Ferg's Finds
This is a short weekly email that covers a few things I’ve found interesting during the week.
Article
The Markets interview of Jim Chanos: I’m not Sure Speculation Is Gone
Loved this example:
Podcast
Kuppy is always worth a listen: The Fed Hasn’t Broken Anything Yet | Harris Kupperman
Quote
“As usual, they extrapolated it rather than question its durability. As in so many of the examples in this book, for most people, psychology-driven extrapolation took the place of an understanding of and belief in cyclicality.”
― Howard Marks
Tweet
Had never heard of “death by capacity factor”.
Charts
The tragedy in this chart is that nuclear went from 5.02% to 4.30% over 36 years.
It’s even sillier when you consider the below precedents.
Something I'm Pondering
I’m pondering how absurd it is that you can buy oil (WTI) in the low sixties per barrel three years out.
Consider today’s oil price is same level as 2005.
Forgetting massive under investment in oil CAPEX, ESG and the overall villainization of fossil fuels all while demand is steadily growing.
If you simply inflation adjust that 2005 barrel of oil to today you’re at $105 barrel (don’t get be started on using “real” CPI via Shadow stats).
I’m in the camp that we will easily see oil in the $150-200 barrel range inside the next two years.
I hope you’re all having a great week.
Cheers,
Ferg
P.S . I always look forward to these chats with Nick Jones as he is usually in the weeds with US energy and isn't afraid of a contrarian take. He nailed it last time we chatted with a structurally bearish view on natural gas which has come to pass. This time we revisit gas and coal and what this year may bring for them before moving on to oil. Uranium and tin get a mention before we discuss the optimal place to be positioned with our shared view that nothing has been fixed, and energy is due for another squeeze next winter.
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