Thursday, January 18, 2018

The Millennials, Apparently, Have Changed The Definition Of "Unanimous" -- January 18, 2018

I have read and re-read the headline and the story over at and cannot figure out what I'm missing. Either I'm missing something very, very obvious, or the millennials have changed the definition of "unanimous."

Sort of reminds me of what the definition of "is," is. LOL.

On another note, my biggest fear following the 2018 mid-term elections when the Republicans lose control of the House and the Senate is that we will go back to having no adult leadership in Congress. No matter where one stands with regard to the two parties, it sure seems like we have more adult leadership in Congress now than we did in 2009, but I've long forgotten the political timeline.

Diane Feinstein seems to be truly conflicted on this whole thing; in her heart, I think, she knows the right thing to do, but peer pressure is another thing. My hunch is she will compromise, taking ten crucial Democratic votes with her -- the compromise will be to shut down the government over the weekend when it doesn't matter; hope the stock market crashes Monday, and the polling scares the GOP, but regardless of what happens Monday, will vote to extend temporary funding by the end of the week.

The interesting thing is that, except for Yogi Bear and a few park rangers, not one American will even notice. (Federal workers that don't show up for worker will just assume it's a paid vacation [history tells us that in these situations, all Federal workers will get backpay)].

If the shutdown lasts longer than Monday, the mainstream media will be going nuts but the rest of America will go on as usual, except, of course, those who had planned to visit Yellowstone Park.

This would be payback for the 16-day government shutdown under President Obama.

Davos: January 23 - 26, 2018. Trump will be in Davos during the shutdown -- exactly perfect for those wanting to embarrass Trump. The Senate may simply say they will re-address the funding issue when the president gets back form Davos. President Trump will address the body on the last day, I believe, January 26.

It should be an interesting week on CNBC next week.

The Only Thing That Separates The Brits From Americans: The Language
In Britain, A Supersonic Passenger Plane Is Called A "Train"

From The Daily Star,
New York-London passenger flight goes ‘SUPERSONIC’ in record-breaking trip A PASSENGER plane has set a new world record for the fastest ever transatlantic flight after going “supersonic”. this screenshot:

The dizzying speeds of Concorde made a shock comeback on Monday when a Norwegian flight topped the speed of sound.

It zoomed from New York to London at a mind-blowing 776 mph and took just five hours and 13 minutes – almost a whole hour quicker.

And after touching down at Gatwick and shaving 53 minutes off the flight duration, the pilot then revealed: “We could have flown faster.”
Captain van Dam said: “We were actually in the air for just over five hours and if it had not been for forecasted turbulence at lower altitude, we could have flown even faster.”
Then this, captured in a screenshot:

In California we have a "bullet train" in the planning stages; in Britain, they already have a trans-Atlantic "supersonic train."

I can't make this stuff up.

Four New Permits; Eighteen Permits Renewed; Six DUCs Completed; Hess With A 60-Stage Frack; XTO With Two 75-Stage Fracks -- January 18, 2018

Active rigs:

Active Rigs583849157187

Four new permits:
  • Operator: Nine Point Energy
    Fields: Rawson (McKenzie); Spring Creek (McKenzie)
  • Comments: Nine Point has permits for a 4-well Hovde pad in lots3/6, section 6-150-100
Eighteen (18) oil and gas permits renewed:
  • BR (9): a Jerome permit, two Merton permits, all in McKenzie County; a Rifle Person permit, a Scottvale permit, a CCU Burner permit, a CCU Golden Creek permit, a CCU Audubon permit, and a CCU Boxcar permit, all in Dunn County
  • Whiting (5): a Helling permit in Williams County; a Wold permit in McKenzie County; a Kostelecky permit in Stark County; and, two Pronghorn Federal permits in Billings County
  • Petro-Hunt (2) two Clark Griswold Federal permits in McKenzie County
  • Murex: a Barrett Leigh permit in Williams County
  • Hunt: a Patten permit in Mountrail County 
Four permits canceled:
  • BR (3): an Elizabeth Stroh permit; a Cecilia Stroh permit; and a Linvald permit, all in Dunn County
  • Petro-Hunt: a Joel Goodsen permit in McKenzie County
Six producing wells (DUCs) reported as completed:
  • 30374, 0 (no typo), Statoil, East Fork 32-29 8TFH, East Fork, Three Forks, 32 stages; 8.6 million lbs small sand,  t12/17; cum --
  • 31938, 1,554, WPX, Rachel Wolf 22HC, Squaw Creek, t8/17; cum 90K 11/17;
  • 32332, 52, BR, CCU Red River 3-2-16 TFH, Corral Creek, Three Forks, 24 stages, 14 million lbs large/small; t12/17; cum --
  • 32827, 2,613, Hess, BB-Lars Rothie-151-95-3229H-7, Blue Buttes, Three Forks, 60 stages; 4.2 million lbs small/large, t11/17; cum 34K after 24 days;
  • 33211, 2,025, XTO, Lundin 11X-4E, North Fork, Three Forks, 75 stages, 16.8 million lbs, t11/17; cum 12K after 17 days;
  • 33212, 1,756, XTO, Lundin 11X-4AXD, North Fork, 75 stages; 16.8 million lbs, t12/17; cum -- 
The Lundin wells are tracked here.

Random Update Of An XTO Lawlar Well With A Small Bump In Production -- January 18, 2018

So, Oasis drills/fracks a well, and at least one XTO well shows some benefit, albeit not much.

The graphic:

The Lawlar well:
  • 31629, 2,208, Oasis, Lawlar N 5199 41-23 2B, North Tobacco Garden, 70 stages; 10.2 million lbs; t7/17; cum 212K 11/17;
    Production profiles:
    • 23469, 3,146, XTO, Lawlar 41-15SEH, North Tobacco Garden, t4/13; cum 276K 11/17; #31629 fracked 3/31/17  - 4/28/17;
    PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare

    Unremarkable change in production:
    • 23470, 1,551, XTO, Lawler 41-15SH, North Tobacco Garden, t4/13; cum 121K 11/17; 
    PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare

    This Is What All The Fuss Is About -- OMG -- January 18, 2018

    From the Obama White House regarding a government shutdown:
    • vital services that ensure seniors and young children have access to healthy food and meals may not have sufficient Federal funds to serve all beneficiaries in an extended lapse
    • call centers, hotlines and regional offices that help veterans understand their benefits will close to the public
    • and, veterans’ compensation, pension, education and other benefits could be cut off in the case of an extended shutdown
    • every one of America’s national parks and monuments, from Yosemite to the Smithsonian to the Statue of Liberty, will be immediately closed
    • new applications for small business loans and loan guarantees will be immediately halted.
    • research into life-threatening diseases and other areas will stop and new patients won’t be accepted into clinical trials at the National Institutes of Health
    • work to protect consumers, ranging from child product safety to financial security to the safety of hazardous waste facilities, will cease. The EPA will halt non-essential inspections of chemical facilities and drinking water systems
    • permits and reviews for planned energy and transportations (sic) projects will stop, preventing companies from working on these projects (there goes the California bullet train -- LOL)
    • loans to rural communities will be halted (since it takes months for the application process to be completed, no one will even notice)
    • hundreds of thousands of Federal employees including many charged with protecting us from terrorist threats, defending our borders, inspecting our food, and keeping our skies safe will work without pay until the shutdown ends
    • hundreds of thousands of additional Federal workers will be immediately and indefinitely furloughed without pay (history says they will all get back pay; in the meantime, they will qualify for unemployment insurance)
    The following services that will continue during the government shut down:
    • social security beneficiaries will continue receiving checks
    • the U.S. Postal Service will keep delivering mail
    • active military will continue serving [and will still get paid]
    • air traffic controllers, prison guards and border patrol agents will remain on the job [and still get paid]
    • NASA Mission Control will continue supporting astronauts serving on the Space Station [thank God]
    When the list starts with "call centers" and "healthy meals" one knows how serious a "government shutdown is." LOL.

    And this was written with a bias and an agenda.

    Meanwhile, for me today was a buying opportunity when the market took a breather and actually dropped back a bit. Thank you Ms Pelosi and Mr Schumer.

    Disclaimer: this is not an investment site. Do not make any investment, financial, job, travel, or relationship decisions based on what you read here or think you may have read here. 

    There are two issues here, whether the government shutdown is due to:
    • lack of budget
    • reaching the debt ceiling
    If it's the latter -- reaching the debt ceiling -- yes, entitlements could be cut completely or decreased. The US Secretary of Treasury would call the shots, I assume. My hunch is that a lot of money would be shifted from other agencies and/or programs to cover military, retired military, and social security payments. But yes, if it's a "debt ceiling" issue and this issue lasts for a protracted period of time -- perhaps two pay cycles -- then there might be cut in federal pay and benefits, but my hunch is that Congressional pay would have to be cut first if any incumbent hoped to remain in office.

    GDP 4Q17 Estimate Up Again -- January 18, 2018

    Europe running scared. This is a huge story and will be seen by few, over at Bloomberg.
    France wants joint banking-union proposals with Germany in March. Why now? One reason: the Trump tax bill. Do you need proof?
    [Germany's acting finance minister] praised the French government’s efforts to cut its budget deficit and reform its economy. The acting German finance minister also said that Europe had to react to U.S. plans to overhaul its tax system, noting that companies are likely to undertake a massive shift in funds from abroad as a result.
    Gee, do you think that the lower US corporate tax rate had any effect on this?

    This is good news for another reason: the "synchronized global economy." Seriously. CNBC won't call "it" the Trump rally. Instead they call the stock market surge due to the "synchronized global economy." Well, if France-Germany cut corporate tax rates because of Trump -- that can't be all bad.


    GDP Now: Latest forecast: 3.4 percent — January 18, 2018. Link here.
    The GDPNow model forecast for real GDP growth (seasonally adjusted annual rate) in the fourth quarter of 2017 is 3.4 percent on January 18, up from 3.3 percent on January 12.
    The fourth-quarter forecast of real consumer spending growth increased from 3.8 percent to 4.0 percent after Wednesday's industrial production release from the Federal Reserve Board of Governors.
    Government Shut-Down

    The only thing that the government shut down really affects:
    • parks
    • museums
    If the government shuts down, the national parks in North Dakota will close. I assume that makes the refinery issue in Belfield a moot point. No park, no reason to worry about whether the refinery can be seen from the park or not.

    Best Business Optic Every Day

    Best business optic: when Rick Santelli schools Steve Liesman on CNBC. And it happens every, every day. Steve Liesman still can't give any credit to Trump. He's become a parody of himself. Steve still argues that repatriation is not guaranteed. While he's babbling about that, CNBC cuts to Rick Santelli, who says, "They should have asked Steve about 'inversions." Since Trump has come in as president, "no one is talking about inversions."

    Great smack down.

    If Steve is investing in line with his political views, he has missed one of the biggest bull markets in US history. 

    The Political Page, T+362 -- January 18, 2018 -- How's That Global Warming Working Out? Texas Shatters Winter Power Demand -- It's Cold Outside

    We were told by Patrick Kennedy that our grandchildren would never see snow by 2010 or some such year. Don reminded me of that. Today, it is being reported that there is snow in all 50 states.

    Texas: shatters record for winter power demand.
    Texas has set a new record for winter power demand in the wake of a record-breaking cold snap that gripped the state on Tuesday night, according to the Electric Reliability Council of Texas, which oversees 90 percent of the state's grid.
    Power demand peaked between 7 a.m. and 8 a.m. Wednesday at 65,731 megawatts -- shattering the record of 62,855 megawatts hit earlier this month when another cold snap hit the state. In a news release, ERCOT said the state had sufficient power resources available to meet demand.
    The spike in demand also affected wholesale power prices, which hit around $200 per megawatt hour across the state, according to ERCOT. The average wholesale price of power, which changes by the minute every day, is typically $25 per megawatt-hour. By 9:30 a.m., prices had dropped down to around $100 per megawatt-hour, except in South Texas.
    Don't cry for Texas at $200/MWh. Those in New England are paying $500/MWh, and those in South Australia are paying $10,000/MWh (no typo). [Update: this was how bad it was last week in South Australia -- in two days they burned more money on electricity costs than it would have cost to build a new natural-gas fired plant.]

    Our electricity bill here in the DFW area in December, 2017, was about 4X our normal monthly payment. 4x.

    Teaching Spanish

    US Crude Oil Inventories Dropped 7 Million Bbls -- Records Set -- January 18, 2018

    Gasoline demand is at this site; at the link, scroll to the bottom of the page. Gasoline demand continues to fall (as expected this time of the year) but remains ahead of the same period last year.


    Five years ago, or thereabouts, "we" were building LNG import terminals; now we are exporting natural gas. This is the story that is not being told: our energy balance of payments would be setting new records buying natural gas from the Mideast. Our "energy balance of trade" is allowing the Federal government to spend money elsewhere, much on social services. Those folks complaining about frackers and fracking should be sending the oil industry "thank you" letters -- like that will ever happen. LOL. And those frackers did that fighting regulations, politicos, and protestors all along the way. They're still fighting natural gas pipelines in New England. We'll never know who "lucky" we were. We certainly won't read about this story in the mainstream media.

    Before we get to the US crude oil inventories, let's look at the US natural gas draw, from John Kemp via Twitter. The current stocks are almost at historical lows -- not quite there but ....

    Chart as depicted by EIA:

    Now, back to the US crude oil inventories.

    I'm being told that the 7-million-bbl draw is:
    • a record;
    • the most ever drawn from Cushing: and, 
    • the largest drawdown ever. I guess I'm repeating myself.
    ZeroHedge has the data - it's a great read with great graphics.

    The market's reaction: ho-hum. WTI at $63.94, down 3 cents. Yes, after the report, WTI declined slightly. The phrase that CNBC will use: the price of WTI has already baked in the weekly drawdown. 

    The weekly petroleum report is here. The data points:
    • US commercial crude oil inventories decreased by 6.9 million bbls; now at 412.7 million bbls, still in the middle of the average range for this time of the year
    • refineries operated at 93% of their operable capacity last week
    • total gasoline inventories increased by 3.6 million bbls
    • distillate fuel inventories decreased by 3.9 million bbls (think heating oil in the northeast)
    • jet fuel product supplied is up 8.7%
    Re-balancing is now down to 20 weeks, around mid-2018:

    Weeks to RB
    Week 0
    Apr 26, 2017

    Week 1
    May 3, 2017
    Week 2
    May 10, 2017
    Week 3
    May 17, 2017
    Week 4
    May 24, 2017
    Week 5
    May 31, 2017
    Week 6
    June 7, 2017
    Week 7
    June 14, 2017
    Week 8
    June 21, 2017
    Week 9
    June 28, 2017
    Week 10
    July 6, 2017
    Week 11
    July 12, 2017
    Week 12
    July 19, 2017
    Week 13
    July 26, 2017
    Week 14
    August 2, 2017
    Week 15
    August 9, 2017
    Week 16
    August 16, 2017
    Week 17
    August 23, 2017
    Week 18
    August 30, 2017
    Week 19
    September 7, 2017
    Week 20
    September 13, 2017
    Week 21
    September 20, 2017
    Week 22
    September 27, 2017
    Week 23
    October 4, 2017
    Week 24
    October 12, 2017
    Week 25
    October 18, 2017
    Week 26
    October 25, 2017
    Week 27
    November 1, 2017
    Week 28
    November 8, 2017
    Week 29
    November 15, 2017
    Week 30
    November 22, 2017
    Week 31
    November 29, 2017
    Week 32
    December 6, 2017
    Week 33
    December 13, 2017
    Week 34
    December 20, 2017
    Week 35
    December 28, 2017
    Week 36
    January 4, 2018
    Week 37
    January 10, 2018
    Week 38
    January 18, 2018

    We haven't talked about this in a long time: weekly US days of crude oil. Right now it's about 24 days; I put the over/under line at 20 days. If we drop below 20 days, it will be something we haven't really seen since before the Saudi surge, back in 2014. If we stay at / above 24 days, one would think the price of crude oil would not trend higher.