This may sound paradoxical, but melting polar ice caps might actually result in overall lowering of the temperature in the industrialized areas of the world. As more fresh water is dumped into the oceans from the melting polar regions, water density is altered. This alteration is believed to disrupt the ocean currents that carry warmer water north from the tropics. Studies of ancient ice-cores and pollen have shown that this disruption of ocean currents has occurred several times in the past 100,000 years, resulting in abrupt overall DROPS in the average worldwide temperature, but particularly in the latitudes occupied by Europe and Canada. Thus, the melting ice caps might actually precipitate MORE energy usage in Europe and North America.
It is important to remember that stocks move in anticipation of future earnings, which for RDC is a function of the price of oil. Whereas economic improvements in Asian will not result in a near term increase in oil prices because it will take a while to reduce supplies in storage, they will be very bullish for the oil sector because it will indicate a bottom in oil prices and oil sector earnings has been reached and future increases can be expected. Furthermore, oil is still being pumped and reserves are being depleted, so unless the oil companies are planning to get out of the business E&P drilling will cointinue. I fully agree in that if RDC falls below $10/share jump in with both feet, you will be rewarded greatly (2 - 3X grains) over the next 2-3 years or sooner. It is certainly a much safer bet than the S&P 500 at 29X trailing earnings
I would not expect RDC to stay below $10 for long. Many brokers won't allow a sub-$10 stock to secure margin positions. I would think the company is aware of this and will fully execute its share buyback program to stay above $10. In any event, at todays price I believe its an outstanding value for investors.
I could't agree with you more!!! In addition to those reasons you mentioned for not selling, let's not forget the real possibility of M & A activity??? You can't discount RDC either acquiring another company or being acquired by another company. If either scenario occurs, the stock price would rise dramatically. RDC is a solidly managed company and I believe that Mr. Palmer will do whatever is required to maximize shareholder value. I'm going with Mr. Palmer on this one and will not sell but rather accumulate for future return on investment.....