Ours. We've spent the past few days selling our present abode and buying a new one, so this is going to be short. It has been an emotional experience which also makes it hard to write.
OK, we can probably say we are in the midst of a bond rout with the 10 year closing today yielding 2.44%That is one hell of a move since the election boys and girls indicating that suddenly the entire Street and a good part of the investing world are positive on The Donald or at least what he might mean for the economy. Whilst I normally pay little attention to the consumer confidence number this week's move upward to over 100% was equally extraordinary. Of course equities are like a rocket ship aided in no little degree by the announced deal to cut oil production ...more on that in a bit.
Tomorrow brings the jobs report which suddenly is more or less meaningless absent the political ramifications. Estimates are up 180,000 but once again the quality of what is being reported is open to serious question. In an age of big data one would think that there could be more of a delineation between bedpans/burgers and quantum physics hires but one has to really struggle to find it. Memo to President Elect: better reporting is something we desperately need along with believable data which half the time we haven't received. but right now there are a lot of people around the world staring with shock and awe at where the U.S. appears to be headed and whether Mr. Trump's promises in regard to role of government are about to be fulfilled. If there is one consistency since his election it is that his Cabinet appointments are doers--you may not like what they do but there are damn few theorists named so far. To think this is not being closely watched globally is to be sadly mistaken...especially Over There. That election cycle is coming around at precisely the wrong time for Europe's entrenched interests even in Italy which of course votes this Sunday (Memo to Us: the whole world votes on Sunday, why can't we?). And even there, the word is "change;" we just don't know what kind it will be.
Finally...oil. The agreement will last in practice for about a month and then the leaking will start and become a flood. My buds in the West Texas Town of El Paso tell me there's more damn oil and gas out around their place and in the Permian than anybody ever dreamed about and Good Ol' Donald gonna let us go git it. And don't forget them Mexicans, they say. They gotta get their production up and they need us and the money to do it which they only git if Good Ol' Donald gits himself a deal on NAFTA otherwise that boy just gits up and walks away from the table. Now I don't know whether these guys are right or not but in this business it's a lot what people believe that counts. They are believers.
Jobs number tomorrow. Whoopy damn-do.
Showing posts with label Oil. Show all posts
Showing posts with label Oil. Show all posts
Thursday, December 1, 2016
Wednesday, February 24, 2016
SPOOLING UP
As funerals go, it was spectacular but now that we're back, I have to start spooling up as to what has happened over the past week or so. At first glance, not very much, but two things stand out as becoming bell weathers as to future conditions.
The first is the price of oil which took a huge jump on reports that there was to be a deal between OPEC and non-OPEC producing nations to reduce production thereby setting a floor on the price. You might remember that it was predicted here that would not happen and sure enough, the Saudi Minister threw ice water on the report saying in no uncertain terms that such a deal was not on. Surprisingly, oil rallied today even in the face of higher inventory numbers pulling the DOW out of a 268 point hole, but I suspect we will see it drop again shortly. What is surprising is how everything turns on the price and how little talk there is of this market, if not being outright manipulated, is being massaged by some professional leakers of information and an all-too-gullible press who seemingly will print anything without out much verification whilst knowing that in times like this any rumor will move markets.
The second event is the becoming-more-real possibility of a British exit from the EU. Last week, Boris Johnson, MP, Mayor of London, Impregnator of various women not including his wife, and either beloved or be-hated, announced that he was for Brexit. Whilst commentary focused on why he broke with Cameron (hint...he wants to be the PM), little was made of the effect this stance would have. Within days, he was brutally attacked in the Commons by Cameron and as we look today, the Pound closed at 1.39-something having traded to 1.38 earlier in the day. Oops.
For a variety of reason, some of which are political, the Bank of England will not prop up the currency but it's continued weakness will give even greater fear to a "yes" vote for Brexit. Boris has a following: from an American's standpoint (he's American as well having been born in New York) he looks for all the world like a Donald Trump in the making. That really isn't the case, however, but he surly is making life difficult for the "establishment politicians" and sending shivers up the spines of more than a few on the Continent. Imagine, a Yank, running Britain? And then, there was Winston Churchill. Best watch this thing develop. As usual, never a dull moment with the Brits.
The first is the price of oil which took a huge jump on reports that there was to be a deal between OPEC and non-OPEC producing nations to reduce production thereby setting a floor on the price. You might remember that it was predicted here that would not happen and sure enough, the Saudi Minister threw ice water on the report saying in no uncertain terms that such a deal was not on. Surprisingly, oil rallied today even in the face of higher inventory numbers pulling the DOW out of a 268 point hole, but I suspect we will see it drop again shortly. What is surprising is how everything turns on the price and how little talk there is of this market, if not being outright manipulated, is being massaged by some professional leakers of information and an all-too-gullible press who seemingly will print anything without out much verification whilst knowing that in times like this any rumor will move markets.
The second event is the becoming-more-real possibility of a British exit from the EU. Last week, Boris Johnson, MP, Mayor of London, Impregnator of various women not including his wife, and either beloved or be-hated, announced that he was for Brexit. Whilst commentary focused on why he broke with Cameron (hint...he wants to be the PM), little was made of the effect this stance would have. Within days, he was brutally attacked in the Commons by Cameron and as we look today, the Pound closed at 1.39-something having traded to 1.38 earlier in the day. Oops.
For a variety of reason, some of which are political, the Bank of England will not prop up the currency but it's continued weakness will give even greater fear to a "yes" vote for Brexit. Boris has a following: from an American's standpoint (he's American as well having been born in New York) he looks for all the world like a Donald Trump in the making. That really isn't the case, however, but he surly is making life difficult for the "establishment politicians" and sending shivers up the spines of more than a few on the Continent. Imagine, a Yank, running Britain? And then, there was Winston Churchill. Best watch this thing develop. As usual, never a dull moment with the Brits.
Friday, February 12, 2016
A WALK ON THE WILD SIDE
Everything bounced back up today. Equities (DOW) were up 313 at the close; 10 year yield 1.74%; WTI up 12% to $29 and change. Crazy, completely nutso.
The excuses for Janet's performance started coming in from all points on the compass, followed immediately by anyone to whom the networks would give airtime explaining that the U.S. economy was ticking along rather nicely highlighted by Billy the Dud 's almost euphoric rendition of facts and figures from his crack research team at the New York Fed who couldn't recognize a cow paddy if they stepped in one unless it was drawn for them and inserted in some economics book. Real world is not its strong suit.
Even Japan, where the Nikkei was down 5% at the close was considered a "buy" and puzzlement was expressed at the strength of the Yen which, according to one of the geniuses, "should be down if the Nikkei was down which just proves that the Nikkei is overdone." No Dumbo, what that proves is everybody sold the Nikkei and paid back the Yen that had been borrowed in this internal "carry trade," getting back the foreign currency that had been swapped. Buy Yen, sell Dollars and guess what? Up go Yen. Think Dumbo might have been a little slow and still is wearing a bit of the index? Wouldn't be surprised. Which brings us back Over Here.
This is a three day weekend. Everybody was short damn near everything all week but with a global situation like this nobody wants to have much of a position facing three days of no trading. Everybody got square and when you buy into your shorts to get square, things go up. Lots of money was made this week and three days of untroubled sleep to look forward to is not a bad thing. So put away the brass band, we are not out of the woods yet.
And then there is oil. Before the open one of the Gulf ministers was quoted as saying that the Gulf states were prepared to discuss cuts in production. SALVATION! Except, it turns out, that was not exactly what he said. He added--which was reported conveniently after the close of trading--that the Gulf guys were prepared to talk if everybody else, in and out of OPEC, were prepared to talk about cuts. Anybody think that Venezuela is prepared to cut? Nigeria? Russia...and then there is the issue of Il Duce's buddies, the Iranians. Unless something dramatic occurs over the next few days, we're headed back south again. Now I may be completely wrong about all of this but I really do have to ask myself if I'm the only one paying attention, but no matter because Sunday will bring clarity to that which is really important. Arsenal at home to Leicester City and Man City hosting Spurs. 7:00 a.m. start. Yikes! Freezing out here in the Fly-Over Zone but nothing with which to stay warm Saturday night. Got to make the bell...which is harder and harder to do.
Monday we celebrate the birthdays of Washington and Lincoln. The Dane had this one right again: "Such a falling off there were."
Back on Tuesday.
The excuses for Janet's performance started coming in from all points on the compass, followed immediately by anyone to whom the networks would give airtime explaining that the U.S. economy was ticking along rather nicely highlighted by Billy the Dud 's almost euphoric rendition of facts and figures from his crack research team at the New York Fed who couldn't recognize a cow paddy if they stepped in one unless it was drawn for them and inserted in some economics book. Real world is not its strong suit.
Even Japan, where the Nikkei was down 5% at the close was considered a "buy" and puzzlement was expressed at the strength of the Yen which, according to one of the geniuses, "should be down if the Nikkei was down which just proves that the Nikkei is overdone." No Dumbo, what that proves is everybody sold the Nikkei and paid back the Yen that had been borrowed in this internal "carry trade," getting back the foreign currency that had been swapped. Buy Yen, sell Dollars and guess what? Up go Yen. Think Dumbo might have been a little slow and still is wearing a bit of the index? Wouldn't be surprised. Which brings us back Over Here.
This is a three day weekend. Everybody was short damn near everything all week but with a global situation like this nobody wants to have much of a position facing three days of no trading. Everybody got square and when you buy into your shorts to get square, things go up. Lots of money was made this week and three days of untroubled sleep to look forward to is not a bad thing. So put away the brass band, we are not out of the woods yet.
And then there is oil. Before the open one of the Gulf ministers was quoted as saying that the Gulf states were prepared to discuss cuts in production. SALVATION! Except, it turns out, that was not exactly what he said. He added--which was reported conveniently after the close of trading--that the Gulf guys were prepared to talk if everybody else, in and out of OPEC, were prepared to talk about cuts. Anybody think that Venezuela is prepared to cut? Nigeria? Russia...and then there is the issue of Il Duce's buddies, the Iranians. Unless something dramatic occurs over the next few days, we're headed back south again. Now I may be completely wrong about all of this but I really do have to ask myself if I'm the only one paying attention, but no matter because Sunday will bring clarity to that which is really important. Arsenal at home to Leicester City and Man City hosting Spurs. 7:00 a.m. start. Yikes! Freezing out here in the Fly-Over Zone but nothing with which to stay warm Saturday night. Got to make the bell...which is harder and harder to do.
Monday we celebrate the birthdays of Washington and Lincoln. The Dane had this one right again: "Such a falling off there were."
Back on Tuesday.
Tuesday, February 9, 2016
GHOST BUSTERS
Remember that movie? It was terrific fun. The theme throughout was that something really bad was going to happen but nobody could figure out exactly what. There of course were signs all over the place, but putting them together ah, that was the puzzle.
What's going on out there is like Ghost Busters with signs all over the place and no one really capable or perhaps prepared is the better word, to put them all together. There was another big sign today as the Japanese ten-year tumbled into negative territory with the Nikkei crashing almost 6%. Oh yeah, the ten year note closed at 1.72%. This is now completely global and no one seems to have a clue as to what to do. Well, maybe Janet does and we may find out tomorrow but I doubt it. The chances of a global recession have just gone up a notch as it is clear Japan is going no where, whereas prior to today it was just a worry. But of course all she can say is that the Fed is watchful, policy is data dependent and that the dual mandate (which is the cause of a big part of this mess) is clearly understood. If that is the best she can do--and I think it is-- I'm afraid it's "look out below."
Somewhere along the line someone is going to start blaming the Saudis and if you look at it from a pure objective standpoint, there is something to that argument. It would of course be nice if the House of Saud said, "We were just kidding, guys," and suggested that all concerned sit down and pow-wow about the global price for oil. My buds in the West Texas Town of El Paso just might become Muslims...as long as there was an exemption for beer in the list of no-nos. Problem of course, is that nations tend to act in what they perceive to be their best interests and getting the oil price up either aids directly people the Saudis don't like--like the Iranians or people who aid people the Saudis don't like--like the Russians. WTI closed today at $28. Trouble and Strife's SUV got 16 gallons of 93 Octane for less than 30 bucks. Winter mix, too. I love El Nino and the Saudis.
But this ain't good. And not all movies have a happy ending. At this point, Who Ya Gonna Call? I don't know. Maybe Janet? We'll see.
What's going on out there is like Ghost Busters with signs all over the place and no one really capable or perhaps prepared is the better word, to put them all together. There was another big sign today as the Japanese ten-year tumbled into negative territory with the Nikkei crashing almost 6%. Oh yeah, the ten year note closed at 1.72%. This is now completely global and no one seems to have a clue as to what to do. Well, maybe Janet does and we may find out tomorrow but I doubt it. The chances of a global recession have just gone up a notch as it is clear Japan is going no where, whereas prior to today it was just a worry. But of course all she can say is that the Fed is watchful, policy is data dependent and that the dual mandate (which is the cause of a big part of this mess) is clearly understood. If that is the best she can do--and I think it is-- I'm afraid it's "look out below."
Somewhere along the line someone is going to start blaming the Saudis and if you look at it from a pure objective standpoint, there is something to that argument. It would of course be nice if the House of Saud said, "We were just kidding, guys," and suggested that all concerned sit down and pow-wow about the global price for oil. My buds in the West Texas Town of El Paso just might become Muslims...as long as there was an exemption for beer in the list of no-nos. Problem of course, is that nations tend to act in what they perceive to be their best interests and getting the oil price up either aids directly people the Saudis don't like--like the Iranians or people who aid people the Saudis don't like--like the Russians. WTI closed today at $28. Trouble and Strife's SUV got 16 gallons of 93 Octane for less than 30 bucks. Winter mix, too. I love El Nino and the Saudis.
But this ain't good. And not all movies have a happy ending. At this point, Who Ya Gonna Call? I don't know. Maybe Janet? We'll see.
Tuesday, March 11, 2014
THE LESSER PRAIRIE CHICKEN
Sometime you just have to get of your comfort zone. Today is one of those days because I read a piece so bazaar that one just has to comment.
The subject of energy independence, always popular, has become even more so in the past couple of weeks what with the situation in the Ukraine and the strangle-hold that Russia has on western Europe's energy supplies. Bully for us cry the pundits for with the advances in energy extraction the U.S. will soon be energy independent…or so we thought.
The U.S. government has some agency called the Bureau of Land Management, whose duties are not fully understood by anyone but I think it comes under the Dept. of the Interior which, among other things, is the oversight and enforcer for the Endangered Species Act, the greatest act of Congress ever passed according to the enviormental left. Now despite what you might hear from The Leader and his mob, the growth of energy production in the U.S. has nothing whatsoever to do with the genius of the Obama administration. Not 1% of the growth comes from Federal land. All of the drilling and fracking is on private land which can only be regulated as to safety by Washington. Enter the Lesser Prairie Chicken and its cousin, the Sage Grouse.
These noble birds, each of similar size which is slightly smaller than a Rhode Island Red, inhabits broad areas in the western and north western United States…like about 100,000,000 acres. It's a big country, gang. It appears, that under intense pressure from enviormental groups--an absolute core Obama constituency--the Interior Department is wrestling with the idea of designating these two clucks as "endangered species," which means that before anyone does anything, anywhere these birds breed, on public or private land, the permission must first come from the Interior Dept. by way of a request fulfillment, after exhaustive enviormental studies and law suits guaranteed to take a minimum of 10 years. Like, never man. Among those sacrosanct breeding areas? The Permian Basin in west Texas and the Bakken in North Dakota, among a few others.
Now there is stupidity and then there is stupidity. You pick what this is. To be honest, I haven't a clue whether all the gas and oil we talk about is really there, but a lot of smart people say it is (although my classmate, Mike says it's a Ponzi scheme and his family has been in the oil "bidness" in Texas for so long that except for the brief time he served his country I don't think he ever filed a W-2 in his life…uh-huh).
If the Ukraine is any guide, maybe it's not a bad idea to find all the energy we can and if there is enough, we might even be able to help out our buds Over There. I mean, we're talkin' survival here. And, in that vein another thing I'm try to figure out is way the enviormental left is always accusing those who are not absolutely in lock step with them of not believing in science. Like Man, you tellin' me that that Dude Darwin was whacked with that Survival of the Fittest gig? You tellin' me that it's me against the Lesser Prairie Chicken and let's see who wins and it's gonna be the bird? Radical, dude, radical.
The subject of energy independence, always popular, has become even more so in the past couple of weeks what with the situation in the Ukraine and the strangle-hold that Russia has on western Europe's energy supplies. Bully for us cry the pundits for with the advances in energy extraction the U.S. will soon be energy independent…or so we thought.
The U.S. government has some agency called the Bureau of Land Management, whose duties are not fully understood by anyone but I think it comes under the Dept. of the Interior which, among other things, is the oversight and enforcer for the Endangered Species Act, the greatest act of Congress ever passed according to the enviormental left. Now despite what you might hear from The Leader and his mob, the growth of energy production in the U.S. has nothing whatsoever to do with the genius of the Obama administration. Not 1% of the growth comes from Federal land. All of the drilling and fracking is on private land which can only be regulated as to safety by Washington. Enter the Lesser Prairie Chicken and its cousin, the Sage Grouse.
These noble birds, each of similar size which is slightly smaller than a Rhode Island Red, inhabits broad areas in the western and north western United States…like about 100,000,000 acres. It's a big country, gang. It appears, that under intense pressure from enviormental groups--an absolute core Obama constituency--the Interior Department is wrestling with the idea of designating these two clucks as "endangered species," which means that before anyone does anything, anywhere these birds breed, on public or private land, the permission must first come from the Interior Dept. by way of a request fulfillment, after exhaustive enviormental studies and law suits guaranteed to take a minimum of 10 years. Like, never man. Among those sacrosanct breeding areas? The Permian Basin in west Texas and the Bakken in North Dakota, among a few others.
Now there is stupidity and then there is stupidity. You pick what this is. To be honest, I haven't a clue whether all the gas and oil we talk about is really there, but a lot of smart people say it is (although my classmate, Mike says it's a Ponzi scheme and his family has been in the oil "bidness" in Texas for so long that except for the brief time he served his country I don't think he ever filed a W-2 in his life…uh-huh).
If the Ukraine is any guide, maybe it's not a bad idea to find all the energy we can and if there is enough, we might even be able to help out our buds Over There. I mean, we're talkin' survival here. And, in that vein another thing I'm try to figure out is way the enviormental left is always accusing those who are not absolutely in lock step with them of not believing in science. Like Man, you tellin' me that that Dude Darwin was whacked with that Survival of the Fittest gig? You tellin' me that it's me against the Lesser Prairie Chicken and let's see who wins and it's gonna be the bird? Radical, dude, radical.
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