Slope of Hope Blog Posts

Slope initially began as a blog, so this is where most of the website’s content resides. Here we have tens of thousands of posts dating back over a decade. These are listed in reverse chronological order. Click on any category icon below to see posts tagged with that particular subject, or click on a word in the category cloud on the right side of the screen for more specific choices.

Solar, Partial Eclipse Ahead (by BKudla)

By -

For full disclosure, I own a Solar Energy company.  We sell and install systems and also act as a utility and finance long term projects.  From a personal point of view, I love solar, from an investment point of view, they are going the way of memory chips, with few exceptions. The industry is growing quickly, but profitibility will fall even faster. 

 I first wish to discuss the most optimistic growth scenario from an industry advocate, Greenpeace.

"Solar photovoltaic is a key technology to combat climate change and to secure access to clean electricity. By 2015, the global market could be twice as big as today, leading to a Rs.430 billion investment. Our goal is to make solar photovoltaic a mainstream power source through more supportive policies around the world,' said Sven Teske, senior energy expert at Greenpeace International."

That is a market growing 12-14% per year not bad, but that is the top line and we need to get through some headwinds in 2011 first.  This is a quote from an industry research report I get.

"Looking ahead into 2011, the most challenging quarter will undoubtedly be Q1'11. Leading European markets, including Germany will face large reductions in tariffs at the beginning of the year. Even with careful phasing of projects and price reductions, market demand is projected to be less than 50% of module production. As a result, the analysis forecasts end Q1'11 upstream and downstream module inventory days to increase significantly by the end of that quarter.
"Historically, the PV industry has often exuded over-optimism in the face of uncertain end-markets. However, the recent industry conference in Valencia confirmed two prevailing industry positions, one that emphasizes oversubscribed order books, the other that focuses on the German tariff declines and a demand reduction next year," Stevens concluded."

And that is before our elections.  If the Republicans take the House, they will not be renewable friendly.  They are the extraction party.  This will create domestic headwinds.

Another source I have speculates that solar prices will fall 25% over the next five years, and with these near term headwinds I expect to see aggressive pricing to move inventory, frontloading the margin compression.

Another concern for the industry is new entrants with enabling technology.  These companies have already paid for their fixed costs selling other products, and will compress margins even more.

For me, too much risk, recent price action in the space is already sensing this. I will opportunistically short the rips.

Slopefest III (by Market Sniper)

By -

Alright, good folks! It is time to plan the next Official Slopefest (defined as any gathering of Slopers with our illustrious host, Mr. Tim Knight, in attendance)! Just like we plan our trades and then trade our plans, in this case we plan our party and then PARTY! Meet the people you “chat” with. See friends from previous gatherings and make new ones as well.

Slopefest III date: the week end of May 7th and May 8th. In the year 2011 Anno Domini.

Slopefest III location: Bally’s, Las Vegas, Nevada.

That is the weekend prior to the Money Show which starts on Monday, May 9th at Caesar’s Palace, directly across the street from Bally’s. I have been staying at Ballys since it was the old MGM Grand. Great place with good people running it (good but not quite the same since the bean counters took it over from Kirk! LOL).

Due to the Money Show, I thought it best to get a head start as rooms fill quickly.

I have taken down a block of 20 rooms. At the end of this week, I will be negotiating with them. IF we need more than 20, my leverage with them goes up. I will grind them for rock bottom room rates, get a hospitality room with bar, discounts, coupons for free play for the gamblers, etc. So now I need your help. Think about it, talk it over with any other decision maker and get back to me.  I need to get some kind of idea of the size of the “gathering.” Please respond to with one of the following: 1) I will most definitely be there; 2) I most likely will be there or 3) I might be there but doubtful at this time.

After I get it all locked up, I will report back with such mundane items like room rates, etc. Most likely will have a code that you will use to book your individual rooms.

Some further information. Ballys has a Sunday brunch called The Sterling Brunch. Arguably the BEST brunch in Vegas. Gotten a bit pricy at $85 per person but worth every penny and more. A culinary delight. I will see if I can get us a tad off on that! No promises on that one. For those planning to come, additional input is most welcome as to additional events and activities.

Around the first of the year, I will be announcing another SPX guessing game as to the close on Friday, May 6, 2011. Contest rules and prizes will be announced then. One little kicker this time. There WILL be a valuable prize (think gold) for the Sloper in attendance at Slopefest III closest to the closing price!

I will be staying after Slopefest to attend the Money Show. Hopefully, some of you can also hang out. Might be able to introduce you to a “few” trading luminaries. Have been to a number of Money Shows and Trader Expos in the past. Never failed to glean new information that assists my trading.

Also, for those so inclined, I will give short  “workshops” on how I attempt to beat the casino at blackjack and craps. Then we will go out there and DO it! Just might be able to pay all your trip expenses and have a tad left over walking around money. You just NEVER know!

We work hard at what we do. Now is the chance to take a break, have some fun and see Tim as well as other fellow Slopers. I CAN guarantee you one thing. We WILL have a great time. I hope to see many of you there.