Blog
THE AI REVOLUTION NEEDS ENERGY
US natural gas demand is growing to supply data centers and LNG exports. We believe midstream energy infrastructure offers predictable cash flows to investors.
The Fed’s Hobson’s Choice
The Fed has a problem with long-term yields. They are remaining stubbornly low, in willful defiance of steadily increasing short term rates. Slowing the economy so as to raise unemployment will be hard unless bond yields move high enough to impede some capital investment and debt issuance. There were signs of this in the spring […]
Earnings and Pending Legislation Good For Pipelines
The theme to pipeline earnings for 2Q22 is one of positive surprises. It reminds me of Don Layton, former vice chair at JPMorgan and more recently CEO of Freddie Mac, when I told him I’d hired a new derivatives trader with a perfect Math SAT. Don, not easily impressed, responded by recounting a class he […]
Liquefied Natural Gas Shows Up In More Places
To the twin certainties of death and taxes, the energy investor might add increased US exports of Liquefied Natural Gas (LNG). The outcome of Russia’s invasion of Ukraine is far from certain, but it’s hard to envisage Europe ever relying on Nord Stream 2 for natural gas. Moreover, once the flows from Nord Stream 1 […]
Life Gets Complicated For The Fed
Making eurodollar futures interesting is not among Fed chair Jay Powell’s goals, but he’s achieved it nonetheless. From just after their June FOMC meeting through Thursday, the market has lopped over 0.50% off the projected rate cycle. The cycle peak has even been brought forward, from March 2023 to this coming December. The FOMC’s Statement […]
Bad Investment Ideas Still Flourish (Part 1)
I spent the last couple of days at LPL’s Focus event in Denver, meeting a good number of clients and prospects. Denver’s enormous conference center was teeming with LPL financial advisors. CEO Dan Arnold gave an inspiring talk. Human contact is roaring back. On the flight out to Denver, a couple of recent conversations reminded […]