investmentwatchblog--2020-05-01--UK Money Supply surges as Unsecured Credit Collapses

Today brings the UK monetary situation into focus and to say it is fast moving is an understatement .
Let me illustrate in terms of QE or Quantitative Easing where the current rate of purchases is £13.5 billion a week and the total by my maths is now £507 billion .
This means we have seen an extra £72 billion in this Covid-19 pandemic phase .
Looking at it from a money supply point of view means that in theory an extra £72 billion has been added .
We have seen before that in practice QE does not always flow @ @ @ @ @ @ @ theory tells us but I also note that the ECB figures we looked at earlier this week were responding to its QE actions .
Next comes the other programmes where again the heat is on .
The Covid Corporate Financing Facility has bought some £15.9 billion of Commercial Paper and in return supplied liquidity .
Next comes the Corporate Bond programme which has bought around £2 billion so far .
They do not provide much detail on the Corporate Bond purchases to avoid me pointing out that for example they are buying Apple @ @ @ @ @ @ @ is the new version of the Term Funding Scheme supplying liquidity to banks at 0.1 % and it claims to have supported £8.2 billion of new loans .
So we awash with liquidity if not actual cash .
Now let us look at the impact until the end of March as we look at this morning ’ s data .
I think we can say we see an impact here !
The emphasis is mine .
Or as DJ Jazzy Jeff and the Fresh Prince would say .
If we switch to the @ @ @ @ @ @ @ rise in March was as much as not so long ago we were seeing in a year .
The annual growth rate of 7.4 % is the highest we have seen for some time and next month we will break the numbers posted by the Sledgehammer QE effect in the autumn of 2016 and the spring of 2017 .
Actually I think we will break the all-time record for M4 anyway ( yes for my sins I still recall the £M3 days ) but that is for another day .
There are some @ @ @ @ @ @ @ would be too much for the morning espresso of Governor Carney and would have him summoning a flunkey from the Bank of England bar to fetch him his favourite Martini as he would be both shaken and stirred , The first Governor of the Bank of England to preside over negative annual credit card growth .
I guess he and the new Governor Andrew Bailey will be playing a game of pass the parcel with that one !
This is a similar effect to what we saw in the credit crunch with households @ @ @ @ @ @ @ with this time around settling your credit card in the van .
Indeed the net figures may not do the gross data full justice .
This is something of a bugbear of mine as back in the summer of 2012 we were promised the the Funding for Lending Scheme would boost it , especially for smaller businesses .
How is that going ?
Looking at the numbers for smaller businesses we are seeing two failures here .
First the initial failure to get cash to them and second the conceptual failure over the @ @ @ @ @ @ @ help them have recorded very little growth at best and sometimes none at all .
In fact the situation has been so bad that the word counterfactual has been deployed which has two effects .
For those that do not understand what it means it sounds impressive whilst leaving those that do mulling how giving £107 billion to the banks in the TFS had so little effect .
Almost as if it was designed to do that .
Of course it is much easier to lend to larger businesses .
That bit is @ @ @ @ @ @ @ , not need it ?
We open with a bit of all our yesterdays .
Then we get a bit more with the current reality .
Looking ahead with Gilt yields here we are likely to see more people look at a remortgage as my indicator for fixed-rate mortgage trends the five-year Gilt yield is a mere 0.1 % .
Of course there is also the issue of the market essentially being frozen .
Let me remind you that the broad money numbers are supposed to be a predictor of nominal GDP growth @ @ @ @ @ @ @ ahead .
So if we say we will be lucky to be back to where we were at the start of 2020 in two years time we would expect inflation of the order of 7 % or so .
Care is needed because the impulse these days is often seen in asset markets and is in my opinion a driver behind the stock market rally we have seen .
That factor is why I argue to put house prices in consumer inflation measures in spite of the fact that for them “ down @ @ @ @ @ @ @ more likely than Yazz ’ s “ The only way is up ” for this year .
Although some seem to have spotted an alternative universe .
Now let me look at another alternative universe or if this was a Riddick film the Underverse .
You may need reminding that the official Bank of England Bank Rate is 0.1 % as you read the numbers below .
Also the debacle at the Financial Conduct Authority which saw many overdraft rates double to around 40 % is slowly being picked up in the data @ @ @ @ @ @ @ must be torturing the series to keep the rate as low as 24 % and please Governor Bailey who of course presided over the FCA at the time .

by Shaun Richards
Today brings the UK monetary situation into focus and to say it is fast moving is an understatement. Let me illustrate in terms of QE or Quantitative Easing where the current rate of purchases is £13.5 billion a week and the total by my maths is now £507 billion. This means we have seen an extra £72 billion in this Covid-19 pandemic phase. Looking at it from a money supply point of view means that in theory an extra £72 billion has been added. We have seen before that in practice QE does not always flow into the money supply data as the theory tells us but I also note that the ECB figures we looked at earlier this week were responding to its QE actions.
Next comes the other programmes where again the heat is on. The Covid Corporate Financing Facility has bought some £15.9 billion of Commercial Paper and in return supplied liquidity. Next comes the Corporate Bond programme which has bought around £2 billion so far. They do not provide much detail on the Corporate Bond purchases to avoid me pointing out that for example they are buying Apple and Maersk. Last on the list is the new version of the Term Funding Scheme supplying liquidity to banks at 0.1% and it claims to have supported £8.2 billion of new loans.
So we awash with liquidity if not actual cash. Now let us look at the impact until the end of March as we look at this morning’s data.
Money Supply
I think we can say we see an impact here! The emphasis is mine.
The amount of money deposited with, and borrowed from, banks and building societies by private sector companies and households overall rose very strongly in March. Sterling money holdings by households, non-financial businesses (PNFCs) and non-intermediating financial companies (NIOFCs), known as M4ex, rose by £57.4 billion in March, a series high and far above its previous six-month average of £9.0 billion. Sterling borrowing from banks (M4Lex) rose by £55.3 billion, also a series high and up from its previous six-month average of £5.1 billion.
Or as DJ Jazzy Jeff and the Fresh Prince would say.
Boom! shake-shake-shake the room
Boom! shake-shake-shake the room
Boom! shake-shake-shake the room
Tic-tic-tic-tic Boom!
Well yo are why’all ready for me yet
(pump it up prince)
Or more prosaically,
The strength in money was broad based across sectors, with the largest increases since these series began for households (first published in 1963), PNFCs (1963) and NIOFCs (1998). ( non-financial businesses (PNFCs) and non-intermediating financial companies (NIOFCs))
If we switch to the money supply implications then the 2.4% rise in March was as much as not so long ago we were seeing in a year. The annual growth rate of 7.4% is the highest we have seen for some time and next month we will break the numbers posted by the Sledgehammer QE effect in the autumn of 2016 and the spring of 2017. Actually I think we will break the all-time record for M4 anyway ( yes for my sins I still recall the £M3 days) but that is for another day.
Consumer Credit
There are some numbers here which in the previous regime would be too much for the morning espresso of Governor Carney and would have him summoning a flunkey from the Bank of England bar to fetch him his favourite Martini as he would be both shaken and stirred,
The weak net flows of consumer credit meant that the annual growth rate fell to 3.7% in March, lowest since June 2013. Within this, the annual growth rate of credit card lending fell to -0.3%, the first negative annual growth since the series began. The annual growth rate of other loans and advances fell to 5.6%.
The first Governor of the Bank of England to preside over negative annual credit card growth. I guess he and the new Governor Andrew Bailey will be playing a game of pass the parcel with that one!
This is a similar effect to what we saw in the credit crunch with households battening down the hatches by repaying credit with this time around settling your credit card in the van.
Households repaid £3.8 billion of consumer credit, on net, in March, the largest net repayment since the series began . Within this, credit cards accounted for £2.4 billion of net repayments and other loans and advances accounted for £1.5 billion.
Indeed the net figures may not do the gross data full justice.
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This very weak net lending reflected a larger fall in new borrowing that was partially offset by slightly lower repayments. Gross lending was £5.4 billion weaker than February, while repayments were £1.3 billion lower.
Business Lending
This is something of a bugbear of mine as back in the summer of 2012 we were promised the the Funding for Lending Scheme would boost it, especially for smaller businesses. How is that going?
Within this, the growth rate of borrowing by large businesses increased sharply, to 11.8%, and growth by SMEs rose to 1.2%, from 0.9% in February.
Looking at the numbers for smaller businesses we are seeing two failures here. First the initial failure to get cash to them and second the conceptual failure over the past 8 years as the schemes to help them have recorded very little growth at best and sometimes none at all. In fact the situation has been so bad that the word counterfactual has been deployed which has two effects. For those that do not understand what it means it sounds impressive whilst leaving those that do mulling how giving £107 billion to the banks in the TFS had so little effect. Almost as if it was designed to do that.
Of course it is much easier to lend to larger businesses.
UK businesses’ deposits rose by £34.0 billion in March. Changes in deposits and loans were closely correlated across industries.
That bit is awkward. Did those that got it, not need it?
Mortgages
We open with a bit of all our yesterdays.
Mortgage borrowing picked up a little in March, with a net increase of £4.8 billion. The annual growth rate also rose a little, to 3.6%. Mortgage borrowing tends to lag approvals, however, so this strength is likely to reflect strength in approvals in previous months.
Then we get a bit more with the current reality.
In the mortgage market, evidence of a decline in housing market activity started to become apparent in March mortgage approval statistics, which fell by just over 20% (Chart 4). This was a broad based fall across reasons for applying for a mortgage. Approvals for house purchase fell by 24% to 56,200, their lowest level since March 2013; and approvals for remortgage fell 20% to 42,600, the fewest since August 2016. ‘Other’ approvals, which includes for withdrawing equity, fell back 17%, to 12,000.
Looking ahead with Gilt yields here we are likely to see more people look at a remortgage as my indicator for fixed-rate mortgage trends the five-year Gilt yield is a mere 0.1%. Of course there is also the issue of the market essentially being frozen.
Comment
Let me remind you that the broad money numbers are supposed to be a predictor of nominal GDP growth ( economic output) around two years ahead. So if we say we will be lucky to be back to where we were at the start of 2020 in two years time we would expect inflation of the order of 7% or so. Care is needed because the impulse these days is often seen in asset markets and is in my opinion a driver behind the stock market rally we have seen. That factor is why I argue to put house prices in consumer inflation measures in spite of the fact that for them “down, down” by Status Quo is more likely than Yazz’s “The only way is up” for this year. Although some seem to have spotted an alternative universe.
Nationwide said on Friday its measure of house prices rose by 0.7% in April from March and was 3.7% higher than a year earlier, stronger than forecasts in a Reuters poll of economists in both cases. ( Reuters)
Really?
Now let me look at another alternative universe or if this was a Riddick film the Underverse. You may need reminding that the official Bank of England Bank Rate is 0.1% as you read the numbers below.
Effective rates on interest bearing credit cards fell 14 basis points to 18.4%, whilst effective rates on personal loans fell 7 basis points to 6.8%.
Also the debacle at the Financial Conduct Authority which saw many overdraft rates double to around 40% is slowly being picked up in the data. Someone at the Bank of England must be torturing the series to keep the rate as low as 24% and please Governor Bailey who of course presided over the FCA at the time.


investmentwatchblog--2020-05-01--Climate alarmist Bill McKibben pretends ignorance of his funding

I don ’ t know if this is strange or not , but saw it on a Reddit alternative .
@ @ @ @ @ Environmentalist is either .

I don’t know if this is strange or not, but saw it on a Reddit alternative. Not sure how popular this Environmentalist is either.
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h/t Orangutan


investmentwatchblog--2020-05-01--North Carolina has nearly 1 million inactive names on rolls. Pennsylvania: about 800,000. Heavy lift

The previous owners of my home both still have active voter registrations despite not having lived in the state for @ @ @ @ @ contacting the county BOE about the issue .
Guess what party has run the county @ @ @ @ @

North Carolina has nearly 1 million inactive names on rolls. Pennsylvania: about 800,000. Heavy lifting @JudicialWatch sued BOTH states in recent weeks to clean up their rolls. Dirty voter rolls can mean dirty elections! t.co/ULJ8ik6Ukj — Tom Fitton (@TomFitton) May 1, 2020
The previous owners of my home both still have active voter registrations despite not having lived in the state for 10+ years and me repeatedly contacting the county BOE about the issue.
Guess what party has run the county for all those years?
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AC


investmentwatchblog--2020-05-01--The FBI Is A Cesspit Of Corruption And Should Be Abolished.

Alternatively , such horrific examples could be made of the offenders here that the Bureau will be scared straight for @ @ @ @ @ think that ’ s even less likely than abolishing the Bureau .
ANOTHER UPDATE : @ @ @ @ @ lesson there ?
In this episode I address the astonishing new revelations in the FBI @ @ @ @ @ Flynn .
I also address the cowardice on the left , and their failure to @ @ @ @ @ civil liberties .

by GR
via Twitter:
Alternatively, such horrific examples could be made of the offenders here that the Bureau will be scared straight for a generation. But I think that’s even less likely than abolishing the Bureau.
UPDATE: Yep.
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Plus:
ANOTHER UPDATE: Maybe there’s a lesson there?
Dan Bongino: It’s Worse Than We Thought (Mueller Knew!)
In this episode I address the astonishing new revelations in the FBI targeting scandal of General Mike Flynn. I also address the cowardice on the left, and their failure to address this grotesque violation of civil liberties.


investmentwatchblog--2020-05-01--The hypocrisy is mindbogglingly!

The hypocrisy is mindbogglingly!

House Speaker Nancy Pelosi on Joe Biden : “ I have complete respect for the whole Me Too movement…there ’ @ @ @ @ @ is Joe Biden…There was never any record…I am so proud , the happiest day for @ @ @ @ @ support Joe Biden for president of the United States .
”

(26 Sep 2018) Led by House Minority Leader Nancy Pelosi, Democratic Representatives gathered to express their frustration at how GOP Senators are handling the questioning about allegations of sexual assault against Supreme Court nominee Brett Kavanaugh. (Sept. 26)
House Speaker Nancy Pelosi on Joe Biden: “I have complete respect for the whole Me Too movement…there’s also due process…Joe Biden is Joe Biden…There was never any record…I am so proud, the happiest day for me this week was to support Joe Biden for president of the United States.”
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AL


investmentwatchblog--2020-05-01--People need to be prosecuted and disbarred over this, as an example to others.

ROTTEN INDEED : Andrew McCarthy : Something seems rotten in Flynn ’ s case — and maybe others , too .
“ The closer one looks , the worse it gets .
We can say that narrowly about the Flynn prosecution , and more generally about the Mueller investigation.
” People need to be prosecuted and disbarred over this , as an example to others .
UPDATE : Related : “ It is just fascinating to watch the claim that Chris Wray and Dana Boente did everything they could to prevent the stuff from the Missouri U.S. attorney from being @ @ @ @ @ @ @ That is the beginning of a very ugly story.
” Plus : “ The bottom line is this , it ’ s unfolding and what ’ s happening is , what Durham is actually doing is he ’ s painting a picture and not everyone of these acts is going to be a specific separate crime .
But they are going to be , what ’ s called ‘ overt acts in a conspiracy.
’ One to defraud the United States government .
One to deny the civil rights of Trump and Flynn @ @ @ @ @ @ @ people .
”

ROTTEN INDEED: Andrew McCarthy: Something seems rotten in Flynn’s case — and maybe others, too. “The closer one looks, the worse it gets. We can say that narrowly about the Flynn prosecution, and more generally about the Mueller investigation.”
People need to be prosecuted and disbarred over this, as an example to others.
UPDATE: Related: “It is just fascinating to watch the claim that Chris Wray and Dana Boente did everything they could to prevent the stuff from the Missouri U.S. attorney from being given to Flynn’s attorney. That is the beginning of a very ugly story.”
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Plus: “The bottom line is this, it’s unfolding and what’s happening is, what Durham is actually doing is he’s painting a picture and not everyone of these acts is going to be a specific separate crime. But they are going to be, what’s called ‘overt acts in a conspiracy.’ One to defraud the United States government. One to deny the civil rights of Trump and Flynn and Page and a bunch of other people.”
h/t GR


investmentwatchblog--2020-05-01--Rent Is Due Today, But Millions Of Americans Won’t Be Paying

More than 30 million people have applied for unemployment as of April 30 , as a result of the coronavirus pandemic .
Many are falling behind on their rent and are being evicted , despite new rules designed to stop evictions .
Experts say the moratoriums by state and local officials don ’ t go far enough and are leaving tenants vulnerable .
“ My main concern is that I ’ ll be evicted , ” says David Perez .
The self-employed father of one sells artisanal wares , like wallets and sandals , at a flea market in Elkridge @ @ @ @ @ @ @ going to happen to my family ?
” Activists Refuse To Pay Rent As New York Struggles With The Coronavirus Outbreak Perez hasn ’ t had any income since the end of February because the flea market closed , and he says that he and his 14-year-old daughter are living off food donated from his church .
He has already lost his van because he couldn ’ t make his monthly payments .
Some people have gone all out with airbnb , buying lots of properties and counting on renters to make the @ @ @ @ @ @ @ a lot of people went overboard and will lose their shirts People who own Airbnb properties are filing bankruptcies at a record pace .

More than 30 million people have applied for unemployment as of April 30, as a result of the coronavirus pandemic. Many are falling behind on their rent and are being evicted, despite new rules designed to stop evictions. Experts say the moratoriums by state and local officials don’t go far enough and are leaving tenants vulnerable.
“My main concern is that I’ll be evicted,” says David Perez. The self-employed father of one sells artisanal wares, like wallets and sandals, at a flea market in Elkridge, Md. “What’s going to happen to my family?”
Activists Refuse To Pay Rent As New York Struggles With The Coronavirus Outbreak
Perez hasn’t had any income since the end of February because the flea market closed, and he says that he and his 14-year-old daughter are living off food donated from his church. He has already lost his van because he couldn’t make his monthly payments.
www.npr.org/2020/05/01/848247228/rent-is-due-today-but-millions-of-americans-wont-be-paying
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Some people have gone all out with airbnb, buying lots of properties and counting on renters to make the mortgage and service payments, sounds like a lot of people went overboard and will lose their shirts
www.foxbusiness.com/lifestyle/bill-comes-due-for-overextended-airbnb-hosts
People who own Airbnb properties are filing bankruptcies at a record pace.
AC


investmentwatchblog--2020-05-01--The Deep State is enormous. The press and Democrats covered up Obama’s impeachable offenses

The press and Democrats covered up Obama ’ s impeachable offenses and the weak GOP did nothing to push for @ @ @ @ @ is enormous .
1.Obama ’ s Iran nuke deal 2.Obama knew about Hillary ’ s @ @ @ @ @ targets conservatives 4.Obama ’ s DOJ spied on AP reporters 5.Obamacare & Obama ’ s @ @ @ @ @ executive order 7.Benghazi-gate 8.Operation Fast & Furious 9.5 Taliban leaders for Bergdahl 10.Extortion 17 11.
@ @ @ @ @ when Senate was in session 12.Appointment of ‘ czars ’ without Senate approval 13.Suing Arizona @ @ @ @ @ to defend Defense of Marriage Act 15.Illegally conducting war against Libya 16.NSA : Spying on @ @ @ @ @ Carey 19.Birth certificate 20.Executive orders 21.Solyndra and the lost $ 535 million 22.Egypt 23.Cap & @ @ @ @ @ , bypass Congress 24.Refusal to prosecute New Black Panthers 25.Obama ’ s U.S. citizen ‘ @ @ @

The press and Democrats covered up Obama’s impeachable offenses and the weak GOP did nothing to push for impeachment.
The Deep State is enormous.
1.Obama’s Iran nuke deal
2.Obama knew about Hillary’s private email server
3.Obama IRS targets conservatives
4.Obama’s DOJ spied on AP reporters
5.Obamacare & Obama’s false promises
6.Illegal-alien amnesty by executive order
7.Benghazi-gate
8.Operation Fast & Furious
9.5 Taliban leaders for Bergdahl
10.Extortion 17
11.‘Recess ‘ appointments – when Senate was in session
12.Appointment of ‘czars’ without Senate approval
13.Suing Arizona for enforcing federal law
14.Refusal to defend Defense of Marriage Act
15.Illegally conducting war against Libya
16.NSA: Spying on Americans
17.Muslim Brotherhood ties
18.Miriam Carey
19.Birth certificate
20.Executive orders
21.Solyndra and the lost $535 million
22.Egypt
23.Cap & Trade: When in doubt, bypass Congress
24.Refusal to prosecute New Black Panthers
25.Obama’s U.S. citizen ‘hit list’
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AC


investmentwatchblog--2020-05-01--Fed pumped $6.7 TRILLION…  Taxpayers have no way of knowing who is getting cash

Fed ’ s balance sheet at $ 6.7 trln , but growth pace down sharply April 30 ( Reuters ) – The Federal Reserve ’ s balance sheet increased to a record $ 6.70 trillion this week , but the pace of expansion slowed dramatically as key credit markets have calmed since a firestorm of volatility sparked by the coronavirus pandemic drove the central bank to take emergency measures last month .
The central bank ’ s balance sheet as of Wednesday was about $ 81.75 billion higher than the $ 6.62 trillion a week earlier , data released by @ @ @ @ @ @ @ was the smallest increase in seven weeks and was just a fraction of the record $ 586 billion weekly increase in late March .
In all the Fed ’ s stash of assets is up nearly 60 % from just $ 4.2 trillion in early March , when it slashed interest rates to zero , restarted bond purchases and rolled out an unprecedented range of programs to keep credit flowing and shore up business and household confidence as the outbreak forced a wave of stay-at-home orders across the country , torpedoing economic activity @

Fed’s balance sheet at $6.7 trln, but growth pace down sharply
April 30 (Reuters) – The Federal Reserve’s balance sheet increased to a record $6.70 trillion this week, but the pace of expansion slowed dramatically as key credit markets have calmed since a firestorm of volatility sparked by the coronavirus pandemic drove the central bank to take emergency measures last month.
The central bank’s balance sheet as of Wednesday was about $81.75 billion higher than the $6.62 trillion a week earlier, data released by the Fed on Thursday showed. It was the smallest increase in seven weeks and was just a fraction of the record $586 billion weekly increase in late March.
In all the Fed’s stash of assets is up nearly 60% from just $4.2 trillion in early March, when it slashed interest rates to zero, restarted bond purchases and rolled out an unprecedented range of programs to keep credit flowing and shore up business and household confidence as the outbreak forced a wave of stay-at-home orders across the country, torpedoing economic activity.


investmentwatchblog--2020-05-01--‘It’s 2024, and We’re Still Stuck at Home’…  What American life will look like after crisis ends

It ’ s 2024 , and We ’ re Still Stuck at Home ( Bloomberg Opinion ) — Around the world , people are itching to end lockdowns .
Road traffic is rising in the U.K. , while garden centers and hardware shops have reopened .
In a handful of U.S. states , hair stylists are back at work and restaurants and movie theaters have opened .
Germans are shopping again , although many remain wary of the risks .
That caution is well advised .
The example of China , as well as epidemiologic models attuned to the longer-term @ @ @ @ @ @ @ most nations are many months away from anything like normal , even with continued social distancing .
In the U.S. , realistic scenarios include the chance of a new winter epidemic , as well as sporadic outbreaks further on .
It is a little depressing , stuck at home , to read scientists estimating what may happen with the epidemic in 2021 , 2022 and even 2024 .
But there are good reasons to question the more optimistic forecasts for when it may be safe to end the lockdowns .
Models based on @ @ @ @ @ @ @ foresee huge uncertainties and risks ahead .
Among the optimistic projections are those from the Institute for Health Metrics and Evaluation , cited even by the White House .
These suggest safe dates for various U.S. states to begin reopening : May 28 for New York , for example , and June 27 for Georgia .
These are based on statistical curve-fitting to data and project when the level of infections may drop to one per 1 million people .
Graphs with reassuring downward sloping lines accompany the predictions .
Unfortunately , this @ @ @ @ @ @ @ because the basic model assumes that infection numbers will fall rapidly once reaching their peak .
This doesn ’ t come from the data .
The optimistic downward projection is an artifact of the mathematical framework used , which isn ’ t really designed for projection , as the researchers acknowledge .
There is a similar but improved statistical model that more accurately reflects the great uncertainties in these projections .
But it still just assumes a rapid decay in numbers following the peak , and the researchers behind it stress it shouldn @ @ @ @ @ @ @ two to three weeks .
Other models based on fitting data with actual simulations of disease dynamics aren ’ t so optimistic .
For example , one suggests that the rate of infections in Georgia may in fact double by early August following the state ’ s partial reopening and relaxation of distancing rules .

It’s 2024, and We’re Still Stuck at Home
(Bloomberg Opinion) — Around the world, people are itching to end lockdowns. Road traffic is rising in the U.K., while garden centers and hardware shops have reopened. In a handful of U.S. states, hair stylists are back at work and restaurants and movie theaters have opened. Germans are shopping again, although many remain wary of the risks.
That caution is well advised. The example of China, as well as epidemiologic models attuned to the longer-term aspects of the pandemic, suggests that most nations are many months away from anything like normal, even with continued social distancing. In the U.S., realistic scenarios include the chance of a new winter epidemic, as well as sporadic outbreaks further on.
It is a little depressing, stuck at home, to read scientists estimating what may happen with the epidemic in 2021, 2022 and even 2024. But there are good reasons to question the more optimistic forecasts for when it may be safe to end the lockdowns. Models based on simulations of the infection’s dynamics foresee huge uncertainties and risks ahead.
Among the optimistic projections are those from the Institute for Health Metrics and Evaluation, cited even by the White House. These suggest safe dates for various U.S. states to begin reopening: May 28 for New York, for example, and June 27 for Georgia. These are based on statistical curve-fitting to data and project when the level of infections may drop to one per 1 million people. Graphs with reassuring downward sloping lines accompany the predictions.
Unfortunately, this picture is almost certainly too optimistic, because the basic model assumes that infection numbers will fall rapidly once reaching their peak. This doesn’t come from the data. The optimistic downward projection is an artifact of the mathematical framework used, which isn’t really designed for projection, as the researchers acknowledge.
There is a similar but improved statistical model that more accurately reflects the great uncertainties in these projections. But it still just assumes a rapid decay in numbers following the peak, and the researchers behind it stress it shouldn’t be used to forecast beyond two to three weeks. Other models based on fitting data with actual simulations of disease dynamics aren’t so optimistic. For example, one suggests that the rate of infections in Georgia may in fact double by early August following the state’s partial reopening and relaxation of distancing rules.


investmentwatchblog--2020-05-01--Chicago is deep in the planning stages of mass vaccinations

Freedom Advocate Explains How To Say No If COVID-19 Vaccination Becomes Mandatory The first thing we must do is state our position clearly and on the record to those people who administer vaccines .
We are certainly not protected if we haven ’ t even stated our position .
You will see links to two free download documents at FreedomTaker.com .
The first document is a requirement that all medical service and vaccine providers sign for you , to acknowledge the risks of vaccines , that they are causing that risk by offering vaccines , and that they accept full @ @ @ @ @ @ @ they cause by administering a vaccine .
Of course , if vaccines were safe and effective , they would not hesitate to sign a liability agreement… [ but ] they know they are doing harm , so most likely , they will refuse to sign that document , and refuse to be responsible for the harm they cause .
That refusal to sign is evidence that they know that vaccines have risk , and you therefore are fully within your rights to refuse the vaccine regardless of any legal mandates .
That type @ @ @ @ @ @ @ ‘ Conditional Acceptance.
’ You agree to have a vaccine if they agree to pay for all damage you suffer .
They will refuse to sign it .
And that gives you the right to refuse their vaccine , because they failed to meet your reasonable requirements of safety .

Freedom Advocate Explains How To Say No If COVID-19 Vaccination Becomes Mandatory
The first thing we must do is state our position clearly and on the record to those people who administer vaccines. We are certainly not protected if we haven’t even stated our position. You will see links to two free download documents at FreedomTaker.com. The first document is a requirement that all medical service and vaccine providers sign for you, to acknowledge the risks of vaccines, that they are causing that risk by offering vaccines, and that they accept full personal liability to pay for all damage they cause by administering a vaccine.
Of course, if vaccines were safe and effective, they would not hesitate to sign a liability agreement… [but] they know they are doing harm, so most likely, they will refuse to sign that document, and refuse to be responsible for the harm they cause. That refusal to sign is evidence that they know that vaccines have risk, and you therefore are fully within your rights to refuse the vaccine regardless of any legal mandates. That type of document is referred to as a ‘Conditional Acceptance.’ You agree to have a vaccine if they agree to pay for all damage you suffer. They will refuse to sign it. And that gives you the right to refuse their vaccine, because they failed to meet your reasonable requirements of safety.
www.lewrockwell.com/2020/04/no_author/freedom-advocate-explains-how-to-say-no-if-covid-19-vaccination-becomes-mandatory/
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original:
www.collective-evolution.com/2020/04/28/freedom-advocate-explains-how-to-say-no-if-covid-19-vaccination-becomes-mandatory/
AC


investmentwatchblog--2020-05-01--China Ridicules the U.S. over COVID-19 – We Tried To Warn You, You Stupidly Ignored Us (Includes VIR

China Ridicules the U.S. over COVID-19 – We Tried To Warn You, You Stupidly Ignored Us (Includes VIRAL Video)

China : We discovered a new virus .
America : So what ?
“ A Chinese state media outlet has @ @ @ @ @ Lego pieces to mock the United States ’ coronavirus response and the Trump Administration ’ @ @ @ @ @ Chinese COVID-19 coverup.
” What a bunch of cunts .
These dirty bastards and the @ @ @ @ @ the world about human to human transmission and they shipped this shit all over the @ @ @ @ @ to kick some Chinese ass and we need to kick it soon .
Everyday that @ @ @ @ @ to these attacks is a day of shame for the world .
It is time @ @ @ @ @

China Xinhua News
Verified account
@XHNews
China: We discovered a new virus.
America: So what?
China: It’s Dangerous
America: It’s only a Flu
China: Wear a Mask
America: Don’t wear a Mask
…
China: We discovered a new virus.
America: So what? China: It's Dangerous
America: It's only a Flu China: Wear a Mask
America: Don't wear a Mask
… pic.twitter.com/Qxugv8z73J — China Xinhua News (@XHNews) April 30, 2020
“A Chinese state media outlet has released an animated video using Lego pieces to mock the United States’ coronavirus response and the Trump Administration’s claims of an initial Chinese COVID-19 coverup.”
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amp.abc.net.au/article/12204836
What a bunch of cunts. These dirty bastards and the WHO straight up lied to the world about human to human transmission and they shipped this shit all over the world intentionally.
We need to kick some Chinese ass and we need to kick it soon. Everyday that passes without an overwhelming response to these attacks is a day of shame for the world. It is time to decimate the CCP.
AC


investmentwatchblog--2020-05-01--VIDEO: “Convincing evidence”: Trump says he’s SEEN info COVID-19 originated at LAB in WUHAN

China is going to be stripped of sovereign immunity .
We are all going to sue the shit out of them..left ad right .
We are all going to win the suits .
If China responds economically then we hammer them back 3 times harder .
If they respond militarily we wipe the CCP off the face of the Earth .
The Office of the Director of National Intelligence confirmed on-record for the first time Thursday that the U.S. intelligence community is investigating whether the coronavirus outbreak , which has wreaked havoc across the globe , started as the result @ @ @ @ @ @ @ Wuhan , China .
“ The entire Intelligence Community has been consistently providing critical support to U.S. policymakers and those responding to the COVID-19 virus , which originated in China .
The Intelligence Community also concurs with the wide scientific consensus that the COVID-19 virus was not manmade or genetically modified , ” a statement from the office of acting Director of National Intelligence Richard Grenell said .
“ As we do in all crises , the Community ’ s experts respond by surging resources and producing critical intelligence on issues vital to @ @ @ @ @ @ @ continue to rigorously examine emerging information and intelligence to determine whether the outbreak began through contact with infected animals or if it was the result of an accident at a laboratory in Wuhan , ” the statement said .
Fox News first reported earlier this month that there is increasing confidence that the outbreak likely escaped from the lab , not as a bioweapon but as part of a Chinese effort to show that its efforts to identify and combat viruses are equal or greater than those of the U.S .
This would @ @ @ @ @ @ @ originated at a wet market nearby .

China is going to be stripped of sovereign immunity. We are all going to sue the shit out of them..left ad right. We are all going to win the suits.
If China responds economically then we hammer them back 3 times harder. If they respond militarily we wipe the CCP off the face of the Earth.
The Office of the Director of National Intelligence confirmed on-record for the first time Thursday that the U.S. intelligence community is investigating whether the coronavirus outbreak, which has wreaked havoc across the globe, started as the result of an accident at a laboratory in Wuhan, China. “The entire Intelligence Community has been consistently providing critical support to U.S. policymakers and those responding to the COVID-19 virus, which originated in China. The Intelligence Community also concurs with the wide scientific consensus that the COVID-19 virus was not manmade or genetically modified,” a statement from the office of acting Director of National Intelligence Richard Grenell said. We are primarily funded by readers. Please subscribe and donate to support us! “As we do in all crises, the Community’s experts respond by surging resources and producing critical intelligence on issues vital to U.S. national security. The IC will continue to rigorously examine emerging information and intelligence to determine whether the outbreak began through contact with infected animals or if it was the result of an accident at a laboratory in Wuhan,” the statement said. Fox News first reported earlier this month that there is increasing confidence that the outbreak likely escaped from the lab, not as a bioweapon but as part of a Chinese effort to show that its efforts to identify and combat viruses are equal or greater than those of the U.S. This would be at odds with claims the outbreak originated at a wet market nearby.
AC


investmentwatchblog--2020-05-01--Tucker: Michelle Obama sent urgent message over phones to DC residents telling them to stay home! Me

Tucker: Michelle Obama sent urgent message over phones to DC residents telling them to stay home! Meanwhile, Barack is driven by chauffeur to golf course. Doesn’t apply to them. Just you

How is she able to get on the message lines ?
What authority ?

How is she able to get on the message lines? What authority?
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AC


investmentwatchblog--2020-05-01--Are Mandatory Output Cuts The Only Way To Save U.S. Oil?

The United States has been on the opposite side of the OPEC oil cartel for decades in a great battle between the free market and supervised production levels .
All that may be about to change , with the free market in the United States giving way to unprecedented action that could direct production levels of its private oil companies , playing OPEC ’ s game to survive the current crisis .
The U.S. oil industry is very sick and getting sicker by the day .
The negative prices we saw last week , finite oil storage space and the @ @ @ @ @ @ @ have signaled a radical change in the American shale patch .
The change has been quick and brutal .
Just last year , buoyed by sharp increases in natural gas and crude oil output , the United States actually produced more energy than it consumed for the first time since the late 1950s , according to new data from the Energy Information Administration ( EIA ) .
Fast forward four months from December 2019 , and we have shale drillers shutting in wells , suspending deliveries to clients , and filing for bankruptcy @ @ @ @ @ @ @ close to 30 % globally and is unlikely to recover anytime soon .
Production is also falling—but not fast enough : The OPEC+ cuts won ’ t take effect until May , and it takes a while to shut-in a well , so the first effects of the cuts are still months away .
Meanwhile , storage is filling up with unsellable oil , both onshore and offshore .
Around the world , at least one in every 10 very large crude carriers ( VLCCs ) —each capable of holding 2 million barrels @ @ @ @ @ @ @ , according to Saudi energy officials .
Demand for VLCCs is rising , according to data from Signal Group , but the bookings are not for crude oil deliveries , just for storage .
The United States federal government has leased 23 million barrels of storage space in the Strategic Petroleum Reserve to struggling oil companies .
A pipeline operator , Enterprise Products Partner , has offered companies to open up the unused capacity of its Seaway pipeline to send oil to the Cushing hub .
Energy Transfer has gone a step further @ @ @ @ @ @ @ to allow the use of pipelines as storage space .
All these things paint the picture of an industry in a state of panic , and with good reason : It ’ s running out of options .
In addition to the voluntary shut-ins of wells , the only meaningful move that U.S. oil has is to cut production .
Since most U.S. oil companies do not want to cut production except as a drastic last resort , regulators need to step in .
The idea of mandatory oil production cuts like the @ @ @ @ @ @ @ Canada ’ s Alberta was first floated by Texas Railroad Commissioner Ryan Sitton as a way to mitigate the effect of the Saudi-Russia price war and the looming coronavirus crisis on oil prices .
Now , with the war over but the subsequent crisis still in full swing , the idea probably sounds , if not more appealing , then at least more probable .
The Texas Railroad Commission was scheduled to vote on mandatory production cuts this month .
Instead , it delayed the vote until May 5 , likely in hopes @ @ @ @ @ @ @ .
Although some companies such as Pioneer and Parsley Energy are vocal supporters of mandatory cuts , most are against it , notably the supermajors , who are also the most resilient to the crisis .
Of course , there is also negative sentiment to government-instituted production limits .
It ’ s just not the American way to dictate to companies how much oil they should pump—the United States likes to leave that to the oil cartels .
But when push comes to shove , some have realized that these glaringly un-American measures @ @ @ @ @ @ @ hope .
And despite the blowback on legal grounds , there is no legal obstacle , either , according to a Reuters round-up of lawyer opinion .
It is illegal for companies to agree on production limits amongst themselves , as this would constitute a cartel under U.S. antitrust law .
It does not , however , prohibit state or federal regulators from imposing a production limit .
“ Trump himself , other federal officials , and Congress can not violate antitrust ( law ) by any official actions they take .
It @ @ @ @ @ @ @ ” one antitrust law professor said .
One may ask why the industry would need mandatory cuts if it ’ s already cutting by default due to market pressure ?
After all , President Trump himself said U.S. oil production would decline organically , thanks to low oil prices .
However , prices have fallen way too low and too fast , and an organic decline will not be fast enough to respond to the situation , which would justify mandatory cuts .
And while Texas and its oddly named Railroad Commission have @ @ @ @ @ @ @ it is not the only state considering mandatory cuts .
In a recent notice , the North Dakota Department of Mineral Resources is also set to discuss whether producing low at current prices is not a waste of resources , suggesting that they may be preparing for mandatory cuts , too .
So , the chances of state regulators imposing production limits on oil companies are growing increasingly more likely .
The question of whether they would work fast enough to revive the U.S. oil industry , however , remains .
Some , @ @ @ @ @ @ @ are optimistic .
Others , such as Art Berman , not so much .
One thing is for sure , though .
The effect of this crisis on the U.S. oil will be even more transformative than the shale revolution .

By Irina Slav
The United States has been on the opposite side of the OPEC oil cartel for decades in a great battle between the free market and supervised production levels. All that may be about to change, with the free market in the United States giving way to unprecedented action that could direct production levels of its private oil companies, playing OPEC’s game to survive the current crisis.
The U.S. oil industry is very sick and getting sicker by the day.
The negative prices we saw last week, finite oil storage space and the decimation of demand caused by the coronavirus have signaled a radical change in the American shale patch.
The change has been quick and brutal. Just last year, buoyed by sharp increases in natural gas and crude oil output, the United States actually produced more energy than it consumed for the first time since the late 1950s, according to new data from the Energy Information Administration (EIA).
Fast forward four months from December 2019, and we have shale drillers shutting in wells, suspending deliveries to clients, and filing for bankruptcy. Demand for oil has fallen by close to 30% globally and is unlikely to recover anytime soon. Production is also falling—but not fast enough: The OPEC+ cuts won’t take effect until May, and it takes a while to shut-in a well, so the first effects of the cuts are still months away.
Meanwhile, storage is filling up with unsellable oil, both onshore and offshore. Around the world, at least one in every 10 very large crude carriers (VLCCs)—each capable of holding 2 million barrels of oil—is currently acting as floating storage, according to Saudi energy officials. Demand for VLCCs is rising, according to data from Signal Group, but the bookings are not for crude oil deliveries, just for storage.
The United States federal government has leased 23 million barrels of storage space in the Strategic Petroleum Reserve to struggling oil companies.
A pipeline operator, Enterprise Products Partner, has offered companies to open up the unused capacity of its Seaway pipeline to send oil to the Cushing hub.
Energy Transfer has gone a step further and has asked the Texas Railroad Commission to allow the use of pipelines as storage space.
All these things paint the picture of an industry in a state of panic, and with good reason: It’s running out of options.
In addition to the voluntary shut-ins of wells, the only meaningful move that U.S. oil has is to cut production. Since most U.S. oil companies do not want to cut production except as a drastic last resort, regulators need to step in.
We are primarily funded by readers. Please subscribe and donate to support us!
The idea of mandatory oil production cuts like the ones affected by OPEC+ but also by Canada’s Alberta was first floated by Texas Railroad Commissioner Ryan Sitton as a way to mitigate the effect of the Saudi-Russia price war and the looming coronavirus crisis on oil prices. Now, with the war over but the subsequent crisis still in full swing, the idea probably sounds, if not more appealing, then at least more probable.
The Texas Railroad Commission was scheduled to vote on mandatory production cuts this month. Instead, it delayed the vote until May 5, likely in hopes that the situation would somehow resolve itself.
Although some companies such as Pioneer and Parsley Energy are vocal supporters of mandatory cuts, most are against it, notably the supermajors, who are also the most resilient to the crisis.
Of course, there is also negative sentiment to government-instituted production limits. It’s just not the American way to dictate to companies how much oil they should pump—the United States likes to leave that to the oil cartels. But when push comes to shove, some have realized that these glaringly un-American measures might be the industry’s only hope.
And despite the blowback on legal grounds, there is no legal obstacle, either, according to a Reuters round-up of lawyer opinion. It is illegal for companies to agree on production limits amongst themselves, as this would constitute a cartel under U.S. antitrust law. It does not, however, prohibit state or federal regulators from imposing a production limit.
“Trump himself, other federal officials, and Congress cannot violate antitrust (law) by any official actions they take. It doesn’t apply to them,” one antitrust law professor said.
One may ask why the industry would need mandatory cuts if it’s already cutting by default due to market pressure? After all, President Trump himself said U.S. oil production would decline organically, thanks to low oil prices. However, prices have fallen way too low and too fast, and an organic decline will not be fast enough to respond to the situation, which would justify mandatory cuts.
And while Texas and its oddly named Railroad Commission have stolen the limelight in this respect, it is not the only state considering mandatory cuts. In a recent notice, the North Dakota Department of Mineral Resources is also set to discuss whether producing low at current prices is not a waste of resources, suggesting that they may be preparing for mandatory cuts, too.
So, the chances of state regulators imposing production limits on oil companies are growing increasingly more likely. The question of whether they would work fast enough to revive the U.S. oil industry, however, remains. Some, such as the government in Washington, are optimistic. Others, such as Art Berman, not so much.
One thing is for sure, though. The effect of this crisis on the U.S. oil will be even more transformative than the shale revolution.
By Irina Slav for Oilprice.com


investmentwatchblog--2020-05-01--The Wave Of Shale Well Closures Has Finally Begun

U.S. shale oil producers have so far held up admirably , hanging on for dear life amidst the biggest oil demand collapse in history .
American producers continued to pump at record highs in March , even after dozens of drillers laid out blueprints to limit production .
But with U.S. storage about to hit tank tops in a matter of weeks and the world deep in the throes of the biggest pandemic in modern history , the inevitable has begun to unfold : The arduous and costly process of well shut-ins .
Oil production in the country tumbled sharply @ @ @ @ @ @ @ week of April , a good 900,000 bpd less than the record peak of 13.1 million bpd recorded just a month prior .
That ’ s a 7 % production cut in the space of only a few weeks and the lowest level since July .
A lot more could be on the way .
Oklahoma-based Continental Resources ( NYSE : CLR ) , the company controlled by billionaire Harold Hamm , has ceased all its shale operations in North Dakota and shut in most wells in its Bakken oil field totaling roughly @ @ @ @ @ @ @ , has refused to sell its contracted oil to pipelines at negative prices by declaring force majeure .
Continental has defended its stance by pointing out that the coronavirus outbreak has “ …brought about conditions under which force majeure applies ” while adding that selling its oil at negative prices constitutes waste .
Continental made the risky gamble of betting that economic growth would lift prices and , therefore , left itself heavily exposed to low oil prices by failing to employ the industry ’ s usual playbook of hedging future production with @ @ @ @ @ @ @ , though .
Rystad Energy via CNBC has reported that six major U.S. shale producers will shut another 300,000 bpd of crude in May and June .
That ’ s ~100,000 bpd more than April cuts , thus bringing the country ’ s total production cuts to 1.2 million bpd .
The cuts will come from Continental Resources , ConocoPhillips ( NYSE : COP ) , Cimarex Energy ( NYSE : XEC ) , Enerplus Corporation ( NYSE : ERF ) , Parsley Energy ( NYSE : PE ) and PDC Energy ( @ @ @ @ @ @ @ is set to slash 69,000 bpd in April and nearly 150,000 in May and June while ConocoPhillips will lower output by 125,000 bpd of oil equivalent , including 60,000 bpd of oil .
Rystad ’ s head of shale research , Artem Abramov , has estimated that the biggest shale fields–Permian , Eagle Ford , and Bakken–will cut a further 900,000 bpd , 250,000 bpd , and 400,000 bpd , respectively , throughout 2Q20 , with shut-ins accounting for a staggering 60 % in the early stages .
A well shut-in is considered @ @ @ @ @ @ @ because it can result in huge or even total loss of production .
That ’ s a big consideration in these dire times , where even oilfield values are descending into negative territory due to liabilities such as plugging wells and land remediation .
Chris Atherton , president of EnergyNet , a company that deals in oil and gas operations , undeveloped acreage and royalty interests , has told Forbes that oilfield prices have tumbled from an average price of $ 42,000 per net flowing barrel per day when oil prices were around @ @ @ @ @ @ @ .
Buyers started getting picky and sellers more desperate in 2019 when oil prices were still relatively high .
Things have gone to the dogs now , with a shut-in field fetching only half the price of a virtually identical field but with oil still flowing .
As Bob Bracket of Bernstein Research revealed last week , “ Shut-ins are not easy decisions .
When production shuts-in , problems arise .
Multi-phase well flows begin to separate out , while problematic hydrates , waxes , asphaltenes form which will have serious economic implications @ @ @ @ @ @ @ large wells with flows exceeding 1,000 barrels/day that could not be brought back to life after being shut-in .
That ’ s the main reason why even heavily indebted shale companies , including bankrupt ones like Whiting Corp. ( NYSE : WLL ) , insist on continuing to pump at all costs.Related : The Death Of U.S. Oil California Resources Corp. ( NYSE : CRC ) is a $ 133.7M ( market cap ) company drowning in debt to the tune of more than $ 4 billion due by the end of 2022 @ @ @ @ @ @ @ cost per barrel of $ 35 means that it ’ s losing ~ $ 20 for each barrel of crude it pumps .
Yet , the company is unable to shut-in its wells because they require a continuous injection of steam to keep them alive .
A shut-in well is a tough proposition for a prospective oilfield buyer , too , because it ’ s hard to determine how much oil can be coaxed out , especially after a lengthy layoff .
The only solace for the beleaguered oil sector is that there @ @ @ @ @ @ @ of takers when the worst is finally over .
Atherton says that his company has 40,000 registered users with access to $ 17 billion in cash ready to make deals .
He has predicted that distressed companies will “ turn into a flood of assets available ” in a year or so .
The bottom hunters will certainly be waiting to pounce , the downside being that many investments in the space could turn worthless due to the swelling wave of bankruptcy .

By Alex Kimani
U.S. shale oil producers have so far held up admirably, hanging on for dear life amidst the biggest oil demand collapse in history. American producers continued to pump at record highs in March, even after dozens of drillers laid out blueprints to limit production.
But with U.S. storage about to hit tank tops in a matter of weeks and the world deep in the throes of the biggest pandemic in modern history, the inevitable has begun to unfold: The arduous and costly process of well shut-ins.
Oil production in the country tumbled sharply to 12.2 million bpd in the third week of April, a good 900,000 bpd less than the record peak of 13.1 million bpd recorded just a month prior. That’s a 7% production cut in the space of only a few weeks and the lowest level since July.
A lot more could be on the way.
More Production Cuts
Oklahoma-based Continental Resources (NYSE:CLR), the company controlled by billionaire Harold Hamm, has ceased all its shale operations in North Dakota and shut in most wells in its Bakken oil field totaling roughly 200,000 bpd.
The company, though, has refused to sell its contracted oil to pipelines at negative prices by declaring force majeure.
Continental has defended its stance by pointing out that the coronavirus outbreak has “…brought about conditions under which force majeure applies” while adding that selling its oil at negative prices constitutes waste.
Continental made the risky gamble of betting that economic growth would lift prices and, therefore, left itself heavily exposed to low oil prices by failing to employ the industry’s usual playbook of hedging future production with derivatives.
Continental is in good company, though.
Rystad Energy via CNBC has reported that six major U.S. shale producers will shut another 300,000 bpd of crude in May and June. That’s ~100,000 bpd more than April cuts, thus bringing the country’s total production cuts to 1.2 million bpd. The cuts will come from Continental Resources, ConocoPhillips (NYSE:COP), Cimarex Energy (NYSE:XEC), Enerplus Corporation (NYSE:ERF), Parsley Energy (NYSE:PE) and PDC Energy (NYSE:PDCE).
Continental Resources is set to slash 69,000 bpd in April and nearly 150,000 in May and June while ConocoPhillips will lower output by 125,000 bpd of oil equivalent, including 60,000 bpd of oil.
Rystad’s head of shale research, Artem Abramov, has estimated that the biggest shale fields–Permian, Eagle Ford, and Bakken–will cut a further 900,000 bpd, 250,000 bpd, and 400,000 bpd, respectively, throughout 2Q20, with shut-ins accounting for a staggering 60% in the early stages.
We are primarily funded by readers. Please subscribe and donate to support us!
Expensive Shut-Ins
A well shut-in is considered a drastic action of last resort mainly because it can result in huge or even total loss of production.
That’s a big consideration in these dire times, where even oilfield values are descending into negative territory due to liabilities such as plugging wells and land remediation.
Chris Atherton, president of EnergyNet, a company that deals in oil and gas operations, undeveloped acreage and royalty interests, has told Forbes that oilfield prices have tumbled from an average price of $42,000 per net flowing barrel per day when oil prices were around $60/barrel to under $20,000 currently. Buyers started getting picky and sellers more desperate in 2019 when oil prices were still relatively high.
Things have gone to the dogs now, with a shut-in field fetching only half the price of a virtually identical field but with oil still flowing.
As Bob Bracket of Bernstein Research revealed last week, “Shut-ins are not easy decisions. When production shuts-in, problems arise. Multi-phase well flows begin to separate out, while problematic hydrates, waxes, asphaltenes form which will have serious economic implications,” citing numerous examples of fairly large wells with flows exceeding 1,000 barrels/day that could not be brought back to life after being shut-in.
That’s the main reason why even heavily indebted shale companies, including bankrupt ones like Whiting Corp. (NYSE:WLL), insist on continuing to pump at all costs.Related: The Death Of U.S. Oil
California Resources Corp. (NYSE:CRC) is a $133.7M (market cap) company drowning in debt to the tune of more than $4 billion due by the end of 2022. The company’s average all-in cost per barrel of $35 means that it’s losing ~$20 for each barrel of crude it pumps. Yet, the company is unable to shut-in its wells because they require a continuous injection of steam to keep them alive.
Deal Mania
A shut-in well is a tough proposition for a prospective oilfield buyer, too, because it’s hard to determine how much oil can be coaxed out, especially after a lengthy layoff.
The only solace for the beleaguered oil sector is that there probably won’t be a shortage of takers when the worst is finally over.
Atherton says that his company has 40,000 registered users with access to $17 billion in cash ready to make deals. He has predicted that distressed companies will “turn into a flood of assets available” in a year or so.
The bottom hunters will certainly be waiting to pounce, the downside being that many investments in the space could turn worthless due to the swelling wave of bankruptcy.
By Alex Kimani for Oilprice.com


investmentwatchblog--2020-05-01--USO ETF No Longer Tracking WTI Crude Only

This is crazy , as of May 1st the USO Fund ETF is now branching out and putting funds into • All spread across multiple months in 2020 AND 2021 This thing is so far off kilter , check it out : www.sec.gov/Archives/edgar/data/1327068/000117120020000330/0001171200-20-000330-index.htm Accordingly , commencing on May 1 , 2020 and for the foreseeable future , to address and comply with the market conditions , regulatory requirements and other factors that have influenced , and will continue to influence , its investment decisions , USO intends to buy or sell the following permitted investments taking into account the order @ @ @ @ @ @ @ decreases either its portfolio overall or its holdings of particular investments : • The current or front month ( “ first month ” ) Oil Futures Contracts based on the price of the light , sweet crude oil known as West Texas Intermediate ( “ WTI ) or , which are priced off of the oil futures contracts based on WTI as traded on the NYMEX including the Benchmark Oil Futures Contracts and the ICE WTI Contract ( “ WTI Oil Futures Contracts ” ) ; then • The first month , the @ @ @ @ @ @ @ month ” , with months thereafter being numerically designated , i.e.
, the third month , the fourth month , the fifth month , etc . )
and the third month WTI Oil Futures Contracts ; then • The first through the fifth month WTI Oil Futures Contracts , plus the next nearest June WTI Oil Futures Contracts , plus the next nearest December WTI Oil Futures Contracts ; then • The first through the twelfth month WTI Oil Futures Contracts ; then • The first through the twelfth month WTI Oil Futures @ @ @ @ @ @ @ Oil Futures Contracts based on Brent Crude Oil traded on ICE Futures ( “ Brent Oil Futures Contracts ” ) ; then • The first through the twelfth month WTI Oil Futures Contracts Months plus the second through thirteenth month Brent Oil Futures Contracts plus the first through the twelfth month Oil Futures Contracts based on Ultra Low Sulfur Diesel Oil Futures Contract traded on NYMEX ( “ USDL Oil Futures Contract ” ) ; then • The first through the twelfth month WTI Oil Futures Contracts plus the second through thirteenth month @ @ @ @ @ @ @ through the twelfth month USDL Oil Futures Contracts plus the first through the twelfth month RBOB Gasoline Oil Futures Contracts ( “ Gasoline Futures Contract ” ) ; then • USO may also utilize the Oil Futures Contracts based on WTI , WTI Oil Futures Contacts or other types of crude oil traded on the Dubai , Singapore , and Houston exchanges , if and when these contracts reach sufficient scale and liquidity to meaningfully contribute to USO ’ s investment objective , in addition to the foregoing investments ; then , finally @ @ @ @ @ @ @ addition to the foregoing investments .
What does this mean for you ?
Well these are all radically different markets ( especially now ) and this is actually WAY more conservative than even their USL fund .
Which means any run up on WTI crude prices will see very little transfer to your USO gain .
Basically the entire freaking curve has to move up at the same time if you want to make any money .
So you open up and see the front-month WTI crude contract has shot through the roof @ @ @ @ @ @ @ excited and can ’ t wait to sell out and rake in those sweet massive profits , only to see USO barely moved because all their positions are spread out across different crude grades and also gasoline and diesel prices !
So if you have calls , sorry to say your gains have now had their legs cut out from underneath them .
You could be a 100 % right on your WTI prediction but not see shit for gains .
Haha remember when this was sold as a FRONT MONTH WTI CRUDE @ @ @ @ @ @ @ fair for anyone on either the call OR put side .
Disclaimer : This information is only for educational purposes .
Do not make any investment decisions based on the information in this article .
Do you own due diligence .

by TheOneAboveNone2
This is crazy, as of May 1st the USO Fund ETF is now branching out and putting funds into
Brent Crude
WTI Crude
US Diesel (Low Sulfur)
RBOB Gasoline
All spread across multiple months in 2020 AND 2021
Possibly Dubai, Singapore, other international crudes
This thing is so far off kilter, check it out: www.sec.gov/Archives/edgar/data/1327068/000117120020000330/0001171200-20-000330-index.htm
Accordingly, commencing on May 1, 2020 and for the foreseeable future, to address and comply with the market conditions, regulatory requirements and other factors that have influenced, and will continue to influence, its investment decisions, USO intends to buy or sell the following permitted investments taking into account the order set forth below when USO increases or decreases either its portfolio overall or its holdings of particular investments: The current or front month (“first month”) Oil Futures Contracts based on the price of the light, sweet crude oil known as West Texas Intermediate (“WTI) or, which are priced off of the oil futures contracts based on WTI as traded on the NYMEX including the Benchmark Oil Futures Contracts and the ICE WTI Contract (“WTI Oil Futures Contracts”); then The first month, the next or following month (“second month”, with months thereafter being numerically designated, i.e., the third month, the fourth month, the fifth month, etc.) and the third month WTI Oil Futures Contracts; then The first through the fifth month WTI Oil Futures Contracts, plus the next nearest June WTI Oil Futures Contracts, plus the next nearest December WTI Oil Futures Contracts; then The first through the twelfth month WTI Oil Futures Contracts; then The first through the twelfth month WTI Oil Futures Contracts plus the second through thirteenth month Oil Futures Contracts based on Brent Crude Oil traded on ICE Futures (“Brent Oil Futures Contracts”); then The first through the twelfth month WTI Oil Futures Contracts Months plus the second through thirteenth month Brent Oil Futures Contracts plus the first through the twelfth month Oil Futures Contracts based on Ultra Low Sulfur Diesel Oil Futures Contract traded on NYMEX (“USDL Oil Futures Contract”); then The first through the twelfth month WTI Oil Futures Contracts plus the second through thirteenth month Brent Oil Futures Contracts plus the first through the twelfth month USDL Oil Futures Contracts plus the first through the twelfth month RBOB Gasoline Oil Futures Contracts (“Gasoline Futures Contract”); then USO may also utilize the Oil Futures Contracts based on WTI, WTI Oil Futures Contacts or other types of crude oil traded on the Dubai, Singapore, and Houston exchanges, if and when these contracts reach sufficient scale and liquidity to meaningfully contribute to USO’s investment objective, in addition to the foregoing investments; then, finally, Other Oil-Related Investments, in addition to the foregoing investments.
What does this mean for you? Well these are all radically different markets (especially now) and this is actually WAY more conservative than even their USL fund. Which means any run up on WTI crude prices will see very little transfer to your USO gain. Basically the entire freaking curve has to move up at the same time if you want to make any money.
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So you open up and see the front-month WTI crude contract has shot through the roof on May 15th, you get all excited and can’t wait to sell out and rake in those sweet massive profits, only to see USO barely moved because all their positions are spread out across different crude grades and also gasoline and diesel prices!
So if you have calls, sorry to say your gains have now had their legs cut out from underneath them. You could be a 100% right on your WTI prediction but not see shit for gains. Haha remember when this was sold as a FRONT MONTH WTI CRUDE FUND. This doesn’t seem fair for anyone on either the call OR put side.
Disclaimer: This information is only for educational purposes. Do not make any investment decisions based on the information in this article. Do you own due diligence.


investmentwatchblog--2020-05-01--Oil Tanker Storage Play Update

Oil Tanker Storage Play Update

TL , DR : the bull case around earnings remains strong in the short-term ( 30 days ) which is all I care about .
Reading a lot of oil tanker trader feeds ( OOTT ) .
Info from the ones with actual jobs in the industry… • the absolute crazy spot rates for tankers ( $ 200K+ ) are currently gone , but • tanker storage rates are often still at multiples of normal rates on spot market , and at least strongly “ elevated ” • long-term contract rates are at very high , well-above “ normal ” @ @ @ @ @ @ @ adds are because there ’ s truly little room in Cushing ( the “ empty ” space is for refining needs , and the rest is contracted ) • The storage issue is now global • top names are trading around Feb stock prices , as if market expected somewhat typical ( but good ) year , after sell-off • the contango curve is dropping hard/gone for the moment with the rise in WTI • US govt says they ’ ll store hundreds of millions of barrels for US producers in strategic reserve @ @ @ @ @ @ @ split + USO changing to “ we can buy any type of oil contract ” pulled a shit ton of pressure on WTI rates • OPEC+ cuts start now , will have a strong effect • US cuts ( and others ) are already in effect • POTUS punched Saudi Arabia in the face , and threatened regime change and complete Middle Eastern destabilization without cuts , which came immediately • It ’ s middle month , there ’ s a likely huge drop in WTI prices coming again as we near May @ @ @ @ @ @ @ future price cuts , pressure rates for immediate contracts , little effect on oil already in holds • Russia cheats on cuts all the time .
Other countries may join them • The storage space for hundreds of millions of barrels of oil in the strategic reserve is a fantasy ( unless the Jones Act is suspended , meaning taker calls print , or oil in the ground is counted as “ reserve ” and the US govt pays for future production…which feels insane , but no less insane than any other economic @ @ @ @ @ @ @ Twitters I ’ m reading : just # OOTT and you get a lot of info .
The wheat from the chaff I ’ m using are • twitter.com/calvinfroedge ( he showed up here and called the NAT top perfectly ) • twitter.com/TankerTrackers ( I grabbed premium sub , but haven ’ t asked for info on particular tanker company fleets from today ’ s report on oil storage yet ) I took the advice of smarter people , and sold my NAT calls all for profit ( 50 % – 200+ % @ @ @ @ @ @ @ still , and further dips would make me load more .
I definitely will buy STNG calls at this price because it ’ s back to near “ yawn ” -type year levels .
Since it ’ s the first , if it reports blockbuster numbers everybody reacts to them .
Disclaimer : This information is only for educational purposes .
Do not make any investment decisions based on the information in this article .
Do you own due diligence .

by ez2remembercpl
TL,DR: the bull case around earnings remains strong in the short-term (30 days) which is all I care about.
Reading a lot of oil tanker trader feeds (OOTT). Info from the ones with actual jobs in the industry…
BULL case:
the absolute crazy spot rates for tankers ($200K+) are currently gone, but
tanker storage rates are often still at multiples of normal rates on spot market, and at least strongly “elevated”
long-term contract rates are at very high, well-above “normal” prices
the “lower” storage adds are because there’s truly little room in Cushing (the “empty” space is for refining needs, and the rest is contracted)
The storage issue is now global
top names are trading around Feb stock prices, as if market expected somewhat typical (but good) year, after sell-off
BEAR case
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the contango curve is dropping hard/gone for the moment with the rise in WTI
US govt says they’ll store hundreds of millions of barrels for US producers in strategic reserve
Noobs out of USO after reverse split + USO changing to “we can buy any type of oil contract” pulled a shit ton of pressure on WTI rates
OPEC+ cuts start now, will have a strong effect
US cuts (and others) are already in effect
POTUS punched Saudi Arabia in the face, and threatened regime change and complete Middle Eastern destabilization without cuts, which came immediately
BULL response (whoops):
It’s middle month, there’s a likely huge drop in WTI prices coming again as we near May 21 settlement
Production cuts today drive future price cuts, pressure rates for immediate contracts, little effect on oil already in holds
Russia cheats on cuts all the time. Other countries may join them
The storage space for hundreds of millions of barrels of oil in the strategic reserve is a fantasy (unless the Jones Act is suspended, meaning taker calls print, or oil in the ground is counted as “reserve” and the US govt pays for future production…which feels insane, but no less insane than any other economic decision by the USA these days)
Twitters I’m reading: just #OOTT and you get a lot of info. The wheat from the chaff I’m using are
twitter.com/TankersInt (actual handshake/confirmed contract rates)
twitter.com/chigrl
twitter.com/JHannisdahl
twitter.com/calvinfroedge (he showed up here and called the NAT top perfectly)
twitter.com/Samir_Madani, who helped start –
twitter.com/TankerTrackers (I grabbed premium sub, but haven’t asked for info on particular tanker company fleets from today’s report on oil storage yet)
I took the advice of smarter people, and sold my NAT calls all for profit (50% – 200+%). I am holding several others still, and further dips would make me load more. I definitely will buy STNG calls at this price because it’s back to near “yawn”-type year levels. Since it’s the first, if it reports blockbuster numbers everybody reacts to them.
Disclaimer: This information is only for educational purposes. Do not make any investment decisions based on the information in this article. Do you own due diligence.


investmentwatchblog--2020-05-01--FAANG stocks are holding up the market and they all missed on EPS so far

The Nasdaq is basically flat year to date .
All the FAANG stocks are near all time highs .
Facebook , Netflix and Google all missed on EPS estimates .
Apple is likely to be hit even worse ( sales are down and stores are closed ) which leaves Amazon as the only member of FAANG that is likely to beat on earnings .
EDIT : NEVERMIND , AMAZON MISSED ON EPS TOO .
Surprisingly Apple was the only beat but that ’ s because their estimates were low .
Here ’ s the thing… According to earnings calls and @ @ @ @ @ @ @ only beginning to experience negative effects for the last few weeks of the quarter .
GDP declined by 4.8 % this quarter , whereas economists are projecting a decline of 30 % to 40 % next quarter .
If we look at tech across the board , we have some winners like Microsoft and Zoom , but chip makers like AMD ( which met EPS estimates but didn ’ t beat ) and Qualcom both delivered poor guidance for coming quarters .
AMD has been rallying back to all time highs .
Nvidia @ @ @ @ @ @ @ Yet , despite the relative strength in the tech sector , the current trend of earnings , economic forecasts and guidance ( or lack thereof ) strongly suggests that tech will take a huge hit in coming quarters .
Let ’ s look at how concentrated the S & P is in the very top stocks , all of which are tech… i.imgur.com/Gir5SXH.jpg This blows the dot com boom out of the water .
Now consider how much of the S & P the rest of the tech stocks account for .
All @ @ @ @ @ @ @ these tech stocks closely .
If they fall , the indexes will go with them .
There is a high probability they will lead the next leg of the drop .
Also , here ’ s my take on the long term value of these stocks .
The US is moving closer and closer towards adopting basic income .
Nothing is guaranteed , but if anything has made the case for increased automation and basic income , it ’ s the current circumstance .
Such a policy would likely necessitate a rise in @ @ @ @ @ @ @ ’ s a direct hit to the earnings of notorious tax evaders like Amazon .
In addition , basic income would give working class people more leverage in holding out for higher pay because they wouldn ’ t be weighing job offers against total destitution .
This too would detract heavily from future earnings .
After the 2000 crash , the Nasdaq didn ’ t recover to the highs for 15 years .
If you look at the S & P chart I posted , two of the top five stocks in 2000 @ @ @ @ @ @ @ 16 years to recover to its highs and Intel never fully recovered .
Therefor , I advise extreme caution in this environment .
Do not be shamed out of taking profits near all time highs if that ’ s what you personally feel comfortable with .
I won ’ t say it ’ s wrong to hold if you ’ re ready to accept the risk , however , just because these companies are good “ blue chips stocks ” that doesn ’ t mean that they ’ re low risk or no @ @ @ @ @ @ @ .
That ’ s just my two cents .

by bingo_bango_zongo
The Nasdaq is basically flat year to date. All the FAANG stocks are near all time highs. Facebook, Netflix and Google all missed on EPS estimates. Apple is likely to be hit even worse (sales are down and stores are closed) which leaves Amazon as the only member of FAANG that is likely to beat on earnings. EDIT: NEVERMIND, AMAZON MISSED ON EPS TOO. Surprisingly Apple was the only beat but that’s because their estimates were low.
Here’s the thing… According to earnings calls and the current economic trend, they were only beginning to experience negative effects for the last few weeks of the quarter. GDP declined by 4.8% this quarter, whereas economists are projecting a decline of 30% to 40% next quarter.
If we look at tech across the board, we have some winners like Microsoft and Zoom, but chip makers like AMD (which met EPS estimates but didn’t beat) and Qualcom both delivered poor guidance for coming quarters. AMD has been rallying back to all time highs. Nvidia is also near all time highs. Yet, despite the relative strength in the tech sector, the current trend of earnings, economic forecasts and guidance (or lack thereof) strongly suggests that tech will take a huge hit in coming quarters.
Let’s look at how concentrated the S&P is in the very top stocks, all of which are tech… i.imgur.com/Gir5SXH.jpg This blows the dot com boom out of the water. Now consider how much of the S&P the rest of the tech stocks account for.
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All of this is to say, watch these tech stocks closely. If they fall, the indexes will go with them. There is a high probability they will lead the next leg of the drop.
Also, here’s my take on the long term value of these stocks. The US is moving closer and closer towards adopting basic income. Nothing is guaranteed, but if anything has made the case for increased automation and basic income, it’s the current circumstance. Such a policy would likely necessitate a rise in corporate taxes or a VAT. That’s a direct hit to the earnings of notorious tax evaders like Amazon. In addition, basic income would give working class people more leverage in holding out for higher pay because they wouldn’t be weighing job offers against total destitution. This too would detract heavily from future earnings.
After the 2000 crash, the Nasdaq didn’t recover to the highs for 15 years. If you look at the S&P chart I posted, two of the top five stocks in 2000 were Microsoft and Intel. Microsoft took 16 years to recover to its highs and Intel never fully recovered.
Therefor, I advise extreme caution in this environment. Do not be shamed out of taking profits near all time highs if that’s what you personally feel comfortable with. I won’t say it’s wrong to hold if you’re ready to accept the risk, however, just because these companies are good “blue chips stocks” that doesn’t mean that they’re low risk or no risk, regardless of your time horizon. That’s just my two cents.


investmentwatchblog--2020-05-01--What to do when we do not know GDP,Inflation or even Unemployment levels?

Today has brought a whole raft of data for our attention and much of it is eye-catching .
So let is begin with La Belle France a subject on my mind after watching the film Waterloo last night .
I have to confess I am a little in the dark as to 1968 and can only think it may have been related to the student riots of the era .
The Covid-19 vibe is established by the way that domestic demand plunged .
I guess no-one is going to be surprised by this either .
Such production as there was @ @ @ @ @ @ @ a time like this GDP really struggles to deal with trade so let me use France as an example on the way to explaining the issue .
As you can see the net effect here is rather small especially in these circumstances .
But there is a lot going on as we see large moves in both exports and imports .
Another way of looking at this is provided by the Bureau of Economic Analysis in the US .
A lot less detail for a start .
Let me help out as imports @ @ @ @ @ @ @ $ 140.1 billion in fact and exports only fell by US $ 56.9 billion .
So net exports rose by US $ 83.3 billion and boosted the numbers .
This is really awkward when a signal that the US is doing badly raises GDP by 2.32 % on its own and in net terms by 1.3 % ( care is needed with US numbers because they are annualised ) .
So here is a major caveat that the US may appear to be doing better but the trade breakdown hints strongly things are @ @ @ @ @ @ @ been having a good run but sadly that is now over .
The chart is quite extraordinary as the good run since around 2014 is replaced by quite a plummet .
We see that it is essentially a domestic game as like France the international factor small .
We do get a hint of what is about to hit the labour market and indeed unemployment which had remained high in Spain .
Let me return to France to illustrate the issues here .
A problem leaps off the page and ironically they have @ @ @ @ @ @ @ weight for energy is too high as for example factories stopped work and there was much less commuting .
Then there is this .
Fresh food prices rose by 18.1 % in March but are weighted at a mere 2.3 % as opposed to the 8.1 % of energy , when we know that there was heavy demand to stock up .
I do not wish to demean their efforts but the claim that other food prices rose by 1.4 % compared to 2.3 % this time last year looks dodgy and may @ @ @ @ @ @ @ was a rough month for smokers as tobacco rose by 13.7 % .
If we look at Spain we see the energy/fuel problem emerge again .
Also with food prices albeit it on a lower scale .
Although to be fair to INE in Spain they are trying to adapt to the new reality .
This may well be the biggest statistical fail I have seen in the world of economics .
Yes you did read the latter part correctly .
They had two issues to contend with but tripped over a theoretical @ @ @ @ @ @ @ do the survey by telephone and a sample size some 20 % lower .
The flaw is that to be unemployed you have to be available for work and in this situation I am sure many reported that they were not .
Indeed you can see this below .
Let me add a fourth which is the impact of imports that I have described above .
Switching to the unemployment numbers from Italy I do not blame those compiling the numbers and find them helpful when I have an enquiry .
But someone @ @ @ @ @ @ @ have put a large warning on these numbers and maybe even stopped their publication as statistics are supposed to inform not mislead .
They seem to have taken Talking Heads a little too literally .
Me on The Investing Channel

by Charles Hugh-Smith
Today has brought a whole raft of data for our attention and much of it is eye-catching. So let is begin with La Belle France a subject on my mind after watching the film Waterloo last night.
In Q1 2020, GDP in volume terms fell sharply: –5.8%, the biggest drop in the series’ record, since 1949. In particular, it is bigger than the ones recorded in Q1 2009 (–1.6%) or in Q2 1968 (–5.3%). ( Insee )
I have to confess I am a little in the dark as to 1968 and can only think it may have been related to the student riots of the era. The Covid-19 vibe is established by the way that domestic demand plunged.
Household consumption expenditures dropped (–6.1%), as did total gross fixed capital formation in a more pronounced manner (GFCF: –11.8%). Overall, final domestic demand excluding inventory changes fell sharply: it contributed to –6.6 points to GDP growth.
I guess no-one is going to be surprised by this either.
Overall production of goods and services declined sharply (–5.5%). It fell the hardest in construction (–12,6%), while output in goods declined –4.8% and output in manufactured goods dropped –5.6%. Output in market services declined by –5.7% overall.
Such production as there was seems to have piled up.
Conversely, changes in inventories contributed positively to GDP growth (+0.9 points).
At a time like this GDP really struggles to deal with trade so let me use France as an example on the way to explaining the issue.
Exports also fell this quarter (–6.5%) along with imports (–5.9%), in a less pronounced manner. All in all, the foreign trade balance contributed negatively to GDP growth: –0.2 points, after –0.1 points the previous quarter.
As you can see the net effect here is rather small especially in these circumstances. But there is a lot going on as we see large moves in both exports and imports. Another way of looking at this is provided by the Bureau of Economic Analysis in the US.
Imports, which are a subtraction in the calculation of GDP, decreased
A lot less detail for a start. Let me help out as imports in the US fell heavily by US $140.1 billion in fact and exports only fell by US $56.9 billion. So net exports rose by US $83.3 billion and boosted the numbers. This is really awkward when a signal that the US is doing badly raises GDP by 2.32% on its own and in net terms by 1.3% ( care is needed with US numbers because they are annualised).
So here is a major caveat that the US may appear to be doing better but the trade breakdown hints strongly things are much worse than that.
Spain
Spain had been having a good run but sadly that is now over.
Spanish GDP registers a -5.2% variation in the first quarter of 2020 compared to the previous quarter in terms of volume. This rate is 5.6 points less than the Registered in the fourth quarter. ( INE)
The chart is quite extraordinary as the good run since around 2014 is replaced by quite a plummet. We see that it is essentially a domestic game as like France the international factor small.
For its part, external demand presents a contribution of 0.2 points, three tenths lower than that of the previous quarter.
We do get a hint of what is about to hit the labour market and indeed unemployment which had remained high in Spain.
The employment of the economy, in terms of hours worked, registers a variation of ,5.0% compared to the previous quarter.
Inflation
Let me return to France to illustrate the issues here.
Over a year, the Consumer Price Index (CPI) should rise by 0.4% in April 2020, after +0.7% in the previous month, according to the provisional estimate made at the end of the month. This drop in inflation should result from an accentuated fall in energy prices and a sharp slowdown in service prices.
A problem leaps off the page and ironically they have unintentionally described it
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an accentuated fall in energy prices
That is because the weight for energy is too high as for example factories stopped work and there was much less commuting. Then there is this.
Food prices should rebound sharply, due to a strong rise in fresh food product prices.
Fresh food prices rose by 18.1% in March but are weighted at a mere 2.3% as opposed to the 8.1% of energy, when we know that there was heavy demand to stock up. I do not wish to demean their efforts but the claim that other food prices rose by 1.4% compared to 2.3% this time last year looks dodgy and may well be suffering from this
The price collection carried out by collectors on the field (about 40% in the CPI) has been suspended since 16 March:
Also it was a rough month for smokers as tobacco rose by 13.7%.
If we look at Spain we see the energy/fuel problem emerge again.
The preliminary data that is presented today through the leading indicator of the CPI, places its annual variation at –0.7% in April, seven tenths below that registered in March, influenced for the most part by the drop in fuel prices and fuels, compared to the increase registered in 2019.
Also with food prices albeit it on a lower scale.
It is remarkable the behavior of food prices, whose annual rate passes from 2.5% in March to 4.0% in April. Of these, fresh food reaches a rate of 6.9%, three points above that of the previous month, and packaged foods, place their annual rate at 2.2%, six tenths above that of March.
Although to be fair to INE in Spain they are trying to adapt to the new reality.
the prices of the products included in the goods special group COVID-19 increased 1.2% in April, compared to the previous month. While the services COVID-19 decreased 1.4% in April compared to March.
Unemployment
This may well be the biggest statistical fail I have seen in the world of economics.
In March 2020, in comparison with the previous month, employment slightly decreased and unemployment sharply fell together with a relevant increase of inactivity.
Yes you did read the latter part correctly.
In the last month, also the remarkable fall of the unemployed people (-11.1%, -267 thousand) was
recorded for both men (-13.4%, -169 thousand) and women (-8.6%, -98 thousand). The unemployment
rate dropped to 8.4% (-0.9 percentage points) and the youth rate fell to 28.0% (-1.2 p.p.).
They had two issues to contend with but tripped over a theoretical flaw. The issues were having to do the survey by telephone and a sample size some 20% lower. The flaw is that to be unemployed you have to be available for work and in this situation I am sure many reported that they were not. Indeed you can see this below.
In the last three months, also the number of unemployed persons decreased (-5.4%, -133 thousand), while
a growth among inactive people aged 15-64 years was registered (+1.5%, +192 thousand)……..On a yearly basis, the decrease of employed people was accompanied by a fall of unemployed persons
(-21.1%, -571 thousand) and a growth of inactive people aged 15-64 (+4.4%, +581 thousand).
Comment
I summarised the situation on social media yesterday.
Reasons not to trust the US GDP print 1. Advance estimates only have ~50% of the full data 2. Inflation estimates will be nearly hopeless at a time like this. 3. Output of say planes for no one to fly in them has obvious issues….
Let me add a fourth which is the impact of imports that I have described above.
Switching to the unemployment numbers from Italy I do not blame those compiling the numbers and find them helpful when I have an enquiry. But someone higher up the chain should at least have put a large warning on these numbers and maybe even stopped their publication as statistics are supposed to inform not mislead. They seem to have taken Talking Heads a little too literally.
Stop making sense
Quit talking
Stop making sense
Start falling
Stop making sense
Hold onto me
You’re always at your best
When you’re not making sense
Me on The Investing Channel


investmentwatchblog--2020-05-01--Krugman: “Investors are buying stocks in part because they have nowhere else to go. In fact, there’s

Krugman: “Investors are buying stocks in part because they have nowhere else to go. In fact, there’s a sense in which stocks are strong precisely because the economy as a whole is so weak.”

What , after all , is the main alternative to investing in stocks ?
Buying bonds .
Yet these days @ @ @ @ @ .
The interest rate on 10-year U.S. government bonds is only 0.6 percent , down @ @ @ @ @ in late 2018 .
If you want bonds that are protected against future inflation , @ @ @ @ @ a percent .
So buying stock in companies that are still profitable despite the Covid-19 @ @ @ @ @

What, after all, is the main alternative to investing in stocks? Buying bonds. Yet these days bonds offer incredibly low returns. The interest rate on 10-year U.S. government bonds is only 0.6 percent, down from more than 3 percent in late 2018. If you want bonds that are protected against future inflation, their yield is minus half a percent.
So buying stock in companies that are still profitable despite the Covid-19 recession looks pretty attractive.