Chesapeake to Sell Acres in Oklahoma; The Fiscal Cliff; Other Items

In the WSJ, page B2, Chesapeake to sell acres in Oklahoma oil fields.

Data points from the article:

• cash-strapped natural-gas producer continues to trim acreage to raise money for drilling
• selling drilling rights to more than 28,000 acres in western Oklahoma
• area abuts its "Hogshooter" oil discovery which the company touted in June
• includes some of the "Hogshooter" acreage

The article states that Chesapeake has more than 15 million acres across the US and is the second-biggest natural-gas producer after Exxon Mobil.

 The Fiscal Cliff

Lots of talk/ink about the "fiscal cliff" -- the media's phrase for "what happens" if "the" tax breaks expire at the end of the year. I believe these are also referred to as the "Bush tax breaks." So, if all bad things are blamed on Bush, but yet everyone says the end of the "Bush tax breaks" will send us over a fiscal cliff, ... well, let's just say, I'm confused. I guess it was bad to have passed them in the first place, now that the tax breaks have brought us to the edge of a cliff. My understanding of the constitution is that that Congress legislates, the President executes. But I digress.

The tax breaks won't be extended. First, it is way too contentious, and Congress will have too little time between the November election and the holiday break which begins sometime around Thanksgiving and ends sometime after the first of the year. If President Obama and his party win big in November, they won't extend the tax breaks -- ending the tax breaks for the 1% is one of their defining platform planks. If Mr Romney and his party win big in November, the losers (who control the White House and the Senate) are not going to hand a gift to Mr Romney. They will want  him to feel the pain.

So, we will go over the fiscal cliff sometime between December 15th and January 20th. The real question is whether there is a safety net after January 20th? And the answer to that question is a resounding yes. But it will be quite a ride between December 15, 2012, and April 15, 2013.

Disclaimer: this is not an investment site. Do not make any investment decisions based on what you read here.

The man most afraid of the fiscal cliff: the vice-president

The president has a lot to lose personally if the tax breaks are not extended, but ideologically that's not an issue for him. Pragmatically, he has seen how well Mr Clinton has done post-presidency. The president is not worried.

The same can be said for Paul Ryan -- at least the first part: ideology is his driving force, not personal accoutrements (at least not yet; that will come). And, of course, Mitt Romney will know how to finesse any change in tax law. No, of the four, Mr Joe Biden has the most to fear. So it is interesting that it appears to be Joe himself who is leading the charge to re-write the president's tax plan and save us all from the fiscal cliff.

Vice President Joseph R. Biden on Thursday seemed to open the door to adjusting President Obama’s tax increases to only apply to those making $1 million or more a year — a much higher threshold than the $250,000 level they had pushed previously.

That will fly.

That will be the post-November 15, 2012, compromise, two parts: a) "temporary" extension for six months; and, b) increasing the $250,000 threshold to one million dollars. North Dakota oil millionaires will still have to scramble.