Oil – The Only Way is UP *** Vacation Time – Blogs start again in March ***

Oil is a Barometer of Economic Times as is Gold

Standard & Poor’s downgraded Japan’s sovereign debt rating last week. It was the first cut in Japan’s rating in nine years. Japan now joins Greece, Ireland, Portugal, Spain — all of which have been downgraded.

Everyone is also looking toward the U.S. fiscal situation, given the massive policy responses to the financial and economic crisis. There’s been speculation of imminent bond market collapse, hyperinflation and an exit of the dollar — so far, none of it has happened.

In Europe, there are already crises, as bond market vigilantes have expressed their view on the unsustainable sovereign debt situation in Europe through a mass exodus. Now the European Central Bank and the European Financial Stability Fund have stepped in.

Oil is an Interesting Commodity
It looks to us as if the price of oil has to keep stable or increasing. Perhaps you believe in the theory of PEAK OIL. We don’t, but we do acknowledge that the supply of oil is finite and when the world uses 83 million barrels of oil a day, it is getting perilously close to a supply shortage. The problem will be solved by natural gas, alternatives and conservation, but in the short term, the price of oil will not fall. It will rise.

Perhaps you believe that the debt crisis will provoke inflation, or perhaps currency devaluations, or instability. In all of these events, the price of oil will rise.

Oil – A Place to Invest?
We face a strange conundrum in the price of oil. The world uses roughly 83+ million barrels a day, although demand is less at this time than it was expected to be, mostly because of the recession. Yet new demand from China, India and others is growing quite quickly. As the Western world recovers from the recession, demand will increase in the future.

Although demand is temporarily weaker, still the price of oil stubbornly continues to rise with many pundits prophesying a return to the $140 price of the last oil shock.

Buy Oil
Buy Canadian oil sands companies. Buy oil producing companies. Buy oil in any manner that you wish. It seems almost a universal bet to hold or increase in value.

Vacation Time
We are off to Mexico.

A bit of fun.

A bit of business visiting mine site and prospective mine sites.

Next blog will be in March, 2011

By Larry Cyna

Mr. Cyna is an accomplished investor in the Canadian public markets for over 20 years, and has managed significant portfolios. He is a financing specialist for private and public companies, and has expertise in real estate and debt obligations. He has assisted private companies accessing the public markets, has been a founding director of public companies and continues as a strategic consultant to selected clientele. He is and has been a director, a senior officer and on the Advisory Board of a number of TSX and TSXV public companies in the mining, resource, technology and telecommunications sectors, and the Founding Director of two CPC’s with qualifying transactions in mining and minerals. He was an honorary director of the Rotman School of Management MBA IMC program, has completed the Canadian Securities Institute Canadian Securities Course & Institute Conduct and Practices Handbook Course, was a former Manager under contract to an Investment Manager at BMO Nesbitt Burns, a roster mediator under the Ontario Mandatory Mediation Program, Toronto, a member of the Institute of Corporate Directors of Ontario, a member of the Upper Canada Dispute Resolution Group, and the Ontario Bar Association, Alternate Dispute Resolution section. He obtained his designation as a Chartered Accountant in Ontario in 1971 and was the recipient of the Founder’s Prize for academic achievement together with a cash reward. He became a CPA in the State of Illinois, USA in 1999 under IQEX with a grade of 92%. He is a Member of the Institute of Chartered Accountants of Ontario and the Canadian Institute of Chartered Accountants. He holds certificates in Advanced ADR & in Civil Justice in Ontario, Faculty of Law, University of Windsor, certificate in Dispute Resolution from the Ontario Institute of Chartered Accountants. Previous accomplishments are Manager of Cymor Risk Consultants LP specializing in Risk Management Assessment; CEO of Cyna & Associates specializing in mediation and ADR; Founder & Senior Partner of Cyna & Co, Chartered Accountants, a fully licensed and accredited public accountancy firm with international affiliations; and was a partner in a large public accountancy firm. Mr. Cyna is well known in the Canadian Investing community. He is invited to, and attends presentations given by public companies usually 3 or 4 times each week. These presentations are intended by the various hosting companies to present their inside story to sophisticated parties and Investment Managers for the purpose of attracting funding, or of making parties more interested in acquiring shares of those companies. Being a part of this keeps Mr. Cyna deeply involved in the current market and leads to numerous investment opportunities.

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