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September 18, 2022

The Fed Is Fuct Part 3


Part 1        Part 2 Investors like to focus on QE and QT, because the quantity of money has an immediate effect on risk assets. In the same way, we like to focus on the Fed Funds Rate as the price of money also has a dramatic effect on risk assets. Oddly, we rarely focus on the actual banking function of the Read More
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August 22, 2022

The Pause…


I have frequently described “Project Zimbabwe” as a highly inflationary cycle where both fiscal and monetary stimulus go into insanity mode. While I sincerely hope we don’t go hyperinflationary like Zimbabwe, I certainly think we see an elongated period of substantial and debilitating inflation. When this cycle finally ends, society and our financial system will have been irreparably changed. For those who are aware Read More
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June 13, 2022

Volcker and Inflation…


For my entire career, Paul Volcker has been deified. In fact, I cannot think of an unelected government official, since the Generals of WW2, who is held in such esteem—which may also be a function of how terrible most government functionaries are. As JPOW suddenly pretends that Volcker was his boyhood hero, I think it’s worth re-examining Volcker’s inflation fight. Of course, everyone knows Read More
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May 26, 2022

The Fed Is Fuct (Part 2)…


Part 1 is here. Let’s try a thought experiment here. Fast forward into winter. The Fed has been on autopilot and has continued to raise rates. They’ve managed to crush risk assets and the “negative wealth effect” is rapidly filtering through to the consumer economy. All the guys trading meme stonks and monkey JPEGs have now returned to their prior jobs and the supply Read More
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May 16, 2022

The Fed Is Fuct…


The Fed is fuct. They know it. We know it. They know we know it. They intend to continue the charade anyway. Despite centuries of study, no one really knows what causes inflation. While it tends to show up during periods with excessive money printing and large fiscal deficits, sometimes such periods have not witnessed inflation. No one knows why it shows up when Read More
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April 25, 2022

The Undertow…


Think back to the summer of 2019. Back before COVID and before oil traded with a negative integer. I remember foolishly trying to find a bottom in oil and gas producers. While, I am no specialist in energy, the prices seemed unhinged from reality. Multiple producers were trading at large discounts to stated PDP, even using crazy strip values. There were even a few Read More
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April 18, 2022

The New Levels…


For over thirty years, excluding a few brief spikes, copper traded in a range between $0.60 and $1.00 a pound. In many ways, that range became self-fulfilling as an entire generation of producers and consumers came to expect that it would remain in that range. They’d sell excess inventory when it poked over a buck and fill warehouses in the sixties. That range defined Read More
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February 15, 2022

Impediments To US Oil Production Growth…


I recently interviewed my good buddy Josh Young, from Bison Interests, on a Twitter Spaces where we discussed all the unappreciated impediments to a resumption of US oil production growth. We cover a lot of topics and take a grand tour through all the various subsectors, components and suppliers needed to drill and produce a well. Despite spending a lot of time following oil, Read More
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January 3, 2022

The Great Rotation…


In a few short hours, we’re headed back into the trenches. No sleep for us weary hedgies. They’ve re-set the performance clock at zero and we’ve got to fight our way forward, showing why we’re worth those incentive fees. Before heading off for battle, I figured a 2022 roadmap would be helpful. Here’s mine. I’ve been critical of the Ponzi Sector for quite some Read More
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