Exxon Mobil, they must have a lot of cash

When the news that Exxon Mobil Corp., the biggest oil corporation in america, wants to buy the XTO Energy Inc for $ 31B a whole sector turned on the stockmarket. I was very happy since one of my biggest possessions, QEC popped more than 8% and the index for oil and gas producers climbed 6,4% in average, but I realized that this would have to be analyzed. This offer from Exxon (ticker XOM) values XTO with a premium of 25% from the price it closed in the friday market, and it turns out to be the largest energy acquisition since 2006. Advisors in this purchase will be JP Morgan Chase & Co and Barclays Plc, well I guess Goldman Sachs have to miss out on some assignments. Exxon Mobil has been sitting on a pile of cash during the financial crisis and has also bought back $ 200B worth of their own shares, so theres has been a massive speculation what they've been planning to do with it - Now we have the answer.

The attentive investor could've been starting to speculate a month ago when Senior Vice President of Exxon Mobil, Andrew P.Swiger presented the companies view on forthcoming demand of global energy - "The global energy demand will rise 30% by 2030 and gas will increase twice as fast as demand for oil and will also surpass coal as the second largest energy source."

XOM (Exxon Mobil) fell 4,3% on this information, and I must be honest - I feel tempted to buy. Citigroup fell 7% today since they announced their plan to repay the taxpayers by selling equity and debt. I feel tempted to buy this stock too.
Both Citigroup and Exxon has been on my surveillance list for a while now, I've said to myself that I will go long in C when it reaches 3,50 and Exxon by 65. I think that these potential purchases will be good in the longterm but only one can tell - Time.

SAAB, will it go during the after-christmas sale?

Todays statement gave a few more drugs to an already pumped up question. No doubt about it, SAAB is one hell of a company considered being a black and endless hole for leaking money. General Motors has recieved expressions of interests, just hope it's not from the Swedish government. So who could this prospective buyer be? Since the critics from the opposition over the actions from the Swedish government has attacked us during the last couple of weeks we can only suppose that the one behind this expression is no other than Mona Sahlin, Lars Ohly and the pathetic ones from the Environmental Party (Don't get me wrong, I like the idea of an environmental party in politics, but the leaders are worse than a Snickers bar to a nut-allergic). Maybe they have formed a syndicate using the same wallet that provided Göran Persson with the estate Torp.

Let's hope that this long-shot turns out to be a bulls-eye, because I would love to see those socialists trying to make a profitable company out of SAAB. They have been able to do the reverse with a couple of other companies so they know that routine.

All jokes aside, I personally think that todays decision was great for everyone working at SAAB, let's hope that they will at least "keep the boat floating" for the rest of the year. Although the development in this issue will probably be that a chinese company will buy the assets and try to move it to China. The good side of this coin is that people will be able to keep their jobs for maybe a few years longer, but in the long-term it looks more like the swedish automobile industry seems to follow the shipyard industry.

New Company in the Portfolio

Questerre Energy Coproration, I have considered this stock for a long time now and today i finally bought a few shares. I think that the price fell according to the general fall of the stockmarket in Oslo. I payed 12,60 NOK for the shares and I see a great possibility that the stock will break it's resistance of 13,20 NOK, perhaps already tomorrow. I considered the falling price on shalegas but in the long run I'm not that scared when it comes to Questerre. The stock has consolidated on these levels but I find it very possible for a soon break towards higher levels. QEC is a very solid company with loads of cash and an overall strong balancesheet, let's hope for a developing price of gas and this purchase will turn out to be a great investment. I have put a stop loss at 12 NOK. Please observe that the chart below is based on QEC on the Toronto Stock Exchange.

The market in the week to come

As we suffered huge red numbers in the end of last week, especially in Asia but also in Europe since we were struck by fear for an exploding credit crisis in Dubai. OMXS30 fell 3,3% during the thursday market and the opening was very negative on the friday morning. I have actually been waiting for a few percent down from the top so i tried to pick a few stocks in the opening. I missed some great opportunities because I couldn't sit in front of the screen later on but I was able to gain my possession in Astra Zeneca, Transcom A and WESC and as Dow Jones opened I was able to do the same in Citigroup.

As the markets developed after the information from Dubai my fundamental side got a little thoughtful. The information of that sort were able to pull down the OMX with more than 3% in the thursdays market and also to make the OMX open down with more than 1% in the fridays market. How much would this really effect us, if one of the constructing companies in Dubai decided to cut their payments? Can you flip that and say the reason that the market fell so hard is that it's actually overvalued? Although, my technical side saw a great situation of buying stocks in the short term.

You can possibly see the events as proof of the theory of efficient markets, that everyone gets the information at the same time and handles based on that. The thing is that when you mix this with emotions, you overreact.

To come to a conclusion: I think that the market fell last week during to an overreaction, but this doesn't mean that the coast is clear so take it easy out there.

The Crisis of Credit

The Crisis of Credit Visualized from Jonathan Jarvis on Vimeo.

This video "The Crisis of Credit Visualized" by Jonathan Jarvis is a fantastic explanation of a crisis that is hard to understand. Will we see another turn down in the markets as the financial crisis increases in Dubai, or is it just that on of the sheikhs had a cough? What is important to remember is that the market corrects these sidesteps, if we let the market work it´s magic.

The Grand Premiere

I must tell you that firing this blog off with a picture of something in the socialist colour really hurts. Although the red carpet is much like the socialist ideology, it will bring some clever people up the hill but they won´t reach the top without entering the blue hall. I am truly glad to see that you are with me on the red carpet and about to enter the hall of freedom.