Sunday, April 03, 2005

Hey Mr. Dinosaur(juice)

Fifty million years ago
You walked upon the planet so
God of all that you could see,
Just a little bit like me
Walking in your footsteps
Walking in your footsteps

Hey hey, Mr. dinosaur
You really couldn't ask for more
You were God's favorite creature
But you didn't have a future
Walking in your footsteps
Walking in your footsteps

Hey hey, mighty brontosaurus,
Don't you have a lesson for us
Thought your rule would always last,
There were no lessons in your past
You were built three stories high
They say you would not hurt a fly
If we explode the atom bomb
Will they say that we were dumb

Walking in your footsteps
Walking in your footsteps

Above lyrics: The Police, Walking in Your Footsteps.

Let's hope we do better than the dinosaur, eh?

Donald Coxe is Global Portfolio Strategist with BMO/Harris, and this is some of his latest, entitled "BIG FOOTPRINTS ON THE SANDS OF TIME and little footprints of Fear".

I recommend you read the whole thing, but I'll touch on a few points and highlight a few of his quotes:

- Recommends reducing equity exposure to 45% (5% above his minimum).

- "Enthusiasm for the commodity stocks and dividend-oriented stocks remains undiminished."

- Observes that as a result of the ongoing scandals with major corporations, people are losing faith in the market, and this historically has led to bad markets.

- Presents some strong charts of various metal oriented producers, but doesn't really come to a conclusion either way whether this will continue, especially if China and/or India cool off.

- On oil, he believes that because Saudi Arabia's new oil is mostly in the form of heavy, sour and much of their 'new' production is really supplanting declining production in other fields (including Ghawar - the mother of all oil fields), it's a harbinger of the fact they are past peak.

- "from here on, energy demand can only be constrained by runaway prices"

- "With OPEC's excess capacity apparently tapped out, oil consumers have lost their security blanket against petrochills, and oil traders and speculators have the largest-scale commodity free market the world has ever known."

- "However the powerful performance of oil stocks has meant that Street strategists have a new arguement to back the recommendation they've been making most of the time for three years; sell overpriced oil stocks and buy cheap tech stocks. Since the oil stocks are way up from the prices the Street recommended selling them, then they must be the new bubble."

- Mentions oil sands and a new process Opti Canada and Nexen have developed (Peter Thiel is smiling here, I'm sure) that - may - further decrease the cost of production to single digits at the wellhead.