Behind the Headlines

Ditch and Switch: What Turmoil in Oil Means for Stocks

Stephen Leeb
Tuesday, December 2, 2014

Is the recent tumult in the energy sector a sign that investors should flee energy stocks? The quick answer is no. The turmoil does, however, give investors an opportunity to ditch some of the weaker and more poorly positioned players—mainly companies whose operations are concentrated in North America—and switch into the much stronger international entities.

In most cases this means shifting from producers to service companies and in particular getting out of companies in the business of domestic nonconventional oil production, aka the frackers. Even more critical to avoid are... Read more about Ditch and Switch: What Turmoil in Oil Means for Stocks

China's Continued Success-- 2 Possible Winners and a Potential Disaster

Stephen Leeb
Wednesday, October 15, 2014

China's growth this year, which could be around 7 percent, looks a bit lower than I expected. On the other hand, the country's 2013 and 2014 achievements paved a road toward rapid future growth that far exceeded my very high expectations. Given these facts, I think China's growth for the rest of this decade will likely exceed 7 percent, be much more balanced, give it complete hegemony in the Far East and bolster a currency increasingly able to rival or surpass the U.S. dollar as a worldwide reserve currency. For investors, the implications are enormous. I'll focus here on two potential... Read more about China's Continued Success-- 2 Possible Winners and a Potential Disaster

Energy Keeps Chasing Its Tail

Stephen Leeb
Monday, August 18, 2014

This summer gas prices on the East Coast hit the highest levels in six years, according to the EIA. In fact, for only the second time ever, average U.S. gas prices topped $3.75 a gallon.

It’s jarring that this comes despite two things that seemingly should lead to lower prices: huge gains in U.S. oil production and lower demand for energy because of more energy-efficient cars, appliances, and so on. In fact, according to BP, energy supplies worldwide—encompassing everything from oil to geothermal—have been rising by 2.5 percent a year since the century’s start, around the fastest... Read more about Energy Keeps Chasing Its Tail

Appointment in Samarra

Stephen Leeb
Friday, June 20, 2014

While U.S. oil production keeps climbing, it’s clear that even if, as the fracking bulls predict, we become the world’s largest oil producer, it won’t make us energy-independent.

Fracking optimists argue we can boost production by 2 million or even 3 million barrels a day. Even if true, however—and we doubt it—we’d still be well short of what we need. That’s because, by a monster margin, we’re the world’s biggest consumers of oil, and the largest gains foreseen by the bulls wouldn’t suffice to meet our demand.

Morever, the cost of the additional barrels produced from fracking... Read more about Appointment in Samarra

Energy Weakness and How to Profit From It

by Dr. Stephen Leeb
Wednesday, May 28, 2014

Recent figures released by the International Energy Agency (IEA) show how much rides on the U.S. ability to keep oil production from North American shale deposits rising. And that’s worrisome.

While the figures didn’t suggest any immediate pressure on oil prices—good news for stocks over the near and intermediate term—they did indicate that the balance between supply and demand has tightened somewhat, as the agency revised upward their forecast of global demand for oil. Meanwhile, supplies have remained in check due to political upheaval in Libya, Nigeria, Iraq and Russia.

... Read more about Energy Weakness and How to Profit From It