Author: Petros

Yeah, but are YOU open to dialogue (Poserorprophet, Dan Oudshoorn)

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Dan Oudshoorn, one of the leading radicals that was critical of Tyndale Seminary and University College for having a fund raising event featuring U.S. President George W. Bush, claims that Tyndale has stifled dialogue with dissenters, such as their accusation that the Tyndale president Gary Nelson censored professors–after a meeting with Nelson, Oudshoorn wrote:

When pressed on the ways in which it appears as though Tyndale is muzzling professors who present an opinion that is more critical of the ways in which the administration has handled this process (i.e. the puzzling redaction of the Christian Week article written by Arthur Boers, compared with the remarks made by Carter and Masson), Gary was adamant that he would never muzzle any professor and that he is a very firm believer in academic freedom. Instead, Gary presented a fairly compelling narrative as to why the article was redacted but I don’t want to get into the details of that, or the details that I have heard from another reliable source that provides a somewhat different narrative (which I mention for the record because, in this case, I don’t want to appear as though I have taken a stand one way or another).

[snip]

So, we see claims of transparency yet a refusal to speak with us, which was only broken down due to the threat of ongoing pressure (NB: I’m not claiming that this means that Gary does not value transparency; the conclusion I’m drawing is that he is in an institutional position that is situated amongst the elites in such a way as to have certain blind-spots about what transparency does or does not mean).

Yet try commenting on Oudshoorn’s blog.  I did once when he mentioned me by name, and he summarily erased my comment, though he has come here and commented so far without censorship.  So I conclude that his intention is to insist on dialogue on our turf but won’t permit it when he is in control.  This is typical of the radical Left, which insists on the freedom to say what they want but then will attempt every sort of speech code to stifle what they don’t like.

PROOF:  At a recent blog post of Oudshoorn’s, I made the following comment that he later erased: Continue reading →

You keep using that word IV: fiat

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Economics has become a pseudo-science and one of the reasons why the education bubble is real and will result in the demise of the university system.  It will collapse under its own weight of stupidity.  Here I am a university-trained PhD telling you that much of what goes on in academics is just a bunch of  fantasies created in the mind of the scholars.  In my own field it consists of such scholarly imaginations as Q, the Secret Gospel of Mark, or the anti-Semitic source theory of the Pentateuch (JEPD [pdf]).

So it is not at all surprising to me to learn that the same foolishness inhabits other fields of study, including economics.  So now a certain Prof. Willem Buiter has produced a blog post entitled, “Gold – a six thousand year-old bubble“.  Rather than just simply admit that gold has intrinsic value because of its rareness and unique properties, Prof. Buiter, that colossus of economic brilliance, concludes that mankind throughout recorded history has kept gold in a bubble.  In my view, wisdom would dictate that 6000 years as a currency would make gold the most secure form of money known to man.  But alas, then Prof. Buiter writes these lines:

Gold has become a fiat commodity or a fiat commodity currency, just as the US $, the euro, the pound sterling and the yen … [snip] are fiat paper currencies. (From Financial Times Blog, [snip because of 30 word limit imposed by Financial Times])

The term fiat actually refers to currencies with nothing, such as gold or silver, backing them.  Such currencies are predestined for failure as the temptation to make too much of it seems to derive from human nature.  On the other hand, gold has intrinsic value, so it requires no backing.  To call gold a “fiat” anything is as stupid as Nouriel Roubini saying that gold has no intrinsic value.  These economists don’t even understand what the terms “fiat” or “intrinisic” mean.  This is disgusting and pathetic and it is no wonder that the world is in such economic chaos with such dunderheads running the show.

For the correct definition of fiat currency, see Investopedia.

And now for the video clip, which I dedicate to Prof. Buiter :

Gold versus paper currencies in the aftermath of war

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To understand the value of gold as a currency with intrinsic value versus paper currencies which have only derivative value, it is perhaps helpful to consider what happens when a war comes to a conclusion.  The victors, if they ask for tribute or war reparations, will only accept gold.  Consider that throughout history, when conquerors overtook cities, they would strip them of gold and silver and other precious real goods, such as when Alaric sacked Rome in 410.  They didn’t say, “Oh please, would you print some images of the Emperor and give them to us.”  Instead, the barbarians forcefully took away the intrinsic wealth of the city.

In our more recent past, we see that the United States has been able to force its paper currency on the losers of wars.  At the end of the Civil War, the Confederate dollar became worthless paper.  The loser cannot make the winner accept its paper.  Then, at the end of World War II, the US was able to begin to impose its currency on the rest of the world, until it became the world’s reserve currency.  Originally the US dollar was a derivative for gold; but  afterwards, Nixon took it off the gold standard, and it became a purely fiat currency.  But had the United States not won World War II, we’d be speaking German and Japanese and Yen and Marks would have become the world’s reserve currencies.

At the end of World War I, the Treaty of Versailles imposed war reparations upon Germany, mind you not in the paper currency of the Weimar Republic, the Deutsche Mark, which became so much wallpaper in a few years, as it began to fill the wheel barrows of the country.  No, the treaty required that the Germans pay back their debt in gold.  Funny, isn’t it?  How is it that the loser of a war can impose upon the winner the acceptance of a metal which has been in a 6000 year bubble?

Should Canadians boycott the USA?

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I wrote the following comment at Beating the Index, after Mich asked us what we thought of an oil company operating in Texas:

Hi Mich:
I gave up my US citizenship on February 28 2011, and I am very angry with the United States and its attempt to persecute Canadian residents, about 1 million of us, with extra-territorial taxation and persecution through laws that are intended to attack money launderers, drug dealers, and terrorists. Many innocent Canadians with dual citizenship with the US have become fearful of not even being able to cross the border to visit their families now, and Canada’s finance minister, Jim Flahrety, has told the IRS to back off of innocent Canadians who are not tax cheats.

When you expatriate from a country because you think that the people running it are persecuting you, treating you in an unfair manner, do you think that’s gonna be the first place you would want to invest? I’ve decided to stop even travelling to the US, except for family emergencies where the risk reward ratio makes sense. I did invest in Texas a few years ago, but thanks again to the US Federal government, I was basically fleeced for 70K. No thanks. Never again.

I think EGL could turn out to be a good investment, but with the OWS movement and an administration that wants to tax the rich, is not nationalization of the resource sector not far off? Paint me as paranoid, but the US federal government has caused me great suffering by threatening me, someone who’s lived in Canada now 25 years, I feel like requesting my fellow Canadians to keep their money at home and to boycott the USA until they [the Yanks] can figure out that it is not right to attack innocent Canadians.

Thanks for letting me rant a little. I just think people should know about this.

What does the sale of Brigham Exploration tells us about the value of Petrobakken?

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Today we learn that Statoil has offered 4.4 billion for Brigham Exploration, a company with holdings in the US Bakken. Using a number of interesting methods of comparing the Brigham Exploration with Petrobakken, Devon Shire concludes that Petrobakken could be worth as much as 300% of its current market price (at close on Oct 17, $8). This kind of comparison is very interesting, because, as I reminded readers in a previous post about Petrobakken, the true value of an junior or intermediate oil company isn’t so much its market capital, but by how much an industry insider such as Sinopec or Statoil is willing to pay. Devon Shire writes:

I don’t know exactly what Petrobakken is worth. But common sense tells me that an acquirer would be willing to pay a lot more than the current share price.

Petrobakken is just like Brigham. They are both companies that have years and years of drilling locations ahead of them and both companies sit on vast amounts of oil. That is why the multiples of flowing barrel of production and EBITA being paid for Brigham are so high.

You can’t value these companies using the same approach as you do for a conventional oil and gas producer. Much of the value is in the huge land positions that these companies have in unconventional resource plays. And much of that doesn’t show up in proved reserves because most of the undeveloped acreage isn’t booked as proved reserves.

It isn’t just Petrobakken that is massively undervalued right now. The entire sector in Canada is. Pick an unconventional producer and I almost guarantee it is trading at 50% or less than what an acquirer would pay.

All it takes is some common sense to see it. And some patience to wait for Mr. Market to figure it out.

See also:  What does the sale of Daylight Energy tell us about the value of Petrobakken?