August 31, 2006: Oil

I do not believe that now is the time to buy oil (on price retreats). Oil has lots farther to go on the downside before the buying should begin. If you do not trust this opinion and still want to play the oil game, look at one of the Canadian oil sands trusts where you will receive a decent yield for your risk, or a driller. I like the driller CPX .It has good upside potential that excellent management provides. PEO provides a conservative cushion as it holds stocks other than oils to mitigate risk. PEO also provides a nice total return via dividends, especially in December. I think it would be a nice addition to tax deferred accounts.

Oil is going down for several reasons. Here are a few: Oil use is not growing as fast as predicted, Democrat gains in November will ease tensions of conflict in oil-producing areas (some would call it cut and run - I agree, but let's play the cards we are dealt), a slower economy, more efficient refining techniques, more rigs in use (with more huge rigs now shortly to be completed) and OPEC pumping oil as if there is no tomorrow to prevent a larger exodus to alternative fuels.

The point being: Oil is not going to $100.00 the barrell, or $80.00 the barrell. It is more likely to be at $45.00 than $75.00 the barrell by January.

Where should you put money taken out of oil stocks? If you still want energy, I say look at MDU, CHK, LNG and ETP (on a pullback to 42). ETP is a limited partnership that has been a superior performer and looks great for the future. It has a rich dividend. Or, Smithfield Foods on a modest pullback. SFD happens to have a large biodiesal operation using pig poop. Or, buy it because it is a superior company in less rancid operations.

August 28, 2006: Stocks to consider

There are a few stocks which I believe warrant your attention:

Look at Canadian Banks for a nice overall return with little downside risk at present. Although many analysts would not make the following bank their first choice, I would. The Bank of Nova Scotia (BNS) is a large, international, lightly traded consistant performer. It has a growing presence in China and has made important inroads into Asia, South America (especially mortgage banking in Mexico - a very lucrative and unexplored area for profit) and, of course, Europe old and new. It has low exposure to the US dollar and has appeared to manage risk vrs. reward. I have owned the stock since 2002 and see no reason to sell, as the fine management is intact and hitting on all cylinders. It is trading around 44 and would be a good choice on a pullback, as it has run up a bit the past few weeks in anticipation of an excellent earnings report (again).

Fortune Brands (FO) has underperformed due to a perceived heavy emphasis on home hardware products. This company is much more than that - ask Mr. Jose Cuervo. I bought the stock following a precipitous dip months ago into the low 70s, where it has flatlined. I would buy it right here for investment, not trading (same with BNS). IBI, another conglomerate trading around 23, would also merit strong investment consideration here. Both companies have international exposure as well as a US presense.

I mentioned Smithfield Foods (SFD) in an earlier post. This is a good news stock, for sure. They have been buying assets on the cheap and I anticipate both more intelligent acquisitions and a nice 2007 earnings report.

The point being: Although these are defensive position stocks they are also poised for growth, even as our political structure and lax attention to the Islamic/Russia/China/North Korea/Iran/Venezuela/Cuba/Bolivia/Iraq/Syrian/UN "hate USA" cartel goes beyond the intellectual comprehension of our Democratic Party friends and their far left minions continues unabated. There is only peace through strength and the willingness to use it.

August 27, 2006: Browne Reprise

Ruminating on a bit of Harry Browne yesterday brought in a few e-mails from friends, some pro, some con. One sent over an article originally published a few years ago under a web site which Browne controlled. It relates to the environment, and I urge everyone to read it in total, as it presents a splendid and logical argument on how to resolve most environmental problems, www.harrybrowne.org/GLO/Environment.htm#Autos

The point being: The private sector is the best avenue to travel when addressing national issues outside of national defense.

I am humored by the amount of charts, "studies", financial planning- talking mouths on radio and tv who miss the big picture on investments. NOTHING MATTERS without the strong projection of power and the decisive military of the United States that is not diminished by appeasement or the template of the present Democratic Party(cut and run).

A couple of decent stocks to take a look at are FERRO and GOODRICH. If MASSEY gets its act together with new management, it could be the best coal play in the sector.