Where does America get its oil?

If you think America gets most of its oil from Saudi Arabia or the Middle East, you are wrong. ExxonMobil ran an ad in yesterday's WSJ (12/10/08, A10-11) showing the sources of America's oil imports:

55% = North American (includes Canada, Mexico)
16% = Africa
14% = Middle East
12% = South America (includes Venezuela)

The remaining 3% comes from Russia/Caspian, Europe, and Asia-Pacific (includes Indonesia).

Last time I checked, the top three suppliers of American oil were Canada, Mexico, and Venezuela.

Scott Burns on Social Security

Scott Burns on Social Security--skip the first question and go to the second one:

http://assetbuilder.com/blogs/scott_burns/archive/2008/12/10/what-others-are-doing-with-their-401-k-money.aspx

I didn't know how the Social Security system really worked until I read Mr. Burn's response to the second question.

The Poor, Poor American Dollar

I have a treat for my readers--The Atlantic's (December 2008, p. 62) interview with Gao Xiqing, who oversees and invests $200 billion of China's $2 trillion U.S. dollar holdings. This interview is one of the best ones I've ever read because of the government official's openness:

http://www.theatlantic.com/doc/200812/fallows-chinese-banker

Below are my favorite two parts from the interview, one about the American dollar, and the other about derivatives:

Everyone is saying, “Oh, look, the dollar is getting stronger!” [As it was when we spoke.] I say, that’s really temporary. It’s simply because a lot of people need to cash in, they need U.S. dollars in order to pay back their creditors. But after a short while, the dollar may be going down again. I’d like to bet on that!

I have been converting my dollars into Canadian dollars recently. I already have euros (FXE) and some Swiss francs (FXF). We'll see in a year whether my decision was the right one. I felt compelled to diversify my U.S. dollar holdings, because they were earning around 1% in interest, while competing currencies had much higher interest rates and the possibility of greater upside.

As for derivatives, here is what Mr. Gao had to say:

If you look at every one of these [derivative] products, they make sense. But in aggregate, they are bullsh*t. They are crap. They serve to cheat people.

Mr. Gao explains derivatives by comparing them to multiple mirror reflections of one actual product. It's such a perfect analogy, I'm surprised no mainstream American publication has mentioned it until now.

Kudos to The Atlantic and Mr. Fallows for publishing this interview.

Investment Outlook

My personal sentiments regarding the stock market are similar to Jim Rogers'. Basically, I am overweight commodities and just bought a Commodities ETF (DBC). I also added to my Canadian dollar position (FXC), as an indirect play on commodities.

I disagree with Mr. Roger's assessment of American stocks being too expensive--many "blue chip" technology stocks appear cheap because of their high net cash holdings and market share. T. Rowe Price holds my 401(k), and around 17% of my 401(k) is in its Science and Technology fund (PRSCX). This particular fund has a relatively high percentage of its holdings in semiconductor companies.

The information on this site is provided for discussion purposes only and does not constitute investing recommendations. Under no circumstances does this information represent a recommendation to buy or sell securities or make any kind of an investment. You are responsible for your own due diligence.

The Auto Bailout, from a Gender Perspective

Amy Siskind has this to say about the auto bailout:

Pew Research recently reported that in 43% of all U.S. homes, women make more of the decisions on household finances (men make more in 26%, and in 31% of homes it is equal). Why then is it that our automotive committee is composed of 21 senators, 20 of which are male. So while 43% of women make the decisions at home, 5% of our Senate Banking Committee is composed of women?

She makes a darn good point.

"Terrorists Are Criminals"

The SJ Merc has a great letter in today's paper (December 9, 2009, 9A): 

All Muslim organizations that I am associated with, including the local mosque, have condemned the Mumbai murders, and all Muslims I know are outraged by this incident in which innocent Hindus, Muslims, Christians and Jews were killed. Yet, people still demand something from Muslims. Terrorists are criminals who represent no one but themselves, and if they happen to embrace the same religion as you or I, then so be it. Religion is intended to teach us about God and how to worship and help others, so people of all faiths must join against the ignorance of terrorism and false accusations. 

Jim Zanghi 

I expressed similar sentiments in an earlier blog post (Anti-Terrorist Sentiment Does Not Require Overt Public Acts): 

When an unarmed black man (Amadou Diallo) in New York is shot 19 times by Christian police officers, does the failure of Christians across the United States condemning the NYPD mean they condone senseless killings? Of course not. Such examples can be made ad infinitum, and it should be fairly obvious that an absence of mass protests or vocal opposition has no relevance as an indicator of general support or non-support. The reasons for silence among most "ordinary Pakistanis" are simple. Muslims in Pakistan don't know the killers in India and don't feel any connection to them. To the 99.9% Pakistanis who live their lives peacefully, there is no connection to the killers in India and therefore no reason to say anything publicly about their heinous acts. 

Countries act against their own interests when they force ordinary citizens to choose between their religion and supporting law enforcement in the battle against terrorism. Governments need to condemn associating terrorism with any single trait, whether religion or race, so as to ensure the broadest possible cooperation among their citizens.

Guanabee

Here is a little-known website that is apparently targeting a Latina audience--I am giving it props, just because:

http://guanabee.com/

It's written in an informal style, and some material is NSFW, but it's a fun website if you like gossip and pop culture. Here's the page that led me to the overall website:

http://guanabee.com/2008/12/guanabee-presents-5-most-epic-quinces-fails.php