RE:Capitulation in Oil Stocks
MigraineCall wrote:
Or simply, perhaps Experienced has the right approach during this storm, sitting nice and dry on his keg of dry powder.
Either way, it is part of the journey, and one must know that although you can be right, the market can stay irrational longer than you can stay solvent.
Oh how much I wish for Mr. Experienced's predictions to turn out wrong. Unfortunately for me, what he said made a lot of sense.
These days I sometimes find myself mired in an inchoate mass of ideas. Not sure how exactly I got myself in this situation. It's only two short months ago when I had more money than I will never need. Life was not exactly care-free, but money was never a carking care. Recession or not, my life was pretty much unaffected.
Then when I sat down one day to count my newfound "fortune," I was exhilarated. In just four months, and with a very limited amount of resource I allowed myself to invest with, I was able to make, let see, 85k from SU, 145k from OBE, 120kfrom SGY, 225k from VET, 95k from CJ, etc. that's a seven-figure profit (and did I say in 4 months?). A crazy idea suddenly dawned on me that with the money I have and with the margin...
Now a good day for me is any day when this margin does not go into the negative.
The pain was somewhat manageable when it was just the gains I was giving back. But it felt very different when it was now my own cold, hard cash that was disappearing at a rate that I sometimes have to marshall all the resources I possess within me to not scream.
I had escaped this inferno twice by a narrow margin (oh the irony!) when I felt very worried about the rapid increase in interest rates and hence the ensued recession. I have no idea how people are planning to service this colossal amount of debt when rates are being reset much higher. I talk to a lot of people, and I won't mention those who have no investments in any asset classes. For those who do have the means to invest, they're all buckling down. Paying off debt is now their number one priority. (How swiftly the sentiment has changed when just a few months ago they were still frolicking on cheap debts.) People are also cutting down on eating out, postponing buying big ticket items, curtailing travel plans etc. Costs of living are just outrageous. I have not seen prices come down at all in grocery stores. In fact, many items have gone up. Water, hydro, property taxes, car insurance etc have all gone up by a large percentage. Pre-Covid, I paid 220/month for my home insurance. I am now paying 287/month for this claims-free policy with no changes made to it.
Inflation is making life much harder for everyone.
As for me, there's no turning back now. If oil goes down, I'll go down with it. The thought of selling out my position only to see oil stocks bounce back and make their new highs is more devastating than to just wait it out and endure a greater loss.
Now if you can please help me answer a question and put my mind somewhat at ease: With the oil inventory being as tight as ever, when does the SPR need to be replenished? Is the government obligated to get it replenished by a deadline, or can they wait until the market has a higher supply?
Wishing happiness on you, as always.