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Investment Research Since 1978

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Archives for December 2012

What We’re Reading 12-28-12

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High-Frequency Trading Prospers at Expense of Everyone, The Editors, Bloomberg Warren Buffett Knows That Tax Rates Matter, Clifford S. Asness, Wall Street Journal Leszek Balcerowicz: The Anti-Bernanke, Matthew Kaminski, Wall Street Journal The Federal Government’s Biodiesel Mandate Ensures Higher Prices All Around, Robert L. Bradley, Forbes … [Read more...]

Confidence Cause for Concern

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The Conference Board released the latest Consumer Confidence numbers this morning. The Consumer Confidence Index tumbled to 65.1 in December compared to a downwardly revised 71.5 last month. Consumers are apparently alarmed with the incompetence of their elected officials in Washington. Four days until year-end and the fiscal cliff is still not solved. Higher income earners who are going to take the brunt of the pain from the fiscal cliff reported the biggest drop in confidence. These are the same consumers who account for well over half of all discretionary spending and who own the … [Read more...]

Another Recession on the Way?

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Since at least 1973 all major dips in total American energy consumption have been associated with recessions. Consumption crashed after the recent Great Recession to the lowest levels since the late 90s. After bottoming out in September 2009, consumption was trending upward until April 2012 when it fell sharply once again. Since a post-recession peak in January of 2011, American energy use has fallen off (chart 1). The question is whether or not falling consumption is caused by an economy sagging toward a new recession, or by structural and technological changes in the American economy that … [Read more...]

Oil and Gas: More Revolution to Come

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The biggest revolution in the American energy industry is taking place today. In the chart above, you can see that natural gas is gaining on oil as the largest source of primary energy consumed in the United States. Two factors are at play. The first is the revolution in shale gas drilling that has made major new resources of gas available for consumption. The second is the decline in the consumption of petroleum fuels in America, which peaked in 2005. But there is more revolution to come. Shale oil deposits in North Dakota are being unlocked by the same technologies that have supplied … [Read more...]