They say there will be no more oil by the year 2030 however, at the current rate of buybacks there will be no more AMAT by the year 2020.
There’s huge amounts of oil around; it’s just a matter of price. Anyway, buying AMAT on an oil depletion play is a pretty long time horizon. What if we all have Mr Fusion reators by then?
JoeyDVivre Wrote: ------------------------------------------------------- > There’s huge amounts of oil around; it’s just a > matter of price. Anyway, buying AMAT on an oil > depletion play is a pretty long time horizon. > What if we all have Mr Fusion reators by then? Yeah, and they’re selling Deloreans again…for under $40 or 50K, with something like 75% of the original parts in them. All I’ll need is a flux capacitor…and hello 1955!
I didn’t mean to imply that I thought AMAT could build enough solar panels to replace oil, what I meant was that everybody is buying oil cuz they think we’re running out yet it looks like we are running out of AMAT shares. It’s just a thought not a pair trade.
I think there will lots of oil left by 2030 due to the high number of potential substitutes, including solar as referenced and potentially hydrogen, wind etc. There are many different opportunities to move away from fossil fuels with the right inititative being taken by both the private sector and even grudgingly the government. We alre already beginning to see that in a big way I think in terms of public opinion and company investment. So I guess I would say, yes, it is a good trading idea, because these are going to be the types of companies that build the “green” infastructure of tommorow and will likely ensure that there is lots of oil left, and will leave alot of tinfoil headed peak oil theorists in the dust. But what is going to be tough, if not impossible to substitue is base metals. If 20 million or so Chinesse people are urbanizing a year (I admit most live in tent cities from what I understand for the first few years) how much copper, zinc, aluminium etc. is that going to require for buildings, cars, subways, highways etc. Obviously that rate of growth will have to slow, but the point is as so many people in the world (China and India esp) will be demanding metals to build the traditional infastructure that we take for granted…and I can’t think of any way they can do so without vastly tipping the demand side for minerals. These are in finite supply on our planet. We’re already beginning to see the state of things to come with people (risking their life) steeling copper from power lines etc.
If an oil company was blowing down reserves as fast as AMAT is buying back shares then you wouldn’t own the oil company, it would be called a canroy.
CFA_Halifax, I like your analysis. I’ve been trying to think through what emerging markets are likely to do after they stop selling so much to the american consumer. I don’t think that China is quite so vulnerable because they are the cheapest things out there still, and Americans in a recession are going to continue to need cheap things. Still the question is what are they going to do while the US consumer is down for a number of years. They may try to sell to themselves, but what is it that they will sell and buy. It could be that sovereign wealth funds may step in in a slowdown and start making key investments in local infrastructure, even if the financial risk-return isn’t as good, many funds are going to have political influences on investment policy, and some options may even be good. So yeah, EM infrastructure and feeders back into the supply chain it is probably a good bet.
Moving slightly on from the investment side (but then coming back!), Hydrogen, wind and solar are all pretty much dead ends in the vast majority of areas. Hydrogen is a really rubbish fuel. Storing it is nigh on impossible (or very expensive) - if you left your car over the weekend, it would be empty on monday - and possibly will have blown up your garage! The energy density per unit of volume is rubbish (less than a third of that of diesel, even when liquified) - which means that when you fill up your tank, you get less than 1/3 as far as you would in a diesel. It also needs to be produced - most hippies agree that by producing it from electrolysis of water with a clean power source (wind/solar) you can have 0 carbon emissions. This is nonsense - you won’t get enough power from either of these sources to get enough hydrogen for a standard gas station. So you are left with nuclear - which means you either need to transmit that energy to the gas station (transmission losses, massive infrastructure upgrade) or you need lots of smaller local nuclear power stations - not necessarily a good idea. So let’s forget hydrogen for anything other than powering rockets. Wind is rubbish, because you can’t rely on it. When there’s too little (or too much) wind, turbines produce nada. This means that 100% of the generating capacity of wind needs to be backed up by another source - natural gas, coal or … nuclear. If it’s backed up by natural gas (which is better because you can easily turn it on and off, unlike a coal one) then you still have plenty of carbon emissions, you are still beholden to Russia if you are European, and you have the expense of duplicate infrastructure. On the whole, sites that are suitable for wind power are not on the national grid, so more expense. If it’s backed up by nuclear, then what’s the point of the wind turbine? Solar only works on sunny days, during the day. We’re still rubbish at storing power. So forget that. Biofuels? Ethical problems of stealing a chapati out of the mouth of an indian/mexican etc to stick in your SUV are a problem with grains (and they are really inefficient crops in terms of energy/area), Sugar cane might be workable in Brazil/Australia for ethanol. Not worth it elsewhere. Also biodiversity issues. Fusion power? I very much doubt it. The technical obstacles are massive still, despite the monstrous amounts of money poured into it. Read the wikipedia article for the problems with the different fuel cycles. So what does the world need to power itself without carbon emissions? Nuclear. It’s the only realistic option. So buy companies that build nuclear power stations, and in 25 years or so (when they are all on stream), buy Uranium miners. That is all.
Solar and biofules are not rubbish alternatives. Currently maybe, but with increasing developments in bioengineering and nanotechnology they are becoming viable alternatives. I don’t see any ethical concerns using cellulose ethanol from wood and farming waste. (cellulose ethanol currently under development). If you are a science geek and follow h-itech and biotech industries you probably know who Craig Venter is… Have a look at this: Famed geneticist creating life form that turns CO2 to fuel http://news.yahoo.com/s/afp/20080228/ts_afp/scienceusitgenetics;_ylt=AptyWwW1wiZRtcLis2t1pq8PLBIF
^ also solar thermal can store the energy as heat pretty efficiently
bchadwick Wrote: ------------------------------------------------------- > CFA_Halifax, I like your analysis. I’ve been > trying to think through what emerging markets are > likely to do after they stop selling so much to > the american consumer. I don’t think that China > is quite so vulnerable because they are the > cheapest things out there still, and Americans in > a recession are going to continue to need cheap > things. Still the question is what are they going > to do while the US consumer is down for a number > of years. They may try to sell to themselves, but > what is it that they will sell and buy. > > It could be that sovereign wealth funds may step > in in a slowdown and start making key investments > in local infrastructure, even if the financial > risk-return isn’t as good, many funds are going to > have political influences on investment policy, > and some options may even be good. So yeah, EM > infrastructure and feeders back into the supply > chain it is probably a good bet. bchad, I think we are already beginning to see the emergence of a fragile consumer culture in China. Remember America got her start by selling mainly raw goods to Europe…
bartok Wrote: ------------------------------------------------------- > Solar and biofules are not rubbish alternatives. > Currently maybe, but with increasing developments > in bioengineering and nanotechnology they are > becoming viable alternatives. Here we disagree. I don’t see them as viable for producing any sizable fraction of our power needs. The only reason they currently exist is by dint of government subsidy. > > I don’t see any ethical concerns using cellulose > ethanol from wood and farming waste. (cellulose > ethanol currently under development). a) lignocellulose production isn’t anywhere near viable technology yet (producing just as much CO2 in transportation and processing as not bothering at all) b) the competition from fuel crops will lead to reduce food crop production, massively increasing the cost of food. Bush’s current strategy is nothing to do with Carbon emission reduction and everything to do with being a sop to farmers. > If you are a science geek and follow h-itech and > biotech industries you probably know who Craig > Venter is… Someone who owns a company that claims to turn CO2 into fuel. > > Have a look at this: > > Famed geneticist creating life form that turns CO2 > to fuel > http://news.yahoo.com/s/afp/20080228/ts_afp/scienc > eusitgenetics;_ylt=AptyWwW1wiZRtcLis2t1pq8PLBIF As Lewis Page in el reg points out, “It would, theoretically, be really great if new saltwater algae tech could effectively turn vast tracts of sea into mighty solar collectors, storing power in handy jetfuel form even as they sucked carbon out of the atmosphere. But nobody’s really even offering this sort of thing yet. And hundred-mile burgeoning slicks of genetically-modified green scum do seem, in some lights at least, a bit more like ecological disaster than ecological salvation” You didn’t come back on the solar “only during the day, whilst it’s sunny” problem. Might be useful in California/new mexico/texas/northern Australia where there is a correlation between hot sunny days and electricity demand (air con), but not much use in the UK or most of Europe, Russia, Canada, China etc. buddha: > also solar thermal can store the energy as heat pretty efficiently No it can’t. You can’t store the surplus energy generated by wind turbines! You are talking massive amounts of energy here. Say you have a 100MW wind farm and you want to store the energy it produces in an hour. 100MWhours = 360 GigaJoules. If you store that as heat, you will have some kind of small sun knocking around, or you would need to heat 6 Billion litres of water by 60 degree celsius. That’s about 2500 Olympic sized swimming pools. References: http://www.theregister.co.uk/2008/02/13/science_biofuel_reports/ http://www.theregister.co.uk/2007/11/01/biofuels_warning/ http://www.theregister.co.uk/2008/02/25/virgin_747_coconut_yes_algae_no/
^oh and yes, there are few things I won’t do to avoid Analysis of Multinational Operations
Is there some reason you couldn’t say pump water up a mountain to store the energy? Seems to me that this is about 45M gallons of water 1000 ft. That’s a bunch of big pumps, but much cheaper than the cost of the wind farm.
there is a big difference between our oil dependence and our energy dependence. we can create a lot of electricity via nuclear, hydro, solar, etc. But, we can’t create a lot of oil which is so essential to transportation. If and when plug in hybrids become common there will be a lot of relief from oil. But, until then it is just very hard to replace oil as the energy source for transportation. Solar, wind, nuclear, are not energy replacements for transportation today.
JoeyDVivre Wrote: ------------------------------------------------------- > Is there some reason you couldn’t say pump water > up a mountain to store the energy? Seems to me > that this is about 45M gallons of water 1000 ft. > That’s a bunch of big pumps, but much cheaper than > the cost of the wind farm. No reason. In fact it’s what is currently done: http://en.wikipedia.org/wiki/Pumped-storage_hydroelectricity But you are limited in the number of sites that are suitable - once the numbers become large enough (as they will if you want to produce significant amounts of power from wind), you run out of sites… PS. As to oil dependence - 68% of US oil consumption is transportation related (including aviation, diesel for trucks etc, tyres). Eliminate other uses of oil and you go a long way towards fixing it… PPS. There are some cracking stats here: http://www.eia.doe.gov/cneaf/electricity/epa/epat1p1.html
chrismaths, I agrree with you that there are no technologies available currently that can replace dependence on oil. I think that you are being a bit too pessimistic as to say that no alternative energy source will be able to replace oil in the future. There’s quite a great amount of research being done in biotech and nonotech (I will use those as a catch all terms). I think you underestimate power of R&D within our top schools. Fusion, it may not be economically feasible right now but how can you possible say that the investment in R&D will not resolve the current problems in the future. And yes, all the points you have brought up about the current faults of those technologies are valid and I am aware of those. I tend to follow industry and academic developments almost on a daily basis and I must say that I am much more optimistic about our ability in finding new potential solutions to energy for living and transportation problems. Here is some fascinating research… http://www.physorg.com/news124111555.html http://www.physorg.com/news120840565.html http://www.physorg.com/news121085616.html http://www.physorg.com/news117206327.html