Notes From All Over, Part 3 -- December 2, 2019

Updates

Later, 8:09 p.m. CT: from seekingalpha --

• Global electric car sales were down 28% YoY in October, reaching 2.2% market share. The fall was due to a large fall in sales in China (due to cut in state subsidies)
• EV market news - Germany to hike electric car subsidies by 50% starting 2020 until 2025. NASA's unveils its first electric plane, the X-57 Maxwell.
• EV company news - Production of Volkswagen ID.3 begins in Germany. Ford unveils Mustang Mach-E starting at roughly $44,000, due late 2020. Tesla launches its e-pickup cybertruck.
• China's electric vehicle market to see sales rebound next year as automakers roll out more new products to lure buyers, but more supportive government policies are needed, auto executives said.
• bottom line: EVs don't sell without huge government subsidies; still way too expensive; and too few charging stations; and, when you find a charging station, 30 minutes to charge, and hard to say how long one will be waiting in the queue to charge one's car

Later, 8:04 p.m. CT: from zerohedge -- 

Meanwhile, here are TSLA’s current cars/products not in production:

• Roadster (unveil was 2yrs ago)
• Semi (unveil was 2yrs ago)
• Model Y (TSLA refuses to mention how many pre-orders they’ve received here)
• Cybertruck ($100 fully-refundable deposits on a car that will likely cost $60K, or  0.167%, is the equivalent of someone putting $1.67 toward an $1,000 iPhone and Apple calling it an order)
• ATV
• FSD (to be FSD, TSLA would have had to achieve level 5 autonomy… they’re at level 2)

So… TSLA has more vaporware products (i.e., stuff that doesn’t exist) than real products for sale; and, it’s real products are seeing large negative y/y growth currently.

But there's more:

Oh… and what about E. Musk’s promise that:

• TSLA would have flying cars (he made this claim 322 days ago),
• TSLA would create break pads that never need to be replaced (he made this claim 336 days ago),
• TSLA would have a base on Mars in 2028 (he made this claim 432 days ago),
• TSLA would have a one hour body shop (this claim happened 437 days ago),
• he would fix the water in all Flint houses above FDA levels (he made this claim 504 days ago),
• there would be no more mass layoffs (533 days, and multiple layoffs, ago), etc.?

And the SEC looks the other way. Because they know no one takes Musk Melon seriously.

Original Post

EVs. After our cross-Texas trip over Thanksgiving I was again struggling to see how EVs were going to become "a thing." It's just not gonna happen. At least not in the US.

• forty percent of the US population live in apartment complexes; charging units are expensive
• homeowners need to install EV chargers; new homes will have them installed
• the grid will be hard pressed to handle any surge in new EVs
• convenience
• ICEs: average time of stop to refill -- five minutes
• to charge: 30 minutes, which also means that when one pulls in to charge, one will wait behind a queue of cars charging and waiting to charge
• EVs have maps to show where charging station is, but convenience of service stations is not to be underestimated
• at the end of the day, Americans don't like to be tethered, and an EV is a tethered vehicle, no matter what one says
• other links:
• oilprice
• automotive news, September 11, 2019: as more EVs hit the market, selling them could be a challenge;
• marketrealist, October 14, 2019: EV makers in trouble as China's market hits the brakes?
• policyoptions, May 20, 2019: the challenge for EVs to disrupt trucks and buses; commercial vehicles use weighty, wildly expensive batteries and need powerful charging stations; a broad shift to electric will take some policy to help 

EV sales are tracked here. New sale data should be out later this week. Wow, that's strange. This site must be having problems. The side doesn't even have October data yet. As recently as a few months ago, sales data lagged only a few days after the end of the month. Oh, there it is, in the small print from the website: "With that being said, we are looking at moving to quarterly reporting as a whole."

It appears that automobile manufacturers are "afraid" to post monthly sales figures. Yes, it's gotten that bad. The "cheap" price of gasoline is not helping. Nor is the fact that some manufacturers are now facing phase out of their federal incentives. At one time a lot of folks thought that Congress might extend these incentives, but with the US House on vacation for the past two years and no end in sight for that vacation, nothing is going to get done. Incentives for EVs is way, way down on the list of things of which the public is interested. Has anyone heard any of the current crop of folks running for president mention EVs?

The fact that the "EV sales" site can't even get reliable data for months at a time tells me all I need to know about EVs in the US. If EVs were flying out of sales rooms, we would be getting the data.

• GM: down a penny today at $35.99, mid-range for the year;
• F: up six cents today, at $9.12, mid-range for the year; maybe a bit on the high side for recent investors;
• TSLA: despite the Dow being down 220 points, TSLA is having a great day, up 1.22%; up over $4.00; trading at $334.

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. 

By the way, the market is down today because "factories extend contraction as index misses forecasts." That headline will be forgotten by the end of the week.

Notes From All Over, Part 2 -- December 2, 2019

First things first: how Americans spent their Thanksgiving (and it wasn't watching Dallas Cowboys lose):



From the linked article:

Disney’s ice princess sequel brought in $85.3 million in the U.S. and Canada over the weekend and earned an unprecedented $132.7 million from Wednesday through Sunday. It has earned $288 million domestically in its 10 days of release.

The record was previously held by "The Hunger Games: Catching Fire," which grossed $109.9 million in 2013.

“Knives Out,” the innovative and star-heavy whodunit from director Rian Johnson, rode strong reviews and word of mouth to a $27 million weekend and a five-day total of $41.7 million that easily earned back its budget.

Echoing what others have said, "Knives Out" is/was one of the best movies I've seen in a very long time.

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.

Market spooked: Dow down 212 points. Buying opportunity!

• Apache plunges as oil-field update offers few details; update on Suriname site disappointed; as its Texas oil fields lose momentum; regular readers know where I am going with this

Disclaimer: I am inappropriately exuberant about the Bakken.

The Bakken, right now, is providing operators best bang for their buck; operators really, really overpaid for the Permian, but they were in a tough position. If they can survive the next couple of years, they will do incredibly well, but a lot of smaller Permian operators are not going to make it in the Permian. Next year, 2020, will probably be the "make or break" year.

The Bakken surprise: from November 30, 2019 --  previously posted --

This is perhaps most surprising news of the day, however.  "Everyone" knew the US was on its way to energy independence; no one saw this coming. Link here.

WTI: holding, and trending up a bit, $55.86, right now.

German car industry faces day of reckoning -- Financial Times. Link here. The number of jobs being lost looks huge but in fact, on a percentage basis, hardly anything to get excited about. The interesting thing is that German manufacturers are able to cut employees -- unions and government regulations make cutting jobs very, very difficult. It's been my observation that when times get tough, the better-run companies will shine. By the way, the FT story is behind a paywall but easy to find similar stories with a google search. Story also here, and not behind a paywall.

Which brings me to this: media outlets that put everything being a paywall are losing a lot of eyeballs and those eyeballs aren't seeing the ads at those sites. Most of us, if we have the headline, can find a way around the paywall. Exceptions: The NYT but that's because most of the original stories are op-ed pieces disguised as news articles. (i.e., fake news).  For the serious investor hobbyist (those playing at home, as Jim Cramer would say) Barron's is hard to beat, and their paywall is pretty much impenetrable. But the library is a great alternative.

Notes From All Over, Part 1 -- December 2, 2019

First things first: last week's fake news in pictures. Perhaps the funniest:

Texas triangle, link here: I'm not in the market for a McMansion, but this tells me a lot about the Texas economy and more specifically the area where we currently reside.

When Danelle and Ron Reimer moved to Austin, Texas, from Orange County, California, last month they were intrigued by its “big little city” feel.

“We’re not really city people, but we love how welcoming Austin feels and how easy it is to get to know and to get around in,” said Danelle Reimer. “We bought in the Seven Oaks neighborhood because it’s close to downtown but also has privacy and views.”

The Reimers’ 9,000-square-foot house, which they purchased for more than $2 million, reminds them of a Southern California-style home with its arched doorways, tile work, wood beams and stonework.

“We like a lot of space and this house has a lot of personality, too,” Ms. Reimer said.

The Reimers, who relocated for Ron’s work with a global financial services company, aren’t the only high-net-worth family to make the “Texas Triangle,” which includes Houston, Dallas and Austin, their home in recent years.

The Dallas-Fort Worth-Arlington metro area is ranked 10th in the world on the list of top locations for the ultra-wealthy, according to the 2019 Wealth Report from Wealth-X. 

Credit card debt at this link; click on the "metro area" list and scroll down to see all the metro areas. Arlington, Texas is near the top, but Alaska is even higher. 

The article did not mention Willie Nelson or Jerry Jeff Walker.

London Homesick Blues, Jerry Jeff Walker

Our little 900-square-foot two-room apartment is nestled within this triangle. I'm looking to downsize. LOL. 

We're not allowed to have grills on our balconies in the apartment complex, so I prepare the lamb in our apartment, and then drive over to our daughter's house and grill it there.

I use hardwood charcoal exclusively now (e.g., Fogo) and absolutely love it. I use a chimney to get the charcoal started; takes about 15 minutes.

Really thick lamb, six minutes on first side, and then turn for another five minutes. I assume with my delay getting to the grill, etc, total time is twelve minutes, again for very thick lamb. It is still quite pink in the center. For thinner cuts, four minutes at most on a side.

Prep time is about 30 minutes with all the chopping of rosemary and thyme. Biggest lesson learned last week: cut back on the balsamic vinegar. We had lamb twice last week.

Saudi Arabia Foreign Exchange Reserves -- Trending To An All-Time Low -- December 2, 2019

Link here.

How much trouble is Saudi in? How badly does Saudi need Brent to go to $80?

This is quite incredible, to say the least. And I love reading from folks saying that Saudi's lifting costs are the lowest in the world.

By 2029, Saudi Arabia will be a net importer of crude oil.

Not Laying Down Rigs In The Bakken; Holding Steady; Up One Today -- December 2, 2019

Active rigs:

	12/2/2019	12/02/2018	12/02/2017	12/02/2016	12/02/2015
Active Rigs	58	66	53	39	64

Wells coming off the confidential list over the weekend, last week -- it appears that the NDIC is no longer posting results until several days after wells come off the confidential list. Last Thursday's wells have still not been posted.

Monday, December 2, 2019: 115 for the month; 216 for the quarter:

• 36095, SI/NC, WPX, St Anthony 9-16HUL, Mandaree, no production data,
• 33448, drl, EOG, Clearwater 30-3103H, Ross,
• 31655, 775, Oasis, Jensen 55-1 11-19 4B, Missouri Ridge, t6/19; cum 92K 10/19;

Sunday, December 1, 2019: 112 for the month; 213 for the quarter:

• 36417, dry, Freedom Energy Operating, LLC, Oltmans Panther 1-16, wildcat, Lodgepole target; not a surprise; previously posted;
• 36318, SI/NC, Petroshale, Anderson North 2MBH, Croff, small bit of production;
• 36317, SI/NC, Petroshale, Anderson North 1TFH, Croff, small bit of production;
• 35635, SI/NC, WPX, St. Anthony 9-16HZ, Mandaree, no production data,
• 35634, SI/NC, WPX, St. Anthony 9-16HA, Mandaree, no production data,
• 35331, 6,028, MRO, Dietrich USA 11-2TFH, Reunion Bay, t9/19; cum 114K 58 days;
• 35330, 4,401, MRO, Holmgren 41-3H, Reunion Bay, t9/19; cum 61K 41 days;
• 33183, SI/NC, BR, Franklin 44-36TFH, Little Knife, no production data,

Saturday, November 30, 2019: 104 for the month; 205 for the quarter:36317

• 35636, SI/NC, WPX, St. Anthony 9-16HB, Mandaree, no production data,
• 33184, SI/NC, BR, Franklin 34-36MBH-2NH, Little Knife, no production data,

Friday, November 29, 2019: 102 for the month; 203 for the quarter:

• 36316, SI/NC, Petroshale, Anderson North 1MBH, Croff, some production;
• 36135, SI/NC, XTO, Sorkness state Federal 34X-36G, Sorkness, no production data,
• 35637, SI/NC, WPX, St. Anthony 9-16HY, Mandaree, no production data,
• 35332, 5,530, MRO, Tommerdahl USA 11-2H, Reunion Bay, t9/19; cum 94K 58 days;
• 30108, 820, Oasis, Jensen 5501 43-7 6B, Missouri Ridge, t6/19; cum 95K 10/19;

Thursday, November 28, 2019: 97 for the month; 198 for the quarter:

• 36136, SI/NC, XTO, Sorkness State Federal 34X-36C, Sorkness, no production data
• 35638, SI/NC, WPX, St. Anthony 9-16HC, Mandaree, no production data,
• 35587, 1,688, CLR, Carus 12-28HSL1, 33-025-03596; Cedar Coulee, t7/19; cum 143K 10/19;
• 35333, 1,414, MRO, Estenson USA 11-2TFH, Reunion Bay, t9/19; cum 31K 10/19;

RBN Energy: late crops and delivery snags send PADD 2 propane prices soaring.

Cold weather and spiking demand from Midwest and Great Plains farmers trying to dry their late-maturing, soggy crops have sent the PADD 2 propane market into a tizzy. Supply is not a major issue — propane inventory levels in the region are only a little below average, and stocks are plentiful along the Gulf Coast in PADD 3 — but distributing propane by rail and truck for crop-drying use has been a bigger-than-normal problem. As a result, farmers are scrambling to get more of the fuel, and propane prices in the U.S. heartland have been skyrocketing. Worse yet, Canada may not be able to come to the rescue as it has in the past, because its propane exports to Asia are up and its inventories are down. Today, we review recent developments on the fuel front in the nation’s breadbasket.

As anyone who traveled across the Midwest or Great Plains this past holiday weekend knows all too well, winter has arrived, spurring demand for propane from the many residential and commercial customers in PADD 2 — the big triangle of states between Ohio, Oklahoma and North Dakota — who depend on the fuel for space heating, not to mention for cooking Thanksgiving dinners and heating up leftovers.

The other big demand center for propane in the Midwest and Great Plains is drying harvested corn and other crops before they are stored or shipped. Propane demand for crop drying varies from year to year, depending on, among other things, the size of the crop, the crop-maturation rate (is it an early, late or normal harvest), and the weather during the harvest. 2019 has been a pretty good year from a crop production standpoint, but a wet spring delayed planting, crop maturation was slower than normal, and farmers are still in the midst of an unusually late harvest (see navy blue lines for 2019 in Figure 1). That complicates things because it means crop-drying demand for propane has been spiking just as heating demand is ramping up.