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Tuesday, October 17, 2023

"X" -- October 17, 2023

Locator: 45806X.

I just got home from watching Sophia -- age 9 -- play soccer under the lights. In the opening game this season, their opponent tonight beat them 8 - 0. Now, six weeks later, Sophia's team completely dominated and won 3 - 0. Outstanding game; lots of fun. Sophia did not score; she might have had one assist. But, wow, was she excited.

Checking the news when I got home, almost the first thing I saw was the outrage over the possibility that Elon Musk might charge a dollar / year to be active on "X."

Oh, give me a break.

For the record, I love "X." I follow eight other folks who tweet regularly. My tweets are limited to two Bakken notes on Sunday morning, and that's it, as a rule. Occasionally I will add an additional Bakken note during the week if a particularly spectacular Bakken well is reported.

And, for the record, also, I'm more than willing to pay a whole more to be active on twitter. Regardless, it remains free if one wants to simply be a passive user of "X." Free. Absolutely free. For lots of information. 

UAW Update -- October 17, 2023

Locator: 45805UAW.

Picking up where we left off.

October 17, 2023:

  • auto suppliers asking for federal assistance to weather the UAW strike
  • sound familiar?


So, how did that work out for Ford?
Link here.

October 17, 2023: UAW claims another casualty -- GM will delay all-electric production at Michigan plant until late-2025. Which makes it early 2026. Which gets close to three years from now. Link here. Links for the following not provided.

  • UAW cuts pay demand from 40% to 36% increase
  • and here we go again, auto suppliers asking for federal assistance to weather UAW strike.
  • day 32: one economic firm estimates the strike has cost industry $7.7 billion.
  • thhese three trucks are now in short supply: the Ford Ranger (mid-size; smaller than the F-150); the Chevrolet Colorado (mid-size); and, the GMC Canyon (mid-size).

A reminder: look at the market caps of largest automakers, global, below.

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From Earlier

Re-posting:  

October 16, 2023: Bill Ford gets it, but is it too late? The fact that Bill Ford is now weighing in on this strike in the public forum speaks volumes. Link here.

October 16, 2023: UAW going for the jugular and now it's getting personal:


They say it's not over
until the "fat lady" sings. It certainly sounds like the "fat lady" has sung.

Four New Permits; Four Permits Renewed; Six DUCs Reported As Completed -- October 17, 2023

Locator: 45804B.

Active rigs: 38.

WTI:

Four new permits, #40268 - #40272, inclusive:

  • Operators: Grayson Mill, CLR, Hess, Eagle Operating
  • Fields: Alexander (McKenzie); Jim Creek (Dunn); Robinson Lake (Mountrail); and, Feldner Coulee (Renville)
  • Comments:
    • Grayson Mill, Bill, SWSW 11-151-101, to be sited 516 FSL and 624 FWL;
    • CLR, Sloan, NENE 19-145-94; to be sited 305 FNL and 460 FEL;
    • Hess, EN-L Cvancara; ESE 29-155-93; to be ssited 412 FSLandd 693 FEL;
    • Eagle Operating, Skaufel, NWSE 5-158-86; to be sited 2050 FSL and 2140 FEL; 

Permitted CO2 storage facility:

  • 40270, Minnkota Power Coop; NRD 1, NESE 34-142-83; Oliver; Minnkota Center Mrys Broom Creek Storage Facility #1 and Minnkota Center Mrys Deadwood Storage Facility #1

Four permits renewed:

  • CLR: two Charlotte permits, one Chicago permit, and one Akron permit, all in Banks oil field, McKenzie County;

Six producing wells (DUCs) reported as completed:

  • 39398, 1,492, Kraken, Wiseman 31-36-35-34 4H,
  • 39396, 1,153, Kraken, Wiseman 31-36-35-34 2H,
  • 39557, 874, CLR, Fuller 10-2H1,
  • 39558, 658, CLR, Fuller 11-2H1,
  • 39559, 658, CLR, Fuller 12-2HSL,
  • 39845, 855, Kraken, Wiseman 31-36-35-34 5H,

GDPNow Estimate For 3Q23 Rises Again: Today’s Reading — 5.4% — October 17, 2023

Locator: 45803GDP.

With the economy on fire, JPow will be forced to raise rates once again. Will probably wait until after the holidays and reassess. 

Later: Investors worried the Fed will not simply be "higher for longer, but "much higher for longer." Link to WSJ.

I'll Be Off The Net For Awhile -- Perfect Weather For Biking -- October 17, 2023

Locator: 45802UAW.

I just posted my thoughts on "US retail sales."

Then, my post on the Mideast.

Next up: the UAW. The strike could go on for another month or longer, but it certainly feels like we are reaching an inflection point.

It ain't over until the fat lady sings.

"Ford Chair Bill Ford Makes A Plea To The UAW."

Sounds a lot like the fat lady is singing.

Iran's Worst Nightmare -- October 17, 2023

Locator: 45801MIDEAST. 

Updates

Later, 5:12 p.m. CT:children's hospital in Gaza Strip destroyed; the media is "rounding" up the usual suspects; 500 killed; Abbas, Palestinian leader cancels meeting with Biden; following script.

Original Post 

The former and the current president had / have something in common. They both wanted to disengage in the Middle East. 

Exhibit A: Afghanistan hasty withdrawal by Biden; plans put in place by his predecessor.

Iran's goal: become dominant player in the gulf. 

Hamas?

Screwed up everything for Iran

The US Navy can't get back to the gulf fast enough

Iran has to be really, really pissed.

One US a/c group already there;

The US second a/c group en route. [By the way, the Israeli's delay will allow the IKE to get there in time to see the fireworks. It amazes me that folks are asking why the IDF is waiting to go into northern Gaza. It also goes without saying that this provides more time to get refugees out of harm's way. And, oh by the way, a a lot of medical capability in an a/c group. Lots of blood for transfusions on those aircraft carriers.]

And, the cherry on top of that sundae: the US Marines will move north through the Strait before Iran can close it to shut down the trade of oil.

The US won't get any ground sites for land-based fighters this go-around -- except possibly Kuwait. Turkey has aligned itself with the Palestinians, against Israel, and Saudi Arabia and Iran are now talking. A new world order.

US Navy / US Marines have the edge over the USAF if this war goes regional.

This is what Iran sees, link here


The US Marines are there for two reasons:

  • provide air support to Israel if ground invasion into Gaza begins to go sideways;
  • prevent the invasion from going regional --

Regional? Euphemism for Hezbollah.

  • Euphemism for Hezbollah? Say what? Quick! What other "entity" is going to attack Israel?
  • Turkey? Saudi? Egypt? LOL.
  • Iran? Hardly -- and at very, very great risk. Israelis would love opportunity to take out nuclear sites.
  • Hamas. They're done.*
  • Hezbollah. That's it. That's the only regional player that could get involved.
    • Hezbollah: a political entity, not a military entity, though it does have a limited military capacity;
    • so, for diplomats: "regional" = Hezbollah.

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Hamas

*They're done.

Biden's trip will allow the Israelis an additional six days to prepare. And when they go, it will look chaotic but Israel will have everything in order given this much time to prepare -- and oh, by the way, water, electricity, and diesel fuel no longer getting to Hamas. They have a lot of diesel stored in anticipation of such a siege but I don't think they expected to be burning emergency diesel "waiting" for Israel to respond.

Israel won't move until Biden is back in Washington.

By the way, has Biden crossed the Rubicon with regard to unlimited military support for Israel is so needed. The tea leaves certainly suggest that.

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Capabilities

Someone over on social media questioned "fighters on amphibious / landing craft"?

Yup.

Harriers and F-35B Lightnings. From wiki, multiple sites.


Retail Sales Rose Almost 4x That Forecast In September -- October 17, 2023

Locator: 45800ECON. 

Big winners? Banks, today, are reporting huge earnings on interest payments for the third quarter, July - September, 2023, off strong retail sales. Investors worried the Fed will not simply be "higher for longer, but "much higher for longer." Link to WSJ.

Link here.

Let's review some charts.

The area under the curve:

This, the area under the chart, without a doubt, the largest ever in the history of mankind.

My favorite chart.

Link here.


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Transfer of Wealth -- Already in Play

Now, let's add another data point: the greatest wealth transfer in the history of mankind. Link here.

My parents' generation transferred to me and my generation: $16 trillion.

My generation will transfer to the next two generations, our children, Gen X and Gen Y: $53 trillion.

First off all, I can't get my mind around one trillion dollars, much less $15 trillion, much less $60 trillion.

This transfer has only just begun.

My generation, the baby boomers: 1946 - 1964.

Today: ages 77 years of age - 59 years of age.

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RMDs

Baby boomers: first generation with tax-deferred (and tax-exempt) IRAs.

IRS changed the rules and now inherited tax-deferred IRAs must be exhausted in ten years.

The phenomenon of RMDs from the baby boomers has also just begun.

Age 73: must begin to take RMDs from IRAs.

Human nature: most folks who have sizeable IRAs and understand investing will try to wait as long as they can to start taking their RMDs each year. So, now, we're coming to the end of the year, and the holidays are coming. RMDs for 2023 start to hit their stride now.

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Housing

Baby boomers: big families. Common for folks like me to have four, five, or six siblings. But, Gens X, Y, and Z will have youngsters with zero or one siblings, and that's it. 

Much less money being spent on housing (high interest rates, also, of course, but less money on housing translates into more money in non-housing retail sector.

Link here

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Transportation

Due to high cost of automobiles, shortage of vehicles, etc., folks spending a lot less on autos. That leaves a lot more money for non-auto retail sales.

Excluding autos, sales were up 0.6%, also well ahead of the forecast for just 0.2%. The so-called control group, which strips out items such as auto dealers, gas stations, office supply stores, mobile homes and tobacco stores and is used for the department’s GDP calculation, rose 0.6% as well.

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Disposable Income

In the US, averages $50,000 per capita. Previously reported. Link provided by a reader, thank you.

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Bottom Line

From the linked CNBC article:

 “The U.S. consumer cannot stop spending,” said David Russell, global head of market strategy at TradeStation.
“All three retail sales reports for Q3 were above estimates, which puts us on track for a strong GDP number later this month. It also gives the Fed zero reason to loosen policy, which keeps the 10-year Treasury yield pushing toward 5%.”
Sales gains were broad-based on the month, with the biggest increase coming at miscellaneous store retailers, which saw an increase of 3%. Online sales rose 1.1% while motor vehicle parts and dealers saw a 1% increase and food services and drinking places grew by 0.9%, good for a yearly increase of 9.2%, which led all categories. There were only a few categories that showed a decline; electronics and appliances stores as well as clothing retailers both saw decreases of 0.8% on the month.

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GDPNow

Link here.

Estimates for 3Q23 coming in at 5.1%.

Next estimate will be released later today: released — rises again, now, 5.4%.

Three Wells Coming Off Confidential List Today -- October 17, 2023

Locator: 45799B. 

What we will be talking about today:

  • Gaza: the delay in the ground invasion is easily explained.
  • US Marines: did anyone know?
  • UAW: quietly, the UAW has already stepped back from that 40% demand.
  • TSM: holy mackerel!Anyone paying attention?
  • US consumer: retail sales come in so much stronger than anticipated.
  • Banks: reporting huge earnings. Telegraphed by JMP's earnings a few days ago.
  • Sports: Dallas Cowboys win last night; Texas Rangers go 2 - 0 in ALCS; best of seven.
    • Rangers need to win two of the next five; 
    • Houston, four of the next five; 
    • to advance to the World Series, where the winner will likely face Philly

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Back to the Bakken

WTI: $87.16.

Wednesday, October 18, 2023: 41 for the month; 41 for the quarter, 611 for the year
39683, conf, Cresent Point Energy, CPEUSC Clermont 4-19-18-158N-100W MBH,
39330, conf, CLR, Arthur 8-12H,
39282, conf, Oasis, Harrier 5401 43-22 6B,

Tuesday, October 17, 2023: 38 for the month; 38 for the quarter, 608 for the year
39684, conf, Crescent Point Energy, CPEUSC Farthing 3-30-31-158N-100W-MBH,
39283, conf, Oasis, Kestrel 5401 43-22 5BX,
36780, conf, BR, George 1C TFH

RBN Energy: clean ammonia production planned at leading deepwater ammonia terminal.

It makes perfect sense, really. If you’re planning to build a large, low-carbon ammonia production facility that’s targeting the export market, why not site it alongside the Gulf Coast’s leading deepwater ammonia terminal? That helps to explain why INPEX Corp., LSB Industries, Air Liquide and Vopak Moda Houston — the last a joint venture of Royal Vopak and Moda Midstream that recently developed the ammonia terminal — are collaborating on the development of a planned 1.1 million ton per annum (1.1 MMtpa) clean ammonia production plant along the Houston Ship Channel. In today’s RBN blog, we discuss the proposed production facility, the markets its clean ammonia would serve, and the benefits of building the project at an existing terminal.

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Got Milk?

An excerpt from a book review in the latest issue of The New York Review of Books, October 19, 2023, p. 36. The book: Spoiled: The Myth of Milk as Superfood, Anne Mendelson, Columbia University Press, 396 pages, c. 2023.

The reviewer: Natalie Angier, a Pulitzer Prize-winning science columnist for The New York Times.

The excerpt: