meiroy
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Posts posted by meiroy
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Pardon if this was covered on another thread, but those of you who live in Europe or have families there, how will you cope with the coming energy crisis in winter?
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The crackdown on the tech sector was at least partially justified.
The short version is that some of these companies managed to grow extremely fast in scale and scope due to lack of regulation in a developing country. It got to the point where it could cause systemic risk or stifle the economy.
The RE sector is far worse. Any adjustment will hurt. Regardless who's in charge.
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22 hours ago, JAK said:
Doesn’t answer your question, but Croatia is actually already in the EU, and will adopt the Euro next year.
Yeah, they are technically in the EU but without the currency and not part of the Schengen.
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8 hours ago, changegonnacome said:
Yep my read too - China has lots of problems going on right now...........an external enemy to direct attention to is a useful distraction.......I think the level of noise made around Pelosi visit should be seen not as a show of strength by the Chinese but rather a sign of internal domestic weaknesses bedeviling the Xi administration.
The "noise" as you call it always exists, it's always in the background, it fills local Chinese news. In that sense, nothing really changed. As far as China is concerned, Taiwan is 100% Chinese. You could flip it and say that they feel stronger, and that's why there's more external noise.
I would definitely agree that deteriorating economic situation leads to a higher probability of war. With the global macro trajectory of the past decade this become more and more likely, going hand in hand with sovereign defaults. This doesn't apply only to China.
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Croatia is going to join the EU, Albania might follow in a few years. Rental yields there are still far higher than western Europe. Anyone been looking to buy RE there?
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yes yes yes let's get it over with so they can reopen the markets!
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In 2009 and 2020 investors were saved by QE and the market has been pumped ever since. I've went all in in both occasions. Now, I can't see how we get QE in the near future. The Fed is backwards looking, so either they see inflation resolved a bit with a lag or something else goes horrible bad -- then QE. Other than that, could be some bear rally, probably in tech. Or, if Putin feels like it, crude goes to the moon.
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15 hours ago, Minseok said:
Canadian energy sector averaging 31% FCF yield and on track to be debt free by Q1 2023. The whole industry can privatize itself in 3.1 years!
This is on a backdrop of oil demand growth which dont turn negative even in hard times, just slower. Hypothetical inventory surplus of 1M BPD is only enough to replenish historical stock piles over a whole year.
Canadian TSX capped energy index ETF seems like a good hold in these times.
Yeah, Canadian oil has some stupid numbers. I've been owning a lot since last year and they did great, but then recently it all went batshit crazy down. Numbers still good, though.
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On 6/26/2022 at 6:39 AM, SharperDingaan said:
Keystone (Canada-US pipeline) is stranded largely because a re-approval would require massive damages payouts, which is not politically practical. The best alternative is a 'national interest' re-approval and completion of the pipeline on the government dime, and a sale/leaseback of the government interest to industry. Still very difficult.
The pipeline carries very high political risk, that risk will continue well after it is completed, and there is very real possibility that it will economically strand before it reaches end of life. Can't make the business case, and existing write-downs cannot be reversed until Keystone is actually completed and product has begun flowing (years away).
The more practical alternative is a build out of west-north-east gas pipelines that are entirely in Canada. Product/transportation/related employment a better fit for the times, globally strategic, more politically viable, and delivery from sea to sea to sea. US pipelines connecting to the trunk, where it makes sense.
The Canadian energy future is bright for decades to come, but it gets there by stepping back from reliance on the US. The US has a great many disruptive issues to resolve (failed Jan 06 Coup d'état, Roe vs Wade reversal, etc.), that will take years to work through. In the meantime it is just pragmatic to avoid getting stepped on, by giving the elephant some distance.
SD
What is the political risk in Canada? (I have no idea).
Justin Trudeau Says Canada May Expand Energy Support for Europe - Bloomberg
"Canadian Prime Minister Justin Trudeau says his country is looking at expanding energy infrastructure to help Europe over the “medium term” to transition away from Russian oil and gas."
That's a good political way out. Drill For Europe!
Even in Europe there's a bit of a change these past couple of days. Once the energy crisis really punches them in the face and extreme political parties gain power they might even drop all the ESG crap.
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3 hours ago, ERICOPOLY said:
I haven't been able to work on my house in Dunsmuir since April because my daughter is refusing to live with her mother. So now I have full custody of her and she doesn't have her driver's license yet.
But she is now getting her permit and I bought her a 2008 BMW 328i for $6,000. 120k miles on it.
It needs new motor mounts and a new alternator and normally those two fixes would cost $2,000+ but I have a NEW HOBBY!!!
I bought a $75 refurbished alternator taken from a wrecked 328i and I bought a pair of new Genuine BMW engine mounts for $220 and I'm going to get my son off of video games and take the car down to my father's house who is the experienced DIY mechanic with all the tools. Three generations of Eric's fixing my daughter's car for a day.
Between the directions on PelicanParts and the videos on YouTube, we have it covered.
oh man that sounds awesome!
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4 hours ago, Viking said:
I am starting to buy into the thesis that we get an earnings recession in the coming quarters and perhaps not an actual economic recession (although growth is slowing). Why? We have a labour shortage. Still. High inflation and a strong labour market = higher than expected interest rates. Maybe we actually see interest rates close to 4% across the curve in the coming months. We will see
Earnings recession + flattish growth + high inflation + solid labour market
Yeah, that's an interesting argument, that there's not going to be an actual recession because of current labor shortages. First, it should be clear that unemployment is a lagging indicator. Now, why is there labor shortage? One obvious reason is because of all that liquidity pumping for the past few years. Take that away + higher inflation + layoffs going on in waves and the shortage is resolved. I think it's extremely unlikely the Fed will manage a soft landing, even if my reasoning here is completely wrong.
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5 hours ago, Parsad said:
Looks like oil prices are flattening and reserves are building as recession fears and high prices hit consumers. Cheers!
https://finance.yahoo.com/news/oil-price-fundamental-daily-forecast-093607544.html
Look at crack spreads which are a better indicator of demand -- upwards. There's SPR release going on which will eventually end as the reserves are being emptied. EIA crude inventories report are delayed to next week, for whichever reason, so it's not clear what's going on right now. There's some demand destruction in Europe (they so fucked) but in the USA? The only thing that can crash oil is Russia/Ukraine being resolved or of course some serious recession. If it's demand destruction via recession, how well would financials do? Google and friends? No place to hide.
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Could be a beginning of a bear rally. Still a bear market, though, which means it will crash lower afterwards, unless the Fed pivots and then shitcoins go to the moon. Yes, lots of bargains to be found.
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What matters is the Fed. If they are determined to squash Inflation, than we will continue this bear market with the occasional run up. Will most likely get a recession as well.
In China there is a convergence of circumstances and we will soon see plenty of new policy and guidance to pump up that liquidity.
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On 4/17/2022 at 4:49 PM, ratiman said:
I want sites like Koyfin to succeed but my bookmarks are filled with dead links to sites that have tried to replace Yahoo finance (remember Zignals?) It's amazing how many things YF got right and how difficult it is to replace even for billionaires. I think the basic problem is that everybody has very unique preferences and ultimately most people default to a mix and match of different sites. I also wonder how large the audience is. We've all heard the anecdotes that like 57 people actually click on the link to the SBUX 10-K.
I switched to Tradingview.
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Wabuffo,
So you're saying the Fed's tightening into a slowdown will most likely not cause a recession?
Personally, I think they can easy fuck this up.
As far as models goes, who knows, just now from twitter:
"Bullard praises the 1994 Fed tightening cycle, which scarred a generation of traders and central bankers. "Faster is better. The 94 tightening cycle is the best analogy here..."
"*BULLARD SAYS HE BELIEVES THE FED CAN ACHIEVE A SOFT LANDING"
Edit: I think you have provided a decent scenario and lots of details, it's reasonable. Might happen. Personally I'm long as always. The problem with such predictions is that they are very static. Is the Fed nimble enough? Have they shown good judgement in the past 5 years? Did they raise when they had the chance and should have? Now, all of a sudden they have the skills and will do the right thing? I doubt it.
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On 3/13/2022 at 9:10 PM, wabuffo said:
FWIW - no US recession.
1) US economy is ready to boom and will absorb the hits due to commodities.
2) Russia/Ukraine war will be over in 1-2 weeks -- Russia has already lost, strategically speaking.
You want to be positioned for the rally in equities that is coming and you don't want to be in commodity plays.
Just my 2-cents.
Bill
Fed tightening into a slowdown can cause a recession. This is without considering any new externalities.
Perhaps the war is over in 1-2 weeks. Perhaps Russia uses chemical weapons and then EU sanctions the energy sectors and things escalates. If Russia does take over Ukraine they will control a very large percentage of the global wheat production not to mention other commodities. It's not that simple.
Various commodities are doing well because there was a demand > supply even before Putin's war started, it might crash for awhile but the trend will resume.
Tech sector as a whole will run up only with a new QE, that is it's enough that the market perceives it will happen and there's sufficient liquidity.
There can be rallies in a bear market.
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In the long term, the big picture is that deglobalization continues, the USD becomes less central etc. Fragmentation.
Shorter term, it depends on when the Fed starts QE again and continuation of trends such as reopening, commodities shortages etc.
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A fantastic thread on what's going on in the futures markets:
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7 hours ago, SharperDingaan said:
We have no idea how this plays out.
While the o/g risk/reward is attractive, it really depends upon your circle of competence and time horizon.
There are currently a great many CDN o/g firms of moderate risk, that will very likely both double < 18 months, and reinstate dividends to former levels. Example: In 18 months, most would expect an OBE currently trading at CDN 9.39, to trade at CDN 18-20 on an 20-25c dividend/quarter. Potentially a cash yield of 8.52% to 10.65%, and a double; but obviously more risk than a SU
More inclined towards a new world order, and secular change versus long term cycle. It's pretty clear to me that 'big oil' is being asset stripped, and proceeds redirected into green energy. Hard not to be long term supportive, and we invest accordingly; but it's very much the outlier position.
It is highly likely that the Soviet, Iranian, and Chinese tanker fleets have been routinely engaged in at sea ship-to-ship cargo transfers. The oil is still getting to market, it's just the price being paid for it, and China/India have obviously being doing very well.
China isn't stupid, and neither is Biden. They both have very well connected advisors, and each team will be very aware of the relative risks, costs and benefits. Putin needs to exchange Yuan receipts for USD in volume, which really means China selling down its USD reserves ... for a transactional fee
Ultimately, it leads to a globally shared central bank reserve currency and everybody's benefit; again not a popular view!
Green transition is already here, and alive and well. There are even west coast forestry companies concluding that their growing trees are worth more in carbon credits, than cut down as lumber. Green in Europe is pretty much everywhere, and accepted fact; whereas it is just starting in NA, but further ahead in Asia.
A number of Cdn o/g companies have long term warrants,
look at those with big hedge positions rolling off this month
SD
A very interesting post, SD. Sadly I have to agree on the new world order.
I own some small Cdn names that have risen like options play in the past year... Thanks for the warrants idea, needs a BAC-WT thread.
IMHO the big risk here is some form of forfeiture. Or an exchange ignoring whatever you own, as we have seen recently.
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Indeed, some margin increases on oil futures today.
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OK my bad for asking that "question", this is all so intertwined with politics it's hard to filter it sometimes.
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Well that's not an enjoyable drop.
Regarding OPEC+, quite a few members can't even produce for current quota, UAE might have spare but why should other members agree?
COVID reopening (umm, even though there's a new wave beginning)
ESG obsession => less investments for years now etc.
Thesis still stands.
Even if Ukraine and Russia is resolved, the commodities macro remains.
Uranium just melted the f up. So at least something went right.
Until QE is back, I'd bet on short equity rallies and then lower lows but that's just for fun, what do I know.
Is Manchin going to stand up to Warren?
I'm wondering if I'm rationalizing it with this list.
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3 hours ago, Fundmanagerthrwawy said:
Added to my JPM position. Has anyone else?
Is there a topic on JPM on this forum?I'm keeping an eye on it but there's so much uncertainty, who knows what they're exposed to. What's the hurry?
GS is the king of commodities, at least while Blankfein was around and they indeed reduced their exposure but Lloyd is probably still around in spirit...
Is The Bottom Almost Here?
in General Discussion
Posted
It's a bear market. There could be some local bottom at some point but it's still a bear market.