Not So Happy Tonight -- Berkeley, CA, Restaurants -- November 22, 2019

Berkeley, CA, restaurants sue the city of Berkely, CA, over the ban on natural gas hook-ups in new buildings.

And so it goes.

Plenty of natural gas for California restaurateurs who want to re-locate to Texas. The interesting thing: menus are very similar, except not so much avocado toast in Texas.

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The Apple Page

Earlier today I caught a short episode on CNBC. After seeing that particular segment I sent this note to a reader:

On another note: nice market action today after three days of being in the red. I've gone back to watching CNBC if I get the chance. Of the high-profile hosts, Michael Santoli (Michael Santoli) seems to be out of his depth. I've never seen anyone so consistently negative about any stock. His cup is always "half empty" when for the rest of us, it's "half full."

I made that comment following a segment when it was pointed out how well Apple's Air Pods were doing.

Michael Santoli blew it (the story) off, saying that Apple was all about its iPhone. Nothing else "moved the needle."

What a doofus.

The following from MacRumor. 

From sixcolors:

Best comment:

https://www.aboveavalon.com/notes/2019/11/19/airpods-are-becoming-a-platform

“AirPods will turn out to be one of the more strategically important hardware products Apple has released this decade. However, you would never know it judging from the way Apple unveiled the device last week. I suspect that was intentional. While the press remains focused on the short-term debate surrounding the iPhone's lack of a 3.5mm headphone jack, few have realized that Apple just unveiled its second wearables platform.”

I do believe that with the AirPods, Apple is well on its way to own the wireless headphones market. While the detractors will dismiss it as overpriced for the sound quality, they once again (predictably) miss the big picture.

This is a runaway train that would be pretty difficult to stop or even slow.

Be sure to read the comments if you are at all interested in the story.

Steve Jobs: a gazillion successes, but iTunes was one of this most brilliant.

Tim Cook: not as brilliant at Steve Jobs, but comparing apples and oranges. AirPods, developed under his watch, will go down as his most brilliant hardware product.

Three New Permits -- November 22, 2019

CRC: down another 6.7% today. The Dow was up about 109 points. Perhaps CRC can be followed as a proxy for the future of oil in California.

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

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Back to the Bakken

Active rigs:

$57.97	11/22/2019	11/22/2018	11/22/2017	11/22/2016	11/22/2015
Active Rigs	57	62	54	36	65

Three new permits, #37211 - #37213, inconclusive:

• Operator: Hess
• Field: Tioga (Mountrail)
• Comments:
• Hess has permits for a 3-well TI-Nelson pad in section 30-157-94, Tioga oil field;

One permit canceled:

• Oasis: a Fraser Federal permit in Williams County

A Huge, Huge Miss On My Part -- A Reader Bails Me Out -- November 22, 2019

I was so caught up in the anti-Greta rant I completely missed the bigger story.

Forget about pollution.

Forget about CO2 emissions.

Look at this story in terms of economic growth in this country. Folks are laser-focused on quarterly GDP of various countries around the world, and miss the long-term story. A reader sent me this. First, a re-posting of an earlier story:

Across China, a whopping 148GW of coal-fired plants are either being built or are about to begin construction, according to a report from Global Energy Monitor, a non-profit group that monitors coal stations. Putting that number in context, the current capacity of the entire EU coal fleet is 149GW, or the same as what China is about to add.

I pride myself in taking a deeper look when given numbers I can't get my arms around, but in this case I blew it. I never thought about what 148GW of coal-fired plants meant. Yes, I saw that was the "current capacity of the entire EU coal fleet" but I blew that off -- thinking that the EU coal fleet had significantly declined over the past decade.

But a reader put this in perspective:

I have found, over the years, that simply providing raw numbers is not so impactful as charts and/or relative context. 

So ... 150 Gigawatts... If one took a massive, single 1,000 Megawatt coal fired plant ... then took 150 of them ... one would arrive at that 150 Gw figure.

That is, if each state in the US - right now - started building THREE massive coal plants, the Chinese equivalent would be realized.

(The Navajo-operated Four Corners plant - now shutting down - is rated at ~2,000 Mw).

For further context/comparison, take the two (2) massive offshore wind projects proposed off New York state - Empire and Sunrise. At an effective output of just over 800 Megawatts (1,700 namplate at 48% capacity factor), these $10 BILLION boondoggles will not even equal the output of a single, 1,000 new Chinese coal plant.

Pure insanity.

 My first thought: the off-shore wind lobby is certainly very, very powerful.

But I digress.

Forget about the pollution. Forget about the CO2 emissions (FWIW -- nothing). What catches my eye: how big China is (and will be going forward). This puts in perspective how big that population is, and what the economy will need from the rest of the world in terms of food and consumer goods.

Those numbers above -- three massive coal plants in each of the 50 US states -- that simply blows me away.

And, those offshore wind projects -- yeah ... insanity.

A huge thank you to my readers for keeping me on track.

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A Very Clever Christmas Gift / Stocking Stuffer

This is perfect for .... every age group. Seriously.



It will be interesting to see how this product does over the holidays.

I remember when I was in college a representative from 3M (makers of Scotch tape). He talked about how the company brainstormed uses for adhesive, everything from Post-It notes to adhesives used in those huge green interstate signs. This seems to be another example -- 2 x 2 photo stickies.

$54 Million. Rounded. Legacy Fund. November, 2019, Deposit

Link here.

$53,961,839.70.

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The Bee Gees 

Run To Me, The Bee Gees

Recession Is Right Around The Corner, Part 2 -- November 22, 2019

Re-posting:

Janet Yellen: recession is right around the corner. That was yesterday. What a doofus.

This is today, this is from Reuters:

U.S. manufacturing output accelerated in November to its fastest pace in seven months and services activity also picked up more than expected, a survey of purchasing managers showed on Friday in a sign of the continued resilience of the U.S. economy in the face of the U.S.-China trade war and other headwinds.

IHS Markit said its "flash" purchasing managers index for manufacturing rose to 52.2 in November from a final reading of 51.3 in October, while its preliminary services PMI increased to 51.6 this month from 50.6 last month.

Both indexes were at their highest since April and were modestly above the median forecasts among economists polled by Reuters.

A reading above 50 signals expansion, while one below that mark indicates a contraction in activity.

China-US trade war? What trade war? Tim Cook moves Mac Pro to Austin, TX.

Consumer sentiment: Now why would I re-post the note above? Because there was even more good news today that was unreported. I just happened to catch it on talk radio. Consumer sentiment:

• prior: 95.7
• forecast: 95.7
• actual: 96.8
• narrative:  

Consumer sentiment continues to recover from its tariff-related scare in August, at 96.8 in final November for the best score since July.

Expectations lead the report, up more than 3 points to 87.3 in a gain that likely reflects confidence in future income. Not contributing to November, however, are current conditions, down 1.6 points to 111.6 in a reading that is not pointing to consumer momentum going into the holidays.

Inflation expectations are very subdued but at least aren't falling, holding steady at 2.5 percent for the year-ahead outlook and actually rising 2 tenths for the 5-year outlook which is also back at 2.5 percent. Note that the 2.5 percent year-ahead rate matched Econoday's consensus.

Impeachment proceedings have yet to skew results, but the report does note increasing polarization among the sample, with one side anticipating recession and the other uninterrupted expansion. Today's results will likely lift expectations for next week's consumer confidence data from the Conference Board which have been on a deep two-month slide.

Existing home sales, link here:

• prior: 5.380 million
• prior revised: 5.360 million
• forecast: 5.480 million
• actual: 5.460 million
• narrative:

Favorable mortgage rates together with high levels of employment are giving housing, a sector that had been flat, a strong lift going into year end. Existing home sales rose 1.9 percent in October to a 5.460 million annual rate, lifting the year-on-year gain to 4.6 percent. Recent reports have been the best since early 2018.

Single-family resales jumped 2.1 percent in the month to a 4.870 million rate with year-on-year change at plus 5.4 percent.

Condo resales came in steady at a 590,000 rate but, in contrast to the larger single-family category, are down 1.7 percent on the year. The median price for single-family sales, at $273,600, is 6.2 percent higher than a year ago with the median condo price, of $248,500, up 5.6 percent.

It was the spring sales season in 2018 that proved a flop, pulling the housing sector into a dip from which it is only now beginning to emerge. Yet the pivot upward for resales, despite the strength of this report, has been less visible than for new homes where starts and especially permits data released on Tuesday were very favorable. November sales of new single-family homes will be posted next week.

Doesn't have the "flavor" of "recession just around the corner."

Recession Is Right Around The Corner -- Former Fed Chair -- Janet Yellen -- November 22, 2019

Janet Yellen: recession is right around the corner. That was yesterday. What a doofus.

This is today, this is from Reuters:

U.S. manufacturing output accelerated in November to its fastest pace in seven months and services activity also picked up more than expected, a survey of purchasing managers showed on Friday in a sign of the continued resilience of the U.S. economy in the face of the U.S.-China trade war and other headwinds.

IHS Markit said its "flash" purchasing managers index for manufacturing rose to 52.2 in November from a final reading of 51.3 in October, while its preliminary services PMI increased to 51.6 this month from 50.6 last month.

Both indexes were at their highest since April and were modestly above the median forecasts among economists polled by Reuters.

A reading above 50 signals expansion, while one below that mark indicates a contraction in activity.

China-US trade war? What trade war? Tim Cook moves Mac Pro to Austin, TX.

Let's look at some of the comments at that Reuters story. There were only five -- is anyone paying attention? Two out of five: the economy would be doing even better if the US House could work with Trump.

LOL. It's  not in their political interest to work with the president. Their goal is not a better economy; their goal is their man/woman in the White House and their control of the US House and US Senate. Sorry for the rant. Sorrier (more sorry?) for pointing out the obvious.

And that's why I love Tim Cook. Sees the writing on the wall and moves Mac Pro to Texas.

Speaking of which, I forgot to post this story: 660 companies moving facilities out of California with many bound for Dallas-Fort Worth. It's behind a paywall but I was able to access the entire story earlier on my iPad. This is the interesting story. The headline would be a bit more accurate to say that these 660 companies are pretty much located in two geographic areas in California: the Bay area in the north, and Los Angeles County. I doubt many companies are leaving beautiful San Diego, and there are "no" California companies north of 38.4404°N.

So, these 660 companies are leaving a relatively small geographic area of California.

On the flip side, these companies moving to Texas are mostly moving to DFW area, and more specifically, to the north side of the metroplex, and even more specifically, to three cities: Plano, McKinney, and Frisco. The sleeper is Las Colinas, Irving, on the southeast side of the airport, closer to Dallas than to Fort Worth.

Twenty years from now the population center of the DFW metroplex will be 10 miles west of the airport, on TX-114. 

On another note: GM, Isuzu investing $175 million for a new Dayton-area plant. Photo-op for the president, late October, 2020. Construction on the facility will be completed by the end of 2020. Just saying.

Due to the popularity of General Motors' 2020 Chevrolet Silverado and GMC Sierra heavy-duty pickups, General Motors and Isuzu have unveiled a $175 million investment through its DMAX joint venture to build a diesel engine components plant in Brookville.

The 251,000 square-foot facility would expand ....  The project will create new local jobs and further cements the Dayton region as a national hub for automakers. Production of engine components for the company's current DMAX diesel engine manufacturing operation in Moraine.

Collusion? November 22, 2019

Collusion: I've always maintained that the anti-fracking crowd is funded/backed by Russia and Saudi Arabia. This is not rocket science. Putin's most recent remarks confirm my thoughts on this. Story easily found; no links provided. Don't need to add pageviews to those stories.

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China: Coal

FWIW

Biggest energy story of the month, year? We've talked about it often but it seems no one else does. Tyler Durden over at zerohedge posted a great essay a couple of days ago on China, coal, and Greta's imminent meltdown. Not! She's enjoying the good life. But I digress.

Look at this one data point: this should scare the heck out of the Union of Concerned Scientists:

Hopefully that is about to change because as the FT reports, China is set to add an army of new coal-fired power plants equivalent to the EU’s entire capacity, as the world’s biggest energy consumer ignores global pressure to rein in carbon emissions in its bid to boost a slowing economy.

Across China, a whopping 148GW of heavily-polluting, coal-fired plants are either being built or are about to begin construction, according to a report from Global Energy Monitor, a non-profit group that monitors coal stations. Putting that number in context, the current capacity of the entire EU coal fleet is 149GW, or the same as what China is about to add.

This is even scarier -- quick! Why is this graphic so scary? Answer is below the graphic.

Why is this graphic so scary? The data is old -- prior to 2015. And we have yet to see the surge in coal plants yet to be built in China. 

Can You Break That Second Window? Here, Hold My Beer -- Market, Politics, Notes From All Over, Part 1 -- November 22, 2019

Legacy Fund. I'm hoping the state treasurer posts the Legacy Fund deposits for the month of November, 2019, today. It would be too much to ask to get a spreadsheet of the $455 million distributed over the lifetime of the fund.

Biggest story of the day: I still can't get over the Canadian story. Per capita, one of the most energy rich countries in the world, and they have a shortage of propane. Story everywhere. Previously posted. Trudeau can't get propane to the east, and he can't get crude oil to the west. Regina is fine this time of the year, I suppose.

The second biggest "story" of the day: it's really not a news story but it's a story I think about all the time. I agree with Lynn Helms: bang for the buck, for an operator, the best place to spud a well these days is the Bakken. The EIA dashboards corroborate that monthly and have been doing so for quite some time. I've always thought the SCOOP/STACk were a bit exaggerated and now RBN Energy has a full essay on the play. Previously posted. If you haven't read this story, do so quickly -- it will go behind a paywall soon. But, wow, what a great analysis. RBN Energy never fails to amaze.

Politics: wow, wow, wow -- in her own backyard, Pocahontas getting slammed by Buttigieg in New Hampshire -- St Anselm poll, Buttigieg, 25%, Pocachontas, 15% (tied with Biden) and Crazy Bernie at 9%. Threshold for any delegates is 15%. Daily political note here.

Quick: name one thing Pelosi's US Congress has accomplished. It looked like the one thing the House might pass was the US-Mexico-Canada Agreement. Not gonna happen. What happened? Pelosi's plate was too full. First, she had to rein in Nadler. Done. Then, lots of valuable time trying to rein in Occasional Cortex; finally gave in; compromised. Now dealing with impeachment inquiry and Pencil Neck. The biggest problem with the US-Mexico-Canada Agreement -- well, actually there are several. The name of the bill is too long; unpronounceable; not "cute" like NAFTA. In fact, every time I see USMCA, I see semper fi. Second, no one cares. The only real trade agreement that matters is China and the president controls the timeline on that one. Trump can get a lot of traction out of this issue, and not have to pull the trigger until July / August, 2020. Canada: a no-growth country. Mexico: lurching from one leftist to another leftist.

Tesla: I bet you can't break the second window? "Here, hold my beer."


Here, Hold My Beer
Tesla: well, that didn't go well. Biggest story of the night and google search minimizes hits on that story. But the videos are priceless and will go viral. OMG -- I thought it was just one window -- so did Elon, "Franz, you had just one job." Did they not rehearse this? My hunch, Franz is no longer with Tesla this morning. Pretty funny. Look at the "soft-ball" toss for the second throw.

Tesla: on the first day that the market shows a little life, and the morning after a huge, anticipated rollout, TSLA, down $20, down almost 6%. I may have to watch late afternoon CNBC to see what Guy Adami has to say about this. Without question, he has the most personality on that show, although Karen Finerman holds her own. [Later: TSLA down 6.6%; down $22.]

The market: three down days. Buying opportunity. LOL.

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

Four Wells Coming Off The Confidential List Today -- Whether They Get Posted Or Not -- That's Another Story -- November 22, 2019

How not to run a country. No propane. Canada rail strike triggers emergency propane shortage in Quebec. Canada is perhaps one of the most natural-resource-rich country in the world.

Got coal? China is going to burn a lot of it.

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Back to the Bakken

Active rigs:

$58.73	11/22/2019	11/22/2018	11/22/2017	11/22/2016	11/22/2015
Active Rigs	57	62	54	36	65

Wells coming off the confidential list today -- Friday, November 22, 2019: 76 for the month; 171 for the quarter:

• 35908, SI/NC, WPX, Beaver 22-21HX, Squaw Creek, no production data,
• 35259, SI/NC, Hess, BB-Olson-150-95-09H-8, Blue Buttes, no production data,
• 31614, 20 (no typo but typical of BR), BR, Hefer 8-8-20 UTFH-ULW, Elidah, t9/19; cum --;
• 29920, 1,377, Oasis, O M Erickson 5501 43-7 5B, Missouri Ridge, t5/19; cum 88K 9/19;

RBN Energy: are SCOOP and STACK the crude oil plays that couldn't? Archived.

Crude oil production in the Permian grew steadily through the 2010s and now tops 4.5 MMb/d — five times what it was at the start of the decade. Production in the Bakken and the Denver-Julesburg (D-J) Basin sagged when crude prices plummeted in 2014-15, but both regions chugged their way back, with output setting new records every month or two in 2018-19. SCOOP and STACK are another story. Only a year or two ago, many producers and others were talking up the neighboring crude-focused plays in central Oklahoma as the next big thing, maybe even a Sooner State Permian. But while SCOOP/STACK production increased through 2018, it’s been flat or falling ever since, and most producers there have been slashing their drilling activity. Today, we look at recent developments in the once-hot region.