Oil and Plastics

July 21, 2008

I heard on Marketplace that 70% of plastics are made from domestic natural gas and not petreoluem imports. This made me wonder how dependent we really are on oil imports. According to the Transportation Energy Data Book, 68.3% of the United States petroluem consumption is used for Transportation in 2007 with imports accounting for 58.2% of total consumption. If we cut our oil consumption for transportation by half, we can be less reliant on foreign imports. It is solely our transportation system that makes the United States dependent on foreign oil. Although transportation also includes all the diesel vehicles (big rigs) used to ship goods around the country. One should always go back to the numbers and look at the facts to be imformed about what is and what isn’t true. Blind assumptions that we are dependent on foreign oil for plastics is false.

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Small Cap Talk: Laser TVs

July 18, 2008

Some may say laser TVs have been on the horizon and always will be, but according to recent news, they may be coming out rather soon. Two companies of interest are Novalux and Arasor Interlational (ASRYF.PK ARR.AX). Novalux was privately held and backed by a few venture funds, but was subsequently bought by Arasor.

Why laser TVs?

They offer more colors than traditional displays, so things appear more lifelike. The only technology that may come close in color fidelity is organic light emitting diode displays. They also consume less energy and produce less heat, because lasers are more efficient than light bulbs.

Potential Pitfalls

Your source also needs a lot of color information to feed the display. The main problem in developing this technology is the coherence of the laser, which could cause undesirable inference patterns. There are also other display technologies that may offer cost benefits.

Future

I foresee major inroads in small portable, quiet projectors. Conference room projectors are large, costly and noisy, because the hot bulbs require cooling, take up space, burn off and need replacements, and are less efficient than lasers. These projectors could also make for painless small home movie theaters. A possible competitor is Microvision (MVIS).

Disclosure

I’m crazy enough to own some shares, but I consider the company high risk, because they have yet to post positive earnings.


Google Stock Screener

July 7, 2008

Google has a new stock screener to keep investors happy!

Google Stock Screener


Why gas is cheap

July 4, 2008

Yesterday, crude oil prices hit $145 per barrel for August delivery, and current spot prices are not far behind. According to the AAA fuel-gauge report, the national average price for a gallon of regular unleaded is now $4.10 – and this is actually a steal.

For every 100 barrels of crude oil a U.S. refinery purchases, about 47 barrels of gasoline are produced. Gasoline is delivered from oil refineries through pipelines to a distribution chain serving about 167,500 retail gasoline stations in the United States.

In 2007, for every gallon of regular grade gas we bought at the pump, approximately 53% of the price covered the cost of crude oil, 15% went to state and federal taxes, 10% paid for distribution and marketing, and only 17% actually went to refineries.

In July 2007, the inflation-adjusted average crude oil price was also only $68 per barrel. At that time, the average price for a gallon of regular was $2.95.

Scaling to today’s prices, for every gallon of regular gas we now buy at the pump, approximately 81% of the price we pay covers the cost of crude oil, 10% goes to taxes, 6% pays for distribution and marketing, and refineries are now losing money for every gallon of gas they sell.

Realistically, there is up to a 3-month delay between the time a refinery purchases a barrel of crude oil and then sells it at the pump. But even going by April’s average crude oil price of 104.31 per barrel, refineries are still facing significantly smaller profit margins.

This means that even if the price of crude oil does not continue to rise, gas prices will still be ramping up for at least another 3 months, and will stay high until refineries are able to reclaim some profits. Pump gas – get it while it’s cheap!


Got Silicon?

July 3, 2008

If you believe in electronics and solar cells, you must realize that they both rely on silicon as starting material. MEMC Electronic Materials (WFR) makes silicon wafers for microchips and silicon for solar panels. It might be worth a look since they can’t make silicon fast enough to meet demand.