This will be the last meeting until September 6, 2011.

 

         1. Eagle Ford shale play is booming in Texas.

                        June $3.5 billion spent by Marathon Oil on 141,000 acres $21,000/acre.

                        March $1.55 billion spent by Korean Oil

                        October 2010 $1.1 billion spent by CNOOC of China

         2. Texas economy is humming. National economy is slowing down, but probably will pick up later in the year. Unemployment rate has risen to 9.1%. Over 15 million unemployed. Toyota auto sales were down 30% in May, but GM and Ford has only small sales losses.

         3. Borders Books is in bankruptcy. E-books are replacing hardcopy. Amazon and Kindle. E-books are not significantly cheaper than hardcopy, but e-books are very convenient.

         4. Greece has been financing national spending with bonds. Now, Greece cannot sell bonds. Interest rates are very high, because of the risk of default. Ultimately, Greece's standard of living has to decrease, commensurate with the country's reduced spending power.

         5. Federal Reserve Board. Pushing on a string. Money is available to borrow at low interest rates - FED cannot make people borrow.

         6. Treasury bond prices are up, which reflects a slowing economy, and reduced likelihood of spending and inflation.

         7. Stock market has been down for 5 straight weeks. Dow is down 5%  Midcap stocks are down about 5%, but Russell 2000 smaller stocks are down over 7%.

         8. Commodities

Oil is down 12% from peak

Natural gas is down about 10% from peak

Gold is only down 1% Silver is down 30%

Cotton, corn, and wheat are continue to have high prices - all are up over 100% from a year ago.

         9. Commodity ETF's - check these out, if you want to speculate on commodities. Most diversified with a lower energy component and larger commodity component is I-Path Dow Jones - UBS Commodity Index(DJP)

       10. Individual stocks. No big ideas this month. Darrell and Gary both like Chevron. ATP looks good.

Have a great summer, stay out of the heat, drink lots of fluids(easy on the firewater stuff), and as Barbara Hatcher emailed Gary, "enjoy your fishing trip, and if you find a pot of gold, share it with the Investment Club," (paraphrased and with  acknowledgement of the thoughts of the aforementioned Dr. Hatcher).