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I'm out of champagne so I opened up a bottle of chateauneuf du pape. The worrier must pace himself. Napoleon's soldiers received champagne when they returned home. Frankly this does not feel like the end. Fully how this thread starts to mirror the what are you drinking thread.

Did we have a 7% day since the GFC? I don't have the data but out of memory I don't actually think we did.

Why not open a fine bottle of red and have a glass? Tis the way of the warrior.

Cmon guys, give the guy a break. I doubt he knows what the Dow is. He probably thinks that the stock market is that place in lower Manhattan where guys wearing hats buy and sell stocks. Then you get them in the mail and you put them in a binder. Probably sent the tweet cause 1,000 points sounded BIG!. The S&P is a pussy because it only lost 200 points. :D

Maybe the Saudis will stat giving the stuff away for free lol

BAC, EPD, PGR, BRK

Tickling match?

Yeah.

It's 4 PM where I am. Soon will even be socially acceptable ;D

Well they're only down sub 6% now that they got to change their pants.

Switch to crude oil. it's cheaper.

It just doesn't work like that.

It's definitely not predicting deflation. I find it useful to use both of charts below when thinking about the bond market. The second one is probably more important. https://fred.stlouisfed.org/series/DGS10 https://fred.stlouisfed.org/series/DFII10 What it is saying though is that the stock market guys were way too enthusiastic especially in 2019. It's also saying that the economy is not that great. It's also saying that things in the labour market are not as they seem. I just didn't figure out what exactly. All of this probably has a lot to do with income inequality and a lot of other stuff like that though, not just a prediction of the next quarter GDP print.

I'm not spek, but here are my thoughts. I don't think that the bond market has much to do with with whats going on. But current events have certainly pushed it into overdrive. Here's the chart for the 10 year: https://fred.stlouisfed.org/series/DGS10 The 10 year yield has been coming down HARD since the end on 2018. Basically the bond market has been quietly flashing red for a while now. But nobody was paying any attention to it until now. They were too busy coming up with arguments about why elevated P/Es are just fine.

The way I understand it is that in the world we are today with shale you have to do more drilling because a fracked well has a shorter life than a conventional well. So you have to continuously invest in drilling to be able to fracture new wells. If you don't the production of the field declines. So you can't drill because you're broke and the capital markets are telling you to buzz off then you should see production declines.

I agree with spek on most of what he said above. I think that upstream will be a shit show for a long time. As I wrote above, I don't think that you can have production at $30 bbl. So I don't think we'll be there or below for a long time. If we do get there I'm just gonna do what I should have done last time. Buy physical oil futures. Not mess around with ETF but the actual futures. In the future after a protracted unfavourable price environment you may see consolidation in the industry. But the oilman is a special breed. And the oilmen of today are not just gonna become accountants they're gonna shuffle around in the industry. So there'll still be the same guys there after consolidation. So what will the do when they see $60 a barrel prices? Drill Baby Drill!! Then prices get bonked again. The only way you see significant money upstream is through supply and demand shocks. The 80s were great because of the decline in the conventional Texas oil fields (supply). The 90s sucked because OPEC decided to stop being a dick (or perhaps they got tired of tomahawk missile showers). The noughts were great because of India and China came alive (demand). But right now we're out of Indias and we're out of Chinas. It doesn't seem that field depletion is an issue, and at $80 you can get your fill of oil sands barrels and boy there's a lot of that stuff. So there's no demand or supply shocks as far as the eye can see. But we still need lots of oil and NG (especially) for the foreseeable future. To me that's why midstream is interesting. I see it like owning a bridge. You want to get from A to B? Well you'll have to use my bridge. The only negative that anyone has brought about midstream seems to be along the lines of "you can't do well if your customers are hurting". But there have been businesses that have been making tons of money off of poor people for years. For example credit card companies (I know, not a perfect analogy). Now taking the bridge analogy further. The only way the bridge is not a good investment is if you pay too much money for the bridge. The opportunity and folly comes from categorizing these companies as "energy" companies. So their prices are correlated with prices for pure play and integrated producers. Lately with indexing and ETFs this is probably more so. But they're not energy companies, they're infrastructure companies. You wouldn't link the price of a bridge with the price of GM stock, would you? So the opportunity and folly comes from this correlation. When energy is doing well these companies become really expensive relative to their economics. But you can pick them up cheap when energy is doing poorly - such as today. Or I don't understand the space, these aren't bridges and i'm whistling Dixie out of my ass.

I disagree that it has to do with the relatives. It looks like he wants to punish Russia for not going along with the cut. The biggest discount is for NW Europe - Russia's market. The question is if MBS can actually do it. It didn't work very well the first time he tried it. NA producers have proven to be very resilient. Who would have thought back in 2015 when he tried to pull this sort of crap that it was going to be the Saudis that are going to back off and not crappy producers from Oklahoma? I certainly didn't. So I don't think that we can have a protracted period of 20 and 30 dollar oil. As you say the whole system just doesn't work at that level. So the system re balances itself either through an OPEC+ cut, or bankruptcies in NA or both. My guess is that it's gonna be OPEC+ cuts because it seems that they have less of a stomach for those kind of prices than NA producers. But I think at the end of all of it you're gonna have hydrocarbons coming out from exactly the same basins that are coming out of today.

The thing about energy hydrocarbon markets is that prices are very sensitive to supply. You're a little under supplied and prices skyrocket - the 2000s. You're a little oversupplied and prices plummet - the 2010s. I don't see why the midstream systems have to be affected much by what's going on upstream. You only have to cut production by a little in order to balance the market so volumes won't be greatly affected. The locations of production will still stay the same. So if you have gas coming out of field A and you have power plant B that needs that gas and I am midstream guy C that has a pipe from A to B then why should I cut my tolls?? These midstream businesses also have chemical operations which would appear to be more volatile. But to me look like NGL export businesses. US NGLs are cheap and the world wants it and it's it's cheaper and safer to ship polyethylene and polypropylene than the NGLs themselves. So you process the NGLs over here. If there's a demand shock I suspect that the low cost producer (the US) will be ok. This is basically how i look at it. I welcome people that know more about the space to tell me why I am wrong.

Laphroaig Cairdeas. It's 10 PM where I am, it's been a crappy week and I had a bottle around. So i figured why not ;D.

Nobody really knows for a multitude of reasons. I also don't think that the number of cases per day matters from an economic perspective. And you didn't create a survey.

The selloff in some of the midstream names has been relentless. Is the coronavirus really going to render pipelines obsolete?

Thanks. We are doing great and not losing any sleep. Just staying informed exercising reasonable caution. +1 Yeah, I'd +1 that too. I don't want to diminish what's going on. This thing is definitely a nasty bug. But the reaction to it is definitely weird. I lived in Toronto during SARS (I actually worked on the subway during the crisis) and I lived in London during H1N1 (England was one of the harder hit places). But I don't remember anything like what is going on right now. There was a general level of concern (I started to cough in my elbow) but life pretty much went on as usual. I don't remember being any shortage of masks in the heath care sector. People definitely didn't stockpile masks. The markets certainly didn't care because we were all fucked at that point anyway. I just don't get why things are so much different this time. Social media This So basically the world would be a better place if we burned facebook and twitter to the ground and erased all trace of their existence...

Thanks. We are doing great and not losing any sleep. Just staying informed exercising reasonable caution. +1 Yeah, I'd +1 that too. I don't want to diminish what's going on. This thing is definitely a nasty bug. But the reaction to it is definitely weird. I lived in Toronto during SARS (I actually worked on the subway during the crisis) and I lived in London during H1N1 (England was one of the harder hit places). But I don't remember anything like what is going on right now. There was a general level of concern (I started to cough in my elbow) but life pretty much went on as usual. I don't remember being any shortage of masks in the heath care sector. People definitely didn't stockpile masks. The markets certainly didn't care because we were all fucked at that point anyway. I just don't get why things are so much different this time.

I'd think that Iran is doing fairly well in the UV department. But that hasn't helped. I don't necessarily disagree with a lo of what you wrote. But I think it's a little more complicated.

Does anyone know who's the asshole who voted against it?? Senator Rand Paul WOW! If I had to guess I would have said Ted Cruz... not the doctor.