Something to Invest in…

Just read this article (http://seekingalpha.com) about water being the resource of the future. I see the author’s point but I don’t agree – at least I wouldn’t put my money in water. There is too much of it, and if it ain’t clean right now, then cleaning it ain’t rock science. Once we run out and prices go up, folks will figure out how to produce more clean water real quick.

This article about investing in oil makes way more sense. To build our future on oil is crazy. Such excess will smother the planet. But for as long as it’s legal at least, people will keep drilling for oil. That oil is a limited resource is no longer true once prices keep going through the roof as they have been doing. Demand drives up supply. No, not even that is true. Speculation drives up prices which drives up investment and exploration for more reserves. At $110 a barrel, there’s enough oil in the ground to keep us going for a long time, unfortunately long enough to make climate change inevitable.

Similarly, much of the gold frenzy right now will go up in smoke once the big bang has come and gone. None of the recent activity with gold would be sustainable at prices that were normal just a few years ago. A whole industry of recently spawned gold companies will be wiped out once again when gold dips the other way. It’s the fact that 7 years ago, you couldn’t make money producing gold @ $300/oz, although you may have known about many “deposits” (speak inferred resources) containing gold with >$300/oz production costs… now an ounce gold fetches almost three times that much. So out of the ground has become feasible. People aren’t using more gold. Few people actually use gold. This gold is a recession hedge, and once the economy is out of the woods, the glut in gold will be worse than before, and prices will tumble. – Admittedly, I probably have no idea what I’m talking about. 🙂

Much of what you read about the economy right now is ridiculous. Are we in a recession ? Are we through it? Is this the time to buy ? Who cares about where we are on the curve of the stock market. It says little about the general state of the economy at large ! Everything seems to be out of whack in the macro-picture. Are you suffering yet ? Didn’t think so. Which means the big bang is still around the corner.

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