Brad Wall

Today's poll question; has your opinion of Brad Wall changed this week? Do you like him more or less than you did before this whole Potash snafu began? Some economic pundits whom I trust a great deal are absolutely livid about Brad Wall's demand to block the Potash takeover. This being a minority government, the feds really had no choice but to respect the wishes of a popular Premier. Before this controversy even started, I ran the webpoll who is the best Premier in the country. Brad Wall was the runaway winner with 66% of the vote.

I disagreed with Brad Wall on this issue, but after listening to an interview with Charles Adler, I disagreed a little less than I did before.  Do you think Brad Wall has a future in federal politics? Does he even want a future in federal politics?

The Sale Of Saskatchewan's Potash

Today's poll question; do you think that an Australian company should be allowed to purchase the Potash Corp of Saskatchewan? There seems to be a difference of opinion between the federal government and popular Saskatchewan Premier Brad Wall (recently selected by 66% of my visitors as the best Premier in Canada). The feds approve of foreign investment in Canadian companies, but Brad Wall sees it as a loss of sovereignty over a treasured resource. The takeover bid is $39 billion dollars, most of which would be distributed to Canadian investors selling their stocks. This is going to be a massive deposit into our financial sector, while Canada retains most of the economic benefit to selling the resource.

Unless you think that the Aussies are going to come in and steal all our potash, how is this a bad thing? There is lots of foreign ownership in Alberta's resource sector, and it has made it our nation's wealthiest province. Even under foreign ownership they provide billions of dollars annually in wealth for our country.

And might I say that I have never in my life met an Australian that I didn't like. I am a big fan of the Aussies. Let them distribute most of $39 billion dollars into Canada. This is a good thing. I disagree with Brad Wall.

Selling Potash

As an outspoken advocate for the Potash Corp of Saskatchewan, it pains me to announce that I sold POT as part of my portfolio in the FP Stockmarket Challenge. I did this because prizes are awarded in a few months, and POT is not a short term play. POT is a long term buy. I read a fantastic story in today's Globe and Mail that described it perfectly. I recommended that my father buy Potash when it had fallen from $250 to $80 because at that price it was terrific value. If you don't already know, Potash is a crop fertilizer, and on a "per crop yield" basis, it is the best in the business and a select few producers produce it.

As good as it is, demand for the commodity grew too fast and the price inflated too fast, to the point where farmers started boycotting it in favour of less productive alternatives. That's why when it hit $80, I said buy, buy, buy. Well on Friday we found out that the boycott led to a 95% decline in profit at Agrium, and an 80% decline at POT in the past year. With the growing season over, this situation will not improve much between now and the end of the FP Stockmarket Challenge.

If you are investing with real money at home, I say that Potash is a very strong 5-10 year investment. There is going to come a time in the next decade when there will be a very significant upward pressure on increased crop yields. To fuel that need, Potash is the best in the business. You may want to allow Friday's bad news to further deflate the price before you buy. I'm not sure where the bottom will be, but a sweet peak will happen in the next 5-10 years.

To replace my holdings in POT, I selected Transalta Corp because they are in sync with my "all of the above" energy policy.