Our friends in Britain have thwarted another attack through the arrest of 21 individuals with plans on detonating liquid explosives aboard airliners over the ocean.

While many terror attacks have a bullish affect on the oil markets, this one seems to have a bearish effect on oil prices.  What gives?

Well, the real effect on this terror plot would not lie with supply of petroleum products, like many other events would endure, such as terrorist events on pipelines or general geopolitical events in petroleum producing nations.

While those events put supply into question, this recent event puts demand into question.  Will …

In my quest to diversify my Roth IRA, I ran across a few contenders.  Not one of them fits all my requirements for my search, but sometimes you’ve got to give a little in order to take a little.

Here is a quick synopsis of what I’ve found so far, and I’ll follow up with a more detailed analysis at a later date.

NovaStar Financial (NFI)
NovaStar Financial, Inc (NFI: chart, web) is a specialty finance company. The company originates, purchases, invests in, and services residential nonconforming loans in the United States.

NovaStar stock offers a 16.5% yield, paid out quarterly and has paid out fairly consistently back to 2002 when they started paying out each quarter.

They have a 38% profit margin and maintain a slightly lower operating margin.  They hold a balance sheet with $154 million in cash, and $3.61 billion in debt, which is to be expected with a financial lender.

A sizable drawback to this stock is that their payout is upwards of 193%, which means they are paying out more than they are bringing in. I can’t predict how much longer this strategy can last, but to be sure, it won’t last forever.

In addition, this is a company who is in a sector that is about to take a beating if it hasn’t already.  The housing market is slowing, and it is anticipated that the number of new loans will drop significantly.  In addition, the Fed just stopped raising rates (as evidence from the stock chart clearly shows), which is detrimental to financial and lending institutions.  These points alone make the risk levels in NFI somewhat unattractive.

New Century Financial Corp. (NEW)
New Century Financial Corp (NEW: chart, web) is in much the same position as NovaStar.  The company operates as a real estate investment trust (REIT) in the United States. It originates and purchases mortgage loans through both retail, and wholesale channels.

Increases in energy costs are not isolated at the gas pump.  Electricity costs are rising as well, thanks in part to higher natural gas prices and scalding hot temperatures across the nation.  As demand for energy rises, power companies switch on additional power plants which use natural gas rather than coal.

So it was no surprise yesterday when my flat black mail box not only looked hot, but heavy as well.  Reaching inside revealed an electric bill for $138 for last month.

Actually, the numbers were a bit better than I had expected, since the sky high temperatures throughout the Midwest have kept my air conditioner working …

Yesterday the Fed decided to take a siesta on interest rates, leaving the core rate at 5.25%.  So the speculation continues.  Will they leave the rate where it is for a few months, or continue with the quarter point hikes?

No one knows for sure, but it is clear the data from the economy will dictate the rate direction.

Energy prices continue to weigh on the economy, and the growth rate is cooling visibly.  Unemployment is up, spending is starting to dip, and housing is moderating across the board.

Economists opinion on whether the Fed is done are widely varied, and until new data comes out as a result of the pause, I …

Oil prices didn’t require an ignition source this morning, they just spontaneously combusted on news that BP had shut down a major pipeline in Alaska due to corrosion problems.

Crude prices for the September contract were up $1.54 as BP (BP: chart, web) said they had shut down the Prudehoe Bay field after finding corrosion and a small leak, putting a halt to 400,000 barrels of crude for each day it remains shut in.

The government has said it doesn’t see a problem tapping into the strategic petroleum reserve …

Here are some tips to save you some money by adjusting your household habits and making some changes around your house:

Light bulbs

Replacing your regular incandescent bulbs with compact fluorescent lights (CFLs) will require 70 percent less energy, and while they cost more than regular bulbs, they will last much longer.

Install dimmers on light bulbs to save energy and extend their life. Timers work well for front-door and security-related lights; sensors, which turn on lights only when needed, are ideal for outdoors.

Potential Savings: At least $90 a year.

Total Energy Savings: If every American home swapped just five incandescent bulb fixtures for Energy Star CFLs, it would keep 1 trillion pounds of greenhouse gases out of the air and save $6.5 billion in energy costs.

Of all the morning rituals, shaving is the worst.  What’s not to like about taking a razor blade to your face and removing a layer of skin while wobbling in a half awaken stupor?

If only we had a razor blade that would remove hair to the skin on one pass, making the art of face sculpting much less demanding.

It seems the shaver wars are still raging, as Gillette has added their 5 bladed Fusion to the shelf for a whopping $11.99.  That’s just for the handle and a single cartridge.

Need a refill pack?  Get eight cartridges for only $28.99.

Rather than spend a fortune …

I’ve come up against quite a dilemma.  I’ve got more money to contribute to my Roth IRA retirement account, but have no idea which securities to buy with the money.

The problem is that I’m overloaded in the oil and gas sector, but right now, that’s really the only attractive sector out there until the rest of the market (driven by the direction of the economy) decides which way to turn.

My requirements for securities in my Roth are:

A yield substantially higher than current bank rates
Stable securities with a consistent dividend payout
Securities must not be tied with the oil and gas sector

Some qualities I’d like to see …

I’ve had a few emails requesting more information about how to invest in oil and gas fields, so I thought I’d put together a series of posts on that very subject.

If you haven’t already read it, take a quick read through my Crash Course on Natural Resources post, as it will help understand the rest of the posts in the topic.

If you were going to drill an oil or gas well, you set out finding the location.  As in many businesses, it’s all about location, location, location.  Finding the heart of the reserves in the most prolific formation is 90% of the work, and takes the most time.

Once you’ve found that sweet spot you need to make a deal with the owner of the land.  This requires signing a lease with the land owner which outlines his royalties and the operators’ responsibilities in the operation.  This may include building a road to the well, compensating the owner for any lost livestock, etc.

Sirius Satellite (SIRI: chart, web) offered expanded losses today even though revenues were up by a factor 3 versus the same quarter last year.  Sirius lost 17 cents a share versus 13 cents a share last year.

On the bright side, Sirius increased its subscriber forecast for the rest of this year, expecting a total of 6.3 million subscribers by the end of the year.  Their previous forecast was 6.2 million by year end.

While I applaud the fact that their being aggressive with their forecast, I think broad economic forces will restrain their subscriber growth.

With gas prices high and …