent with the direction OH! Bama wants to take the country.

There is a good article in The Wall Street Journal about Barney Frank's plans to increase regulations on the financial sector. He wants to designate certain institutions ‘too big to fail’ and implement tighter regulations on their operations. The unintended consequences of this lead the author to argue, “Congress is the Real Systemic Risk.”

While you are at the Wall Street Journal, you might check out the article about NAFTA. It is from Mexico’ Ambassador, concerning the end of cross border trucking between the U.S. and Mexico. Language inserted in the Stimulus Bill defunded the ‘test’ program. This was a payoff to the unions by the Democrats. Now that the democrats are in charge, they had better grow up, or we will have trade wars with more than Mexico.

This morning the market trended down. Even a drunk has to take a break after a few days. The market was overbought and needed to work off the hangover. Everything was proceeding on a predictable path until the Federal Open Market Committee (FOMC) issued their report. Interest rates did not change, but they announced they would buy $300 billion in treasuries in the next six months and start buying mortgage backed securities! Within two minutes, the Dow went from down 60 to up 150! Gold, financials, builders, and oil jumped. The dollar and interest rates dropped. We just became more oversold. “Irrational exuberance” could be used to describe today’s action. Tomorrow should shape up like today started. 

The information presented in this newsletter is based on generally available news releases, corporate filings, current events, interviews and the editor’s opinions.  It may contain errors and you should not make investment decisions based solely on what you believe you have read here.  Do your own research, it is your money.  If you lose it, it is your responsibility, not ours or your grandmothers!  The editor may or may not have a position in any securities discussed.  The editor may have held a position in a security earlier, or in the future.

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