Top Stories Of The Week -- The Narrative -- December 14, 2019

The top stories for week 50 of 2019 have been posted; it still needs a little work but for the most part it is done.

Wow, what a week.

For investors: tectonic changes. I apologize for beating a dead horse, but this was huge: the Schwab-Ameritrade story. The story broke two weeks ago but seismic after-shocks continue. I may do a stand-alone post. It's that big a deal.

Politics: at the other end of the spectrum, politicians have "cheapened" the concept of "impeachment."

Texas: more and more "stuff" moving to Texas. Big names to keep in mind: Apple, Ford, Chevron, Schwab, McKesson, European Wax Centers.

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International 

Saudi Arabia: The Saudi Aramco story is a non-story. A year from now it will be long forgotten. Remember: most investors around the world were not even allowed to participate. Valuations on this new company range from $1.2 trillion to $2.0 trillion. That's a pretty big spread.

Mexico; AMLO setting the stage for "president for life." Mexico will take the "road to Venezuela." US sanctuary cities will be overrun with immigrants. Story won't be reported.

Canada: really, really closed for business. When Chevron announced it was pulling out of Canada that pretty much said all there was to be said.

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Investing

Buffett/Berkshire Hathaway -- sitting on $130 billion. Apparently no FOMO. Buffett likes:

• highly capitalized industries, like railroads; huge tax benefits; write-offs;
• banks; examples, BofA and Wells Fargo; stuck with Wells Fargo when morally/ethically should have sold;
• energy companies, especially natural gas production, gathering, and transmission

He has said he is sitting on a huge cash hoard because everything is so overvalued. Looking at the entrails of the Schwab-Ameritrade story, it really, really looks like he missed  a whale:

• TD-Ameritrade: everybody forgets about "TD" -- one of the biggest banks in the US; unique; innovative; really, really raises the bar that will now be part of Schwab
• discount brokers were already cheap (under-valued) and then when Schwab announced commission-free trading, Ameritrade shares plummeted and Buffett failed to pounce; even Schwab/Ameritrade employees caught off guard; tells me that Buffett couldn't pivot fast enough; 

Quick: match column A with column B

Total Assets Under Management (AUM): the figures are not correctly aligned. Hint: Merrill Lynch is not #1.

Column A                           Column B
Merrill Lynch                   $1.3 trillion
Schwab                             $1.4 trillion
Ameritrade                       $3.25 trillion

Number of brokerage accounts (active): the figures are not correctly aligned. Hint: Merrill Lynch is not #1.

Column A                           Column B
Merrill Lynch                   $12.1 million
Schwab                             $12.0 million
Ameritrade                       $1.8 million

Asset growth y/y for Merrill Lynch, 2019 data: a negative 2 percent. That really, really surprised me.

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Bakken

Completion of another huge natural gas liquids pipeline was a huge story.

It will be interesting to see if ND regulators approve the DAPL expansion.  Nothing surprises me any more.