Sweet

@formthirteenagree with all of that. I think they should focus on acquisitions rather than trying to innovate themselves. I think Metaverse is going to be a huge waste of money. Better would be to have an acquisition team who buys up the best companies. They bought Instagram for a billion - what a purchase that was.

I also think META needs a new CEO, but I can’t recall a big mistake yet, I think the ‘metaverse’ will become a big mistake. What are the other big mistakes he has made in your opinion.

I doubt anyone in this thread is wagering that it will blow up, things can rumble on for a long time before they do… if they ever do. Plenty of people on Twitter and YouTube like to constantly predict doom. Very few of these guys must make any money outside of the revenue stream of being a constant doomsayer. So many of those guys are broken records, lured me in when I started investing and cost money sitting out when I should have been participating. Wonder how much money they have collectively cost investors, must be huge sums.

Just because commentators have wrongly predicted the decline of China in the past doesn’t mean they are wrong about the serious economic challenges. A country growing at a rapid clip, with lots of inwards investment, and a huge current account surplus, can mask these challenges through sheer momentum. When the economic momentum slows / stops / reverses, economic challenges can become serious economic problems. For China, the inward investment appears to be slowing, and it may cease to be the workshop of the world, with Western government hostile and suspicious. The greatest economic miracle might yet become an economic disaster - I think there will be a reckoning.

I’m reminded of this in 2018. Totally mad. And we are doing it with China too.

Yep, Europe’s biggest problem is natural gas, no SPR for that. Going into winter any power plant / industry that can switch to coal or oil will be doing so. The boom and bust nature of the industry is bad enough and it’s compounded by energy ignorance and arrogance from Western governments. Shunning reliable energy sources like fossil fuels and nuclear, in favour of internment energy like wind and solar which cannot be easily stored is crazy. Further idiocy is outsourcing our energy production to unreliable and rogue states like Russia, meanwhile the West which produces some of the most ethical energy in the world has tried to kill off home grown production. The generalist media blame oil companies, not the insane government policies. Leads me to believe that the media is infested climate activists, eager to blame the greedy oil companies and shareholders that got decimated not 2 years ago, not to take a serious look at the root causes. Politicians are at least consistent, it’s nearly always somebody else’s fault.

Thanks @fareastwarriors

He is correct shareholders have been wrecked, but wrong about it being profitable only recently. Oil companies were spending huge money to grow production as fast as possible. Moderation of that growth is now finally showing all the doubters that Shale is extremely profitable. It was the ‘drill baby drill’ approach, which crashed prices and destroyed shareholder value, it was never that shale was uneconomic. The fundamentals of shale are sound, it’s not the marginal cost barrel in world oil markets. It only took two oil downturns, and a near death experience with covid, for the producers to find religion again. Thanks for posting what was behind the paywall. Cheers

Behind paywall. The title seems to suggest fracking was ‘wasteful and unnecessary (had to google the word). Why does he think that?

Interesting Minseok - thanks

It’s not even $100 oil, the world coped well with oil hovering at that level for a period of 4-5 years. It’s two other issues which are the bigger problem: 1. The price of products which very recently traded at $200 barrel of oil equivalent. 2. US dollar strength. Oil could sit quite comfortably at $100 if 1 + 2 were not a problem.

I don’t think there will be a shift in attitude, I said should there be a shift in attitude. I think some manager like Fink of Blackrock have a common sense approach to O&G so I still think it’s possible. I would prefer buy backs at these levels for most companies. Oil stocks are not expensive in a forward basis. Companies really weren’t in a position to buy back shares in 2020. I think the easy gains have been made in the sector, I would not open a position at these levels either but nor would I sell if you had a position.

Agree it won’t be a 1:1 correlation. If break even if $40 and WTI is $50 = $10 income per barrel. If oil doubles and goes to $100 your income has increased by 500%. Problem is oil stocks don’t reflect that change. I believe historic correlations have broken down for oil and gas stocks because so many don’t want to buy them. Should there be a shift in attitudes multiples could expand without any oil price increase. Likewise share buybacks can do the same.

Our understanding of history’s temperature records are based on proxy measurements which can be impacted by any number of things. We date those indirect temperature measurements using carbon dating which can be out by many thousands of years. By contrast modern climate data is a composition of real-time measurements of just about every aspect of weather imaginable. There is a major mismatch in both the directness of data but more importantly the resolution of data. One is indirect that at best can be placed within a few thousand years the other is effectively an live data stream of a comparatively small period in the Earth’s life. That poses a serious problem for the claim that weather is changing today like never before in our history. Quite simply we don’t have the data to say. Thats not to say man-made activity doesn’t cause warming. Anyone who thinks CO2 doesn’t have a warming effect is a loon. However does a change from 0.02% of CO2 in the atmosphere to 0.04% cause catastrophic climate change? I doubt it.

In the UK the office of national statistics was claiming that climate change was driving up violent crime.

really funny

That is a realistic scenario. However worth noting that the these moves are very influenced by financial markets. The physical market is still displaying large deficits - I’ve explained what I mean by deficits before. It’s not the average price that is putting off investors but the enormous swings. Many energy stocks are down nearly 40% in one month, what generalist wants to invest in that? It’s got more volatility than some crypto. I see some oil watchers on Twitter questioning the usefulness of financial markets because of these swings - both up and down. I’ve not seen any solutions though.

This is why generalists stay away from energy. Some names are trading below November levels now.

Since 2014, but what about before that period. Cathie seems to buy hype and stories.

Performance of energy stocks this last month have been woeful. A little more than three weeks ago the broad sector was up nearly 70% for the year. It was an unsustainable move that was sure to correct. Today it is up 25% having given up most of its gain these past three weeks.

Many of those criticisms were justified then and are still justified. However in the US stock market optimism has been handsomely rewarded in the long run, and its a lesson some people will never get. Even now I people predicting on Twitter a recession incoming WORSE (kid you not) than covid and 08 combined. It's important to separate out who is complaining and for what reason. The perma-pessimists, the likes of zerohedge, Hussman, Schiff crowd are making their money from sounding the alarm... nearly... all... the... dam... time. Others just have it in their DNA. On the other hand there are just mom and pop savers, uneducated in stocks, and only know interest from bank accounts. And I gotta say, they have been screwed whilst we investors got our ass saved and generous multiple expansion. I am worried that the historic low rates the past 15 years, and the massive printing money, will lead to underperformance in the next decade, but where else would you be if not stocks? NFTs, a shitcoins?

Investors got something for nothing. The whole financial system was bailed out, interest rates were set at zero, and we had huge amounts of QE. Remember the taper trantrum? Fed tried to wind down purchases, the market get wobbly and suddenly its called off. The Fed should not have been so willing to intervene just because stocks were falling.

Greg, what is it you don't understand? If the Fed raised the interest rates massively because inflation couldn't stay under control, I guarantee that all of us investors would be pissed. Can you try a bit of empathy please? Heck you don't even need empathy, just invert. Nobody is saying that savers are entitled a return, likewise Gregmal and Sweet the stock market investors are not entitled a return in the market either. This cuts both ways. It's not just savers, it's pension funds in bonds, its old people who coming to the end of their life who would prefer the stability of a bond than the volatility of stocks. They are perfectly entitled to complain, and when the shoe is on the other foot, and the Fed has to step on the economy for one reason or another, I've no doubt you would be pissy as well (as would I).

Yeh it wasn’t a tightrope, it was a wrecking ball. There was no reason for rates to be as low as they were for so long, or for QE to occur for so long.