EUROPE’S ENERGY CRISIS IS KEEPING ENERGY PRICES HIGH
America leads the world in oil and gas production. We believe midstream energy infrastructure offers predictable cash flows to investors.
MLP Humor — A Target-Rich Environment
Humor can be a most effective weapon against your adversaries, especially when more extreme measures are unavailable. MLP management teams have made many poor capital allocation decisions in recent years, providing a rich source of material for an observer armed with both wit and a deep knowledge of the sector’s history. On Twitter, such a […]
Blinded By The Bonds
German 30 year bunds yield 0.6%. Investors are inured to insultingly low yields, but somehow this still shocks. The ECB defines price stability as inflation “…below, but close to, 2% over the medium term.” Assuming it averages 1.5%, investors are accepting a negative real return virtually in perpetuity. French energy company Total (TOT) issued perpetual […]
The Quiet Investors in Energy
The S&P Energy sector has delivered the worst returns of eleven sectors for four of the past five years. Reflecting investor disdain, energy is now around 6% of the S&P500, down by half in the past decade. Realizing the full potential of the Shale Revolution has demanded a lot of capital – over $1TN by […]
Bond Market Corrects Fed
Last week stocks shuddered as ten year yields dipped below treasury bills, reminding investors that yield curve inversions eerily precede recessions. A Cleveland Fed model using the yield curve gives a 30% probability of a recession within a year, up from 24% in December. Nonetheless, the S&P500 is within 5% of its all-time high, reflecting […]
A Slogan Not Science
JPMorgan’s recent Eye on the Market: Energy Outlook 2019 is the best analysis we’ve seen of the Green New Deal (GND). Author Mike Cembalest, whom I know from when I worked there, as always takes a balanced approach supported by insightful research. Cembalest breaks down the challenge aided by figures and charts to pick the […]