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[Crude oil is just one of many things the
world is running out of, says our friend Tom McCafferty, a frequent contributor to Rick’s
Picks, in the guest commentary below. Never one to pass up an opportunity,
Tom, author of Options
Demystified and
numerous other books on trading, suggests using puts and calls to manage
short-term risks while investing for the long haul in “real entities
that produce real products.” RA]
We
are all familiar with all the hullabaloo in recent
years over Peak Oil. Dozens of books and websites devoted an enormous about
of space to scaring the pants off of us. In a few years, we would be all be sitting in a dark, cold room without access to
“Dancing with the Stars”. Man …that will be a bummer.
Before you get your blood pressure back under control, I’m here to tell
you the Peak Oil is just the beginning. The World is facing more peaks that
it can handle in the next few decades. For example:
•
Peak
Water: The World does not have enough water for crops or the
increasing population. Every wonder why China was so aggressive to control
sleepy little Tibet? Guess where the origins of the five great Chinese rivers
are located? Or why it is importing so many tons of soybeans? When thinking
about food importation, think of it as just a substitute for importing water.
China is not alone. In India, the Green Revolution is now a disaster.
• Peak Population: How many people can
the World sustain? I’m afraid we are going to find out the hard way.
More specifically, how many senior citizens can it take care of … think
of our Social Security system and then think of countries like Russia or
Italy that have an even more serious aging challenge. China is right in line
because of its one-child policy.
•
Peak
Money: How much fiat currency can the World float? Remember,
there has never a fiat currency that did not collapse.
•
Peak
Weather: Global Warning or long-term cycles? It doesn’t
matter. Oceans and temperatures are rising. Go long hip boots.
•
Peak
Politics: It has always been a mess and it only seems to get
worse. Are there any politicians or leaders that are not just out for themselves? Sadly, it also applies to their constituents.
•
Peak
Taxes: Will there every be enough tax money to solve every problem? Can our
cities, states and national governments every balance a budget and reduce
their deficits? If we can’t, how are the poorer countries going to
cope?
My
point is there are more than enough problems facing the World and its
investors to keep all the prognosticators busy. My advice is to trade
short-term using options to manage the volatility and long term invest in
real entities that produce real products that are needed to soften the
critical “peak” areas.
Rick Ackerman
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Information and
commentary contained herein comes from sources believed to be reliable, but this
cannot be guaranteed. Past performance should not be construed as an
indicator of future results, so let the buyer beware. There is a substantial
risk of loss in futures and option trading, and even experts can, and
sometimes do, lose their proverbial shirts. Rick's Picks does not provide investment advice to
individuals, nor act as an investment advisor, nor individually advocate the
purchase or sale of any security or investment. From time to time, its editor
may hold positions in issues referred to in this service, and he may alter or
augment them at any time. Investments recommended herein should be made only
after consulting with your investment advisor, and only after reviewing the
prospectus or financial statements of the company. Rick's Picks reserves the right to use e-mail endorsements
and/or profit claims from its subscribers for marketing purposes. All names
will be kept anonymous and only subscribers’ initials will be used
unless express written permission has been granted to the contrary. All
Contents © 2011, Rick Ackerman.
All Rights Reserved.
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