long oil?

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Revealer's picture
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He's right. (If not a little "fringy"). I've been long "all things energy" since Dec. 2000. Don't remember exactly what turned me on, but a combination of events/articles convinced me that the world was up against a supply problem of unprecedented proportions. "All things energy" include, oil, nat.gas, coal, drilling, transportation of same but only in North America. These impending shortages change everything we have been taught about investing.

doberman's picture
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I avoid trying to make "homerun-type" investment decisions. Logic may dictate that it's inevitable that "X" will happen in the markets and it's tempting to go there, but the markets aren't logical.
I remember back in 1996, my branch manager asked the brokers what could derail the internet stock bull run. Although, at that time, I had no clients in internet stocks due to valuation concerns, I wouldn't have predicted such a landslide a few years later.
With energy, I feel the same way. I have no idea what could drop the price of gas. It's eventual price fall (and it will fall) might not be due to supply and demand, at all. The financial failure of 1 or 2 major energy derivative players could force a price decrease. (It's been alleged that a large chunk of energy prices is due to speculation and derivatives.)
Investments in energy is a relatively easy sell to prospects and clients, at this time. But I approach from the standpoint that I'm getting in at the top; thus, the dollar amount invested is small by comparison.

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Doberman,
I agree with you.  I just posted the article because I thought it was interesting.  Here you have a self made billionaire, who made his fortune buying things out of favor, and all of sudden he's bullish on a sector that already has seen significant gains, interesting or maybe he's ready to sell and ensuring he gets top dollar.

Revealer's picture
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doberman wrote:
I avoid trying to make "homerun-type" investment decisions. Logic may dictate that it's inevitable that "X" will happen in the markets and it's tempting to go there, but the markets aren't logical.
I remember back in 1996, my branch manager asked the brokers what could derail the internet stock bull run. Although, at that time, I had no clients in internet stocks due to valuation concerns, I wouldn't have predicted such a landslide a few years later.
With energy, I feel the same way. I have no idea what could drop the price of gas. It's eventual price fall (and it will fall) might not be due to supply and demand, at all. The financial failure of 1 or 2 major energy derivative players could force a price decrease. (It's been alleged that a large chunk of energy prices is due to speculation and derivatives.)
Investments in energy is a relatively easy sell to prospects and clients, at this time. But I approach from the standpoint that I'm getting in at the top; t-hus, the dollar amount invested is small by % oparison. I disagree. Energy investments are NOT easy to sell. Very simply because most people, like you, don't want to believe this is happening. The American people (and the world for that matter) would rather take the "ignore it and it'll go away" attitude. Of course a lot of the move in energy prices is due to speculation.Do not fail to remeber that energy "things" are terrifically fungible both from a futures/cash position and to a geographic position. As far as whether we are in for a price fall, I would point out that energy stocks make up about 9-10% of the market cap of the S&P 500 and at the peak in 1979 they made up about 27% of the same index. Remarkably similar to the tech stock weighting (27%) at the tech peak of 99-00. Long ways to go? I believe we are still in the early innings.

doberman's picture
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Revealer: 
 I disagree. Energy investments are NOT easy to sell. Very simply because most people, like you, don't want to believe this is happening. The American people (and the world for that matter) would rather take the "ignore it and it'll go away" attitude. Of course a lot of the move in energy prices is due to speculation.Do not fail to remeber that energy "things" are terrifically fungible both from a futures/cash position and to a geographic position. As far as whether we are in for a price fall, I would point out that energy stocks make up about 9-10% of the market cap of the S&P 500 and at the peak in 1979 they made up about 27% of the same index. Remarkably similar to the tech stock weighting (27%) at the tech peak of 99-00. Long ways to go? I believe we are still in the early innings.
----------------------------
Hey, you could be right about energy prices. But I'm not willing to bet the farm (or my clients' farms) on speculation, whatever the logic that supports taking such action.
If history is any indicator, something out of left field will come and take the air out of gas prices.

Revealer's picture
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I don't bet the farm, either. Actually triple weighted (about 30%) personally. I've worked too long and too hard for my money to bet the farm on ANYTHING regardless of how bullish or bearish I might be. Most of my "stock" clients are heavily weighted in energy also. We talk about the risks of carrying heavy weighting in energy. Believe me, I can change my mind in a short time and I constantly remind myself not to get myopic about my positions. Right now, I still believe we are early in this energy "thing." 

troll's picture
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Heavy stuff.However, now that it's getting to the point that this is such a universally held belief, I'm inclined to think that near-term prices have already hit their peaks.....

NASD Newbie's picture
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joedabrkr wrote:Heavy stuff.However, now that it's getting to the point that this is such a universally held belief, I'm inclined to think that near-term prices have already hit their peaks.....
Wow, as you typed that oil traded in the futures markets for more than $75 per bbl.
Why not short a few contracts of sweet light crude?

Philo Kvetch's picture
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NASD Newbie wrote:
joedabrkr wrote:Heavy stuff.However, now that it's getting to the point that this is such a universally held belief, I'm inclined to think that near-term prices have already hit their peaks.....
Wow, as you typed that oil traded in the futures markets for more than $75 per bbl.
Why not short a few contracts of sweet light crude?

Is that your considered advice as a licensed broker?

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Philo Kvetch wrote:NASD Newbie wrote:
joedabrkr wrote:Heavy stuff.However, now that it's getting to the point that this is such a universally held belief, I'm inclined to think that near-term prices have already hit their peaks.....
Wow, as you typed that oil traded in the futures markets for more than $75 per bbl.
Why not short a few contracts of sweet light crude?

Is that your considered advice as a licensed broker?

You moron, advice does not end with a question mark.

Philo Kvetch's picture
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NASD Newbie wrote:Philo Kvetch wrote:NASD Newbie wrote:
joedabrkr wrote:Heavy stuff.However, now that it's getting to the point that this is such a universally held belief, I'm inclined to think that near-term prices have already hit their peaks.....
Wow, as you typed that oil traded in the futures markets for more than $75 per bbl.
Why not short a few contracts of sweet light crude?

Is that your considered advice as a licensed broker?

You moron, advice does not end with a question mark.

Ah, but asking for the order does, you simpleton!

NASD Newbie's picture
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Philo Kvetch wrote:NASD Newbie wrote:Philo Kvetch wrote:NASD Newbie wrote:
joedabrkr wrote:Heavy stuff.However, now that it's getting to the point that this is such a universally held belief, I'm inclined to think that near-term prices have already hit their peaks.....
Wow, as you typed that oil traded in the futures markets for more than $75 per bbl.
Why not short a few contracts of sweet light crude?

Is that your considered advice as a licensed broker?

You moron, advice does not end with a question mark.

Ah, but asking for the order does, you simpleton!

Joedabrkr is not lucky enough to have me as an investment advisor so I was not asking for an order.

Philo Kvetch's picture
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NASD Newbie wrote:Philo Kvetch wrote:NASD Newbie wrote:Philo Kvetch wrote:NASD Newbie wrote:
joedabrkr wrote:Heavy stuff.However, now that it's getting to the point that this is such a universally held belief, I'm inclined to think that near-term prices have already hit their peaks.....
Wow, as you typed that oil traded in the futures markets for more than $75 per bbl.
Why not short a few contracts of sweet light crude?

Is that your considered advice as a licensed broker?

You moron, advice does not end with a question mark.

Ah, but asking for the order does, you simpleton!

Joedabrkr is not lucky enough to have me as an investment advisor so I was not asking for an order.

Grovelling for an order is more appropriate.
The days must go by pretty slowly for you now that Bozo the Clown is off the air, huh?
Well, I'm tired of you now.
See you in the funny papers!

TexasRep's picture
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i've been away for the long 4th week-end, but i finally got around to reading this excellent article- tho the original link was erased by the RR police-
you'll need to google The Rainwater Prophecy + Richard Rainwater to get the article-
Rainwater's suggestion for other scary sites including :http://www.lifeaftertheoilcrash.net/
it does really get you to worrying- not only about client portfolios (tho, according to the thought/analysis on this site, you can't really position long-term for a second Stone-Age much anyway--more Gold?)-- but on the survivability of the spieces--- aka: Planet of the Apes?
i know it all sounds kooky, but also a bit scary since it is not totally out of the realm of possibility- i've been accused of being a bit oil-crazed due to the lack of foresight/action to cut consumption, but compared to these guys, i'm totally tame-
check it out-
Dr. Colin Campbell :

It is becoming evident that the financial and investment
community begins to accept the reality of Peak Oil, which
ends the first half of the age of oil. They accept that banks
created capital during this epoch by lending more than they
had on deposit, being confident that tomorrow’s expansion,
fuelled by cheap oil-based energy, was adequate collateral
for today’s debt. The decline of oil, the principal driver of
economic growth, undermines the validity of that collateral
which in turn erodes the valuation of most entities quoted
on Stock Exchanges. The investment community however
faces a dilemma. It desires to protect its own fortunes and
those of its privileged clients while at the same time is
reluctant to take action that might itself trigger the
meltdown. It is a closely knit community so that it is hard
for one to move without the others becoming aware of his
actions.

The scene is set for the Second Great Depression, but the
conservatism and outdated mindset of institutional
investors, together with the momentum of the massive
flows of institutional money they are required to place, may
help to diminish the sense of panic that a vision of reality
might impose. On the other hand, the very momentum of
the flow may cause a greater deluge when the foundations
of the dam finally crumble. It is a situation without
precedent.
 
 
 
 

troll's picture
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NASD Newbie wrote:Philo Kvetch wrote:NASD Newbie wrote:Philo Kvetch wrote:NASD Newbie wrote:
joedabrkr wrote:Heavy stuff.However, now that it's getting to the point that this is such a universally held belief, I'm inclined to think that near-term prices have already hit their peaks.....
Wow, as you typed that oil traded in the futures markets for more than $75 per bbl.
Why not short a few contracts of sweet light crude?

Is that your considered advice as a licensed broker?

You moron, advice does not end with a question mark.

Ah, but asking for the order does, you simpleton!

Joedabrkr is not lucky enough to have me as an investment advisor so I was not asking for an order.

Are you kidding?
Oh I see...you meant "Joedabrkr is lucky enough to NOT have me as an investment advisor...."
Good Lord I'd rather chew glass......

troll's picture
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Revealer wrote:He's right. (If not a little "fringy").....convinced me that the world was up against a supply problem of unprecedented proportions. "All things energy" include, oil, nat.gas, coal, drilling, transportation of same but only in North America. These impending shortages change everything we have been taught about investing.
Well, there are plenty of folks, it would seem, who are convinced that there's an "energy shortage" (ignoring the massive US coal reserves, increasing abilities to draw oil in places we couldn’t before, the recent demand destruction we saw at the last peak of gas prices and the tanking price of natural gas) and don’t think the current price of a barrel of oil has anything to do with a massive risk premium thanks to Chavez in Venezuela, Iran’s nuke stand-off with the world and the missile launches from the lunatic in North Korea.
Count me in the latter camp….

 

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mikebutler222 wrote:
Revealer wrote:He's right. (If not a little "fringy").....convinced me that the world was up against a supply problem of unprecedented proportions. "All things energy" include, oil, nat.gas, coal, drilling, transportation of same but only in North America. These impending shortages change everything we have been taught about investing.
Well, there are plenty of folks, it would seem, who are convinced that there's an "energy shortage" (ignoring the massive US coal reserves, increasing abilities to draw oil in places we couldn’t before, the recent demand destruction we saw at the last peak of gas prices and the tanking price of natural gas) and don’t think the current price of a barrel of oil has anything to do with a massive risk premium thanks to Chavez in Venezuela, Iran’s nuke stand-off with the world and the missile launches from the lunatic in North Korea.
Count me in the latter camp….

 
Mike: Please don't take my quotes out of context. I would ask that the readers read my ENTIRE comment. As far as lots of reserves of alternative source..... You are right. What I want you to do is some research on the COST of extracting those reserves. Of course there is a geopolitical premium in the price of oil. Think that's gonna go away?

troll's picture
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Revealer wrote:mikebutler222 wrote:
Revealer wrote:He's right. (If not a little "fringy").....convinced me that the world was up against a supply problem of unprecedented proportions. "All things energy" include, oil, nat.gas, coal, drilling, transportation of same but only in North America. These impending shortages change everything we have been taught about investing.
Well, there are plenty of folks, it would seem, who are convinced that there's an "energy shortage" (ignoring the massive US coal reserves, increasing abilities to draw oil in places we couldn’t before, the recent demand destruction we saw at the last peak of gas prices and the tanking price of natural gas) and don’t think the current price of a barrel of oil has anything to do with a massive risk premium thanks to Chavez in Venezuela, Iran’s nuke stand-off with the world and the missile launches from the lunatic in North Korea.
Count me in the latter camp….

 

Mike: Please don't take my quotes out of context. I would ask that the readers read my ENTIRE comment. As far as lots of reserves of alternative source..... You are right. What I want you to do is some research on the COST of extracting those reserves. Of course there is a geopolitical premium in the price of oil. Think that's gonna go away?
Sorry, Revealer, but I don't see where your message was changed when I trimmed down the post to the specific point I wanted to address. But, others can read your original post in its entirety to make their own decision. <?:namespace prefix = o ns = "urn:schemas-microsoft-com:office:office" />
I'm aware of the cost of  extracting the reserves, and as you well know, it still doesn't justify the current price. IMHO all the talk about “peak oil” affecting current prices is just talk, and prices are only moving on a larger than usual risk premium. As to the risk premium and whether or not it will "go away", the short answer is I think it will shrink to historic norms.
There's always been a risk premium of some size in energy prices and it expands and contracts with events. Personally I think it’s currently grossly exaggerated (as do people as diverse in opinion as the former CEO of Exxon and members of OPEC). It wasn’t all peace and light in the late 1990s when oil was at $16 a barrel and the world isn’t coming to an end (and we aren’t running out of energy) now at $75.
 

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mikebutler222 wrote:
.....I'm aware of the cost of  extracting the reserves, and as you well know, it still doesn't justify the current price. IMHO all the talk about “peak oil” affecting current prices is just talk, and prices are only moving on a larger than usual risk premium. As to the risk premium and whether or not it will "go away", the short answer is I think it will shrink to historic norms.
There's always been a risk premium of some size in energy prices and it expands and contracts with events. Personally I think it’s currently grossly exaggerated (as do people as diverse in opinion as the former CEO of Exxon and members of OPEC). It wasn’t all peace and light in the late 1990s when oil was at $16 a barrel and the world isn’t coming to an end (and we aren’t running out of energy) now at $75.
 

 
i've read nowhere anyone saying that "peak oil" is affecting current prices -- no one rational anyway.
but you've already proven that you'll make up your own enemy so you can shoot it down in an effort to solidify your position-
effective? yeah. honest? no.
 
 

troll's picture
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TexasRep wrote:mikebutler222 wrote:
.....I'm aware of the cost of  extracting the reserves, and as you well know, it still doesn't justify the current price. IMHO all the talk about “peak oil” affecting current prices is just talk, and prices are only moving on a larger than usual risk premium. As to the risk premium and whether or not it will "go away", the short answer is I think it will shrink to historic norms.
There's always been a risk premium of some size in energy prices and it expands and contracts with events. Personally I think it’s currently grossly exaggerated (as do people as diverse in opinion as the former CEO of Exxon and members of OPEC). It wasn’t all peace and light in the late 1990s when oil was at $16 a barrel and the world isn’t coming to an end (and we aren’t running out of energy) now at $75.
 

 
i've read nowhere anyone saying that "peak oil" is affecting current prices -- no one rational anyway.
but you've already proven that you'll make up your own enemy so you can shoot it down in an effort to solidify your position-
effective? yeah. honest? no.
 
 

Gee, and we were all getting along so nicely... a bunch of investment professionals...talking about the market...and you had to go personal. Well, I'm not going to take the bait, but I will give you a quote that provides some context to the direction the conversation took;
 
I've been long "all things energy" since Dec. 2000. Don't remember exactly what turned me on, but a combination of events/articles convinced me that the world was up against a supply problem of unprecedented proportions. "All things energy" include, oil, nat.gas, coal, drilling, transportation of same but only in North America. These impending shortages change everything we have been taught about investing.
Now, perhaps you can explain to me in civil terms how that's an argument that current prices aren't being effected by "supply problem" and not the risk premimum I mentioned.

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mikebutler222 wrote:
Gee, and we were all getting along so nicely... a bunch of investment professionals...talking about the market...and you had to go personal. Well, I'm not going to take the bait, but I will give you a quote that provides some context to the direction the conversation took;
 
I've been long "all things energy" since Dec. 2000. Don't remember exactly what turned me on, but a combination of events/articles convinced me that the world was up against a supply problem of unprecedented proportions. "All things energy" include, oil, nat.gas, coal, drilling, transportation of same but only in North America. These impending shortages change everything we have been taught about investing.
Now, perhaps you can explain to me in civil terms how that's an argument that current prices aren't being effected by "supply problem" and not the risk premimum I mentioned.

the "peak oil" crowd talks very specifically/theoretically about the bell-curve properties inherent in the supply/extraction process of oil/natural gas- no one here has linked the theory to the current price-- except you, so that you could subsequently "knock that one out of the park" -
the last sentence of your statement, which turns the discussion from the "peak oil" theory to  "..that current prices aren't being effected by "supply problem"" underscores the way you sometimes turn the topic to suit your side of the discussion.
you can have a short-term "supply problem" without it being any way related to the "peak oil" theory as the cause- Katrina, and the very political problems that you point out, can/do lead to short term supply problems-- but those won't cause the world to run out of oil long-term.
 
 
 
 

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TexasRep wrote:mikebutler222 wrote:
Gee, and we were all getting along so nicely... a bunch of investment professionals...talking about the market...and you had to go personal. Well, I'm not going to take the bait, but I will give you a quote that provides some context to the direction the conversation took;
 
I've been long "all things energy" since Dec. 2000. Don't remember exactly what turned me on, but a combination of events/articles convinced me that the world was up against a supply problem of unprecedented proportions. "All things energy" include, oil, nat.gas, coal, drilling, transportation of same but only in North America. These impending shortages change everything we have been taught about investing.
Now, perhaps you can explain to me in civil terms how that's an argument that current prices aren't being effected by "supply problem" and not the risk premimum I mentioned.

the "peak oil" crowd talks very specifically/theoretically about the bell-curve properties inherent in the supply/extraction process of oil/natural gas- no one here has linked the theory to the current price-- except you, so that you could subsequently "knock that one out of the park" -
the last sentence of your statement, which turns the discussion from the "peak oil" theory to  "..that current prices aren't being effected by "supply problem"" underscores the way you sometimes turn the topic to suit your side of the discussion.
you can have a short-term "supply problem" without it being any way related to the "peak oil" theory as the cause- Katrina, and the very political problems that you point out, can/do lead to short term supply problems-- but those won't cause the world to run out of oil long-term.
 
 
 
 

Are you telling me that "....the world was up against a supply problem of unprecedented proportions." and " These impending shortages change everything we have been taught about investing." comments don't relate to the "peak oil" theory thread from which they jumped?
http://forums.registeredrep.com/forum_posts.asp?TID=2012&amp ;PN=0&TPN=1
Also, the refernce to "since Dec 2000" means to you that he was talking about short-term supply issues like Katrina?

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mikebutler222 wrote:
Are you telling me that "....the world was up against a supply problem of unprecedented proportions." and " These impending shortages change everything we have been taught about investing." comments don't relate to the "peak oil" theory thread from which they jumped?
http://forums.registeredrep.com/forum_posts.asp?TID=2012&amp ; ;PN=0&TPN=1
Also, the refernce to "since Dec 2000" means to you that he was talking about short-term supply issues like Katrina?

again, "...Katrina, and the very political problems that you point out, can/do lead to short term supply problems-- but those won't cause the world to run out of oil long-term..."
in the 2000 we were still dealing with OPEC, unstable regimes situated over the world's reserves (remember what happened in 2001?), and new gas refineries not being built, all of which will hiccup from time to time and cause "supply-issues" regardless of the overall global supply of oil in reserves.
you can still bet on supply issues being a short term play simply by understanding that our extraction/refinering processes are maxxed out, and that since hurricane season is upon us, bet that we will take another Gulf-hit this year which would then lead to a short-term supply issue---- again, unrelated to the "peak oil" theory.
 
 
 

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The Peak Oil discussion is interesting.  Common sense dictates that a peak in production will (or maybe has already) eventually happen.  It is a finite resource after all.  We won't know when the peak was until many years after.  A better view on energy is historical.  Oil has always been a boom/bust industry (read "The Prize" by Yergin).  We currently have plenty of oil, peak or no peak.  Prices will come down relative to demand.  When the next global slowdown occurs, watch out.  In the meantime, buy during oil price weakness and sell during strength. 

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TexasRep wrote:mikebutler222 wrote:
Are you telling me that "....the world was up against a supply problem of unprecedented proportions." and " These impending shortages change everything we have been taught about investing." comments don't relate to the "peak oil" theory thread from which they jumped?
http://forums.registeredrep.com/forum_posts.asp?TID=2012&amp ; ; ;PN=0&TPN=1
Also, the refernce to "since Dec 2000" means to you that he was talking about short-term supply issues like Katrina?

again, "...Katrina, and the very political problems that you point out, can/do lead to short term supply problems-- but those won't cause the world to run out of oil long-term..."
in the 2000 we were still dealing with OPEC, unstable regimes situated over the world's reserves (remember what happened in 2001?), and new gas refineries not being built, all of which will hiccup from time to time and cause "supply-issues" regardless of the overall global supply of oil in reserves.
you can still bet on supply issues being a short term play simply by understanding that our extraction/refinering processes are maxxed out, and that since hurricane season is upon us, bet that we will take another Gulf-hit this year which would then lead to a short-term supply issue---- again, unrelated to the "peak oil" theory.
 
 
 

Everything you've mentioned is of a short term nature and sounds to me unrelated to long term issues as mentioned in "....the world was up against a supply problem of unprecedented proportions." and " These impending shortages change everything we have been taught about investing." .
Could you name something in your response that is covered by Revealer's quote? Secondly, why pretend the other thread doesn't exist?

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Pandale wrote:
The Peak Oil discussion is interesting.  Common sense dictates that a peak in production will (or maybe has already) eventually happen.  It is a finite resource after all

Maybe not. That's one theory.  Here is another.
http://freeenergynews.com/Directory/Theory/SustainableOil/in dex.html

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sure--- if refineries are maxxed, and new ones are not being built, then short-term supply problems will happen from time to time and with increasing frequency as our usage increases--- again, unrelated to the overall supply of global reserves addressed in the "peak-oil" theory--
what part of the other thread?
 
 

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Revealer wrote: I disagree. Energy investments are NOT easy to sell. Very simply because most people, like you, don't want to believe this is happening. 
I don't know about anyone else, but I've found them to be a very, very easy sell. In fact I'm concerned about how many clients sound now like they did in 1997-1999 when they wanted to sell everything and buy the hot dot. So many of them are convinced that oil prices can only go up and never again down that I’m feeling the way I did when I read the WSJ articles of the late 1990s about NYC cab drivers pulling over with fares waiting in the back so that they could make a trade on their lap top.<?:namespace prefix = o ns = "urn:schemas-microsoft-com:office:office" />
Anyone else seeing this?

troll's picture
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TexasRep wrote:
 
sure--- if refineries are maxxed, and new ones are not being built, then short-term supply problems will happen from time to time and with increasing frequency as our usage increases--- again, unrelated to the overall supply of global reserves addressed in the "peak-oil" theory--
what part of the other thread?
 
 

Why are you working so hard to dispute what Revealer himself has said? Of course the quotes I gave you were about long-term supply problems and not short term issues which simply can't be label "unprecedented". Read the other thread, start at the top. He supports “peak oil” there repeatedly and uses it as an underpinning for his views on oil prices moving forward.<?:namespace prefix = o ns = "urn:schemas-microsoft-com:office:office" />
 

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i'm disputing no one but your:
"...IMHO all the talk about “peak oil” affecting current prices is just talk..."
 

troll's picture
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TexasRep wrote:
 
i'm disputing no one but your:
"...IMHO all the talk about “peak oil” affecting current prices is just talk..."
 

I'm going no further with you in this circle, read the link to the thread I gave you and the "peak oil" under pinnings for the quotes I provided.

dude's picture
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Mikey B at work again!  I'm gettin' dizzy.

dude's picture
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TexasRep wrote:mikebutler222 wrote:
.....I'm aware of the cost of  extracting the reserves, and as you well know, it still doesn't justify the current price. IMHO all the talk about “peak oil” affecting current prices is just talk, and prices are only moving on a larger than usual risk premium. As to the risk premium and whether or not it will "go away", the short answer is I think it will shrink to historic norms.
There's always been a risk premium of some size in energy prices and it expands and contracts with events. Personally I think it’s currently grossly exaggerated (as do people as diverse in opinion as the former CEO of Exxon and members of OPEC). It wasn’t all peace and light in the late 1990s when oil was at $16 a barrel and the world isn’t coming to an end (and we aren’t running out of energy) now at $75.
 

 
i've read nowhere anyone saying that "peak oil" is affecting current prices -- no one rational anyway.
but you've already proven that you'll make up your own enemy so you can shoot it down in an effort to solidify your position-
effective? yeah. honest? no.
 
 

 
Exactly....

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dude wrote:TexasRep wrote:mikebutler222 wrote:
.....I'm aware of the cost of  extracting the reserves, and as you well know, it still doesn't justify the current price. IMHO all the talk about “peak oil” affecting current prices is just talk, and prices are only moving on a larger than usual risk premium. As to the risk premium and whether or not it will "go away", the short answer is I think it will shrink to historic norms.
There's always been a risk premium of some size in energy prices and it expands and contracts with events. Personally I think it’s currently grossly exaggerated (as do people as diverse in opinion as the former CEO of Exxon and members of OPEC). It wasn’t all peace and light in the late 1990s when oil was at $16 a barrel and the world isn’t coming to an end (and we aren’t running out of energy) now at $75.
 

 
i've read nowhere anyone saying that "peak oil" is affecting current prices -- no one rational anyway.
but you've already proven that you'll make up your own enemy so you can shoot it down in an effort to solidify your position-
effective? yeah. honest? no.
 
 

 
Exactly....

Dude, you're late to the party and I'm not interested in a whizzing contest. <?:namespace prefix = st1 ns = "urn:schemas-microsoft-com:office:smarttags" />Tex, in his eagerness to make up for who knows what commented on my post before he knew what had been said on the subject in the prior thread.<?:namespace prefix = o ns = "urn:schemas-microsoft-com:office:office" />

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TexasRep wrote:mikebutler222 wrote:
.....I'm aware of the cost of  extracting the reserves, and as you well know, it still doesn't justify the current price. IMHO all the talk about “peak oil” affecting current prices is just talk, and prices are only moving on a larger than usual risk premium. As to the risk premium and whether or not it will "go away", the short answer is I think it will shrink to historic norms.
There's always been a risk premium of some size in energy prices and it expands and contracts with events. Personally I think it’s currently grossly exaggerated (as do people as diverse in opinion as the former CEO of Exxon and members of OPEC). It wasn’t all peace and light in the late 1990s when oil was at $16 a barrel and the world isn’t coming to an end (and we aren’t running out of energy) now at $75.
 

 
i've read nowhere anyone saying that "peak oil" is affecting current prices -- no one rational anyway.
Perhaps I could have saved us all some bandwidth if I'd just responded to the above with;
http://forums.registeredrep.com/forum_posts.asp?TID=2012 I think if you read this thread you'll read exactly that....

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i read nothing about the impending doom of mankind related to the peak-oil theory in that thread-- but that you did only proves my point about how you can manipulate the context to support your side--
you keep running from yourself here mike- i just wanted to point out that you can play supply games with oil stocks due to short term glitches, and not be a peak-oil nut job--
 
 
 

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i read nothing about the impending doom of mankind related to the peak-oil theory in that thread--<?:namespace prefix = o ns = "urn:schemas-microsoft-com:office:office" />
note to self... some people will take you literally when you jokely say "end of the world".....
 but that you did only proves my point about how you can manipulate the context to support your side--
Sorry, <?:namespace prefix = st1 ns = "urn:schemas-microsoft-com:office:smarttags" />Tex, but it proves nothing of the sort. Revealer, on that thread, voiced support for the "peak oil" theory. In this thread he talked how he came to the conclusion in Dec of 2000 that we faced " a supply problem of unprecedented proportions " and how "these impending shortages change everything we have been taught about investing." and his belief that we're only in the beginning rounds of higher oil prices.
You might think it's unfair or a "manipulation of context" to link the two. I don't, I think it’s obvious his comments are each part of his philosophical approach to investing in energy. You'll notice Revealer himself never tried to make the case that you're trying to make.
you keep running from yourself here mike-
No, Tex, you're just not familiar with what was said before you entered my conversation with Revealer.
i just wanted to point out that you can play supply games with oil stocks due to short term glitches, and not be a peak-oil nut job--
I never said you couldn't, and I don't recall saying "peak-oil nut job". I was referring to Revealer's comments (see above for the quotes) specifically, and they were about long term trends. For whatever reason you decided to attempt to apply my specifically directed comments to other situations.
Now, if you’d like to talk about future engery trends, I’m happy to continue. If all you’re interested in doing is taking my posts and twisting them to “prove” that I twist posts, I’m not interested in continuing. Life’s too short for whizzing contests, but I’m happy to learn if real if a real exchange of ideas is what’s going on.
 
 

 
 

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mikebutler222 wrote:Revealer wrote:mikebutler222 wrote:
Revealer wrote:He's right. (If not a little "fringy").....convinced me that the world was up against a supply problem of unprecedented proportions. "All things energy" include, oil, nat.gas, coal, drilling, transportation of same but only in North America. These impending shortages change everything we have been taught about investing.
Well, there are plenty of folks, it would seem, who are convinced that there's an "energy shortage" (ignoring the massive US coal reserves, increasing abilities to draw oil in places we couldn’t before, the recent demand destruction we saw at the last peak of gas prices and the tanking price of natural gas) and don’t think the current price of a barrel of oil has anything to do with a massive risk premium thanks to Chavez in Venezuela, Iran’s nuke stand-off with the world and the missile launches from the lunatic in North Korea.
Count me in the latter camp….

 

Mike: Please don't take my quotes out of context. I would ask that the readers read my ENTIRE comment. As far as lots of reserves of alternative source..... You are right. What I want you to do is some research on the COST of extracting those reserves. Of course there is a geopolitical premium in the price of oil. Think that's gonna go away?
Sorry, Revealer, but I don't see where your message was changed when I trimmed down the post to the specific point I wanted to address. But, others can read your original post in its entirety to make their own decision. <?:namespace prefix = o ns = "urn:schemas-microsoft-com:office:office" />
I'm aware of the cost of  extracting the reserves, and as you well know, it still doesn't justify the current price. IMHO all the talk about “peak oil” affecting current prices is just talk, and prices are only moving on a larger than usual risk premium. As to the risk premium and whether or not it will "go away", the short answer is I think it will shrink to historic norms.
There's always been a risk premium of some size in energy prices and it expands and contracts with events. Personally I think it’s currently grossly exaggerated (as do people as diverse in opinion as the former CEO of Exxon and members of OPEC). It wasn’t all peace and light in the late 1990s when oil was at $16 a barrel and the world isn’t coming to an end (and we aren’t running out of energy) now at $75.
  Of course we aren't running out of oil. Just running out of cheap oil. Ladies and Gentlemen: The cure for high prices is..........HIGH PRICES.

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>>>>Revealer, on that thread, voiced support for the "peak oil" theory. In this thread he talked how he came to the conclusion in Dec of 2000 that we faced " a supply problem of unprecedented proportions " and how "these impending shortages change everything we have been taught about investing." and his belief that we're only in the beginning rounds of higher oil prices. You might think it's unfair or a "manipulation of context" to link the two. I don't
Oh mike, you can have belief's in 2 separate theories and still not be wrong- if you then say that the short term supply issues COULD be the precursor to the longer term supply issue's theory conclusions, you MAY not be wrong--  but HE did not, YOU did- that's unfair, you should not connect the dots for someone, and then go on to rebut it with:
"...IMHO all the talk about “peak oil” affecting current prices is just talk..."
that's just wrong.
 
 

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Revealer wrote:mikebutler222 wrote:Revealer wrote:mikebutler222 wrote:
Revealer wrote:He's right. (If not a little "fringy").....convinced me that the world was up against a supply problem of unprecedented proportions. "All things energy" include, oil, nat.gas, coal, drilling, transportation of same but only in North America. These impending shortages change everything we have been taught about investing.
Well, there are plenty of folks, it would seem, who are convinced that there's an "energy shortage" (ignoring the massive US coal reserves, increasing abilities to draw oil in places we couldn’t before, the recent demand destruction we saw at the last peak of gas prices and the tanking price of natural gas) and don’t think the current price of a barrel of oil has anything to do with a massive risk premium thanks to Chavez in Venezuela, Iran’s nuke stand-off with the world and the missile launches from the lunatic in North Korea.
Count me in the latter camp….

 

Mike: Please don't take my quotes out of context. I would ask that the readers read my ENTIRE comment. As far as lots of reserves of alternative source..... You are right. What I want you to do is some research on the COST of extracting those reserves. Of course there is a geopolitical premium in the price of oil. Think that's gonna go away?
Sorry, Revealer, but I don't see where your message was changed when I trimmed down the post to the specific point I wanted to address. But, others can read your original post in its entirety to make their own decision. <?:namespace prefix = o ns = "urn:schemas-microsoft-com:office:office" />
I'm aware of the cost of  extracting the reserves, and as you well know, it still doesn't justify the current price. IMHO all the talk about “peak oil” affecting current prices is just talk, and prices are only moving on a larger than usual risk premium. As to the risk premium and whether or not it will "go away", the short answer is I think it will shrink to historic norms.
There's always been a risk premium of some size in energy prices and it expands and contracts with events. Personally I think it’s currently grossly exaggerated (as do people as diverse in opinion as the former CEO of Exxon and members of OPEC). It wasn’t all peace and light in the late 1990s when oil was at $16 a barrel and the world isn’t coming to an end (and we aren’t running out of energy) now at $75.
 
Of course we aren't running out of oil. Just running out of cheap oil. Ladies and Gentlemen: The cure for high prices is..........HIGH PRICES.
I've spent a good bit of bandwidth talking to other people about what you believe. Let me remedy that now.
How much of today's prices are, in your opinion, due to this running out of cheap oil and how much (if any) of the price is a risk premium due to <?:namespace prefix = st1 ns = "urn:schemas-microsoft-com:office:smarttags" />Nigeria, NK, Iran, etc? Do you see prices continuing to increase or is this speculative bubble?<?:namespace prefix = o ns = "urn:schemas-microsoft-com:office:office" />
And seriously, have you really found that energy investments are a tough sell?
 

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TexasRep wrote:
 
>>>>Revealer, on that thread, voiced support for the "peak oil" theory. In this thread he talked how he came to the conclusion in Dec of 2000 that we faced " a supply problem of unprecedented proportions " and how "these impending shortages change everything we have been taught about investing." and his belief that we're only in the beginning rounds of higher oil prices. You might think it's unfair or a "manipulation of context" to link the two. I don't
Oh mike, you can have belief's in 2 separate theories and still not be wrong-
Where's your evidence that these are two "separate theories" and not part of a consistant, unified approach?
if you then say that the short term supply issues COULD be the precursor
Only you raised the issue of "short term" supplies through your inventive reading of Revealer's quotes about his toughts dating back to Dec 2000. In fact "short term" was a phrase that you alone introduced. 
to the longer term supply issue's theory conclusions, you MAY not be wrong--  but HE did not, YOU did- that's unfair, you should not connect the dots for someone, and then go on to rebut it with:
You call it "connecting the dots" with zero evidence. I see a consistant theme, and Revealer hasn't said otherwise.
"...IMHO all the talk about “peak oil” affecting current prices is just talk..."
that's just wrong.
So you say, but you have to ignore everything he's said to believe it.
 

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BTW, Tex, Revealer's an adult and if he feels I'm mistaken in thinking/saying he has expressed a connection between his support for peak oil and current prices I'll admit it and apologize.
You, otoh, had to be informed after you began this attack line that he is, in fact, a peak oil subscriber.

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Like I said earlier. Do you suppose this is gonna go away? (Geopolitical problems) Like I also said earlier, "Most people don't WANT TO believe this is happening." And indeed, a lot of people will not buy energy because they believe this is some giant conspiracy. Look, I don't really care what you believe (or don't). If you look @ previous posts, you will see that I said, personally I am 3X weighted in energy (approx 30%) and I am nervous about that type of position. I will also share that I own many small E&P co's and refiners where I have NONE of my "own money" involved because I have sold off entirely original cost. Isn't this all about making $$? 

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Like I said earlier. Do you suppose this is gonna go away? (Geopolitical problems)
No, but we've always had them, as we did when oil was $16 brl. Is it your theory that (and I'm not trying to sound like a DA, just trying to understand your POV here) the risk premium will always be this high?
Like I also said earlier, "Most people don't WANT TO believe this is happening."
What's the "this" that you're talking about? Peak oil's effects?
And indeed, a lot of people will not buy energy because they believe this is some giant conspiracy.
The people I know who think it's a conspiracy are sure oil is only going up forever, since there would be no need for a conspiracy for any other purpose, and they want to buy, buy, buy. Are you saying some people think "peak oil" is a conspiracy or that high prices are?
Look, I don't really care what you believe (or don't).
I was hoping, since this is an exchange of views of professionals, you'd explain your theory on the matter to us and your expectation of prices.
If you look @ previous posts, you will see that I said, personally I am 3X weighted in energy (approx 30%) and I am nervous about that type of position. I will also share that I own many small E&P co's and refiners where I have NONE of my "own money" involved because I have sold off entirely original cost. Isn't this all about making $$? 
I have no problem with making money   and I'm not suggesting you're being unethical. This was all just an attempt to have a civil debate. Thanks for your time

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You're welcome.

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Revealer wrote:You're welcome.
rev-
sorry for hopping in- friday was just one of those days.
mike has this annoying habit of taking several things you may have written and amalgamating them into one unified statement, pretending not to realize that you did not actually state it that way, and then teeing-off on HIS version of what you wrote-
i've tried to bring this to his attention as a pitiful way for a bright guy to debate--- basically erecting a straw-man argument just so he can knock it over to solidify his viewpoint- 
he's done it to me, and to others, lately i just try to ignore it, friday, for some reason, i could not--
 
 

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Revealer wrote:He's right. (If not a little "fringy"). I've been long "all things energy" since Dec. 2000. Don't remember exactly what turned me on, but a combination of events/articles convinced me that the world was up against a supply problem of unprecedented proportions. "All things energy" include, oil, nat.gas, coal, drilling, transportation of same but only in North America. These impending shortages change everything we have been taught about investing. Tex: This was in response to a link to a Dec 2005 issue of Fortune where Richard Rainwater espoused his theory of "very disasterous" consequences of the impending energy "shortages". I simply agreed and you'd thought I'd passed gas (flatulence) in someone's church! My reference to "changing everything we've been taught about investing", is perhaps the reason that our markets P/E mutiples continue to shrink and we have been in a pretty poor market (less than normal rates of return) for some yrs. now. I intend to conduct my personal and client investments accordingly. I suggest everyone do the same based upon THEIR beliefs. However, a dogmatic attitude rarely wins in the long run (Buy and Hold?) We'll see how this all turns out, won't we?

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mike has this annoying habit of taking several things you may have written and amalgamating them into one unified statement,
Sounds like a lame way of saying I quote you...
 
 pretending not to realize that you did not actually state it that way,
What does this mean? Should I just assume the various things you've said are unrelated and an example of incoherent, unstructured thought?
 and then teeing-off on HIS version of what you wrote-
I have to assume by "HIS version" you mean that I quote you directly...
 
i've tried to bring this to his attention as a pitiful way for a bright guy to debate--- basically erecting a straw-man argument just so he can knock it over to solidify his viewpoint- 
Seems to me that's exactly what you did, erect a strawman...

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the current state of the oil market has allowed many to cash in on their belief's-- this, possibly short term, bull mkt has made many of my clients and relatives very rich- i have a cousin who at age 35 is considering partial retirement as he has seen his Valero stocks make him a millionaire in short order--
the peak oil theory, for the most part, see's global oil supplies peaking in 2010, and then dissipating very quickly, right as demand is escalating higher than ever-
question: is this current oil mkt bull run part and parcel of peak oil?
answer: who cares? if you are riding the wave, and making money-- but technically, the theory theorizes shrinking production as the precursor, and that 2010 is the outside date for production to begin decreasing at 3% per year--
so are you making money in todays market due to the peak-oil theory? possibly, as you said, we will see in time, if this has started with the energy-wars currently being staged- but the supply/shrinking production precursor is the true indicator and that hasn't happened yet-
most believe, i think correctly, that the current short term uptick in energy is due to the terror-premium factor, not a pure supply shortage result- but the encompassing theory also allows for these terror-wars/energy wars as part and parcel of the peak oil theory-
it's really interesting that so many have hopped on this bandwagon, yet very little seems to be changing--
 

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jeesh- you can really be thick when you need to be............
 
mike has this annoying habit of taking several things you may have written and amalgamating them into one unified statement,
Sounds like a lame way of saying I quote you...
roses are red.violets are blue.Mike: "Although you believe all flowers are either red or blue, it doesn't make it so.."
 
 pretending not to realize that you did not actually state it that way,
What does this mean? Should I just assume the various things you've said are unrelated and an example of incoherent, unstructured thought?
Don't be a retard.. you are beginning to admit that you can't understand english when it doesn't suit you..what it means: The peak oil theory is convincing to me.I am making money in this oil-stressed market.Mike:"...IMHO all the talk about “peak oil” affecting current prices is just talk..."you knock down the strawman that you erect.....
 
 
and then teeing-off on HIS version of what you wrote-
I have to assume by "HIS version" you mean that I quote you directly...
But you've already admitted that you don't bother....Mike: "You might think it's unfair or a "manipulation of context" to link the two. I don't...."
 
i've tried to bring this to his attention as a pitiful way for a bright guy to debate--- basically erecting a straw-man argument just so he can knock it over to solidify his viewpoint- 
Seems to me that's exactly what you did, erect a strawman...
No clue what this means....look, all i'm saying is that you should refrain from "linking" things people say in effort to bend them into a position that you can then bash...it's beneath you.
 
 

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jeesh- you can really be thick when you need to be............
What was I thinking, assuming you could be civil....
mike has this annoying habit of taking several things you may have written and amalgamating them into one unified statement,
Sounds like a lame way of saying I quote you...
roses are red.violets are blue.Mike: "Although you believe all flowers are either red or blue, it doesn't make it so.."
Strawman... a pure invention. I could do the same...
roses are red
violets are blue
Tex: "Where did I ever say anything about flowers? Stop "bending" what I've said"
 
 pretending not to realize that you did not actually state it that way,
So you're saying you don't have an example, fine...
What does this mean? Should I just assume the various things you've said are unrelated and an example of incoherent, unstructured thought?
Don't be a retard.. you are beginning to admit that you can't understand english when it doesn't suit you..
What are you, 15? If you don't what to be quoted for exactly what you've said, that's your problem.
what it means: The peak oil theory is convincing to me.I am making money in this oil-stressed market.Mike:"...IMHO all the talk about “peak oil” affecting current prices is just talk..."you knock down the strawman that you erect.....
It seems it will never sink into you (since you entered a converstaion at the mid-point) that Revealer HAD BEEN supporting peak oil and using it as an under-pinning in his CURRENT oil investment strategy. Just because you didn't know it doesn't mean I invented it.

 
 
and then teeing-off on HIS version of what you wrote-
I have to assume by "HIS version" you mean that I quote you directly...
But you've already admitted that you don't bother....Mike: "You might think it's unfair or a "manipulation of context" to link the two. I don't...."
I admitted nothing other than the fact that YOU clearly didn't understand what Revealer had said and continued to defend long after you inserted yourself in the conversation.  IOW, just becuase you see a problem doesn't mean there is one. All you did was provide a side-show as Revealer explained his theory.
Speaking of manipulating, nice job editing those quotes...
 
i've tried to bring this to his attention as a pitiful way for a bright guy to debate--- basically erecting a straw-man argument just so he can knock it over to solidify his viewpoint- 
Seems to me that's exactly what you did, erect a strawman...
No clue what this means....
You erected a strawman with this "Mike has this annoying habit" when I hadn't done anything of the sort. You simply inserted yourself, unaware of Revealer's prior comments, which BTW, he didn't back away from, ala Tex.look, all i'm saying is that you should refrain from "linking" things people say in effort to bend them into a position that you can then bash...it's beneath you.
Notice that only you, and not Revealer felt anything had been "bent".  "Linking" (I assume you're referring to me QUOTING things people have said) things people say seems to me to be a fine way of understanding what they mean. I would hope an adult could speak up for themselves if they feel they've been  misintrepreted and say so. This isn't a trial, there are no traps here, your bruised ego isn't the center of events here.
I suggest that if you, speaking for yourself, feel your positions have been "bent", simply say so and save the outrage. 
 

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