Magic rabbit, page-8

Hi doyle

If you go back and read my posts you will see that I have always declared myself as not holding TLU stock. The first comment of this “magic rabbit” thread (which I started) opens with the words: ‘I began looking at TLU as a possible buy. The more I looked, the more I wondered what else could go wrong with this stock? [most reasonable-mined people would conclude I was not about to buy]Now I'm curious as to how it will survive the macro events.’ [most reasonable-mined people would conclude I was definitely not about to buy] then I ask the question: ‘So who is game enough to tip in more cash? Mmm 0.002 cents not tempting?’ I then rhetorically respond to my own question ‘Not me!’

Doyle if you did not pick up on what I was meaning then perhaps you missed the obvious fact that it could never be anything but a rhetorical question. Since I declared truthfully that I did not hold TLU stock at the bottom of the post. The only thing that has changed during my posts on TLU has been my sentiment towards this stock. I now firmly hold the view that given the immediate difficulties (what you call “issues”) and the macro forces at play that this is a stock to avoid.

I hold certain stocks which I follow on HC. I also follow, while I research a possible buy, stocks that I do not and may never hold. From time to time I do make observations on these non-holding stocks. Why? (broosta asks rhetorically). Because I seek other people’s observations, opinions and knowledge to improve my own understanding of these potential buys. I also offer ideas and perspectives different to holders of that stock so they have an opportunity to add to their understanding – if they so choose and I have the opportunity to have my ideas and observations tested (in this instance) by TLU holders.

You may think TLU is a worthy stock. I disagree. You may think the current capital raising is a great opportunity to add cheaply to your current holding. While I look beyond the current short term gain of a stock; I am not comforted by what the future might hold.

I agree ‘onshore drilling for conventional oil is the cheapest form of production.’ But I don’t see how TLU could possibly come close to the $20/barrel mark of those who now have billions of billions of petrodollars (mainly Saudi Arabia) earned thanks to the peak of the market. And who are currently and deliberately selling it at a price well below the long term historical average. We may even see Saudi Arabia sell at below cost to bankrupt higher cost competing countries. i.e. Russia, Venezuela and the oil sands of US and Canada.

In this sense, I look at how the plunge in the oil price will play out for certain companies. I ask myself questions like: how it will affect the company’s share price, its ability to raise future capital and for some micro stocks their ability to simply exist? I trade on the stock market to strategically increase my very modest level of wealth. And while I trade I am always very, very mindful of how easy it is to lose money on a bad trade no matter what stage of the investment cycle or what colour the sky happens to be.

I’ll end by pointing you to a post that is an example of the kind of HC’s information/ideas flow that is invaluable to me. It’s a big picture perspective offered by this relevant poster (her point 2 is worth investigating):

http://hotcopper.com.au/threads/you....2431682/page-5?post_id=14511899#.VLoUGi4-6Pd

All of the above is my opinion. It is nothing more than general and personal ideas of investing that sometimes work for me.

DYOR. The whims and fancies (and occasional gripes) of others will never make you rich.