Stories We'll Be Talking About Today -- January 11, 2024

Locator: : 46515B.

Comes in three: Saban (Alabama), Carroll (Seattle), and now -- just breaking now -- Belichick out as head coach at New England Patriots. Widely predicted 24 hours ago over on twitter.

Michael Novogratz: on CNBC -- excellent. I agree with him completely on his statements on Trump, Biden. Nice to hear someone talk plainly.

CPI, December numbers: 0.3% vs 0.2% m/m; 3.9% for y/y; best since 2020 or thereabouts; ex-food and energy m/m came in exactly as estimated, 0.3% vs 0.3%; y/y 3.4% vs 3.2%. Core CPI 3.9% y/y vs 3.8% y/y. Everything right in line. Dow goes from slightly positive to slightly negative. Jobs data unremarkable: 202K vs 210K estimated, first time claims. See this note for further discussion. By noon, this will be old news. Especially since numbers are in line with expectations. 

• Steve Liesman:
• trajectory is not a straight line
• in December, a reversal of some gains last month
• rental (homes): still a problem
• others
  
• Fed won't cut rates "sooner"; most analysts, it seems, suggest Fed will "stand pat"
• average credit card carries balance of $4,000 (hard to believe but if accurate Americans are paying a lot of interest on a monthly basis)
• "we" need to see a lot more "goods" deflation before "see" relief on inflation numbers
• "services" inflation vs "goods" inflation
• "everybody" talks cost of groceries; real cost concerns for Americans: price of automobiles. 
• it's one thing to complain about turkey at $1.19 / pound when it was $0.99 / pound -- Americans can "handle" that, but a $50,000 car today vs a $30,000 car two years ago? Same with housing. In other words, talking heads on CNBC are giving auto manufacturers a pass while complaining about cost of groceries.

CNBC: US equity markets are all green an hour before CPI data is to be reported. My hunch? Lots of volatility today.

Bitcoin ETFs: approved by SEC. Think back on comments by Jamie Dimon and Charlie Munger. On wrong side of history.

Huge day for ARKK. Cathie Wood on a roll: could put gig economy on steroids. 

Continues to defend Tesla despite recent decision by Hertz to downsize its Tesla inventory, to sell one-third of its EV inventory. Cathie Wood was disingenuous when responding to the Hertz development. Cathie Wood says it's all about educating the American population. There is a huge difference among a) riding in an Uber Tesla and b) buying a Tesla and c) renting a Tesla. I won't do "a, b, or c." Rich folks will pay up for an Uber Tesla, but except for niche situations, EVs have lost their luster. I can't even imagine taking a chance driving from north Texas to Flathead Lake in Montana in January in a Tesla: 1,771 miles divided by 300 mile-range = six (6) re-charging stops each direction. 

Joe Keenan calls GM’s EV division a joke — says GM sold one EV in period when Tesla sold 100’s of thousands: some hyperbole but sentiment in right place. Fact check here. Not as bad as Joe suggests. Actually worse when you dig through the numbers. And then there’s the “snow problem.”

10-Year: drops below 4% prior to CPI data; after data comes out, 10-year goes just above 4% -- barely.

SCCO: down this past week but up 12% in the past month. 

AAPL: appears to have stabilized at $186. Headlines remain "negative." What did Buffett say?  "Be greedy when others are fearful; be fearful when others are greedy."

BA: may have stabilized; y/y still a 20% gain.

Folks may want to take a look at that last post on the blog last night. Today, even before the day's news cycle has begun:

• state of Maine begins paying rent for undocumented tourists; $3.5 million for 60 families; link here.
  
• works out to $58,333 / family; with 4 electoral votes, Maine is considered blue.
• and ten folks wonder why these tourists take the bus or plane from Texas to New England;
  
• that's why I'm not worried about US economy; so much money sloshing around out there, even Maine an afford upwards of $60,000 for each undocumented tourist and family.
• it's just beginning; imagine what NYC and Chicago are paying
• a lot of hoteliers must be making money "hand over fist," for their o/w money-losing properties
  
• Iran boarding a ship in the Red Sea is the number one story (by far) on twitter this morning;
• PAA just increased its quarterly dividend by almost 20%, from 26.75 cents to 31.75 cents (need to fact check); link here; and, here; at this link says PAA now pays 8.2%;
  
• OXY / Buffett: being reported: Buffett has made another huge purchase of OXY; raising stakes to 34% of OXY; up from 27.7%; there’s a difference between buying an equity position in a company (you and me)  and buying the company (him).
• NVID up $12 yesterday; pre-market today, up another $7; Nvidia cannot be stopped. In past month, NVID up 17%.
• MSFT: up $7 yesterday; pre-market today, up another $2.00; Microsoft closing in on Apple's market cap record. MSFT up 3% in past month, trailing the broader market. MSFT does edge out AAPL on market cap.
  
• OXY: in past month, down 0.5%; S&P up 3.5% in past month.
  
• Chesapeake to buy Southwestern (SWN); the latter falls on that news; note: this is not Southwest Gas (SWX).
  
• Germany de-industrializing: link here to one of the best -- Bjorn Lomborg.
  
• Bloomberg's letter today: the flood of US LNG about to hit the market; link here. 
• will go on for decades
• only thing that can slow this down: "greenies" in Biden's administration
• will look at "climate change" issue when considering permits for new export facilities
• Stap reported this yesterday;
  

 
Quick note: recent OXY buy by Buffett suggests:

• Buffett still sees huge risk of recession this year; and/or,
• he sees OXY way, way undervalued; or,
• he’s “buying” the company (just joking).

Buffett, OXY, from Barron's:

Occidental shares closed Wednesday at $56.80, down 1.2%, its lowest closing price of 2024.

The stock has fallen more than 3% so far this week amid a selloff in energy stocks with crude oil down more than $2 a barrel to about $71.25 a barrel (based on WTI crude).

Occidental pointed 1.6% higher ahead of the open Thursday as investors digested the news that Berkshire has increased its holding.

As a holder of more than 10% of Occidental stock, Berkshire must file with the Securities and Exchange Commission within two business days of a purchase or sale of Occidental stock.

There was heavier-than-usual volume of more than 10 million shares of Occidental stock on Monday, above the roughly 8.5 million shares Wednesday.

Buffett, 3Q23: link here. Previously reported. It's reported that Buffett likes dividends; note dividend payout for OXY vs CVX.

Monetizing streaming companies: link here.

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Back to the Bakken

WTI: $72.78. Up almost 2%; up $1.41.

Friday, January 12, 2024: 13 for the month; 13 for the quarter, 13 for the year
39884, conf, Kraken, Kisner 24-13-12 3H,

Thursday, January 11, 2024: 12 for the month; 12 for the quarter, 12 for the year
39721, conf, Falcon Midstream Services, Cheryl 3,
38302, conf, Whiting, Bigfoot 23 7H,

RBN Energy: acquisition of Calllon Petroleum gives APA much deeper roots in the Permian.

Permian this and Permian that. For several years now, acreage and production in that sprawling, crude-oil-focused shale play in West Texas and southeastern New Mexico have been at the center of so much M&A activity. And the deals keep coming! Just last week, APA Corp. — the international E&P formerly known as Apache — announced that it will be acquiring Callon Petroleum, which in recent years has become a Permian pure play with significant holdings in both the Delaware and Midland basins. In today’s RBN blog, we discuss the APA/Callon deal, the drivers behind it, and why the acquisition makes sense for both companies.