The Stock Market Thread

Days.

 

I’m not sure about that.

Sounds likely they’ll be able to return about 2 MMbbl/d of the 5.7 disrupted barrels within days.

But, satellite photos suggest the spheroid light end storage tanks have holes in them. Unlike the towers, those tanks will take longer to repair. We’ll see, but could be a few weeks.

But they have a quite a bit in storage and should be able to make up a lot of that gap, not counting spare capacity in other OPEC countries and the US SPR.

 

I don't think it is really about actual supply, the market and futures market will overreact, partly driven by algorithms and automated decision making, causing a price spike way out of whack with the actual impact to availability

 

Eh. I don’t think that’s accurate.

Can there be overreaction? Sure. But it’s the most liquid market there is - if the market overreacts, it will sell off (which it did).

An imbalance of a few million barrels a day is enough to draw down inventories over several weeks to put price closer to 65 or 70 than 60, where it was before. If the market anticipates that, it will price it in now.

With strategic reserves, there isn’t a threat of lack of crude availability. But the impact on normal inventories will still be felt by the market in the meantime (it can take 10-14 days to by the SPR flowing and it may only be able to do 1.5 MMbbl/d, which could be only half the shortfall depending on what gets restarted and when).

 

I see what you did there.

 

Fed cut the rate by 25 points.

 

Whoa boy.

 

https://finance.yahoo.com/news/fed-fomc-decision-september-2019-133503618.html

 

What does that mean or imply?


Asking for a friend.

 

Means that the fed, as a whole, is concerned about economic growth.

 

Any comments/concerns on the manufacturing report yesterday?

 

Same as always: i don't understand one iota of it.

 

No, but the florida freeze has causes some concern in the OJ market

 

Continues the trend that we were talking about a month or two ago.

There are two primary manufacturing PMIs for the US. The IHS Markit and the ISM. Both have been falling sharply. This release was the ISM. It is more weighted to large manufacturers.

The market reached heavily to the ISM PMi because it is the one used in the nowcast surveys for GDP. Both by the FED Nowcasts (St Louis, Atlanta, and NY) and the consultants. So the market will follow it because it likely moved the GDP forecast that many people were feeding into their equity models. Manufacturers were down heavily yesterday.

An ISM PMI of 44 is a recession redline - where we are now is a heavily contracting manufacturing sector - including employment.

The ISM will likely lead the IHS manufacturing PMI down in this turndown because it is driven by trade war friction and export markets, which the large manufacturers are more exposed to. That will roll into the smaller guys over time as the large guys turn export pounds toward domestic markets and attack price.

 

The We Work failed IPO is just fascinating.

 

Having an off the rails CEO didn’t help, but the concept was always going to be hampered by completely mismatched investment and revenue time horizons.

I’m disappointed. A few guys and I were planning a trip downtown to pretend like we were interested in a space just to see the show.

 

I just don’t see any way to explain the runaway valuations other than basically just calling it fraud.

 

And the S1 was freakin comedy gold

 

Yeah someone is likely going to jail.

 

I'm not kept up with this one other than knowing the bare basics. But yeah, that was.........interesting.