My Favorite Chart — February 23, 2023

Locator: 46890MMF. 

From Reuters:

Investors poured cash into money market funds at the fastest pace on record in the first weeks of the year, and funnelled another $15 billion into equities in the week to Wednesday, Bank of America Global Research said on Friday, today, February 23, 2024.

The BofA report showed the equity market rally is broadening beyond the mega caps, as U.S. small cap funds logged their largest weekly inflow in the week to Wednesday since June 2022, at $5.1 billion. BofA said in its weekly roundup of fund flows in and out of world markets citing EPFR data, that flows to cash were running at an annualised rate of $1.3 trillion in the first weeks of 2024 through to February 21. 

Investors can often opt for cash when they are less confident, but with interest rates at elevated levels and looking less likely to drop in the very near term, cash-equivalent money market funds have drawn in flows. In the latest week, as the S&P 500 hit record highs, investors put $15.2 billion into bonds, including $10.2 billion into investment-grade bond funds, which logged a 16th straight week of inflows, the longest such stretch since October 2021, BofA said.

That Was A Very Short Spring — February 23, 2024

Locator: 46889WEATHER.

The Weather Channel now forecasts a high of ninety-two degrees for north Texas (DFW) Monday. The previous forecast was for 87°.

Wow -- Let's See Where This Goes -- Ford Discontinues Its EV Pickup And Upscales Its Best ICE Pickup -- Some VP Of Marketing Just Got Promoted -- February 23, 2024

Locator: 46888FORD.

Updates

February 25, 2024: now, this from Dan:

Original Post

This is one way to get rid of a white elephant.

Link here. 

How much does this add to Ford's share price, Monday morning?
__ $1
__ $5
__ $10

Or ...

Well, That Ends That -- Another Gift For The Oil & Gas Operators -- February 23, 2024

Locator: 46887DAMN.

Link here.

Spacing Unit Change, No New Permits, But Seven Permits Renewed -- February 23, 2024

Locator: 46886B.

WTI: $76.49.

Active rigs: 38.

No new permits.

Seven permits renewed:

• Hess: three AN-Lone Tree permits; four TI-Beauty Valley permits -- most interesting, a spacing unit change:

Six producing wells (DUCs) reported as completed:

• 39776, 1,352, CLR, North Tarentaise Federal 6-18H, McKenzie County;
• 39873, 1,352, CLR, North Tarentaise Federal 9-18HSL2, McKenzie County;
• 40044, 1,324, CLR, Quale Federal 7-1H1, McKenzie County;
• 40045, 578, CLR, Quale Federal 7-1H2, McKenzie County;
• 40047, 1,223, CLR, Harms East Federal 2-33H2, McKenzie County;
• 40049, 2,619, CLR, Harms East Federal 4-33H1, McKenzie County;

Week 8: February 19, 2024 -- February 25, 2024

Locator: 46885BIGSTORY.

Top, top story

• IVF: hunch — 99% of those who pay big bucks for IVF are conservative, white, suburban, happily-married white couples. Trump knows.
  
• measles: hunch — Florida schools to start reporting pockets of mini-epidemics. Thank goodness there’s a vaccine — oh, that’s right — not safe.
• Florida SG: nominated for the 2024 Geico Rock Award
  
• US economy on fire; 
• the US stock market continues to hit new highs;
  
• the Fed won't cut more than 50 basis points this year
  

Top story: 

• Ukraine on the ropes; Trump/Johnson throwing Ukraine under the bus
  

Top international non-energy story:

• Israel getting ready to clear Rafah of Hamas
  
• global shipping still avoids the Red Sea (Suez Canal)
• Houthis sink first ship
  

Top international energy story:

• Qatar taking advantage of the "Biden pause"
  

Top national non-energy story:

• Trump risks not coming up with $400 million judgement
  

Top national energy story:

• Biden's LNG export facility permitting pause gets almost no pushback

Focus on fracking: link here.

Top North Dakota non-energy story:

Top North Dakota energy story:

• 
  

Geoff Simon's quick connects: link here.

Just How Big Is Nvidia? And Actually It Could Be / Should Be And Will Be Seriously Bigger -- February 23, 2024

Locator: 46884TECH.

Link here.

North Dakota Oil Production -- Annual -- 2019 - 2023 -- Returning To A Reader's Question Of Some Weeks Ago

Locator: 46883B.

Link here. From NDIC data here.

Full year, oil production:

• 2019: 524,430,647 bbls crude oil
  
• 2020: 438,683,034
  
• 2021: 409, 104,098
  
• 2022: 390,326,798
  
• 2023: 435,013,847
  

Average amount of oil per well per day:

• 2019: 93.17 bbls crude oil per day per well
  
• 2020: 81.09
  
• 2021: 68.75
  
• 2022: 63.33
  
• 2023: 67.33

Number of producing wells, at the end of the year:

• 2019: 15,656
  
• 2020: 15,384
  
• 2021: 16,829
  
• 2022: 16,874
  
• 2023: 18,365
  

Best year of the five years:

• 2019: 524,430,647 bbls for the year

2022 was atrocious, averaging 1,069,388 bopd:

2023, last year, averaging 1,191,819 bopd, an 11% increase over 2022.

Several weeks ago a reader asked what explains the jump in production year-over-year.

That's really two questions:

• why did production increase year-over-year; and,
• how did operators manage to increase production year-over-year in the Bakken.

So, to answer the first question, the "why." It's all about managing assets, something we've discussed before.

Second, "production follows price."

So, now the how? All things being equal, how did operators increase production? Two parts to the answer to that question:

• first, they only had to open the choke (open the spigots) and hope takeaway capacity was there (it was); and,
• second, to keep the open spigots flowing at an increased rate:
• hope for good weather, so drilling and fracking could proceed, based on the operator's schedule; 

But what was the secret sauce?

• complete the DUCs.

Let's check that out.

Assumption:

• the number of active rigs has not changed: and that's true, running between 36 and 39 rigs for quite some time;
• the weather held, for the most part, and the drilling stayed on schedule; and,
• finally, the operators started completing DUCs.

Check this post.

DUC inventory:

• December, 2020:   811
• December, 2021:   555
• December, 2022:   602
• December, 2023:   324

There seems to be a trend.

By the way, 800 DUC-inventory has been the norm for years in the Bakken, so even a drop to 555 was noteworthy, but look at that "324."

That leads to the next question ... what makes the Bakken so special to be able to frack so fast .. but for another time ...

There are a number of other Bakken-specific reasons for increased production but that's enough for now.

But the real shout-out goes to the blue-collar workers in their Carhartt Clothes: the truckers; the roughnecks.

World's Most Important Stock? CNBC -- Fast Money -- February 23, 2024

Locator: 46882FASTMONEYCNBC.

Early this morning, I posted by two "buys" today:

• TSM
• BRK

On CNBC's "Fast Money," the first segment was to ask the "world's most important stock."

Stock named, by first panelist:

• TSM

Next panelist:

• nervous about NVDA
• agrees with TSM

Third panelist:

• NVDA
• TSM

Then, :

• Home Depot
• in-flows into "materials"
• energy: worst performer
• small market cap: still struggling -- capital access? Capital cost?

Now, back to general question. Again:

• NVDA

Conversation back to high interest rates:

• investors won't be affected by Fed rate until at least July, 2024 
• sounds as if analysts are getting tired of talking about rates and getting back to talking about "it is what it is" and time to invest with that in mind
• folks on sidelines waiting because they worried about souring economy
• folks on sidelines waiting for Fed to cut rates
• time for "waiting" investors to start doing something, anything, anything but waiting;
  
• finally someone says what no one else is saying:
• we're in the sweet spot right now; there's no difference between 5% and 4%
• if we suddenly drop to 2% it means something horribly wrong with the economy
• if we move to 7% it means investors have to completely re-adjust their thinking about their investment strategy

Global equities (MSCI World Index makes major move today):

• US S&P 500 makes up 50% of global equities
• global equities, as measured by the MSCI Worrld Index, this week, finally got back to "even," recoups all its losses for the past two+ years;
• finally, emerging markets
• bottom line: great time for investors
• India: 52-week high today

SPDR consumer staples:

• great movement today - this week: not seen since August
• first mentioned: WMT
• also: Costco
• but as a sector: flat, no growth, or negative growth
• 6% of the S&P, KO and Procter make up a third
• investors should think differently about staples; investors can do better
• then panelists try to justify because staples pay dividends (think Buffett; old school)
• in this sector: stock picking: Pepsi, Hershey, Tyson but then back to WMT
• WMT / Cost growing faster than economy in general
• basically, a balance to those who did well with Nvidia
• but staples overall? Investors can do better.

Carvana.

Final trades:

• iShares MSCI India ETF
• Abercrombie and Fitch
• Rivian
• WMT

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. 

All my posts are done quickly: there will be content and typographical errors. If anything on any of my posts is important to you, go to the source. If/when I find typographical / content errors, I will correct them. 

Again, all my posts are done quickly. There will be typographical and content errors in all my posts. If any of my posts are important to you, go to the source.

Reminder: I am inappropriately exuberant about the US economy and the US market.

New Records At The Dow, S&P 500 -- Only One Stock Matters On The Russell 2000 -- February 23, 2024

Locator: 46882INV.

Just saying. Link here.

***********************************
And, Then This

*************************************
Spring Is Here

Jobless Report Earlier This Week; Compare Texas, California -- February 23, 2024

Locator: 46881JOBS.

Link here.

******************************
California Budget Deficit

Renewable Energy -- Wind And Solar -- Will Get A Lot Of Press -- But It's Hit A Wall -- February 23, 2024

Locator: 46880WOLAR.

Link here. 

There are so many stories along this line, and I'm bored with reporting / link them, so this is simply for the archives and to remind myself that "wolar" has hit a wall.

And here's France:

Just A Matter Of Time Before Saudi Starts Sellling Much More Oil -- Or Monetize More Of Their Cash Cow -- February 23, 2024

Locator: 46879SAUDI.

Link here.

No Wells Coming Off Confidential List Today -- February 23, 20024

Locator: 46878B.

Updates

Later, 8:01 p.m. CT: link here. 

From the linked article:

Rivian Automotive Inc. emerged as a darling of investors — a brand with promise of bringing the "cool" factor to the once-red-hot market for electric vehicles. But the Irvine-based company hit the brakes Wednesday, announcing a 10% cut to its workforce and lower production expectations.

The news sent its stock plummeting. The 25% drop in stock price that it notched Thursday was its worst day in its history.

Original Post 

Personal investing today, bought:

• BRK-B
• TSM

Carvana today: classic short squeeze. Most "shorted" stock in the market; reported unexpected earnings; stock surges. Up an astounding 33% today. 

WBD, RIVN, LCID: wow, I feel sad for those investors who listen to the "wrong" analysts. 

• WBD is down 15% this past week, falling 13% today, down $1.24 today, trading at $8 and change.
• Rivian, Lucid shares plunge:
  

ARKK: that was probably my biggest mistake -- listening to Cathie Wood -- sometime last year (2023) if I recall correctly. Fortunately, came to my senses and got out within a week. Jim Cramer on Cathie Wood.

Germany: but, maybe we should feel even sorrier for the demise of Germany's heavy industry sector? Link here:

China: now banning selling stocks at the opening and the closing, along with making "quick profits." 

• Punishment to include longer prison sentences. 

BRK: surging this past month; nice balance on the tech - non-tech barbell of investing.

Yeah, Wall Street needs the Fed to lower rates:

***************************
Back to the Bakken

WTI: $76.19.

Monday, February 26, 2024: 62 for the month; 121 for the quarter, 121 for the year
39616, conf, Whiting, DE YK 12-33-2TFH,
37486, conf, CLR, Gibb 3-24H,

Sunday, February 25, 2024: 60 for the month; 119 for the quarter, 119 for the year
38641, conf, Hess, GO-Knudson-156-97-2017H-3,
37485, conf, CLR, Gibb 2-24H1,

Saturday, February 24, 2024: 58 for the month; 117 for the quarter, 117 for the yea
39617, conf, Whiting, DE YK 12-33-2H,
39340, conf, Enerplus, Cushion 148-93-04A-09H-LL,
37343, conf, Whiting, Bigfoot LS 23-22 8H,

Friday, February 23, 2024: 55 for the month; 114 for the quarter, 114 for the year
None.

RBN Energy: additionality rules throw a monkey wrench into plans for hydrogen scale-up.

The federal government’s Hydrogen Production Tax Credit (PTC), also known as 45V, provides the highest incentives for hydrogen produced using clean sources of power generation, like wind and solar. That might seem like great news for current and potential hydrogen producers looking to take advantage of the credit, since the U.S. has added significant renewable generation capacity in the last several years, but the reality is much different. In today’s RBN blog, we’ll explain how “additionality” fits into the “three pillars” of clean hydrogen, how it would be calculated under the proposed guidance, and some ways the rules might be adjusted to give hydrogen producers and power generators a little more flexibility. 

The proposed rules around 45V were rolled out in late December 2023. Under 45V, credits are available based on the rate of lifecycle greenhouse gas (GHG) emissions during a clean hydrogen facility’s first 10 years of operation. As defined by the Inflation Reduction Act (IRA), clean hydrogen is produced in a way that results in a lifecycle GHG emissions rate of not more than 4 kilograms (kg) of carbon dioxide (CO₂) equivalent per kilogram of hydrogen (CO₂e/kg). As we described in Part 1 of this series, that new standard could severely limit how much of the tax credit is available to many of the potential low-carbon hydrogen production facilities. For example, a blue hydrogen project — one in which hydrogen is produced through the auto thermal reforming (ATR) or steam methane reforming (SMR) of natural gas, with the resulting emissions mitigated by carbon capture — can qualify for the credit if it has sufficiently high carbon-capture rates, but the proposed regulations likely limit it to the less lucrative bottom two tiers of the credit due to a “locked” upstream natural gas feedstock emissions factor. There are four tiers to the credit, maxing out for the top tier (GHG emissions rate of less than 0.45 CO₂e/kg) at $3/kg but falling to $1/kg or less for the other three tiers (between 0.45 and 4 CO₂e/kg).

With regard to other "stuff" on this post -- remember:

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. 

All my posts are done quickly: there will be content and typographical errors. If anything on any of my posts is important to you, go to the source. If/when I find typographical / content errors, I will correct them. 

Again, all my posts are done quickly. There will be typographical and content errors in all my posts. If any of my posts are important to you, go to the source.

Reminder: I am inappropriately exuberant about the US economy and the US market.