Buffett was a fan of at least one utility stock in the last major recession. In the second quarter of 2008, Berkshire Hathaway bought more than 3.2 million shares of NRG Energy (NRG -15.08% - today, December 6, 2022).
One year later, the conglomerate had increased the size of that holding to 7.2 million shares.
Some utility stocks went on to perform quite well as the U.S. economy emerged from the recession. Unfortunately for Buffett and Berkshire Hathaway shareholders, NRG Energy wasn't one of them.Berkshire began selling its shares of NRG in the third quarter of 2009.
The company sold its entire remaining stake a year later.
The energy stocks that are performing well in the current environment are those connected with the oil and natural gas industry.
NRG is an electric utility, and not only has its stock performance lagged well behind that of oil and natural gas players this year, it has also trailed many of its utility peers.
I watch the movie Tinker Tailor Soldier Spy at least once a year. Some years, I watch it more often than that. I don't think I could watch it once a month, but ...
And when watching it, I can re-watch and re-watch the last ten minutes of the film over and over.
The movie happens to be showing on Apple TV+ now through the end of December.
Watching it tonight more than paid for the $6.99 monthly fee.
I've read dozens of reviews of this movie over the years, and the critics still don't "get it."
Quentin Tarantino, in his most recent book, names what he says is the "perfect movie."
For me, the perfect movie is TTSS.
The last ten minutes of the film carries one through every human emotion, and simultaneously ends with a curtain call with the entire cast. Pretty amazing how the director did that.
And now, a Showtime/Paramount "musical-documentary" -- George Jones and Tammy Wynette. On Apple TV+ the first episode is free. Wow, wow, wow. Link here.
The series will have six episodes; tonight's episode is "free" on Apple TV+. After the first episode, the final five episodes will be available only on Showtime.
Jessica Chastain plays Tammy Wynette. From wiki:
Jessica Michelle Chastain (born March 24, 1977) is an American actress and producer.
Known for primarily starring in films with feminist themes, she has received various accolades, including an Academy Award and a Golden Globe Award. Time magazine named her one of the 100 most influential people in the world in 2012.
It's gonna be a late night.
By the way, I completely forgot to mention the best ten minutes all week: Tom Brady and the Buccaneers and the New Orleans Saints, Monday Night Football (last night). No matter what one thinks of Tom Brady, one can't take last night away from him. In the process, he set at least one, maybe two, more records.
******************* The Georgia Election
It's over.
And the results should please almost everyone. But they (the results) won't. But seriously, Senator Herschel Walker? Read his bio at wiki.
And with a 51 - 49 majority, Senator Manchin's one-person ability to bring the US Senate to a halt should be over. Although I suppose it elevates the importance of the second half of the duo: Senator Krysten Sinema. [See below.]
Speaking of which -- Manchin was already neutered -- even before the Georgia election results were known -- and who teamed up to neuter him? The most liberal wing of the Democrat party and ten members of the GOP.
************************** Post Script
I wrote and posted the original post above last night after the outcome of the George US Senate was known.
I posted it and then brought it down and put it in draft because I want Bakken-related news to be at the top of the blog overnight.
This morning, a contributor over at PowerLine made the very same observation about Senator Manchin.
These are the first midterm elections since 1934 where the
president’s party didn’t lose a single incumbent Senate seat.
Appearances to the contrary notwithstanding, Slow Joe must be a
political dynamo.
On the one hand, Joe Manchin is no longer the man. On the other
hand, he is up for reelection in 2024 as Democrats face a more hostile
map. We can look forward to his departure from the scene one way or
another at that time.
Not only did Joe Biden "hold the US Senate," an unprecedented achievement given the circumstances, the US Senate is more left-leaning than it was before the mid-terms. I'm not talking numbers, I'm talking philosophy and swagger.
And still another note, after reading the wiki-bio of Herschel Walker, what was the GOP / Trump thinking when they endorsed him?
We'll see the EIA data tomorrow but the API data today:
amazing; but,
same ol', same ol'.
Look at the crude oil inventories, over the past year:
commercial US crude inventories have grown by just six million bbls this year, but ...
SPR inventories fell by 206 million bbls -- that "decline" is 32 times the six-million-bbl build;
at least we now know where it all went. To Europe.
Look at the numbers, the change this past week from the previous week:
there was a draw of over six million bbls;
the previous week commercial inventories had dropped even more than that, almost eight million bbls; again, this is the commercial inventories;
analysts had forecast a commercial draw of 3.9 million bbls;
The SPR: contains the least amount of crude oil since early 1984 -- let's see, 2021 - 1984 = thirty-seven years.
US crude oil production: 12 million bpd for the fourth week in a row:
which is 400,000 bpd more than the level seen at the start of the year;
but still one million bpd less than what the US was producing just prior to the pandemic.
Refined products (gasoline, distillates) in storage increased.
We'll see the updated data tomorrow, but in last week's EIA report, US refiners were operating at nearly 95% of operable capacity, the highest I've seen since I started blogging over ten years ago.
On another note, two things to watch after the first of the year:
I would imagine that 99% of US corporations will finally end all remote work / all work from home; and,
what the Chinese do with regard to Covid restrictions.
By the way, here's a "thought experiment." Looking at the graph above, tell me again the Keystone XL pipeline was critical, the pipeline that would have brought another million bopd to the US from Canada starting around 2018, perhaps earlier.
That's a "trick question," of course. If all oil was created equal, the Keystone XL was absolutely unnecessary. But that would have been 20-20 hindsight; when the Keystone XL was being planned, no one knew about the coming US shale revolution.
And, of course, all oil is not created equal, but the "average American" doesn't (and didn't) know that. Maybe US refiners needed heavy oil from Canada, but US consumers didn't need Canadian heavy oil.
Carrying this discussion a bit longer, imagine if the Keystone XL pipeline had been built -- any thoughts on how that might have affected the "build-out" of the Permian? Just asking.
We're getting back to the same discussions we've had for the past ten years.
What blows me away is the trajectory of that "US export line” after 2012.
By the way, record exports and nearly record production despite:
US rig counts down significantly from five years ago;
the US Dept of Interior slow-rolling the oil companies on permits on federal land;
the bans on off-shore drilling;
the decline in Alaskan oil production;
the lack of interest in the Arctic;
almost a similar lack of interest in shale oil plays across the US except for the P, the EF, and the B
Meanwhile,
the Europeans have a supply problem: they produce nada, zilch, zero oil;
the Chinese and Indians have a demand problem: they are both pro-oil but their demand is excessive, more than they can really afford if one thinks about it.
Some of these links are quite dated, going back to 2021.
First, pneumococcal.
Wow, talk about a lot of confusion with regard to which pneumococcal vaccine one should get. This confusion is generated by the relatively "quick" advances in new pneumococcal vaccines.
Many folks have already received an "older" pneumococcal but are now learning that "newer" pneumococcal vaccines with better coverage are now available.
This is what I understand, though I could be wrong. Many seniors have already had the "13 -strain" (PCV13) OR the "23-strain" (PPSV23) which were the recommended pneumococcal vaccines as recently as January 28, 2022.
On October 21, 2021, the advisory committee recommended the "15-strain" (PCV 15) or the"20-strain (PCV20) for adults who had no history of pneumococcal vaccination. If one received the PCV 15 vaccine, it should be followed by the PPSV 23 one year later.
On January 28, 2022, recommendations were simplified: either PCV15 in series with PPSV23 OR PCV 20 alone.
Another way to write that:
Adults aged ≥65 years who have not previously received PCV or whose previous vaccination history is unknown should receive 1 dose of PCV (either PCV20 or PCV15). When PCV15 is used, it should be followed by a dose of PPSV23.
It makes sense to me to simply get the PCV20 and be done with it.
Recommendations vary for age groups and risk factors: the above seems to fit seniors with no risk factors.
June 9, 2021: note the date. From FiercePharmathis is interesting for investors interested in Pfizer and Merck. It provides some background for the pneumococcal vaccine for children. At that time, June 9, 2021, it appeared Merck might get its next-gen shot on the market for kids a year before Pfizer. Children make up roughly 80% of the market for pneumococcal shots.
For pediatricians and mothers a pneumococcal vaccine for children is really, really important -- preventing meningitis at worse, but preventing a lot of pesky ear infections. The first pneumococcal vaccine was licensed for use in the US in 1977. That vaccine has been "improved" multiple times over the years and recommended for larger populations based on age.
I don't know how that race between Pfizer and Merck for the next-gen vaccine for kids turned out.
From the June, 2021, article, regarding the pneumococcal vaccine :
With Tuesday’s FDA nod for its next-gen pneumococcal vaccine Prevnar 20, Pfizer scored its second major vaccine win in seven months as it crossed the finish line ahead of rival Merck.
The shot, which attacks 20 different strains of the bacterium, is approved for adults 18 and over. It was fast-tracked for approval in December when the FDA not only accepted Pfizer’s application but set it up for priority review.
Meanwhile, Merck is hammering away at approval for its own next-gen pneumococcal conjugate vaccine, V114, a 15-strain shot. The vaccine scored priority review in January and its action date comes next month. Plus, because of its early study in youngsters, it could follow up with an approval in children a year ahead of Pfizer's.
Tuesday’s approval strengthens Pfizer’s hold on the pneumococcal vaccine market. Its Prevnar 13 generated sales of $5.95 billion last year, continuing its run as the world’s top-selling vaccine, at least until 2021's COVID revenues are tallied.
Prevnar 13 scored FDA approval in 2010, and in 2014 it won the CDC's backing in adults over 65.
That CDC decision fueled a blockbuster sales increase during the subsequent years.
Prevnar 20 will tackle the same 13 serotypes included in Prevnar 13, plus seven serotypes associated with high fatality rates, antibiotic resistance and meningitis, the drugmaker says.
Break, break.
To get an idea how big this "industry" is, take a look at the FiercePharma article from November 23, 2021, link here. This is the story of the Covid-19 vaccine and treatment for the disease.
The COVID-19 pandemic is creating a $100 billion pharma goliath.
Pfizer’s revenue could reach $101.3 billion in 2022, with major contributions coming from the company’s BioNTech-partnered COVID vaccine and an antiviral therapeutic that has shown stellar clinical data, SVB Leerink analyst Geoffrey Porges projected in a Monday note to clients.
That level of revenue would be unheard of in the pharma industry. Johnson & Johnson, the world’s largest biopharma company by revenue for years, recorded $82.6 billion revenue in 2020. Pfizer’s own revenue in 2018 clocked in at $53.7 billion before the separation of its consumer health franchise into a joint venture with GlaxoSmithKline in 2019.
Of the $101.3 billion, oral COVID drug Paxlovid could contribute $24.2 billion and COVID vaccine Comirnaty $29.7 billion, Porges figured.
Paxlovid, when given to nonhospitalized patients within three days of symptom onset, cut the risk of COVID-related hospitalization or death by 89% compared with placebo in a late-stage trial, Pfizer said earlier this month. The drug is used in combination with HIV drug ritonavir.
Armed with the positive data, the New York pharma is seeking an FDA emergency use authorization for the drug. The U.S. government has bought 10 million courses for $5.29 billion.
Upper- to middle-income countries will be the main contributors to Pfizer's COVID drug revenue. The company has signed a licensing agreement with the Medicines Patent Pool, allowing 95 low- and middle-income countries to make their own versions of Paxlovid. In key target geographies for Pfizer, Porges expects governments will want to procure enough stockpile to cover 10% to 20% of their populations, a demand that he expects will unlikely be met in 2022 or 2023 because of capacity limitations.
Pfizer’s estimated 2022 production volume for Paxlovid is 50 million courses, while the entire stockpile demand is about 222 million courses, Porges noted.
Port Arthur LNG Phase 1: permitted and expected to include two natural
gas liquefaction trains and LNG storage tanks and associated facilities
capable of producing as much as 13.5M metric tons/year of liquefied
natural gas.
$10.5 billion project (Phase 1)
capacity: 13.5 million metric tons / year
to start 2027
Sempra to make FID for Phase 1 in 1Q23
Phase 2: similarly sized project being marketed and developed
Wednesday, December 7, 2022: 17 for the month, 126 for the quarter, 670 for the year. 38894, conf, CLR, Bonney 9-3H, 38850, conf, Crescent Point, CPEUSC Fantuz 2-13-24-158N-100W-MBH, 38348, conf, Hunt, Smoky Butte 160-100-31-30H 5,
Tuesday, December 6, 2022: 14 for the month, 123 for the quarter, 667 for the year. None.
It's been almost a year since the co-owners of the massive Capline crude
oil pipeline initiated southbound service between Patoka, IL, and St.
James, LA, on what for a half-century had been a northbound conduit.
How’s it working out? So far, so good, it seems. As expected, for the
first several months the volumes of heavy Canadian crude oil flowing
down the 632-mile, 40-inch-diameter pipeline to the St. James hub were
modest. Since June, however, Capline has been offering a temporary
incentive rate to attract more heavy oil, and starting December 1 it’s
also been offering a temporary buck-a-barrel rate for light oil too. In
today’s RBN blog, we discuss the latest Capline developments, the
challenges associated with batching heavy and light crude on such a big
pipe, and the prospects for much higher flows.
President Joe Biden is joining the founder of Taiwan Semiconductor Manufacturing Co. on Tuesday to announce the opening of a second chip plant in Arizona, raising the company’s investment in the state from $12 billion to $40 billion.
The company will also announce it will be producing more technically advanced chips than originally proposed. The investment by TSMC is one of the largest foreign investments in U.S. history, and the largest in the state of Arizona.
Biden signed the CHIPS and Science Act into law in early August, allocating billions to lure manufacturers to produce the widely used chips domestically. The law includes $52.7 billion in loans, grants and other incentives as well as billions more in tax credits to encourage investment in U.S. semiconductor manufacturing.
Once the TSMC plants open, they will produce enough chips to meet the U.S. annual demand, 600,000 wafers per year, according to Ronnie Chatterji, National Economic Council acting deputy director for Industrial Policy who oversees CHIPS implementation.
Tech centers of excellence in the US?
Chips, processing, "pure tech"
Silicon Valley, San Francisco Bay area, California, Cupertino, Apple
Wasn’t President Biden going to end Donald Trump’s destructive trade
wars against allies? Apparently not.
His “super aggressive” climate
protectionism—to quote French President Emmanuel Macron—is infuriating
U.S. friends and may set off a subsidy and tariff war.
U.S. allies are upset about the Inflation Reduction Act’s generous
subsidies for domestically manufactured green technologies.
In his trip
to Washington last week, Mr. Macron said the U.S. subsidies may “perhaps
fix your issue but you will increase my problem.
They’re really a
problem for everybody.The dispute involves tax credits for
electric-vehicle and battery production. The IRA’s $7,500 consumer tax
credit are restricted to EVs assembled in North America. Most foreign
auto makers make EVs abroad and export them because the global and U.S.
markets are still small. They can’t tap the consumer tax credit unless
they invest in American production. But making EVs in the U.S.—or Canada
or Mexico—may be more costly and could render their cars less
competitive in other export markets.
Half of the U.S. $7,500 tax credit is also contingent on an increasing
share of the vehicle’s battery minerals being extracted or processed in
the U.S. or a country in which the U.S. has a free-trade
agreement—starting at 40% in 2023 and increasing to 80% in 2027.
The
other half will be available only to EVs whose battery components are
mostly made in North America, starting at 50% in 2023 and reaching 100%
by 2029.
President Biden is getting into the holiday spirit by slapping a bow and some American Flag wrapping paper on a sweet little surprise for Europe...The Inflation Reduction Act.
Inside they'll find a wide array of pro-American manufacturing programs that are less than favorable for the Europeans.
Europe has enjoyed 75 years of safe and lucrative trade thanks to the guns and butter deal we know as globalization, but the Americans have outgrown that model.
They are ready to bring some of their manufacturing home, and not in a small quantity...we're talking 12 zeros here.
This comes at a time when Biden needs some new footing with the organized labor faction and nothing speaks louder than money.
Europe isn't happy about the American's leveling out the playing field and WTO action has been threatened, but at the end of the day, the Biden administration is going to get its way.
