- North Korean malice or… a brilliant marketing stunt?
- Standing up for freedom by sitting your butt down in a movie theater… Really?
- Why the Saudi princes let oil prices fall through the floor
- “How bad can it get?” Byron King with his ear to the ground in the U.S. shale patch
- A painkiller as effective as morphine… without the addiction risk
- Complainers wanna complain… and The 5 gives ’em space
“I do not think North Korea hacked Sony,” writes Joe Brown reviewing The Interview at Wired magazine’s website. “After watching this thing, I kinda think Sony hacked Sony. Bravo, guys. Masterstroke.”
Heh… What did our fearless leader Addison Wiggin say in our virtual pages last week? Oh yeah: “I am really, really hoping that Seth Rogen is a supergenius and this is all just a huge marketing stunt.”
More from reviewer Brown: “Can we all please take a moment to marvel at Sony’s luck?
“A month ago, The Interview was the cause of widespread shrugs in theaters across America. A few days later, we were reading emails from Sony execs bashing Angelina Jolie. And then last week, President Obama was talking about this crapbasket buddy film in a press conference during which he also discussed one of the most pressing environmental decisions facing our government.”
Seems more and more plausible. The FBI, the president, the media — they all got punked. Really, since when did North Korea do any sort of dastardly deed without bragging about it?
The media, at least, are catching on, throwing in disclaimer lines to its stories now — like this one from the BBC: “However, many cybersecurity experts have come forward to dispute this assertion.”
Gee, we’ve been saying that for more than a week…
If it’s all an elaborate put-on, we daresay it’s even more ingenious than the folks at Wired think. Or maybe even Seth Rogen.
Consider the hacker threats to carry out a “movie 9/11” that prompted Sony’s initial decision to cancel the movie’s release.
“Moviegoers Defy Threat, Defend Freedom of Speech,” says a headline at the website of Seattle’s KING-TV. “I want to be part of the message that this is how censorship ends,” an earnest 25-year-old from Queens told Reuters.
Yes, it became our patriotic duty to go out and see a “crapbasket buddy film.” Shades of another president telling us to fight terrorism by going to Disney World.
Let’s hear it from Rogen himself…
Right. We can see The Interview and feel good about how we’re standing up against attempts at “censorship.” Because it’s much easier for Americans to fume at a foreign government trying to suppress freedom of speech… rather than think about how their own government routinely stomps on the rest of the Bill of Rights.
Now that’s brilliant political satire. Well played, Mr. Rogen…
Major U.S. stock indexes are drifting higher into record territory on this thin-volume day. As we write the Dow is 12 points away from 18,100… the S&P 10 points away from 2,100.
Even the small-cap Russell 2000 index is joining the record-high party, now at 1,214. Small caps have lagged much of this year, but Greg Guenthner of our trading desk spotted a breakout back in October.
The commodity complex is all over the place today. Gold is making another run for $1,200, now at $1,195. But crude couldn’t hold on to early gains today and sits at $55.18.
“Something has to give in the oil price war,” says our Byron King — assessing the state of play as 2014 winds down.
Why did Saudi Arabia let prices fall as far as they have? The conventional answer is to stick it to the U.S. shale operators. The problem with the conventional answer, as Byron has explained these last three months, is that most U.S. shale operators can still turn a profit with oil in the $50s.
The Saudi princes’ prime motivations, Byron suggests, include “cracking the whip on other OPEC members. That is, let them feel some financial pain for a few months. Then, in the future, they’ll be less likely to cheat on OPEC quotas.”
But the biggest factor at work: “to crimp pocketbooks in Iran, with its nuclear program,” says Byron, “and in Russia, due to its meddling in Syria.”
If something has to give, it will most likely be OPEC, Byron suggests.
“Its membership includes many nations that will go hat in hand to Saudi Arabia, and make a deal about oil output, despite any bluster and bellyaching. It’ll happen sooner or later, but not too much later — because with $60 oil, we’re looking at riots in streets in some locales before too long.
“Along the way, as 2015 unfolds, we’ll feel blowback across the energy spectrum — investmentwise, and in many other arenas. Yes, capital expenditures will scale back in the U.S. oil patch; it’ll affect the U.S. economy.
“We’re in the midst of a massive oil and service share sell-off, where the good has been sold down with the not-so-good. In general, for many plays right now, share price is NOT a fair reflector of inherent value. Indeed, many shiny gems have been sold out of portfolios because fund managers had to sell something — and they sold good ideas, versus shares that went ‘no bid’ for all intent and purpose.”
“How bad can it get?” This was the question Byron put to his many contacts in the U.S. energy patch this month.
“I spoke with geologists, engineers, drilling guys, company executives and big-time economists. I talked with land men, lawyers, government regulators and courthouse filing clerks.”
The consensus: “No one is panicking. It’s going to get better, they tell me.”
Here’s how a senior scientist at a major oil service company put it: “Last thing OPEC wants to do is drive the price down for too long and force U.S. tight oil to be even more efficient. We can do that, you know. You want lower finding, development and lifting costs? You want more price and production competition? We’ll give it to you. OPEC is creating its own worst nightmare.”
Byron’s takeaway: “Don’t panic in the face of short-term market turmoil. Panicked times are when great assets move from weak hands to strong ones.
“In tumultuous markets, we can’t time things exactly — especially picking exact bottoms. But we can focus on acquiring better positions in companies with great assets and taking advantage of beaten-down share prices.”
In the current issue of Outstanding Investments, Byron identifies six names you can get at bargain prices right now — including the oil services giant Schlumberger (SLB).
“Shares in these companies have strong rebound potential over the next year,” he says, “as the oil price war plays out — and certainly when (not if) oil prices begin to rise from the $60 range into the $80 and $90 range.”
Modern medicine’s best answer for severe pain is now more than 200 years old, writes our Stephen Petranek on the science-and-wealth beat.
“Morphine was extracted from the poppy flower by a German assistant pharmacist — Friedrich Serturner — in 1804,” Stephen writes. “After the hypodermic syringe was invented in the 1850s, morphine use became even more widespread because a shot of it could relieve extraordinary pain within seconds.”
Alas, it is highly addictive. “Morphine is the chemical cousin of heroin. Withdrawal symptoms for patients who have been receiving morphine for extended periods can be ugly and difficult.
“The addiction problem has led more than one pharmaceutical company to seek an alternative to morphine that could be given more freely. Yet the only alternatives that work well,” Stephen says, “are themselves opiates and addictive.” Think oxycodone and such.
“Patients who are properly administered a controlled-release form of morphine should not develop a tolerance to the drug, but there is quite a mythology surrounding morphine, including reports of patients requiring doses above 2,000 mg. The tolerance controversy has tended to limit the amount of opiate pain relievers given in hospitals and spurred a further controversy about terminal patients not being given adequate pain relief.”
Indeed, many doctors are reluctant to prescribe legal painkillers lest they wind up on the radar of federal law enforcement. Result: a “public health crisis” of undertreated chronic pain, according to the Institute of Medicine — affecting 116 million Americans and costing the economy $500 billion in medical bills and lost productivity.
Enter the first genuine nonaddictive painkilling alternative. It’s been in development for nearly a decade. Next year, it goes into Phase 3 trials.
Earlier trials, given to more than 400 patients, look promising — alleviating pain with few side effects.
“There are more than 40 million surgical procedures a year in the United States alone, and more prescriptions for pain medications are written each year than for any other drug classification,” says Stephen, examining the profit potential.
“For example, about 5,500,000 prescriptions were written last year for OxyContin. This new drug has the potential to displace morphine as the default prescription for severe pain.” Readers of Breakthrough Technology Alert got the name and ticker symbol of its maker last month.
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“I don’t get it,” a reader writes. “Jim Rickards is forecasting the demise of the U.S. dollar next year, but now you say that he is starting two new premium services that would make us make a lot of dollars!
“What good is making a lot of dollars if it is not going to be worth anything anyway? Do you see the irony?”
The 5: Heh. We have every confidence Jim will guide readers into the right mix of nondollar assets at the right time.
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“I, and reality, must disagree with part of what that reader said on Tuesday, that you waste a lot of time with emails,” a reader writes — “because your marketing emails are very easy to distinguish from informational ones.
“They’re much shorter, more openly spaced and use a bigger font and can be distinguished at a glance. Thank you for that, because it helps me prioritize and make efficient use of my time.
“However, I empathize with at least his sentiment regarding the video presentations.
“I write very successful sales letters, so maybe I’m a little overly sensitive to the issue, but because I have a limited amount of time in each day and every second I spend is gone forever, I tend to close video presentations almost immediately if there isn’t a written transcript available, because the inefficiency of listening to someone slowly read to me is some mixture of frustrating and offensive.”
The 5: Understood. That’s why, if you mouse toward the “X” in the corner as if you were going to close the window, you get a pop-up that allows you to skip the video and read a transcript.
“Apparently, some of your readers don’t grasp the concept of Internet commerce, or commerce in general, for that matter,” writes someone rising to our defense.
“They complain about the ads and solicitations that they are ‘forced’ to wade through in
order to get to the free stuff. Then they threaten to quit accepting the free stuff. Maybe they don’t grasp the concept of their freebies being subsidized by those of us who actually pay for something, and that if no one buys, you guys don’t have a business and the complimentary
columns go away. Simple sixth-grade economics.
“But as you folks at The 5 are well aware, complainers are not happy unless they be
complainin’. By the way, I have watched many of your videos and read many of your ads. I have also not watched many of your videos or read many of your ads. At no point was I forced to do either.
“Seems like Scrooge is forcing himself to do things and blaming you. I wonder if
he learned that tactic from a current sitting president?”
The 5: We won’t bad-mouth the complainers. Some of them, as you see above, do know e-commerce. And all of them manage to keep things lively around here!
Best regards,
Dave Gonigam
The 5 Min. Forecast
P.S. Speaking of video “hacking”…
All the hoopla over The Interview got us thinking about another video we saw recently… one that’s even more entertaining and potentially lucrative than The Interview Sony just decided to release.
(Don’t worry… This is completely secure. And as far as we know, North Korea has no idea it even exists.)