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.
Oil And Pipelines Less In Sync
The relationship between crude oil and pipelines exhibits the qualities of a copula distribution. This was suggested to us last week by a highly numerate financial advisor, commenting on the tendency of the midstream energy infrastructure sector to have its biggest falls when oil is also collapsing. It is an unfortunate historical truth that a […]
Why Keep Money At A Bank?
I looked through First Horizon Bank’s (FHN) 10K last week. They were in the news because Toronto Dominion (TD) canceled their merger agreement due to uncertainty about when they might receive regulatory approval. FHN’s stock slumped to below $10. The merger price, agreed in February of last year, was $25. FHN CEO Bryan Jordan told […]
The Inflation Reintroduction Act
The Inflation Reduction Act (IRA) may be the least appropriately named legislation in recent memory. That doesn’t detract from its impactfulness. Ever since its passage last summer, energy companies have been exploring ways to benefit from the uncapped tax credits and other subsidies available. The IRA provided an improved tax credit of $180 per tonne […]
Not Yet Cool Enough
The regional banking crisis rolled on with two key developments on Friday. One was the release of several reports detailing the errors that led up to Silicon Valley Bank’s sudden collapse. Poor regulatory oversight combined with an absence of risk management were to blame. The other was the slow collapse of First Republic, which is […]
Inflation vs Regional Bank Crisis
This Friday’s inflation update will include the monthly Personal Consumption Expenditures (PCE) deflator and the Q1 Employment Cost Index (ECI). The Fed prefers the PCE because its weights are dynamic. When apples rise in price relative to oranges, CPI assumes no change in behavior, whereas some substitution towards oranges is to be expected. PCE picks […]