SharperDingaan

Best guess is somewhere well under $1. As it exists to facilitate settlement of the consideration portion of a smart-contract, & there is no limit as to how many are issued, its value is really based on how much the miners verification is worth to you. As the smart-contract leaves an audit trail, there's no premium for annonymity. SD

"SD, have you forgotten that Alberta is formed of independent producers? This is not an OPEC country that unilaterally decides what happen." Even independent producers need to have a coordinating industrial policy. Tying the cats in a sack, and tossing the whole thing in a fast flowing river doesn't help anybody. The hoped for industry leadership just drowns in the bag. Agreed that to an Albertan this is 'socialism'. And while 'diversity of opinion' is a good thing; industrial policy is common practice the world over, and for the most part - it works very well. There is nothing wrong with sharing a beer with Karl Marx, if he actually has something that works better than your way. You don't have to kiss him! SD

If your time frame is (< 2 yrs) Canada should probably be avoided. If it is long term (7 yrs+) and the intent is to 'roll-in' the investment over time - it's pretty hard to find something better. No matter what, NAFTA is going to force very big changes. Highly desirable, but it will be extremely disruptive in the short to intermediate term as interprovincial trade has long been extremely restrictive - and used to support provincial fiefdoms. Most would expect that once it's done, Canadian inter-provincial trade/people movement will resemble the EU - and that ultimately, it will become easier to ship goods entirely within Canada, than it is via northern US rail links. No matter what, demographics are pointing to extensive and disruptive cultural change in the near to intermediate term. We don't have enough young people, technology (blockchain, self driving vehicles, etc) will force up productivity by cutting jobs, and much of the existing workforce is going to turnover due to retirement. Skills shortages will be met by 'import' from abroad, with the 'divide' between the working and retired populations widening considerably. Nobody likes 'change', and the older you are the more resistant you are to it. The record suggest long term advantage to Canada vs the US, short/medium term advantage to the US. Lot's of folks hated Trudeau (pere) - primarily because he wouldn't play the regional 'game'. Instead the 'bastard' played for Canada; and didn't hesitate to pit provinces against each other (scorpions in a bottle), or slash throats (NEP) when it was in the national interest. If you had a problem with that - bring it on; but if you failed - you either retired 'gracefully', or fell into line and did what you were told. Looking forward, most would expect that Canada is about to enter a period of 'muscular' federalism. There will be threats to 'seperate', and there will be throats cut - no different to a meeting of mafiosi 'dons'. Not a bad thing, but probably not the place to invest when the blood starts flowing. SD

This has been going on for some time. Yet only now ..... it's suddenly 'in the news' Or is it really just a marketing campaign - decided upon by a small group of people, trying to save their ass? The reality is that Alberta is flooded with heavy crude, cannot get it out, and has new 2 new tarsands plants coming on line with huge quantities of heavy crude per day. Most places would have dried up their excess supply via a temporary shut in of these new plants, and used the current BC/Alta spat to shut-in all o/g production from BC using Alta facilities - at the BC/Alta border. Very unpopular, especially amongst those at risk of shut-in, but no different to what we expect OPEC (now expanded) to do - control supply. Material portions of WCSB heavy oil production are going to get temporaily shut-in within weeks/months, and unemployment is not avoidable. Furthermore it will stay shut in until the west coast pipelines are built/expanded, and all the obfuscation in the world is not going to hide the fact that the cause is gross mismanagement. Hence the screaming match between Alta/BC. Until that heavy oil is shut in, don't expect any changes. SD

Arguably it really comes down to FFH not being 'his' company anymore, but treating it as though it were. Sadly it's not that unusual, as the folks at the former Toronto Street post office found out a while back. We wish them luck. SD

There is nothing wrong with bringing your kids into the business, and we have all kinds of examples in Canada's business dynastys. But they all work their way up, and they cut their teeth in the board positions of subs first. Elevating family too quickly isn't fair on them, your partners (shareholders), or the people that elevation displaced. The reality is that at 7% ownership FFH isn't Prems company anymore, and succession planning is everyones problem - not just Prems. Calling him out on it was valid. Might it have been done better behind a closed door? Probably. SD

Why? Sorry if this is a dumb question. We would suggest that this is a version of Taleb's 'taxi driver' anti-fragility. Rather than rely on a single high paying job (pipeline build/terminal delivery process that is fragile), do a number of smaller jobs (delivery by rail to multiple terminals that is anti-fragile) where you are not as reliant on any one employer. Ultimately it may cost a little more (insurance premium), but you will never suffer a total shut-down (& economic collapse) - as you always have a way of getting at least some of your oil out. In business we try not to be beholden to a single dominant customer, same idea here. Transport cost/mile is important, but the real advantage of pipelines is safety. Accidents happen, and the more tanker rail-traffic the higher the odds that there will be one. Nobody wants another Lac-Megantic https://en.wikipedia.org/wiki/Lac-M%C3%A9gantic_rail_disaster SD

It might not be popular, but this thread is in the right place. The reality is that o/g investment in the WCSB includes a material political component, and it should be part of your decision to invest. Canada already has pipelines going west, east, and south. Unfortunately they are nearing end of life (corrosion & leaks), and were sized for smaller volumes than we have today. Fortunately the rights of way already exist, as does the permiting. Most folks would suggest that the long term solution is both replacement (& bigger) pipe, double piping in sections, and removing/re-cycling the old pipe/steel. Long term utility infrastructure investment, ideal for pension fund investment to offset their long term liabilities. Less enviro damage, lower cost through scaling, all kinds of construction/operations jobs in Canada, unrestricted tidewater access on both coasts, and much lower differentials. All Canada benefits, and in a very big way. Canada is a pretty civil place - a industry has to have been behaving pretty badly, and for a long time, to meet this much resistance AND from so many disparate people. We used to think that 'rock 'em, sock 'em hockey' was 'part of the game' - but have since moved on once it was realised how destructive it was to play this way. Agreed it's frustrating to be Albertan, but at times they are their own worst enemy. The smartest thing the fighting kids can do for themselves is to shut-up, and let the adults (fed) clean up their mess. SD

All we have suggested is that Alberta would materially help itself if it had a rail-car fleet on long term lease. No engines, drivers, track, nationalisation, etc. - just a fleet of rail-cars to continuously keep the differentials as low as possible. The industry simply fills 'em up as it needs them, at whatever the cost at the time is. If it's not profitable to ship, there's no fill. Agreed the industry is incredibly innovative, but it's also incredibly 'tone deaf'. For the most part folks are open to alternative solutions (fed involvement), but flatly just don't trust the industry - and will not give it the time of day. It's distrust that's well supported, and 'Lotus Landers' are just as adamant as Albertans are. It also cannot continue. Newfoundland vs Alberta? Per Newfoundland, an investor lets the big boys drill - and only gets involved once the o/g is well on its way to being connected up with on-shore facilities; a back-end focus on who benefits when the o/g starts to flow, & investing accordingly. In Alberta it's front-end focused, as everybody can both drill fairly cheaply & tie-up to a collector facility a lot more easily. It's just a different approach. Ultimately the pipelines will go through, but once the dust settles - it is not going to be business as usual. Not a bad thing. SD

Were there no problem, the Alberta differentials would not have risen to what they were; the problem is just 'lack of common sense' - not money. Example: In the IT world the days activities are backed up every night, and a warm start disaster recovery room maintained at a geographically remote site. It's an entirely redundent continuous expense, treated as an insurance premium, and the CIO would be terminated if he/she didn't maintain it. But if IT goes down, it can be recovered in hours. In Alberta we use pipelines to transport, and rail cars as the equivalent of warm site backup. Except there aren't enough rail cars to take over when the pipeline is constrained - 'cause rail coy's aren't building them in the absence of contracts with terms long enough to finance the cost of the build. So when the pipeline is down/constrained/restricted, we scramble for short-term solutions - and wonder why we end up f'd. Apparently it is too hard for industry/government to collectively lease enough rail cars on a long-term basis, so as to ensure that they are always available? It's cheap insurance, no different to maintaining a warm start disaster recovery room. Canadian industry cost recovery models are widely available (Facility Association auto-insurance). We fully agree that pipelines are the way to go, and that it is in the national interest to allow them to transport o/g across the provinces. Transportation of o/g across provincial boundaries is no different to electricity, hazardous waste, or even produce (wine, beer, weed, cheese, etc.). We simply recognize that it is often easier (& with fewer 'barriers') to move goods between provinces via the northern US rail links - and that for most industries, THAT is the natural 'disaster recovery' plan. We mentioned Newfoundland BECAUSE it is on the ocean. If you think Canadian o/g services is a great place to invest, there are other viable and functioning places in Canada where an investor does not have to put up with the differential. More importantly, it is just a straight forward shipping route to replace declining North Sea production going to customers in the Atlantic basin. SD

"How would provincially owned railcars help? It is your viewpoint that GATX is not leasing out enough cars?" Today you cant get a rail-car unless you commit to a long-term lease. It's to the producer to lease it, they are reluctant to commit, and the oil stays in the ground instead. Can't take the risk. Nothing prevents Alberta from entering into (permanent) long-term rail-car leases, in large quantity (potentially 50% of existing maximum pipeline capacity), and re-leasing them to producers on a short-term spot rate basis. There is now permanently more than enough take-away capacity to move oil by rail to anywhere where it may be sold profitably, producers receive WTI less transport cost, and can produce as much as they can profitably sell. Alberta has permanent incentive to go to pipelines as soon as practicable, but in the meantiime everyone's oil is getting to market. If total lease costs exceed revenue, the difference is simply charged back to industry. It's not difficult, 3rd world countries manage to do it every day. SD

Actually this speaks to just how irresponsible the Alberta o/g industry has historicaly been - and remains so to this day. We all know Alberta's oil/gas is landlocked, and heavily discounted because of it. The opportunity loss literaly costs the Alberta economy (& the Alberta government via the royalty loss) billions/year EVERY YEAR, and has been costing everybody ever since Leduc No.1 came in - in 1947. The Tarsands ALONE had enough proven reserves in 2012 to supply all of NA for 100 years at the 2012 consumptiion level - yet 71 years after Leduc, and through multiple booms/busts, Alberta o/g is still as landlocked as ever. Even 3rd world countries (ME, VZ, etc.) invest in state owned/chartered tanker fleets to move their oil to market - Alberta does not even have a provincially chartered rail car fleet to backstop its pipeline access. Hard to be sympathetic, when the industry continues to be this irresponsible. Newfoundland has long been the butt of many jokes. But those same 'newfies' also managed to put their offshore Whiterose (& now Hebron) o/g into production, from literally scratch, and DO NOT SUFFER Alberta's 'differential'. Furthermore, few investors recognize that there are actually TWO o/g industries in Canada; most see only the WCSB. The fact that Newfoundland has its act together (& has successfully done it under much more difficult technical conditions), and Alberta still hasn't a clue - is an indication of just how irresponsible the 'blue-eyed sheiks' have been. https://en.wikipedia.org/wiki/White_Rose_oil_field http://www.cbc.ca/news/canada/newfoundland-labrador/hebron-first-oil-1.4422476 Hopefully this time around Alberta feels enough pain, and for long enough, to finally make the REAL changes neccessary. Newfoundland oil can also flow west, and at some point - very likely will. We wish everyone the best of luck. SD

Just to add some food for thought. We know that the markets are primarily driven by algorithms, and that optimization includes backtesting against prior data. As long as the future resembles the past, or does not change QUICKLY, everything's beautifull. But when there's a 'market discontinuity' - the algorithms make the wrong decisions, and exaggerate their errors. As was shown this week. So why not simply trade against them via a bar-bell?. A core of rolling treasuries, and a rapid move to futures everytime a algorithm blows up. The underlying premise being that in a rising rate environment, and unwinding of QE, there will be reliable FU's - the only question is frequency, and your ability to exploit them. Furthermore, while you're sitting in your treasury ... there's very little risk. SD

Just throwing out a guess here - but somewhere between EURO 1-2. It will very likely always be more valuable to the criminal element than a EURO 1 coin - simply because it's annonymous and electronic. How much more will depend on how much someone is trying to buy at the time, and why they are buying. On any given day, anyone in the world trying to hide assets in a divorce proceeding, might quite happily pay 'above market' - in the expectation that even if they end up selling at a loss, it's highly unlikely to be 50%. Therefore a maximum of 2 EURO. SD

Sounds like you have the gambling gene. When you notice that, the proper thing to do is to stay away from gambling. Agreed; you have to control the money - and not allow the money to control you. There are lots of examples of folks who let the money go to their heads, then discovering that it often destroys lives. Victims range from yesterdays plumber suddenly winning the lottery, to celebrities dying from overdoses. Part of tuition - is learning how to deal with wealth (& lack of). SD

I have just been advised that both the 'Blockchain' and 'Bitcoin' courses were caught up in the Facebook crypto advertising ban, and that they have now been given permission to advertise on Facebook. Little goes viral in academia quite like a formerly banned course - and on social media no less. I feel so proud! SD

It's not far off - one of the papers on this thread suggests Etherium was spending around $1M/day. It's also (in part) why some are skeptical of the Bitcoin 21M coin limit - as the choices are either pay this per transaction, or pay nothing if new token are issued. Most likely as initial additional token up to the amount thought 'lost' over the years (therefore still a maximum 21M), then maybe 1% year thereafter - 'forever'. Controversial. SD

Sh1te that's good - thanks for posting! SD

This means very different things to diffferent investors, & ultimately is a decision as to how an investment will be made. While well meaning, it often suffers from poor understanding. According to many environmentalists carbon credits are the 'devils creation' and nothing less than a tax grab; the money collected just goes towards the creation of more pollution, minus a healthy 'cut' to the government. Whereas it's actually a very smart thing to do; that 1 very dirty plant gets shut down in favour of 2-3 'cleaner' plants - same total pollution, but now 2-3x the employment. Putting a price on pollution, justifies investment in pollution scrubbers; if the PV of pollution costs saved > cost of the new equipment. Ultimately if we value something (clean air, water, etc.) enough to put a price on it, it will be done - as ACTIONS change behaviour, NOT words. Similar arguments apply to addiction and heathcare. Someone who frequently smokes will become addicted, and it will cost them an early death. Early stage treatment may turn things around, but it has limits; at some point it will cost a lot less to just give the smoker enough cancer sticks to hasten their end, & treat only for pain. Different paths, both equally acceptable. There's lot of investment literature on the topic, but ultimately its a personal decision. SD

You've just learnt what most ICO's are - a whitepaper, a sketchy website, nothing 'patentable', a VERY 'questionable' ICO issuance, and often a token limit - indirectly tied to the 21M maximum of Bitcoin. You've learnt that if you put this stuff into a closed end investment fund, you can sell units in the fund at a 30% premium - when they should be sellling at a discount. And also learnt that it's these 'fund co's' and exchanges that get hacked (& your token stolen) versus the Bitcoin.org oracle itself. If you come from capital markets - you also know how to use Bitcoin options and futures to advantage; on the assumption that a falling tide lowers all boats. The technology behind crypto-token is the distributed ledger, the blockchain, and the smart-contract. Your value add will be in learning how this works, keeping an open mind, and thinking outside the box. Sadly there's almost always a frat-boy 'blow-out', that is the human part of most market tops (movies get made). It's also a reliable indicator that the party is reaching its end - so use accordingly. SD

The smartest thing you can do right now - is educate yourself in the technology. Forget the FOMO - crypto will be around for a long time, and it's hard to short. As at yesterday there are 1,512 tokens/coins in the world - about 131 (9.5%) MORE than they were, just ONE month ago https://coinmarketcap.com/all/views/all/ . Pick 2-3 of the more obscure coins/tokens of interest & do a little research on them. SD

The smartest guys in the room - Enron documentary

Chicago Bitcoin futures and options! SD

There will be an on-line version this Fall. As at the beginning of last Fall there was nothing that I know of in the US - including Harvard! SD

I'm curious what your thought process was originally, i.e. getting into the cryptos. I found it technically interesting and noted the all in of the Vinkelvoss twins (no need to snigger here, just because they lost to Zuck, remember they were absolutely right and early on social media.) But I could not pull the trigger in that I would only be buying on an estimate on what others would find attractive--see Keynes on judging the judges of a beauty contest. I came into cryptos via block chain and the smart contract. I was looking for a thesis topic, found this technology incredibly practical and appealing, and used the opportunity to do a deep dive into what it is. Combined with 20 years+ of business experience in both FI's and supply chain; the result was a 'how to' thesis in the strategic implementation of this technology in 'day-to-day' business - from 'blank paper' through to 'finished working product'. Obviously, its a valuable skill today - and available to all for a very modest hourly fee ;) Along the way I had to research crypto, their relative merits, and their limitations. It was quite obvious that Bitcoin was truly unique; once the 'videos' and 'textbooks' started explaining it 'en masse' - the odds on it ultimately becoming 'mainstream' were also pretty good. Our own view was that Bitcoin would not take off until it became both investable (futures, options), and respectable for institutions to hold. It happened sooner than we thought, and we sold as Chicago started offering derivatives. Ultimately we bought a few Bitcoin just to get the 'feel and experience', and traded the volatility; executing through various exchanges largely as a science experiment. Continuous reinvestment grew the number of coin, & ultimately we dumped at high prices & took the $ off the table. Today we hold T-Bills, and a whack of WCP, instead. To a large extent we've been very lucky; right time, right experience, and increasingly - right place. Maturity, expertise in value investment, backgrounds in petroleum engineering and finance, and experience with some of the worlds nastier 'hot spots' has been extremely helpful. We totally get both the anarchist and CB viewpoints, because we've seen both. The technology is incredible, but the weakness is people. Transformative managers with strong people and social responsibility skills are going to rule the world. SD