But first . . .

POLLING

Some of you asked where Thursday’s poll numbers about ‘unusually excited’ voters came from. The short answer: Democratic pollster Mark Mellman. If I get more details, I’ll share them. In the meantime, I found a less dramatic but still hopeful poll here. This one shows the proportion of Republicans who think the upcoming election ‘really matters’ up 14 points, from 56% in 2000 to 70% in 2004 . . . but the proportion of Democrats who think it ‘really matters’ up 21 points, from 46% to 67%. I prefer Mellman’s more dramatic numbers, of course. But I’d still rather be up by 21 than by 14. Because (not to belabor the point) even with a largely complacent Democratic electorate in 2000 we got 537,000 more votes than the other side. So we have a pretty good base to build on.

YUKOY?

A key reason the rich get richer is that they can afford to take risks. If I offered a family with young kids and nothing but $6,000 in emergency savings ‘four-to-three odds on the flip of a coin’ – heads they win $8,000, tails they lose $6,000 – I hope they would have the good sense to decline. But a wealthy family would rightly grab it.

That said, one of the best ways to do well in the stock market, if you can afford the risk, is to bet on something that could be fundamentally sound over the long run, but that is in the midst of dreadful, but perhaps survivable, difficulties. This insight is hardly original with me. The knack comes in figuring out which bets fall into this category. Martha Stewart’s company? Perhaps. Maybe. But the one I like these days is Yukos, the Russian oil firm (whose American Depository Receipts represent four Russian shares each and trade under the symbol YUKOY). You can read all about its giant tax woes and the power struggle that has landed its oligarch in jailski (I majored in Slavic Languages and Literatures at an expensive Eastern college and can do no better than ‘jailski’?) . . . but to me it boils down to this: Oil could remain very valuable over the next decade or two . . . YUKOY is awash in it . . . its $10 billion tax bill and other uncertainties have kept many investors out of the stock . . . the value of the company’s assets, in the view of a friend much savvier than I, greatly exceeds the tax liability (he owns a million shares) . . . and, at the end of the day, Putin will not want a resolution so severe that it deters investors from investing in Russia. At $16 or so per ADR, I like the odds.

BOREF?

YUKOY, of course, is all but a sure thing compared with my long-running favorite speculation, Borealis, of which (full disclosure) I own enough to make an amusing chapter in a book, if it goes to zero, or to buy the book publisher, if it turns out to be real.

Those of you who have bought a few shares over the years will probably lose your money as I will probably lose mine. But let’s say there is an 80% chance of total loss . . . but a 20% chance of a 20-fold gain – a five-sided coin that swallows your entire $700 (say) four times out of five but pays you $14,000 every fifth time. I like those odds, too.

Of course (as with anything), it all comes down to the numbers you choose. When I first started writing about Borealis, I would have used 95% or 99% as the chance of total loss. This company has so many red flags it looks like Stalin’s army! But with each passing year, and each passing press release – for example, Friday’s – I’ve allowed myself to become a little more hopeful.

So maybe now there’s only an 80% chance of total loss. Or – dare I dream it? – a two-thirds chance. The flip side is that if Borealis did turn out to be real, it could appreciate even more than 20 fold. At today’s $6.50 or so (up from the $3.50 at which it sat for many of the years I’ve been poking fun at it), the entire company is valued at just over $30 million. And it claims to have technologies that could change the world. Martha Stewart’s company, by point of comparison, even after its difficulties, is valued at $560 million, nearly 20 times as much – and it claims to be able to show you how to do remarkable things with grapefruit.

Not to minimize Martha Stewart. I have friends who swear by her advice, and we all marvel at her energy and talents. Grapefruit, in truth, is the least of it. Still, if Borealis has found a way to make strikingly more efficient electric motors, let alone all the other things it claims to have invented, the company could be worth just as much as Martha Stewart. More, even.

You can go back and read my many caveats over the years. Also, the many reader comments deriding the science. These are readers far more knowledgeable than me. I don’t know what a cam shift is, let alone how to juice up its torque. And I am deeply skeptical of anything too small to see, which pretty well puts the kibosh on the entire field of nanotechnology in which Borealis claims to toil.

So I figure I will probably lose all my money. But I like the odds.

I am so sure tomorrow will be Don’t Mess With Texas, you can click here and read it today.

 

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