24
Apr

Wrap – Week Ended 4/22/16

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The ZLT was up 9% last week and is up 21.5% year to date. The XOP was up 8% leading a strong energy group and is up 17% year to date. 

We added to the Core position in CPE last week prior to their acquisition and offering announcement. 

The Blotter is updated. 

Questions and comments under The Wrap will be addressed in the Monday post. 

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wrap 042216

4 Responses to “Wrap – Week Ended 4/22/16”

  1. 1
    Baylor Says:

    How's this for some hyperbole (from the Motley Fool):

     

     

    April 24, 2016

    Dear fellow Fool –

    Did you ever think that in your lifetime you'd see the end of oil?

    What was once an unthinkable idea… suddenly isn't so crazy.

    I've included a chart of oil over the past couple years and it's ugly. We're pumping too much of it, and demand isn't rising fast enough to keep prices up.

    I'm not certain that situation will improve in the next decade either… In fact, aside from the odd price spikes here and there, I think it might actually get worse.

    Price of WTI Crude Since the Beginning of 2014

    Data from Bloomberg and S&P CapitalIQ

    And make no mistake, the world is preparing for the end of oil. This week 980,000 customers of Businessweek opened up their mailbox to see a picture of the Crown Prince of Saudi Arabia staring at them on the cover.

    The message plastered over his face? That he's preparing his oil-rich – and dependent – kingdom for the end of oil.

    The party sure was fun while it lasted, but it's looking like last call.

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    The impending decline of oil has been shocking news – few expected the extent of its fall in recent years.

    And here's my advice: if even the Saudis are preparing for a world where oil is going away, you should really start looking for investing ideas around that theme.

    Because, capitalism and the stock market are built on an idea that's very messy in the short term…. and beautiful and wealth building in the long run: creative destruction.

    Creative destruction is the process by which old parts of the economy need to be destroyed to make way for new ones. It's the basis for why the world has nearly continuously gotten better for hundreds of years.

    And every day it's looking more and more like oil might be its next victim.

    The upshot to creative destruction is something will rise to take the place of oil. In-the-know investors out in front of this trend can potentially accumulate great amounts of wealth.

    Consider the case of lithium carbonate. Ever heard of it?

    If not, that might be about to change, because Goldman Sachs just called it "the new gasoline of the 21st century."

    While the price of oil has collapsed in recent years, the price of lithium has exploded. The reason is simple: lithium is a key component of the batteries in cars like those from Tesla that don't use oil at all.

    Here's a chart of lithium's recent price movements. It's shocking.

  2. 2
    Baylor Says:

    http://www.bloomberg.com/news/articles/2016-04-24/oil-bulls-plunge-into-market-as-u-s-gasoline-demand-hits-record

  3. 3
    Baylor Says:

    Z when you said Bcei was trading like somethings was going to happen last week, what did you mean?

  4. 4
    zman Says:

    re 3 – large percentage price swings on good volume often indicate expectation of notable news, in this case potentially a debt reducing monetizaiton we've been waiting for. 

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