Ferg's Finds

This is a short weekly email that covers a few things I’ve found interesting during the week.

Article

Goehring & Rozencwajg’s commentary is always a must-read: On LNG, AI, and Shale Supply – We Believe the Turn in North American Natural Gas is Here.

Most importantly, on a sequential basis, the dry gas supply likely peaked in December 2023. According to the latest data, February production remained nearly one bcf/d lower than December – the sharpest non-weather-related slowdown outside of COVID since 2008.

Podcast/Video

Dr Anas has proven quite accurate since I started following him a few years ago: MacroVoices #429 Dr. Anas Alhajji: Oil Market Outlook, Iran & Energy Geopolitics

Quote(s)

“A democracy is only as good as the education system surrounding it.”

-Socrates

Tweet

You pay a high price for certainty in the markets. With commodities, mining majors act on this certainty, i.e. ditching/spinning out coal to focus on “transition metals” supply.

Charts

I never would have guessed gold traded with that volatility in a time of hyperinflation.

Here is a chart of the gold price in Germany during the Weimar Republic. Notice that even during the biggest hyperinflation in history there were 5 times that if you leveraged your gold purchases, you could have lost everything.

-Chris Galizio

Something I'm Pondering

I’m pondering how quickly we are seeing the West (particularly the US) take a sledgehammer to the pillars of its success (free speech and the rule of law).

COVID was an eye-opener, as it showed how quickly some countries went from zero to authoritarian and clamped down on free speech.

The seizure of Russian assets, be it FX reserves or Billionaires yachts and mansions, was a revelation that it’s “only yours” if you’re on good terms with the US/EU (no fair trial necessary).

Now the latest pillar being attacked is the American social contract not to prosecute opponents for political reasons. I thoroughly enjoyed this piece by Dr Pippa Malmgren: The Four-Way Race for the American Presidency: Trump, Biden, Manchin and RFK (yes it’s paywalled).

The below section summarises the piece:

“What matters is that we are not witnessing politics anymore. We are witnessing the unraveling of the American social contract. The social contract in many nations is clear. You are either in power or in prison. Political life consists of bouncing back and forth between the two extremes. The US seems to be well on its way to this outcome now.

Also, the old American social contract presumed the existence of an apolitical judiciary. Former Supreme Court Justice Felix Frankfurter once said, “There can be no free society without law administered through an independent judiciary.” Part of the American social contract has been not to prosecute opponents for political reasons. It seems very likely that Trump and Kennedy will both commence a hunt for the guilty in the previous administration. The difference is that Trump will go after everybody, including President Biden himself. Kennedy believes that prior Presidents should be pardoned, but also that their bureaucrats and technocrats should face the full force of the law. If Biden wins, he will no doubt continue on the now-established path, unleashing further prosecutions of any and all opponents.”

Dr Pippa also went over how the Democrats are pushing through legislation that will deprive the former President of Secret Service Protection if he is given a jail sentence.

I usually avoid politics, as it's hard to make money from (unless you’re a politician). That said, this trend of tit for tac looks set to accelerate, which leads nowhere good.

Cheers,

Ferg

P.S. I now have a directory for all my articles (free and paid). Or if you’re interested in my story and why I started this Substack, you can read the story here.