The experts, link here:
I never followed the Fed prior to Jay Powell, at least not to the extent I follow him now.
He has given himself lots of wiggle room to change velocity (speed and direction) as conditions change.
The worst case situation:
At worst.
The fed rate since the 1950s at this site.
So, where do we stand, the first day of February, 2022?
XOM: if this is accurate, we haven't seen anything yet.
That's all, except for the disclaimer.
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.
Have things changed?
Twenty years from now, they're going to say, "we underestimated the Bakken."
North Dakota Senator Hoeven: has tested positive for Covid.
Fertilizer: it's not yet being reported on mainstream media -- Shepard Smith won't report it tonight -- but Putin says Russia won't export any fertilizer for next two months.
Russia accounts for 60% to 70% of the entire world's fertilizer production. And Russia won't export any for two months.
Some folks think this is a economic ploy on Putin's part -- to counter any sanctions the rest of the world is thinking of placing on Russia if it invades Ukraine. Others think it suggests Russia is "short" natural gas. No, not at all. Two things: natural gas is a feedstock for fertilizer; and "fertilizer" feedstock will be needed for explosives that might be needed during the next two months. Really? Now why would Russia need such explosives? Asking for a friend. The White House is monitoring.
Denver: will end all Covid mandates. Except for public schools, public transportation, and the airport. Follow the science: apparently the virus is different in those places.
Jim Cramer:
Investing? Tech is back. Wow, that was fast.
10:1 rule held. Dow up almost 300 points; S&P 500 up 30 points.
Dinner hour in New England. Holy mackerel. I don't think I've ever seen this. Cost for electricity over $400 in Maine, $400 in Boston. Link here. Demand is not even that great, less than 18,000 MW. So, what's the deal? Let's check the fuel mix:
More later, going biking.
AMD: up almost 10% in after-hours trading. Whoo-hoo. Closed at $117; traded at $128 after hours. So, how did XLNX do? Holy mackerel. XLNX also up over 9% after hours. Closed at $198; after-hours surged to $217. AMD earnings beat by 10%; revenues beat by 5%.
SBUX: up a bit during the day, before earnings announced, but then missed on earnings (citing inflation and Omicron -- didn't AAPL have the same problem -- inflation and Omicron as well as supply chain problems? Down about 2% after hours. Later: this is incredible. SBUX is now trading up! What's up? I don't know but it warms the cockles of my heart. LOL.
PayPay and Block: both down after hours. PayPal down a 16%. Down $30, trading at $147. So, what's the real story. No one has mentioned it yet. The story now being told? Apple. Apple announced it will take all credit cards on its iPhone Wallet, not just its own Apple card. This will severely hit one of the few revenue streams that Block and PayPal have.
Debbie Downer: yesterday, Melissa's panel on Fast Money all sounded like Debbie Downer. I missed Fast Money today because Sophia and I studied Spanish, read Wings of Fire, and did multiplication flashcards. But it looks like tech is back. I'll replay Melissa on Hulu later tonight. See if anyone eats crow. They won't; they'll change the narrative.
DWAC? I have no clue. Let's look. Holy mackerel! DWAC surged 14% today; up $10 and trading at $83.
Spread? Most interesting story today? WTI and Brent only one dollar apart.
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Back to the Bakken
Active rigs:
| $88.20 | 2/1/2022 | 02/01/2021 | 02/01/2020 | 02/01/2019 | 02/01/2018 |
|---|---|---|---|---|---|
| Active Rigs | 32 | 14 | 54 | 64 | 58 |
No new permits. Absolutely nothing reported. Did Bismarck have the day off? A winter storm?
Active rigs: NDIC reports 34 but one was a SWD and one rig is a CCS rig. I didn't check to see if there are any double-counted rigs. So, 32 active rigs for now.
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The Book Page
Again, if interested in origin of solar system, earth, fossil fuel, origin of life, this is currently the best new book on the market right now for armchair/amateur biologists, geologists, fossil fuel aficionados.
From the book, pages 183 - 185:
Soon after the Morrison Formation ... the Jurassic Period came to an end.But there is a problem here: what exactly marks the end of the Jurassic and the beginning of the next geologic period, the Cretaceous?
Some geologists maintain that there was a mass extinction that can be used to mark a division between the Jurassic and Cretaceous periods. Others suggest that if an extinction did occur -- and some have questioned it -- the event was limited geographically and was not global in extent, an so cannot be used to distinguish between two geologic periods. In short, not everyone agrees that a sudden shift occurred in the plant's history between these two periods.Some of the problem seems to be the fault the history of geology (sic). The Cretaceous Period, one of the first geological time periods to be names, was first formally defined in 1822 by d'Ormalius d'Halloy for a thick strata for white chalk cropping out in the Paris Basin; whereas, the Jurassic Period was first introduced in 1829 by Alexandre Brongniart for an unusual set of marine fossils found in the Jura Mountains that run along the France-Switzerland border. Neither man was concerned with defining where the boundary between the two time periods should be located within the rock record. And so two centuries have passes as generations of geologist have struggled with the problem.
Currently members of the International Commission on Stratigraphy have taken a radical step and have abandoned the use of fossil succession to define the boundary -- which is how all other geologic periods of the Phanerozoic Era are defined -- and, instead, are using a change in the Earth's magnetic field. (One could almost feel the hearts of professional geologists being broken when the decision was made. Geologists are a conservative bunch, especially when it comes to defining their holiest scepter, the Geologic Time Scale.)
So, for now, the boundary between the Jurassic and the next geologic period, the Cretaceous, is defined as the top of the normal magnetic polarity stripe known as Chron M19n. It occurred 145.7 million years ago and is coincident with an "explosion" in the number of small, globular microorganisms known as Calpionella alpine that can be found in Mexico and across Central and Eastern Europe -- and so there is reason for the conservatives in the world of geology to hope that the Jurassic/Cretaceous boundary, will eventually, be defined by fossil succession. Thus, as this illustrates, a considerable effort goes into precisely defining the boundaries of the Geologic Time Scale.
But for those who choose to look at the history of the 'Earth through a wider lens, it is sufficient to note that there is a significant change in vegetation between the Jurassic and the Cretaceous periods -- the first flowers and the first broad-leaf trees appeared during the Cretaceous -- and that there is a significant change in the types of animals, including in the types of dinosaurs.
And, as d'Hallow noted, there was a surprisingly large amount of chalk deposited during the Cretaceous period.
This is so cool. We noticed this more than a couple of years ago, and have been reporting at least weekly, especially during the winter. Now, everyone is reporting this story. Most recently, from social media:
Note, location, natural gas price, percent change, electricity cost, percent change:
Almost criminal how elites are treating the middle class in New England. Probably not a lot of crypto-mining in New England going forward.
But look at that:
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EU / UK Energy Crisis
Nuclear plants:
*********************************
The Book Page
Again, if interested in origin of solar system, earth, fossil fuel, origin of life, this is currently the best new book on the market right now for armchair/amateur biologists, geologists, fossil fuel aficionados.
From the book, pages 146 - 147:
The Permian Basin: where, why?
It was a consequence of the collision of Euramerica and Gondwana and the formation of the supercontinent Pangea.
Ukraine: to bolster / "increase" army as Ukraine allies start to rally. One wonders if Putin's delay will turn out to be seen as a mistake by his own military leaders.
Germany: now considered by many to be a "client state" of Russia. Pretty interesting.
TSLA: recalling 53,822 US vehicles due to software bug that allows vehicles to travel through an all-way stop intersection without coming to a stop. That's strange: it appears the algorithm favors visual (all other cars stopped) over regulatory (stop sign). This seems to be an incredible flaw but easily fixed. The default for autonomous driving: a stop sign means stop.
NOG: increases dividend by 75%; now paying 14 cents; that's on top of two major acquisitions last year. Someday they will say, "we really underestimated the Bakken." Pre-market flat.
T: as expected, T slashes dividend; will spin off Warner Media in a $43 billion transaction to merge its media properties with Discovery.
ATT sharesholders will received 0.24 shares of Warner Bros for each ATT share they own; overall, ATT now owns 71% of the new Warner Bros Discovery company.
ATT dividend slashed from $2.08 to $1.11 but this was known for the past year this would happen; this should be no surprise. In pre-market, T drops almost 6% in pre-market trading, but only $25.50 yesterday close to $24.04 right now.
UPS: up $20; up 9.5% in pre-market trading.
SBUX: misses on revenues; beats on EPS. Up $1.11 in pre-market.
XOM: misses on revenues; beats on EPS. Up about one percent pre-market. $48 billion in cash flow; unbelievable. Stock to watch? CVX. Feeling the heat.
This is pretty cool: a new business concept for me: "service delivery organizations." Back in the day, corporations stove-piped along "core competencies" -- organized along what they did best. Some would say that was looking "inward." Now, it looks like these companies have pivoted, and are looking "outward." Reorganizing stove-pipes based on their customers. So, as XOM moves from Irving, TX, to Houston, TX, XOM will restructure into three units: oil/gas E&P; combining chemicals and refining into one unit; and, elevating its low-carbon unit into its own division.
EPD: EPS misses by 3%; revenue beats by an astounding 18%; shares down 0.6%.
AMD: pending; 76 cents forecast. Huge move yesterday; up again today by 2.25% in pre-market trading.
Earnings search: I'm sure everyone has found their favorite site for tracking earnings, but the quickest way is staying on google and simply typing in ticker symbol earnings. Amazing how much information pops up.
LNG, US exports: US approaches a year without any LNG cargo cancellations amid strong demand. S&P Global Platts. FOB Gulf Coast: nearly a fivefold jump in cargo values over the past year. I don't think folks realize how big the "US energy thing" really is. I certainly don't and I certainly can't get my head around it.
Pre-market: Dow implied open service delivery organizations
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Back to the Bakken
Active rigs:
| $87.55 | 2/1/2022 | 02/01/2021 | 02/01/2020 | 02/01/2019 | 02/01/2018 |
|---|---|---|---|---|---|
| Active Rigs | 31 | 14 | 54 | 64 | 5 |
Tuesday, February 1, 2022: 3 for the month, 58 for the quarter, 58 for the year
RBN Energy: morphing midstream dealmaking into energy transition and "near green" opportunities.
Any time there’s a step-change in technology, it presents intrepid industrialists with tremendous opportunities. Just looking at U.S. history, this has played out many times, with railroads, oil, automobiles, computers, and the internet being a few obvious examples. The Shale Revolution provided significant opportunities of its own, not just for the savviest producers but for midstreamers who jumped at the chance to develop the pipelines, gas processing plants, fractionators, and other infrastructure that was desperately needed to transport and process rapidly growing volumes of crude oil, natural gas, and NGLs. Master limited partnerships (MLPs) led the way, boosted by their advantaged access to capital, but they got an important assist from private-equity-backed developers, who were willing to take big risks in the hope of creating successful businesses. In today’s RBN blog, we continue our look at midstream dealmaking — and midstreamers’ prospective role in the coming lower-carbon economy — this time with a focus on the private equity (PE) side.
In Part 1 of this blog series, we discussed the evolution of the midstream sector over the past couple of energy economic cycles, focusing on the tremendous opportunities presented to MLPs in particular during the Shale Era. With hydrocarbon production taking off in the Bakken, the Eagle Ford, the Marcellus/Utica, and other shale basins — especially the Permian — there was an urgent need for midstream infrastructure. And midstream MLPs, with their advantaged access to capital, jumped in with two feet, and through the 2010s built out much of the infrastructure that the industry depends on today. As effective as they were, many of them grew into behemoths and their focus was increasingly on huge, multibillion-dollar deals.
That left an opening for smaller companies to get in there and exploit lucrative midstream niches. And into that void stepped another group of daring capitalists. These are the independent, usually PE-backed companies looking to get a toehold in the market, build up their business, and then flip it for a profit, often to an infrastructure fund or strategic buyer. They frequently begin with smaller-scale, greenfield developments (less than $1 billion) and often focus on gathering and processing, terminals or connecting pipelines that develop over time. Alternatively, they may be centered on legacy assets spun off by other upstream or downstream players. These developers are like farm teams in baseball, whereby assets with high potential are developed before being called up to the big leagues.
