Sweet

If oil and gas companies can put shareholders first, and maintain production roughly where it is right now -maybe even growing slightly without swamping the market in oil - then oil companies will be sending back a lot of cash flow to shareholders. Long term shareholders have been wrecked since 2014. Second big change is narrative, no longer does the investment community think oil and gas is dead by 2025 or 2030. There is still a multi decade runway of oil production and shareholder returns. Plenty of wildcards too, largest amongst them is government windfall taxes, which I find quite despicable. Javier Blas said that in the UK the government are now taking 70% of O&G income. If you don’t want then operating as private companies buy them out.

Doubts about coinbase now?

Saw quite an amusing comment that Russia might demand buyers pay the price cap. Currently Urals is trading below the cap being proposed by the EU. Oil volatile as ever this morning, much talk about it being related to OPEC, but I think weakness in the price is being driven once again by China and their covid. It’s been the dominant factor in prices the entire year. The investment banks predicting oil prices to average $100+ are looking quite foolish.

Yes crypto and blockchain aren’t going away, that doesn’t mean any of them, whether it is Bitcoin or Ether, will have any value in 10 years. I wouldn’t be surprised if both are close to zero, I also wouldn’t be surprised if both were significantly higher. If you believe significantly higher, it’s a bet that others will bid it up, neither actually produces something tangible. It’s speculation rather than investing IMO. Nothing wrong with that of course.

saudis said it wasn’t true

Oil flat for the year despite everything that has went on in the oil markets in the last 11 months.

Why? I’d say it makes very little if any difference at all, both to oil production, and oil prices.

crazy that happened, has he provided an answer as to why?

that would be terrible for stocks if inflation followed that chart

Thanks for the explanation!

Noob question, but if your BTC is on a single USB, and for some reason that USB gets wrecked, I presume your money is gone? This isn’t something you can back up… right?

Greatest fear is a decade or more of stock market underperformance. I think that possibility is far worse than a sharp contraction in stocks. We are facing particularly strong macro headwinds currently, the likes not seen since the 70s. Normally when we get a recession rates go down, this time inflation is high, rates are rising and the feds balance sheet is shrinking - all the same time. I would say my pessimism level is high, but there is no choice, you have to be in the market, the optimists are the ones who kill it. Look at Hussman.

Taiwan long predates Biden, it’s a continuation of decades long policy. Don’t think anyone could claim we have nothing to do with either Taiwan or Ukraine. Just can’t see how it’s provoking.

It’s transparent and cynical politicking, but don’t think we can make the claim that Biden provoked a war.

@lnofeisone thanks, I wasn’t aware of that, I don’t follow either Brazil or the Mexican markets. I’d be fairly sure that China GDP is smaller than the headline figure but no idea of the magnitude. It would be quite something if it was 40% lower.

How can the economy grow so much and yet this ^ be the case? Something wrong there.

Yes, that makes sense. I think we could see a squeeze on demand too.

^ Paywalled for me (yes I’m cheap)

Kup, I’m not sure I agree that the oil market is in as deep trouble as feared. I agree there probably is a deficit globally, but US demand is not mirrored everywhere, and in fact its strength is offset by reduced demand elsewhere. Even in the US demand looks weak, though almost certainly not as weak as the EIA numbers imply (which have just been wrong recently). Woodmackenzie are predicting that demand will have dropped by over a million barrels a day yoy in the coming quarter, largely as a result of China. I’m not saying they are right, I just don’t know. OPEC do in fact have sustainable spare capacity, it’s not much, but it exists. It’s probably lower than they claim, but I’d say it’s at least 1 million barrels a day of sustainable capacity. The biggest problem in the market is a lack of US refinery capacity. Crack spreads for diesel are nearing $60, not sure where they are for other products. That’s keeping lid on crude prices because it’s hurting demand. On China, I have a feeling that there may be something bad lurking there economically, and the covid policy is not sole cause of the poor demand figures. Wouldn’t surprise me if headline ‘zero covid’ policy is being used by the CCP as cover for really bad economic data.

The problem for the EU, and your argument, is that the EU signed up to the Brexit treaty too. In black and white text it sets out the conditions by which unilateral action can be taken. The EU can disagree, but the facts are clear, the trade statistics have already demonstrated that there is a diversion of trade. Brexit: Northern Ireland goods exports to Republic 'reached €4bn in 2021' - BBC News Importantly this diversion of trade will increase substantially should the grace periods for checking goods ends, and the checks the EU wants are implemented in full. That says nothing about the political situation in NI. For all the bad faith from both sides - and to be clear I think both the UK and EU knew this couldn't work from the start btw - the UK has held off from Triggering Article 16 for much longer than they are required to do so under Annex 7. Ironically the UK have actually presented serious proposals to alter the Protocol to make it work, but does the EU want to make it work, or just use it as leverage for something else? I don't know. I also don't know what is the best deal, or who is best placed to deliver it. I just dislike the claims of extremism, I think it's very out of touch with what real extremism is and looks like. Foolish, chancers, liars... sure. Extremists??? No way.

Why the sensationalism? The majority that voted for Brexit are not extremists, and the Tory Party that implemented Brexit was not hijacked. Two post-Brexit PMs, Truss and May, voted remain - are you forgetting that? The Tories have long had a Eurosceptic wing, and in fact so did Labour. Leaving the EU is not an extremist endeavour. The UK joined the European Economic Community but left the European Union. There is a significant difference between the institutions, in scale, in scope and the areas they regulate. At no point from joining in 1973 where the people of the UK consulted about the increasing scope of the European project, not a single treaty change was put to the UK electorate by referendum in 43 years. Should the UK have signed up to a post-Brexit trade agreement that split their country? My view is no, and that it was a mistake. However there were quite different interpretations about how the NI Protocol should be implemented, with the UK side believing it would only impact goods at risk of moving to the Republic of Ireland, and the EU believing that all consignments from GB to NI need checked. That’s quite a gulf. There are problems with the NI Protocol, every side admits that now. Let me repeat, every side, including the EU, agree the NI Protocol has problems. The flow and approval of medicines in the UK as part of the health service was under threat, and an agreement had to be reached between the EU and UK to resolve this. The fixes, and grace periods, and offers of reduced checks by the EU are proof there are issues because none would be required if the Protocol was working well. The safeguards to the Northern Ireland Protocol, the infamous Article 16, says that the UK or the EU can take unilateral action for a number of reasons. It states that: "If the application of this Protocol leads to serious economic, societal or environmental difficulties that are liable to persist, or to diversion of trade, the Union or the United Kingdom may unilaterally take appropriate safeguard measures. Such safeguard measures shall be restricted with regard to their scope and duration to what is strictly necessary in order to remedy the situation. Priority shall be given to such measures as will least disturb the functioning of this Protocol." We have diversion of trade between GB and NI - fact. We have societal unrest in NI - the devolved government in Northern Ireland has collapsed because of the Protocol - fact. The conditions for triggering Article 16 have therefore been met. Unilateral action by the UK government is entirely in keeping with the Brexit Agreement and the safeguards therein. Not very many people understand this, because they haven't actually read the NI Protocol.

Let’s not exaggerate about the ‘extremist’ nonsense. Countries change their international relationships regularly, and apply and interpret law it as it suits them. International law is only given effect through domestic legislation in the UK. If a new PM comes along, and they can take a sufficient number of the Parliament with them, they can change international relationships. It’s their right. The NI Protocol, implemented as part of the Brexit trade deal, is in many respects unworkable. It’s also unique in that it puts a trade barrier within a country. I can’t imagine very many countries willing to accept that, certainly not the US. It’s takes quite a bit of spin to portray the Tories as extremists - They aren’t. Regarding the finances. We don’t actually know if the fiscal deficit would have increased, the mini-budget was not the full story, cuts in public spending were touted to follow. The messaging was bad, the plan clearly not fully formed, but is that extremism - of course not.

In the UK we don’t elect a Prime Minister, it’s simple, whichever party wins the election forms the government and the leader of that party is the Prime Minister. In some ways it actually a good thing for democracy since are more ways to get a person out of office. Long term the system has been shown to work. In other ways it’s worse because there is a democratic deficit, but we tolerate it for the longer term good. My own opinion is we need a general election, I agree the Conservatives have selected too many leaders. The Tories are a fractious mess and some of them need to be retired and some time in opposition might humble them.

Agree with Spek, don’t think it is wise to have money in China. It could disappear quite easily and I don’t need help losing money Disagree with comments about the US and education. Not everyone needs to be highly educated. I think risk taking and entrepreneurial spirit in the US remains strong and they will remain the innovators and leader in the global economy for decades provided the politics calms down.