BrotherMaynard's Comments RSS Syndication from SeekingAlpha.com http://seekingalpha.comuser/134909/comments http://seekingalpha.com/article/168748-china-as-scapegoat-again?source=feed#comment-736595 736595
just to add:

feldstein in today's FT: www.ft.com/cms/s/0/fd4...

krugman in last weeks nyt: www.nytimes.com/2009/1...]]> Fri, 30 Oct 2009 01:10:59 -0400
just to add:

feldstein in today's FT: www.ft.com/cms/s/0/fd4...

krugman in last weeks nyt: www.nytimes.com/2009/1...]]> http://seekingalpha.com/article/168748-china-as-scapegoat-again?source=feed#comment-735726 735726
The only vice in economics is disequilibrium and the only virtue is equilibrium. the more disequilibrium, the bigger the problem. chinese consumption as a % of GDP hit 30% with the recent gov't stimulus program...that is an all-time low for any country at any point in time. that is disequilibrium at an extreme...get your gaussian model out and assign a x-sigma to that event.

obviously, the US is at the opposite end of that balance. but to suggest that there is some sort of inherent benefit to infinite savings, falls in line with a socioeconomic heuristic that does little towards solving the current dilemma, and in fact, falls into the category of disinformation.]]> Thu, 29 Oct 2009 12:47:13 -0400
The only vice in economics is disequilibrium and the only virtue is equilibrium. the more disequilibrium, the bigger the problem. chinese consumption as a % of GDP hit 30% with the recent gov't stimulus program...that is an all-time low for any country at any point in time. that is disequilibrium at an extreme...get your gaussian model out and assign a x-sigma to that event.

obviously, the US is at the opposite end of that balance. but to suggest that there is some sort of inherent benefit to infinite savings, falls in line with a socioeconomic heuristic that does little towards solving the current dilemma, and in fact, falls into the category of disinformation.]]> http://seekingalpha.com/article/168748-china-as-scapegoat-again?source=feed#comment-734561 734561 Wed, 28 Oct 2009 17:46:56 -0400 http://seekingalpha.com/article/167425-bernanke-calls-for-balance-asia-could-care-less?source=feed#comment-725699 725699
That is circular logic.

Quoting Martin Feldstein:

"the currency in which oil is priced has no significant or
sustained effect on the price of oil when translated into dollars, euros, yen, or any other currency. The market is now in equilibrium with the price of oil at $80. That translates into $53 euros at the current exchange rate of around $1.50 per euro.

If it were agreed that oil would instead be priced in euros, the quoted market-equilibrating price would still be $53 euros and therefore $80. Any lower price in euros would cause excess global demand for oil, while a price above $53 euros would not create enough demand to absorb all of the oil that producers wanted to sell at that price."

The forex markets take care of the dollar delta. Markets buying or selling oil b/c of the forex market would be double counting, and would in fact turn into a reinforcing cycle that has no fundamental underpinning.
]]> Thu, 22 Oct 2009 15:33:39 -0400
That is circular logic.

Quoting Martin Feldstein:

"the currency in which oil is priced has no significant or
sustained effect on the price of oil when translated into dollars, euros, yen, or any other currency. The market is now in equilibrium with the price of oil at $80. That translates into $53 euros at the current exchange rate of around $1.50 per euro.

If it were agreed that oil would instead be priced in euros, the quoted market-equilibrating price would still be $53 euros and therefore $80. Any lower price in euros would cause excess global demand for oil, while a price above $53 euros would not create enough demand to absorb all of the oil that producers wanted to sell at that price."

The forex markets take care of the dollar delta. Markets buying or selling oil b/c of the forex market would be double counting, and would in fact turn into a reinforcing cycle that has no fundamental underpinning.
]]> http://seekingalpha.com/article/167425-bernanke-calls-for-balance-asia-could-care-less?source=feed#comment-722686 722686
so is it wrong to say that you think long-term low US interest rates and a falling dollar means that the current expectations about the intersection between supply and demand for commodities in the future should go higher?

AKA refineries in, say, 2011 in the UK will need to purchase more oil to sate diesel and gasoline demand, since the dollar has fallen and US interest rates are still low? help me out here, because i just don't see how the former has (ever had) anything to do with the latter.]]> Tue, 20 Oct 2009 18:29:00 -0400
so is it wrong to say that you think long-term low US interest rates and a falling dollar means that the current expectations about the intersection between supply and demand for commodities in the future should go higher?

AKA refineries in, say, 2011 in the UK will need to purchase more oil to sate diesel and gasoline demand, since the dollar has fallen and US interest rates are still low? help me out here, because i just don't see how the former has (ever had) anything to do with the latter.]]> http://seekingalpha.com/article/167425-bernanke-calls-for-balance-asia-could-care-less?source=feed#comment-722338 722338
are you talking about the prompt or the future? Maybe you're talking about intrinsic value...or maybe you are confused because commodities don't produce future cash flows?]]> Tue, 20 Oct 2009 13:33:16 -0400
are you talking about the prompt or the future? Maybe you're talking about intrinsic value...or maybe you are confused because commodities don't produce future cash flows?]]> http://seekingalpha.com/article/161524-united-states-natural-gas-fund-back-in-business?source=feed#comment-678046 678046
yikes
]]> Tue, 15 Sep 2009 15:38:54 -0400
yikes
]]> http://seekingalpha.com/article/160947-plenty-of-natural-gas-exploration-and-production-companies-keep-increasing-oversupply?source=feed#comment-672319 672319
just to expand on the EOG comment, stephen schork today:

"several Northeast pipelines started issuing operational flow orders (OFOs) in an apparent attempt to limit shippers exceeding their contractual limits...In addition to the Labor Day holiday, last week’s report also comprised the ratchet clause rollover. Injection ratchet clauses in the East require shippers to inject working gas through scheduled stages in order to preserve operational integrity. By September 01st no more than 80% of storage can be filled....According to the latest estimate from the EIA, maximum storage capacity in the East is 2.178 Tcf. As of two reports ago, week ended August 28th, estimated storage was 1.78 Tcf. That calculation was already 81½% of capacity or 1½ points above the ratchet. In other words, storage in the East over the last two reports was at operational capacity. Thus, the OFOs were a likely means to hold storage below the 80% threshold...What’s so bullish about that? Absolutely nothing."


here's the rest of schorks note: www.cnbc.com/id/327973...
]]> Fri, 11 Sep 2009 11:56:25 -0400
just to expand on the EOG comment, stephen schork today:

"several Northeast pipelines started issuing operational flow orders (OFOs) in an apparent attempt to limit shippers exceeding their contractual limits...In addition to the Labor Day holiday, last week’s report also comprised the ratchet clause rollover. Injection ratchet clauses in the East require shippers to inject working gas through scheduled stages in order to preserve operational integrity. By September 01st no more than 80% of storage can be filled....According to the latest estimate from the EIA, maximum storage capacity in the East is 2.178 Tcf. As of two reports ago, week ended August 28th, estimated storage was 1.78 Tcf. That calculation was already 81½% of capacity or 1½ points above the ratchet. In other words, storage in the East over the last two reports was at operational capacity. Thus, the OFOs were a likely means to hold storage below the 80% threshold...What’s so bullish about that? Absolutely nothing."


here's the rest of schorks note: www.cnbc.com/id/327973...
]]> http://seekingalpha.com/article/160860-index-funds-don-t-drive-oil-prices?source=feed#comment-670737 670737
read Chris Cook...he actually links the physical markets to the paper markets and shows how easy it is to manipulate the physical.

"The ABCs of Oil Manipulation"
seekingalpha.com/artic...

]]> Thu, 10 Sep 2009 14:43:04 -0400
read Chris Cook...he actually links the physical markets to the paper markets and shows how easy it is to manipulate the physical.

"The ABCs of Oil Manipulation"
seekingalpha.com/artic...

]]> http://seekingalpha.com/article/160539-boone-pickens-puts-his-money-where-his-mouth-is-on-energy?source=feed#comment-669114 669114 Wed, 09 Sep 2009 13:54:35 -0400 http://seekingalpha.com/article/160460-oil-refiners-as-proxy-for-demand?source=feed#comment-667124 667124 Tue, 08 Sep 2009 16:21:26 -0400 http://seekingalpha.com/article/157822-t-boone-pickens-hedge-fund-concentrates-on-energy-drops-basic-materials?source=feed#comment-652640 652640
whats that, you say...-95%?

amazing that warren buffett gets routinely thrown under the bus for his financials yet t boone pickens is praised as if he's some sort of luminary when it comes to investing in anything. way to go on that -95% return, t boone. oh yeah...and well done on prop 10.]]> Sat, 29 Aug 2009 15:57:04 -0400
whats that, you say...-95%?

amazing that warren buffett gets routinely thrown under the bus for his financials yet t boone pickens is praised as if he's some sort of luminary when it comes to investing in anything. way to go on that -95% return, t boone. oh yeah...and well done on prop 10.]]> http://seekingalpha.com/article/158054-not-bullish-on-natural-gas-just-yet?source=feed#comment-646642 646642
i think the "blow-out" spread of natgas/crude is indicative of the rampant paper demand inherent to commodity markets in the current environment...similar to credit spreads last year, these "dislocations" are almost always caused by out of control money flows rather than physical fundamentals.]]> Wed, 26 Aug 2009 01:34:18 -0400
i think the "blow-out" spread of natgas/crude is indicative of the rampant paper demand inherent to commodity markets in the current environment...similar to credit spreads last year, these "dislocations" are almost always caused by out of control money flows rather than physical fundamentals.]]> http://seekingalpha.com/article/156999-natural-gas-could-this-be-the-first-bullish-chart?source=feed#comment-637042 637042
in all of his savviness did he bother to mention that ung is trading at a 15% premium to NAV?

That's in addition to the fact that ung owners are already are paying a negative roll yield (fyi...12 month nat futures spread is almost a 1 bagger...finance.yahoo.com/q/fc...).

ung is a mess - it almost reminds me of that guy at the end of robocop 1 that crawls out of the cesspool only to be made instant road kill by that speeding paddy wagon.

see more here: ftalphaville.ft.com/bl.../]]> Wed, 19 Aug 2009 15:50:50 -0400
in all of his savviness did he bother to mention that ung is trading at a 15% premium to NAV?

That's in addition to the fact that ung owners are already are paying a negative roll yield (fyi...12 month nat futures spread is almost a 1 bagger...finance.yahoo.com/q/fc...).

ung is a mess - it almost reminds me of that guy at the end of robocop 1 that crawls out of the cesspool only to be made instant road kill by that speeding paddy wagon.

see more here: ftalphaville.ft.com/bl.../]]> http://seekingalpha.com/article/156950-asset-class-review-crude-gold-and-the-dollar?source=feed#comment-637028 637028
furthermore, "crude oil" is not an asset class. even goldman sachs knows not to refer to it as such. crude oil is a commodity - which in my opinion is as a much an "asset class" as insulin. but that's another debate.]]> Wed, 19 Aug 2009 15:40:23 -0400
furthermore, "crude oil" is not an asset class. even goldman sachs knows not to refer to it as such. crude oil is a commodity - which in my opinion is as a much an "asset class" as insulin. but that's another debate.]]> http://seekingalpha.com/article/156565-speculators-keep-the-market-liquid?source=feed#comment-633460 633460
yet, if a speculator is there to buy and keep the commodity from falling in price (i.e. stuff onto a ship and float it off the GOM), have the true fundamentals of supply and demand been born out?

this "liquidity at any and all cost" mentality is nuts.

]]> Mon, 17 Aug 2009 14:31:38 -0400
yet, if a speculator is there to buy and keep the commodity from falling in price (i.e. stuff onto a ship and float it off the GOM), have the true fundamentals of supply and demand been born out?

this "liquidity at any and all cost" mentality is nuts.

]]> http://seekingalpha.com/article/154950-congressional-commodity-market-manipulation-rule-is-a-monument-to-cluelessness?source=feed#comment-623704 623704
according to your bio, you have "consulted widely" yet your experience appears to go no further than academia...leading to my question: are you in any way shape or form given remuneration by exchanges and/or parties that benefit from your seemingly one-sided views?

after all, you're no thought-leader...but maybe you can make a buck acting like one? What say you?]]> Mon, 10 Aug 2009 14:53:40 -0400
according to your bio, you have "consulted widely" yet your experience appears to go no further than academia...leading to my question: are you in any way shape or form given remuneration by exchanges and/or parties that benefit from your seemingly one-sided views?

after all, you're no thought-leader...but maybe you can make a buck acting like one? What say you?]]> http://seekingalpha.com/article/143230-don-t-believe-this-rally-in-oil?source=feed#comment-547374 547374 Mon, 15 Jun 2009 12:54:19 -0400 http://seekingalpha.com/article/143230-don-t-believe-this-rally-in-oil?source=feed#comment-547371 547371
re: the SPR...a lot of people minimize the effects that its purchases have on prices...price elasticity of demand for oil is obscenely low (aka its really inelastic) so SPR actions have much bigger effects than casual glances would deduce. Stack China's recent SPR filling and the floating storage and there is a huge impetus for an unsustainable run.

We'll look at the US SPR purchases since 16 2009 was when EIA reported the SPR started purchases again (first time since week of Aug 8th 2008). If you plot the band where SPR purchases were heaviest and then compare to WTI prices...2/27/09 thru 5/22, you will see the SPR filled at a 1.3m bbls per week rate (average)...or roughly 20k per day. According to phil verleger's study (see here: www.iie.com/publicatio...) he concluded that the elasticity of WTI is as follows: "a one-percent reduction in the light sweet crude supply would require a price increase of between 25 and 40 percent to balance the market." (as usual, there are numerous assumptions, so i will no go over them here, please read the study). Given that the DOE may
be taking between 0.1 and 0.5 percent of the light sweet crude from the market on a daily basis (over the period cited above)...this means 15-20% of the runup can be directly attributed to SPR purchases... then combine floating storage demand which has grown at a multiple of the SPR storage (150m bbls over past 6-9 months vs. 20m bbls in SPR over past 3 months...so, the SPRs run rate would be 1/2 to 1/3 the private run-rate) plus Chinese storage (i have no clue how much they have stock-piled, but its probably not any smaller than the US' purchases), pile on delta hedging and we get a better picture of how we doubled in 100 days. These drivers are clearly transient and do not (in my opinion) represent any sort of sustainable behavior (the SPR just halted purchases last week, in fact).

(no positions nor should this be construed as a recommendation to take any positions)]]> Mon, 15 Jun 2009 12:53:20 -0400
re: the SPR...a lot of people minimize the effects that its purchases have on prices...price elasticity of demand for oil is obscenely low (aka its really inelastic) so SPR actions have much bigger effects than casual glances would deduce. Stack China's recent SPR filling and the floating storage and there is a huge impetus for an unsustainable run.

We'll look at the US SPR purchases since 16 2009 was when EIA reported the SPR started purchases again (first time since week of Aug 8th 2008). If you plot the band where SPR purchases were heaviest and then compare to WTI prices...2/27/09 thru 5/22, you will see the SPR filled at a 1.3m bbls per week rate (average)...or roughly 20k per day. According to phil verleger's study (see here: www.iie.com/publicatio...) he concluded that the elasticity of WTI is as follows: "a one-percent reduction in the light sweet crude supply would require a price increase of between 25 and 40 percent to balance the market." (as usual, there are numerous assumptions, so i will no go over them here, please read the study). Given that the DOE may
be taking between 0.1 and 0.5 percent of the light sweet crude from the market on a daily basis (over the period cited above)...this means 15-20% of the runup can be directly attributed to SPR purchases... then combine floating storage demand which has grown at a multiple of the SPR storage (150m bbls over past 6-9 months vs. 20m bbls in SPR over past 3 months...so, the SPRs run rate would be 1/2 to 1/3 the private run-rate) plus Chinese storage (i have no clue how much they have stock-piled, but its probably not any smaller than the US' purchases), pile on delta hedging and we get a better picture of how we doubled in 100 days. These drivers are clearly transient and do not (in my opinion) represent any sort of sustainable behavior (the SPR just halted purchases last week, in fact).

(no positions nor should this be construed as a recommendation to take any positions)]]> http://seekingalpha.com/article/142162-rising-commodities-mean-no-deflation?source=feed#comment-538824 538824
Dave Rosenberg, via FTA:

"right now two out of every three companies are shedding labour. Average weekly earnings — the wage-based proxy for personal income — has slowed to a mere 1.2% YoY...They actually fell 0.2% MoM in May and over the last three months, have deflated in rare fashion at a 0.7% annual rate.

This is the critical deflation that the bond bears do not see — not yet anyway — but the Fed surely knows this and the view being expressed in the futures market that we will see three rate hikes in the next year seems to be out of touch with this wage contraction reality."

I don't buy the inflation canard for a second.

And the fed? Their actions pale in comparison to the amount of credit that has been destroyed -- see here: 3.bp.blogspot.com/_KqO...

here's the FTA link: ftalphaville.ft.com/bl.../
]]> Tue, 09 Jun 2009 11:42:37 -0400
Dave Rosenberg, via FTA:

"right now two out of every three companies are shedding labour. Average weekly earnings — the wage-based proxy for personal income — has slowed to a mere 1.2% YoY...They actually fell 0.2% MoM in May and over the last three months, have deflated in rare fashion at a 0.7% annual rate.

This is the critical deflation that the bond bears do not see — not yet anyway — but the Fed surely knows this and the view being expressed in the futures market that we will see three rate hikes in the next year seems to be out of touch with this wage contraction reality."

I don't buy the inflation canard for a second.

And the fed? Their actions pale in comparison to the amount of credit that has been destroyed -- see here: 3.bp.blogspot.com/_KqO...

here's the FTA link: ftalphaville.ft.com/bl.../
]]> http://seekingalpha.com/article/141610-best-investments-for-rising-oil?source=feed#comment-536444 536444
seriously, though, how many 10-k's has anyone read where currency risk was hedged away by buying commodities? ]]> Sun, 07 Jun 2009 21:32:13 -0400
seriously, though, how many 10-k's has anyone read where currency risk was hedged away by buying commodities? ]]> http://seekingalpha.com/article/141610-best-investments-for-rising-oil?source=feed#comment-536437 536437
"Oil being priced in dollars is not comparable to your house (assuming you live in the US). When Saudi Arabia sells a barrel of oil in dollars what are their costs in?"

Look...the currency markets are seperate from the commodities markets, fundamentally speaking.

There is no fundamental reason for the commodity/currency trade other than speculators think it is a better store of value than the dollar (or whatever currency happens to tickle everyone's fancy).

The dollar movement has nothing to do with fundamental supply and/or demand for the commodity, any more than it does any other asset on the planet.

The dollar can go all over the place, but commodity prices are ultimately a function of supply/demand, not currencies, despite their obvious correlations. Somebody must buy or sell the actual commodity to set the prices...the prices just aren't "adjusted" by a market maker.

Again, the dollar/commodity trade Its merely a speculative store of value. It is not an axiomatic price-setting mechanism like supply and demand, and therefore buying/selling commodities becuase of currency movements is more noise than signal. And if it goes on long enough, you start to get large dislocations.]]> Sun, 07 Jun 2009 21:25:12 -0400
"Oil being priced in dollars is not comparable to your house (assuming you live in the US). When Saudi Arabia sells a barrel of oil in dollars what are their costs in?"

Look...the currency markets are seperate from the commodities markets, fundamentally speaking.

There is no fundamental reason for the commodity/currency trade other than speculators think it is a better store of value than the dollar (or whatever currency happens to tickle everyone's fancy).

The dollar movement has nothing to do with fundamental supply and/or demand for the commodity, any more than it does any other asset on the planet.

The dollar can go all over the place, but commodity prices are ultimately a function of supply/demand, not currencies, despite their obvious correlations. Somebody must buy or sell the actual commodity to set the prices...the prices just aren't "adjusted" by a market maker.

Again, the dollar/commodity trade Its merely a speculative store of value. It is not an axiomatic price-setting mechanism like supply and demand, and therefore buying/selling commodities becuase of currency movements is more noise than signal. And if it goes on long enough, you start to get large dislocations.]]> http://seekingalpha.com/article/141610-best-investments-for-rising-oil?source=feed#comment-534884 534884
"Almost every investor is aware that oil supply is getting harder to find, while oil demand from growing economies is rising."

Well, if you are a contrarian, this is a red alarm. "Almost every investor..." is like saying "everybody knows land is finite and population is growing, so housing prices are going up forever." In addition, the author didn't really offer any evidence/data to support his statements, much less for anybody to refute, but I guess just assuming he is right is good enough? That's how you lose money, in my opinion.

"Furthermore, underinvestment in oil industry infrastructure leaves open the door for an energy shock if a global economic recovery"

Again, this guy is bringing nothing to the table...no statistics, just a headline that you can read on most any newspaper or blog...in other words, every capital market on the planet has priced this in. Nobody should risk capital (short or long) based on these platitudes alone.

"Barrels are priced in dollars, so as the value of dollars fall, the price per barrel will rise."

I understand this correlation is undeniable. But the causation is flat out erroneous. Look for this correlation at any time during the 90's...it didn't exist, and for good reason. Pricing oil higher because the dollar fell is double counting. The currency markets, prima fascia, are responsible for repricing all things on a relative basis. For instance...my house is priced in dollars, so ceterus paribus, my house is worth more because of the dollar fell? You never hear Shiller or CR talk about the dollar being a tailwind for houses. It's fundamentally no different for oil and investors are asking to get burned by assuming this is a sound fundamental reason for risking capital.

"Remember that the next time some part-timer tries to sound wise by pointing out that the leveraged ETFs are calculated on a daily basis -- as if you didn't know that by now, and as if it means they can't work for periods beyond a single day."

This author could've offered some valuable insight, but instead decided to drop ad hominems. So i will attempt to add some insight to leveraged ETFs...Going long a leveraged fund is being effectively short volatility. As volatility falls, you should do OK. But as volatility rises, your returns will indeed erode. So for example, when the VIX hit 90, people lost money hand over fist, no matter which side of the leveraged bet they were are on. In the world where VIX is 20-30, they should probably do OK. But again, doing the leveraged thing is taking on unecessary risk because it adds the fate of the VIX into your total return.



]]> Sat, 06 Jun 2009 12:04:31 -0400
"Almost every investor is aware that oil supply is getting harder to find, while oil demand from growing economies is rising."

Well, if you are a contrarian, this is a red alarm. "Almost every investor..." is like saying "everybody knows land is finite and population is growing, so housing prices are going up forever." In addition, the author didn't really offer any evidence/data to support his statements, much less for anybody to refute, but I guess just assuming he is right is good enough? That's how you lose money, in my opinion.

"Furthermore, underinvestment in oil industry infrastructure leaves open the door for an energy shock if a global economic recovery"

Again, this guy is bringing nothing to the table...no statistics, just a headline that you can read on most any newspaper or blog...in other words, every capital market on the planet has priced this in. Nobody should risk capital (short or long) based on these platitudes alone.

"Barrels are priced in dollars, so as the value of dollars fall, the price per barrel will rise."

I understand this correlation is undeniable. But the causation is flat out erroneous. Look for this correlation at any time during the 90's...it didn't exist, and for good reason. Pricing oil higher because the dollar fell is double counting. The currency markets, prima fascia, are responsible for repricing all things on a relative basis. For instance...my house is priced in dollars, so ceterus paribus, my house is worth more because of the dollar fell? You never hear Shiller or CR talk about the dollar being a tailwind for houses. It's fundamentally no different for oil and investors are asking to get burned by assuming this is a sound fundamental reason for risking capital.

"Remember that the next time some part-timer tries to sound wise by pointing out that the leveraged ETFs are calculated on a daily basis -- as if you didn't know that by now, and as if it means they can't work for periods beyond a single day."

This author could've offered some valuable insight, but instead decided to drop ad hominems. So i will attempt to add some insight to leveraged ETFs...Going long a leveraged fund is being effectively short volatility. As volatility falls, you should do OK. But as volatility rises, your returns will indeed erode. So for example, when the VIX hit 90, people lost money hand over fist, no matter which side of the leveraged bet they were are on. In the world where VIX is 20-30, they should probably do OK. But again, doing the leveraged thing is taking on unecessary risk because it adds the fate of the VIX into your total return.



]]> http://seekingalpha.com/article/140227-gas-oil-ratio-flashing-an-extreme?source=feed#comment-522910 522910
“...the coal displacement story now seems less likely to further unfold given bearish power demand data and coal inventory data. Specifically, last week the EIA reported that March coal inventories held by utilities totaled ~175 million tons, up 12.4 million tons mo/mo (7.6%) and 28.2 million tons (19.2%) yr/yr. This represents the highest level in 26 years and also represents 75 days of supply, the highest in over 17 years. With EEI data showing power demand down 3.2% YTD versus 2008, utilities have built inventories rapidly and are therefore more likely to burn through coal stockpiles than to look to buy significant amounts of spot gas."

Nat gas just can't catch a break]]> Fri, 29 May 2009 11:19:34 -0400
“...the coal displacement story now seems less likely to further unfold given bearish power demand data and coal inventory data. Specifically, last week the EIA reported that March coal inventories held by utilities totaled ~175 million tons, up 12.4 million tons mo/mo (7.6%) and 28.2 million tons (19.2%) yr/yr. This represents the highest level in 26 years and also represents 75 days of supply, the highest in over 17 years. With EEI data showing power demand down 3.2% YTD versus 2008, utilities have built inventories rapidly and are therefore more likely to burn through coal stockpiles than to look to buy significant amounts of spot gas."

Nat gas just can't catch a break]]> http://seekingalpha.com/article/140183-is-oil-going-the-wrong-way-or-do-we-need-to-adjust-our-perceptions?source=feed#comment-521535 521535 Thu, 28 May 2009 13:10:52 -0400 http://seekingalpha.com/article/138839-the-great-driving-reduction-consumers-spend-less-on-gas-with-no-new-legislation?source=feed#comment-513505 513505
In my opinion, that memory will be hard to erase and as a result, demand has permanently shifted.]]> Thu, 21 May 2009 17:02:38 -0400
In my opinion, that memory will be hard to erase and as a result, demand has permanently shifted.]]> http://seekingalpha.com/article/138854-staley-cates-on-chesapeake-ceo-compensation?source=feed#comment-513491 513491 Thu, 21 May 2009 16:52:20 -0400 http://seekingalpha.com/article/138726-cap-and-trade-more-like-cap-and-tax?source=feed#comment-512875 512875 excessive government spending and taxation?"

and

"How about Capping the gas coming out of Politicians?"

i like those euphemisms better. props.]]> Thu, 21 May 2009 11:04:35 -0400 excessive government spending and taxation?"

and

"How about Capping the gas coming out of Politicians?"

i like those euphemisms better. props.]]> http://seekingalpha.com/article/138726-cap-and-trade-more-like-cap-and-tax?source=feed#comment-511368 511368
no need for trading...it just increases the costs and potential distortions.

David Sokol wrote about this yesterday.

www.washingtonpost.com...
]]> Wed, 20 May 2009 11:36:34 -0400
no need for trading...it just increases the costs and potential distortions.

David Sokol wrote about this yesterday.

www.washingtonpost.com...
]]> http://seekingalpha.com/article/138311-fundamentals-don-t-support-oil-at-55-60-a-barrel?source=feed#comment-510679 510679
www.nber.org/feldstein...


I'll even use a simple example...i denominate the value of my shoes in dollars. Now when the dollar falls in value, that means that my shoes go up in price? No.

A commodity, such as oil, is an object with no future cash flows...so you can substitute most anything in that example (hats, ipods, underwear, you name it).

the dollar/oil meme needs to die. notice that the $/oil correlation was nonexistent during the 90's and prior to exempt commercial markets, which today trade huge chunks of daily volume. that's not a coincidence.

]]> Tue, 19 May 2009 23:47:16 -0400
www.nber.org/feldstein...


I'll even use a simple example...i denominate the value of my shoes in dollars. Now when the dollar falls in value, that means that my shoes go up in price? No.

A commodity, such as oil, is an object with no future cash flows...so you can substitute most anything in that example (hats, ipods, underwear, you name it).

the dollar/oil meme needs to die. notice that the $/oil correlation was nonexistent during the 90's and prior to exempt commercial markets, which today trade huge chunks of daily volume. that's not a coincidence.

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