Why I am careful with oil!

Picture of Darnell L Williams running his lawn business at age 18.

On March 5, 1968, gas sold for 27 cents a gallon. I just got gas today March 5, 2001 for $3.49 per gallonWhen I started working, gas sold for 29 cents a gallon. Then came the end of the Vietnam War and the gas lines that the media blamed on the Arabs. That started the negative talk about the Arab World in this country. Next thing you know, we were bombing and shelling Arab Countries, calling them terrorist.

Then the Iraq Wars started and we find ourselves taking over Arab Oil fields.

People do not know that US Oil Field Production peeked in 1970. World Oil field Production peeked in 2001. Demand for oil is going up while the world supply of oil is going down. So prices must go up over time. This is why I have always bought cars giving good gas mileage.

The problem is, the United States runs on oil. Without Oil, the American economy would collapse. We can’t move away from oil because the people who run this country are controlled by oil interest.
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http://dieoff.org/page116.htm

Take a look at this chart created by Campbell and Laherre, Petroconsultants Pty. Ltd., created in 1995. The report, written for oil industry insiders and priced at $32,000 per copy, concludes that world oil production and supply probably will peak as soon as the year 2000 and will decline to half the peak level by 2025. Large and permanent increases in oil prices are predicted after the year 2000. I I said, production peeked in 2001. But this prediction failed to account for an increase in Third World oil usage by China, India, and the rest of the third world. So world wide oil supply will be depleted sooner than predicted.

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http://zfacts.com/p/35.html
Are you ready for another round of gas price increases? As the United States comes out of depression, (yes, depression), the public and industry will use more gas and oil. So will India, China and the rest of the world because they will produce more goods and services that use gas and oil. Even if OPEC increases world production, with aging oil wells, one day, they will not be able to keep up with demand. The price of oil and in turn the price of gas must go up because supply of oil must fall and the demand for oil must rise.

With limited energy; the world economy will have movements toward prosperity followed by periods of economic collapses for countries that have high labor cost and the greatest need for oil.
So what investments should you look for?

Corporate Junk Bonds are the safest investments. But Corporate Junk Bonds do not have the chance of making the most money. That lies with stocks. But in an economy that rises and falls sharply without warning, stocks carry the biggest risk.

I have been investing heavily in VENEZUELA REPUBLIC NOTES 8.500% 10/08/2014.

Venezuela is in South America but is a member of OPEC. This bond has a “BB-“S&P Rating. The reason why is because most American Capitalist don’t like the leader of Venezuela. But who is going to boycott buying Venezuelan Oil?

If this bond is bought on April 8, 2011 and kept until it matured, you make the following;

1. Bond bought at $867.50 and on October 8, 2014, you receive $132.50 at maturity.
2. The bond will give $85 per year, $42.50 twice a year (Oct 8 and April 8) until maturity or $340 received over 8 payments until and including maturity.
3. That would give you a total per bond of $472.50 over 3 years and 6 months on an $867.50 investment.

If the country and its oil company would go bankrupt in this amount of time, you may loose some money.
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How is Darnell's Portfolio doing?

"Year to Date," the stock market measured by the Dow is up 5.96% as of Thursday March 3, 2011. My portfolio made up of 95% Junk Bonds is only up 2.47%. For the past 26 months, it is up 82.85%. If the stock market continues to go up this year, it should out perform my portfolio for 2011. I am looking for at least a 10% return on my money but no more than 15% by the end of the year.