Oil at $80 Is No Bar for BP, Total on Exploring for More Crude

35 Comments on "Oil at $80 Is No Bar for BP, Total on Exploring for More Crude"

oilystuff on Mon, 10th Nov 2014 8:03 pm 



After 50 years of being in the oil business the only thing I could ever “assume” about the price of oil was that it would change, usually downward, sometimes up, but never was it going to happen on my time table.

So this is incredible news to me, a “base assumption” of $100 a barrel. Wow! Is there somebody I can see about this, a form to fill out, you know, to make a claim?

Rockman, why didn’t you tell me, man?

This is another ridiculous self serving article that does little more than keep some wanker at Bloomberg busy writing something. Of course the conventional oil business can make money at 80 dollars a barrel. Its the shale oil business that has everybody’s panties in a bunch.

rockman on Mon, 10th Nov 2014 9:17 pm 



Oily – Exactly. I wonder how folks miss the obvious. So not that many years ago did BP et al not exist when oil was selling for $60? $40? $30? I’ll say it for the umpteenth time: an oil company’s profitability will never be a function of the price of oil/NG. It has always been a function of what it cost the company to get it out the ground. And it isn’t just the shales…I’ve seen it many times with conventional trends: boom time prices create the worse profit margin periods. Same story I told the other day: the best profit margin for a drilling program I have ever conducted was done with NG selling around $1/mcf. Part of the explanation: very low drilling costs. Why? Easy: the oil biz was in the toilet. Oil was also selling for less then $15/bbl. The service companies were desperate for any work they could get. I could drill and complete a 5,000′ well for $60,000 in the mid 80’s. Today the same well would cost me more than $600,000.

The serious problem the public companies face isn’t making a profit per se: they’ll just drill fewer risky/expensive wells and many will have better profits. The very serious problem will be not having enough new wells to drill. Which means they won’t develop enough new reserves to replace depletion. And this potential crash could be the worse by far we’ve ever seen in the oil patch IMHO. And that will be the direct result of the boom in production from the short lives of the shale wells. In the eyes of Wall Street a declining asset base is a death sentence. And if prices stay low enough long enough death will come quickly in the form of corporate acquisitions and not bankruptcy for many pubcos. Does any one know why there’s a company called ExxonMobil today? There used to be two companies: Exxon and Mobil. As well as a Gulf Oil, Texaco, etc. etc.

I suppose for the youngsters out there this potential might be seen as a big surprise. For those of us who have been in the game for 40+ years it’s just the same old same old. LOL.

shallowsand on Mon, 10th Nov 2014 11:43 pm 



I finally can relate to my little corner of the oil field why this shale stuff cannot work unless the price goes up significantly. It was triggered by the discussion above about costs to drill and comparing what it cost to drill in my area 20 years ago versus today.
The cost to drill and complete a well in the shale areas is roughly 100 times what it costs to drill and complete a well in our ancient depleted field. So would I want to go crazy drilling wells that would IP at 5-20, be making 2 after 12 months and making 1/2 bbl or less after 3 years, with an EUR of 3,000 to 5,000, with a significant amount of CAPEX being borrowed? NO. Not at $100 at the wellhead and most definitely not at $60-$70 at the wellhead.
The only way we get by drilling in this little tired field at $90-100 is drilling out of cash flow, a decline after year one of 2-4% and having significant production that was purchased/developed during a much lower cost environment.
We are in an area discarded by all but mom and pop companies about 20 years ago. I’m sure I’m missing something in my calculations here but all I can say is yikes if we are pinning our country’s oil future on fields less profitable than our crummy old stripperfields.

Davy on Tue, 11th Nov 2014 5:52 am 



Rock & Shallow, I know you guys heard this before but I think this time is different. The traditional oil co business model may be in for a makeover. This new normal financial repression economy and new normal fractured world order is changing everything. Gone are the normal fundamental market mechanisms we knew in the past. Gone is Pax Americana and post USSR order.

Gone are the reasonable forecasts of where we are going. In this new normal that has no historical reference because we are now under the influence of artificial liquidity through massive debt and repressed rates. We can use your history and knowledge to make educated guesses but we can’t do much good past that. This is true in all sectors now. This is not your daddy’s economy. Remember that commercial in the late 1980s proclaimed that this was “not your father’s Oldsmobile.

Makati1 on Tue, 11th Nov 2014 6:31 am 



FYI: Tes, I know it is RIGPORN, but…

http://www.rigzone.com/news/article.asp?hpf=1&a_id=135827

“Nov 10 (Reuters) – Transocean Ltd, the owner of the world’s largest offshore drilling fleet, said it was likely to retire additional rigs as the company continued to face pressure due to slowdown in an oversupplied rig market…

– See more at: http://www.rigzone.com/news/article.asp?hpf=1&a_id=135827#sthash.1fXsUfaa.dpuf

“Rigs targeting oil sank by 14 to 1,568 this week, the lowest since Aug. 22, Baker Hughes Inc. (BHI) said yesterday. The Eagle Ford shale formation in south Texas lost the most, dropping nine to 197. The nation’s oil rig count is down from a peak of 1,609 on Oct. 10…

oilystuff on Tue, 11th Nov 2014 7:20 am 



Davy, respectfully, unconventional shale resources I believe make up about 5-6% of total world crude and condensate production, the rest comes from exploration and production dynamics that are not based on leverage and staying on a drilling hamster wheel. It is really not a fractured world out there, it is still quite homogenous. I will remain old fashion, thank you very much; my goal is to drill reasonable prospects that return reasonable profits, without borrowing money to do so. If the price of oil fluctuates, we hang on for better days. That model has worked pretty well for the past 150 years. I’ll stick with it a while longer.

rockman on Tue, 11th Nov 2014 8:23 am 



Davy – “Gone are the reasonable forecasts of where we are going.” I’m probably missing your main point. But as you know I’ve been doing this for 40 years and I’ve not seen any significant change in the oil patch business model over my career. But there has never been one model per se. Majors have one, smaller pubcos have a different one, prospect generating promoters have another, small privately owned companies have yet another. But not really different than they were decades ago.

Maybe you mean pubcos borrowing a sh*t load on money to support a mad dash to develop reserves thanks to a surge in oil prices? And then using those expensive $’s to bump the rig count way up? In 1979 I worked for a pubco that borrowed every penny they could using their share of a new 1 BILLION bbl discover offshore Indonesia. And that wasn’t enough to satisfy their business plan so they placed a $100 million bond offering in the US market. And how is it different now? The oil price spike back then lead to 4,500+ rigs drilling compared to less than half that number running during the current “drilling boom”. And what happened all those decades ago when demand destruction reduced oil prices? Kinda what we may be seeing today: the same business model potentially taking it in the teeth now just like it did in the early 80’s.

Yep: me and Shallow are old farts and have seen a lot. But what some perceive today as the beginning of the end for the oil patch, especially the shale players, hasn’t come close (yet) to the panic the oil patch went thru 30 years ago. So far the current situation is just a bump in the business plan road for so many of those pubco shale players. BTW that pubco I worked for in the late 70’s with the business plan of borrowing/drilling their way to success: they couldn’t pay even one penny of that bond note, filed bankruptcy, had their interest in that billion bbl field liquidated for about $.08 on the dollar value they had booked. If oil stays low enough long enough you’ll see the same downside of this business model that many pubcos have been running for a few years now.

So yeah: for me it’s just history repeating itself so far. The only difference is that the current situation hasn’t gotten anywhere close to how it went 30 years. Today there are worries over oil prices slipping 25% or so. Compare that to what a 70% drop in oil prices did to the same biz plan 3 decades ago.

You ain’t seen nuthin’ yet! LOL.

shallowsand on Tue, 11th Nov 2014 8:37 am 



ROCKMAN: I agree with your above post except for one thing, although I am not completely sure. That is that shale today is dollar for dollar a worse investment than conventional onshore of 30- 35 years ago. At least that is the way it appears, and maybe why this down turn will stop in the 60 WTI range and not in the 30 WTI range. I think 60 may hurt shale about as much as 10 hurt conventional in 1986 and 1998. At least that is my selfish hope. I am afraid, however, that if the shale is really hammered, that will set up a super spike, which will set up another 2008. Not good.

Davy on Tue, 11th Nov 2014 9:05 am 



Guys, respectfully, I have only experience with heavy equipment sales, service, and parts to pipeliners.

My sole point is the oil sector has never gone into a period like we may be going into now. Until that happens and it may not happen like doomers believe your experience and insight hold true.

As a doomer my point is a paradigm shift leaving no rock uncovered is a few months or years away. Crying wolf you say, well maybe. Sorry, I am a hardcore doomer lite that is dedicated to lifeboats and plan B’s.

shallowsand on Tue, 11th Nov 2014 9:37 am 



Davy. I don’t disagree there is a long term problem. Don’t know about going back to horses and plows any time soon. However, I do worry about oil prices going too high and too low over the long term, with the new highs and new lows being significantly higher. Prices will be cyclical, always have been. However, worried about fluctuations like 2008-2009. With all of the debt out there, it is difficult for consumers to adjust to $5 gasoline on short notice. I read the opinions that technology is behind the US boom, but it would not have happened without $90-100 oil prices. I am skeptical about development costs dropping, efficiencies, etc. Costs in oil and gas fall when commodity prices are tanking, not when they are high. I am not completely undiversified. As our country continues to be unable to afford paying interest, and because there are no pensions, our retirees must rely on 401(k)’s invested in the stock market. Will they enjoy prosperity if we have a few more oil price super spikes in the next 20-30 years? Further, there is a 401(k) thread on this board. Seems it has been pretty tough for many to put much in those anyway and keep from withdrawing it early.

Davy on Tue, 11th Nov 2014 10:44 am 



Shallow, your insight is noted and agreed with. I hope things hold for awhile because I have allot to do yet with my new cattle operation. I also worry about my kids. It is folks like you who bring sobriety to my gloom and doom. I welcome that.

Kenz300 on Tue, 11th Nov 2014 12:10 pm 



The fossil fuel companies need to change their business models and become “ENERGY” companies and embrace alternative energy production. Even fossil fuel companies need to diversify and limit their risks.

oilystuff on Tue, 11th Nov 2014 1:02 pm 



No we don’t. We are in the business of extracting fossil fuels.

shallowsand on Tue, 11th Nov 2014 1:38 pm 



Kenz300. I am sure if ExxonMobil, etc could make a better return on alternatives than oil and gas they would do just that. BP has used investment in alternatives for PR purposes, not sure they make much $$ at it. Maybe some day alternatives will get there. However, they are drilling in 8000′ of water, through shale, in the Arctic and in the middle of terrorist laden war zones. I think competitive alternatives are a ways off. Also seems like all of them require some level of ff anyway.

Northwest Resident on Tue, 11th Nov 2014 1:47 pm 



“401(k)’s invested in the stock market”

Ah, the “Institutional Fish”.

http://www.theautomaticearth.com/institutional-fish/

Stocks are highly manipulated and inflated way beyond their actual value. I don’t know about 50% over-valued, but this writer makes a fairly decent case. Note how much of the inflated stock value is due to large corporations buying back their own stock with leveraged QE cheap-interest QE money.

Like Davy, I love your optimism, steve.

Markets Are Overvalued By 2X——Here Are The Reasons Why

http://davidstockmanscontracorner.com/markets-are-overvalued-by-2x-heres-the-reasons-why/

shallowsand on Tue, 11th Nov 2014 3:05 pm 



Northwest. I do not disagree with you. When oil spikes again stock market will tank. Everyone will panic and turn retirement accounts to cash, and then lock in losses by not re-entering stocks until it is too late. Which all in all is a horrible way to try to achieve a good retirement income. But cds pay less than 1%. Gold pays no income. I have a finance degree and am not confident investing in stocks, why should people with no training at all be expected to be able to do it. I guess plow it into an index fund?

ghung on Tue, 11th Nov 2014 3:23 pm 



shallowsand – CDs? Index funds? A lot of folks here expect all of these things to go away in the “big reset”, that financialization will be history. The entire investor class as we know it wiped out.

This won’t be your grandaddy’s depression, but a fundamental change in the way the world does business (or doesn’t). The idea that the average working citizen can have investment income and retirement will die along with the industrial age that allowed this fluke of human history to come about at all.

How this plays out is anybody’s guess, but I have serious doubts that it will be a series of soft landings. It all boils down to falling per capita energy consumption and the rate of decline.

Northwest Resident on Tue, 11th Nov 2014 3:36 pm 



shallowsand — Like ghung says, I also expect the whole “retirement income” thing to disappear like mist in the wind. I don’t see how the financial system survives what the International Settlements bank is predicting will be a “violent unwind”. This won’t be a stock market crash like the one in 1929. Back then, they still had plenty of cheap oil to power them out of the deep depression and right back into the good times again — with a little help from WWII of course. This time, we won’t have the virgin forests, the un-fished waters, the vast tracts of open land, the untapped mineral resources, etc… and we sure as hell won’t have much if any oil left. Which is why THIS TIME, I’m afraid we’re looking at the final bust in what has been a long undulating boom/bust rollercoaster that we’ve all been riding for the last couple hundred years. I think of it as the eternal bust from which there is no escape. And I’m an optimist!

shallowsand on Tue, 11th Nov 2014 4:02 pm 



Northwest and gh. You may be right. I just hope you are way early on your predictions.

rockman on Tue, 11th Nov 2014 4:03 pm 



Davy – “My sole point is the oil sector has never gone into a period like we may be going into now”. Maybe we’re looking at different metrics in the oil patch. What exactly is this “period like we’re going into”?

Maybe I didn’t emphasize that the bust in the early 70’s didn’t just hurt the company I described along with a few others. It crippled/destroyed hundreds of companies. So again from the “boom” side what has gone on for the last 10 years really does pale in comparison. As I mentioned look at the rig counts for the two periods:

In the 10 year period from 1971 thru 1981 the US rig count increased from 1,320 to 4,781. That was the result of oil prices increasing 300%. And what was the effect on oil production: it DECREASED from about 9.2 million bopd to 8.7 million bopd. In the last 10 years the rig count has increased from 1,050 to 1,920. This was also the result of oil prices increasing 300%. And that effect on production: an INCREASE from 5.5 million bopd to 7.5 million bopd.

So in the 70’s boom the US oil patch increased the drill rig count 360% and that resulted in a DECREASE of 500,000 bopd. And in our latest boom the oil patch increased the rig count by 180% and that resulted in an INCREASE of 2 million bopd. And you want to argue that the oil patch has never had its head as far up its ass as it does now? LOLLLLLLLLLLLLLLL.

To be honest I can understand why these stats might be news to a lot of folks: I could find dozens of charts showing the rig count but only from the late 90’s or so. Took much longer than I expected to search the web for documented rig counts from back in the 70’s.

Shallow – “That is that shale today is dollar for dollar a worse investment than conventional onshore of 30- 35 years ago.” You mean like the $billions spent for those 4,000+ rigs drilling 30 -35 years ago that resulted in a DECREASE of 500,000 bopd? LOLLLLLLLLLLLLLLLLLLLL

shallowsand on Tue, 11th Nov 2014 4:47 pm 



ROCKMAN. If you are right and shale is better than conventional of 30 years ago the price should head to $25-40 long term, next ten years or so. Isn’t that about where we where 1986-1998 adjusting for inflation? Did all of those conventional wells 30+ years ago cost $2-3 million in 1970s-1980s dollars? Did they decline as steeply? You may be right, but I hope not. If you are right there are a lot of people like me that need to bail now.

shallowsand on Tue, 11th Nov 2014 5:14 pm 



Maybe 30-60, either way its not great. Put it another way, I do realize dry holes much more probable 30+ years ago than in shale fields now. However, lots of multi million shale wells that won’t cum. 100,000 either. If you spent half a million on a well back in 1980, would 8,500 bbl of oil in first 48-60 months have cut the mustard. That seems to be what you are looking at in Bakken and Eagle Ford times 20 on average. $10 million for 170,000. Who knows, maybe we are headed for another 10+ year bust.

ghung on Tue, 11th Nov 2014 5:41 pm 



Gosh, Rock, you can LOL all you want, but others here can easily rattle off dozens of other statistics as to how the global economy, demographics, demand, etc have changed pretty dramatically since 1971. That oil’s relationship to the economy hasn’t changed much is alarming on a certain level,, and that the oil patch, in a sense, has the global economy by the balls doesn’t belie the fact that the global economy also has the oil patch over the same barrel. Without the capex and customers, many of you guys will be back to driving cabs or something. That’s where my concerns are. I expect that a lot of oilcos will be reaching their MOL in the next year or two, and at some point it will be ‘rinse without the repeat’. I’m with Gail on this.

shallowsand on Tue, 11th Nov 2014 6:17 pm 



Screwed my last post up. Should divide the cost of a 1980 well by 3 to factor inflation. Even still, would a 5000′ well that cost $60,000 that didn’t produce 10,000 bbl gross in 60 months have been considered a success?. I have to be missing something in my thinking about the shale boom. Someone tell me, I’m far from perfect.

Gh. I have read this theory several times since I arrived here. It makes sense, but again, timing may be further out than many here are predicting.

rockman on Tue, 11th Nov 2014 6:22 pm 



ghung – “…how the global economy, demographics, demand, etc have changed pretty dramatically since 1971.” ???? I’m not sure what you think I said in my post but it had nothing what so ever to do with the global economy, demographics or demand. Davy and I were discussing the what’s happening in the oil patch today. As Davy said: “…the oil sector has never gone into a period like we may be going into now”. Which, as I pointed out in exquisite detail, isn’t close to true: it went thru a much more overhyped phase with a much more dismal outcome then anything we’ve seen so far today. Some folks are running around sounding the alarm over the ongoing demise of the oil patch. As I said earlier if folks think these are bad times for the industry: they probably ain’t seen nothing yet.

I don’t fault Davy for his misinformed impression. Unless you’ve been in the oil patch for the last 40 years your knowledge of oil patch history is based only upon the “education” most get from the MSM. And that source typically makes me LOLLLLLLLLLLL.

Kenz300 on Tue, 11th Nov 2014 6:46 pm 



The most costly and least profitable projects will be delayed or cancelled. The most underfunded production companies will go broke………

In any case lower oil prices will cause a revaluation of future fossil fuel investments.

And all the while alternative energy sources get cheaper every year.

German Renewables Output Tops Lignite

http://www.renewableenergyworld.com/rea/news/article/2014/10/german-renewables-output-tops-lignite

Davy on Tue, 11th Nov 2014 6:56 pm 



Rock, I guess I need to make myself clear because we are arguing semantics. I am pointing to a general view of a coming change to the environment of all business the oil patch included. G-man & I are just trying to relate that this will likely be different from any time in the past in a macro sense. I am calling it a paradigm shift to an already warped financial system worlds apart fundamentally from what we knew 20 years ago.

You are right to point out from experience the oil patch has been through booms and busts and you know how they happen. I know you are right because you have been there. I am just opining on the “what may” and “what if”. I am talking in general terms you in focus terms.

I see so many people today just not willing to picture this change. Not you Rock but so many people I interact with. Since it is not here it is not on their radar screen. For that matter maybe I am the type they used to lock up as crazy so maybe these people are just being sane. In any case the academics of this impending paradigm shift is in almost every discipline. Every discipline is pointing to stresses, problems, and predicaments across the board. Even the pseudo-science of economics is sounding the alarm in certain circles.

Davy on Tue, 11th Nov 2014 7:00 pm 



Shallow, now is the time to bail my friend. Get the hell out of Dodge. The Indians are coming to scalp and take prisoners.

There are a number of things you can do besides paper digital wealth. If you hang around the markets just be ready to jump ship quickly. Don’t invest and forget like the thieves tell you to do.

rockman on Tue, 11th Nov 2014 7:20 pm 



shallow – I really can’t follow your modeling efforts. But:”If you are right and shale is better than conventional of 30 years ago.” That wasn’t the point I was tying to make. But lets make sure if you’ve really understood what the FACTS are. We had over 4,800 rigs drilling conventional prospects in 1981 that produced NO INCREASE in oil production. And in recent years we’ve had less than half that number of rigs drilling but have INCREASED production by 2 million bopd. With much of that increase coming from unconventional reservoirs.

If you were FORCED to be the money behind one of the booms, the late 70’s or the current one, which one would you choose? And if you weren’t forced would you put your money in either one?

You know I’ve be doing this for 4 decades. Sometimes doing very well financially…sometimes no so well. And you know what: I’ve never invested a single $ of my own money in any well… ever.

So are you really thinking that all those wells that drilled conventional prospects during the 70’s boom (that produced no increase in oil production) might collectively have been better investments then the shale plays today that have done their part to increase production millions of bopd?

But be sure: I’m not saying the shales are good investments or not. Please don’t lose the context of our conversation: if folks think this is the first time the oil patch cut its own throat chasing high priced oil (whether conventional or unconventional) they are very much mistaken. I’ve seen many companies fail during high oil/NG price periods. And not just when prices fell but during the boom itself. And I’ve seen some of the very best profit margins develope during low price periods.

And that has been the sole point I’ve been trying to make in these posts. And once more: despite what the oil patch PR machine puts out there’s no one in the oil patch over 40 years old that doesn’t expect the coming bust. Every one my cohorts with whom I’ve discussed the current dynamics have the same thing on their minds: their exit strategy. Everyone in the oil patch knows the bust is coming. The only question is when.

Northwest Resident on Tue, 11th Nov 2014 8:18 pm 



shallowsand — If you haven’t already, make yourself a frequent guest at zerohedge dot com. I most definitely do not believe every article or point of view expressed on that site, same as here. But you can get a good sense of which direction the wind is blowing by daily scanning those articles. One thing the ZH writers have talked about is do you want to look like a fool now by jumping out of the market before the big crash hits, or do you want to look like a fool because you’ve waited too long. Tough choice, I know, especially for people that have that institutional 401K or other investments that they have to keep invested, or take a big loss to taxes/fees by pulling it out, or even having to quit a job just to be able to get your hands on the money. I had one of those 401Ks going but decided to take the tax/penalty hit. But that’s just me. I definitely do not believe that I will ever see a penny of social security, and I do not believe in future retirement plans other than the plans I have to grow my own food and be self sufficient. Again, that’s just me. Tough choices, I know.

shallowsand on Tue, 11th Nov 2014 8:38 pm 



ROCKMAN. I know my comparisons are extremely crude. Just trying in my simple minded way to explain why shale doesn’t seem so great.
I also know there will be booms and busts. I’m just trying to live in a little bit of denial that shale production will not cause what we have to go under water on a cash flow basis. Don’t have debt on it thankfully but P & A will certainly be more than equipment salvage, who will want a bunch of small antiques at $30 WTI?

Northwest. Assuming I fix up my place to be self sufficient and don’t owe anyone anything, what do I do with the retirement account and bank account? Buy more land? I already live in the middle of no where.

rockman on Tue, 11th Nov 2014 9:55 pm 



shallow – I wish I could reach thru the Internet and wack you in the back of the head. LOL “Just trying in my simple minded way to explain why shale doesn’t seem so great.” Go back to all my post and cut and paste anything I said about the shales being “great”.

Maybe I’m being to subtle: the oil patch screwed up when it pissed away $billions in the 70’s boom chasing conventional reservoirs because due to the big jump in oil prices. And the oil patch is screwing up today chasing the shales due to the big jump in oil prices. What I keep pointing out is that the latest slump in oil prices recently is far from creating the destruction we saw in the 80’s. We are screwing up now…but not nearly as bad as we did about 30 years ago. Remember how this conversation started: I was responding to the statement that the oil patch has never experienced a tumble as bad as the potential we face now. The current oil patch has a long way yet to fall to even match the energy production recession that hit us 3 decades ago.

Northwest Resident on Tue, 11th Nov 2014 10:12 pm 



rockman said: “I was responding to the statement that the oil patch has never experienced a tumble as bad as the potential we face now.”

rock, I know you’ve been at this for a long time and you’re just looking at it the way your long history in the biz has taught you to look at it.

But wouldn’t it be a valid point to say that this time IS much worse because in the past, there were still plenty of viable places remaining to drill for more oil — given the right price of course. But this time, and I think you’ve mentioned this before, the sad fact is that you guys are running out of viable places to drill even with economy breaking high prices for oil. I’m just thinking that when this shale boom is over then folks, that’s all she wrote, Retirement Party over, time to head for the hills. Am I getting it all wrong?

shallowsand on Tue, 11th Nov 2014 10:13 pm 



ROCKMAN. You got me. You’ve never written that. Also, I agree that $77 now is nothing like $8 in 1986 or 1998 or the $10-18 during most of the time in between.

Hope you at least got some good ORI from some of the wells you have drilled!

Think I need to lighten up a little.

Davy on Wed, 12th Nov 2014 6:16 am 



NR said – I had one of those 401Ks going but decided to take the tax/penalty hit.

shallow said – Northwest. Assuming I fix up my place to be self sufficient and don’t owe anyone anything, what do I do with the retirement account and bank account?

NR, I bailed out in 06. It was one of those prep actions for the great 08 recession. I looked at the fee’s, taxes, and penalties as just lowering my otherwise descent return. My dad who is an excellent gambler and investor always told me your best return is not your highest. What he meant is if you seek out good returns instead of great ones your average return over time will be better. My bailing the market also worked in my favor for my second divorce. She didn’t get half of the 401K that was no longer there. She still scalped me but it could have been worse.

Shallow, man I could tell you so many things to do in a prepper scenario. It sounds like you understand the long term investments with self-sufficiency so I won’t bore you there. I firmly believe physical gold is essential. I believe in physical items that will always have value to resell. Don’t worry if they lose a third their value because they will have value. Land is only as good as you can take care of and utilize. Be sure to have physical cash. If you are going to have physical wealth be sure and properly secure it with elaborate security measures. It has to be hidden well. Don’t talk about it because the word gets out.

There is nothing wrong per say with the paper digital if you want to play the market with money to maybe loose. My dad loves to short the market. He makes good money at it. He doesn’t need the money he just enjoys playing. He does well at blackjack and craps too. Anytime you have a question about investing prep style shoot and I will give you my 2cents.