Huge Drop In First Time Unemployment Claims -- September 22, 2016

Due to family commitments, I am way behind in my blogging and won't catch up for several days. My replies to e-mail delayed. I will eventually get to everything readers send me.

Active rigs:

	9/22/2016	09/22/2015	09/22/2014	09/22/2013	09/22/2012
Active Rigs	33	68	196	185	185

RBN Energy: update on Alberta midstream projects. Projects continue despite upstream challenges.

More midstream projects than you might expect are “goin’ on” in the Western Canadian province of Alberta, considering the challenges that bitumen/crude oil and natural gas producers there continue to face. There are several drivers behind the relatively long list of oil and diluent pipelines; gas processing plants and fractionators; and oil/NGL storage facilities being built in Canada’s Energy Province, but much of the work is being done to meet the expected needs of oil-sands expansion projects approved during better times and set to come online soon. Today we begin a blog series on Alberta midstream projects with an overview of where the province’s energy sector stands today.

Producers in Alberta—the heart and soul of Canada’s energy sector—have had a rough go of it lately. In May, wildfires swept through parts of the oil sands region, forcing temporary shutdowns at several production sites that initially reduced the oil sands’ output by more than 1 MMb/d—or about one-third the area’s pre-fire production level. Output wasn’t back to near-normal until mid-summer, and surely the dislocations and damage caused by the fires (which scorched more than 1 million acres) have had more lasting personal (and business) effects.

Oil sands producers already had been dealing with low oil prices, which have hit them harder than most because their hydrocarbon-extraction processes more complicated and costly than their shale-play counterparts. Also, the Alberta oil sands are further away from most major refinery centers, particularly the U.S. Gulf Coast, and bitumen producers need to either add “diluent” (usually field condensate or natural gasoline, a.k.a. plant condensate or pentane plus) to their bitumen to allow it to flow through pipelines, or transport low-viscosity bitumen in special “coil” rail cars that can be heated before unloading—added costs that make $41/bbl oil an even more bitter pill to swallow.

Dakota Acccess Pipeline:

• things may come to a head a lot more quickly than some suspect; it will be interesting who blinks first
• North Dakotans are a conservative lot; they don't like spending money on "Ferguson follies"
• any problems in the Bakken are seen by most North Dakotans as a "western side of the state" problem
• as long as "western side of the state" problems did not affect Fargo, most North Dakotans did not care much what was happening out west
• that all changed with a $6 million bill to be paid by the state for "Ferguson follies"; and that's just a first downpayment
• Standing Rock is wearing out its welcome
• throw that in with the "politically correct" decision on the "Fighting Sioux" decision and it all gets pretty nasty pretty quickly

Saudi Arabia update. Data points from Forbes:

• exports surge month-over-month in July, 2016
• exports in July: 7.622 million bopd
• increased by 166,000 bopd (2.2%) 
• 7,622,000 - 166,000 =  7,456,000. Then, 166,000/7.456 million = 2.2%
• Saudi cuts domestic use by 7,000 bopd to 697,000 bopd (1%) -- inconsequential
• you decide: Forbes call a 2%increase in exports: a "surge" 
• color me unimporessed
• but if they want to give their oil away for $40/bbl, that's fine with China
• meanwhile, it is being reported elsewhere that Saudi Arabia is meeting with Iran prior to the Opec meeting later this month in Algiers, Algeria, September 27, 2016

Natural gas prices surge. Data points from The Salt Lake Tribune:

• pricing now more than $3/million BTU (reported by RBN Energy, also)
• first time in 16 months price is over $3/million BTU
• due to hot weather / air conditioning
• nuclear plants shut down for seasonal refueling and maintenance
• US shale producers have cut back on production
• natural gas deliveries up 28 percent from same time last year
• 23 US nuclear plants (23% of total capacity) slated to shut down for refueling in the three months through November

Abrams M1 tanks:

• manufactured by Chrysler Defense (now General Dynamics Land Systems)
• unit cost: $9 million
• From wiki: 

General Dynamics Land Systems operates the Lima Army Tank Plant and GDAO (General Dynamics Anniston Operations) in Anniston, Alabama along with smaller operations in Tallahassee, FL and Scranton, PA. The headquarters are located in Sterling Heights, MI.

General Dynamics Land Systems (GDLS) Canada, a London, Ontario-based defense subsidiary to General Dynamics has a 14-year $15-billion deal to supply light armoured vehicles to Saudi Arabia.

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Ballad of the Thin Man

Something is happening, and you don't know what it is.

Rush Limbaugh had an incredibly good program yesterday (September 21, 2016); he may have been the first to see the legacy of the thin man; at least the first to report it -- 

Something is happening but you don't know what it is.

Charlotte. Baltimore. Ferguson. DAPL, NYC/NJ.

Riots new normal under second black president. 

Congress impotent. Supreme Court quiet. 

Mainstream media not paying attention.

Ballad of a Thin Man, Bob Dylan

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Job Watch

Did Janet Yellen do the right thing: no rate increase?

• new claims: 252K; a huge drop from the consensus
• consensus was for 261K  
• prior: 260K
• first time claims plummet by 8,000
• four-week moving average: down to 258,500 from 260,750

Yellen should have raised rates. Initial jobless claims match lowest level since April.

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The Market

Mid-day: Dow 30 up 124 points. NYSE:

• new highs: 127, including Apache (APA); MDU;
• new lows: 0

Open: pops. Up 136 points. WTI up $1.13.

Futures: Dow 30 up 70 points. WTI back in the sweet spot at $46.20. The sweet spot is $46 - $52.

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Please, Mr Jailer, Won't You Let My Man Go Free

Please, Mr Jailer, from "Cry Baby"

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Darwinian

Idiots

The 3.5 MM Headphone Jack Non-Story

Anyone paying attention knows why Apple removed the 3.5 mm headphone jack from their new iPhone.

And anyone paying attention knows that every pair of existing headphones still works with the new iPhone.

Assuming you don't throw out the cord.

From Finance!Yahoo:

The problem for me? I accidentally threw it out with the paper packaging the adapter came with. Based on sheer principle, I refuse to fork over $9 for something I’ve taken for granted on every single iPhone I’ve owned since 2007. But now I have 4 pairs of “old school” EarPods lying around that are semi-obsolete. 

I can't make this stuff up. Why would anyone actually admit this?
 
In the military we called this a personal problem. This idiot has a $700 iPhone with a chip inside that is faster than the chip in the $6,500 MacBook Pro and he won't spend $9 on a cord. To replace the cord he threw out. How in the world does anyone throw out a cord? Something tells me this whole story is bogus. Or we're dealing with an idiot. 

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The Political Page

At least one media outlet is now going to report live poll results -- perhaps based on exit surveys as soon as results become available even if polls have not closed on the west coast.

We all know California will vote for Hillary.

If it's reported before the polls close in California that Trump has taken Pennsylvania, Ohio, and Florida, will that affect the turnout in California?