The Oil Drubbing's Over

This sampling of blog posts from Doug Kass was originally published Jan. 19 on Street Insight. It's being republished as a bonus for TheStreet.com and RealMoney.com readers. For more information about subscribing to Street Insight, please click here.

Energy Price Decline Is Likely Over

1/19/2007 10:03 AM EST

I'm guessing most of the decline in the price of energy is over. My sense is also that a lot of the speculators who buoyed the price of crude oil have mostly liquidated. I use the words "guess" and "sense" because I cannot be certain.

That said, I can't buy the Oil Services HOLDRs (OIH). As I mentioned Wednesday, the last time crude oil sold at $50/barrel -- in May 2005 -- the Energy SPDR (XLE) was trading below $42 a share. Now the XLE trades at over $55.

That's real testimony to the strength of the U.S. equity market.

But I can short the Retail HOLDRs, which will get pulled down if I am correct.

Which is precisely what I am doing. In size.

Short RTH

GE's Numbers Are Underwhelming

1/19/2007 9:03 AM EST

Despite a breathtakingly positive analysis of General Electric's (GE Quote) earnings by former GE CEO Jack Welsh on CNBC, the numbers were underwhelming and I suspect the stock will trade down.

Although organic growth was robust, earnings quality was weak (and it was even aided by a sharp drop in the industrial operating segment's tax rate, which helped EPS by 2 cents) and operating margins were disappointing -- management had previously forecast an improvement.