Ancient Archer

Serendipitous wanderer

[Ancient Archer @Ancient__Archer]

@philippilk Where will capital flee to? China has a closed capital account. Euro is more fcked than the US on any metric you care to look at.
Gold is an option.. but there is no yield there. Where else?

[Ancient Archer @Ancient__Archer]

@JavierBlas @opinion glut blas... blah blah blah

[Ancient Archer @Ancient__Archer]

@MarhelmData Fucking prostitute.. at least professional pros take the money and everyone knows they did what they do.

You are taking money and hiding it. Lying sob

[Ancient Archer @Ancient__Archer]

@MarhelmData This guy in on the payroll.
He's been ramping up his talk of normalisation while missiles and drones are flying in the SOH.

Treat his tweets accordingly. Without respect

[Ancient Archer @Ancient__Archer]

@MarhelmData Ha ha
Key sign, is it?
After all the drones and missiles flying around..
How much are you getting paid to push the normalisation narrative?

[Jaynit @jaynitx]

Charlie Munger spent 50 years studying why intelligent people make catastrophically stupid decisions.

It is the most useful thing I have ever watched:

1. Incentives are more powerful than anyone thinks. Munger says he has been in the top 5% of his age cohort his entire life in understanding the power of incentives and he has still underestimated it every single year. Federal Express could not get their night shift to work efficiently until someone realized they were paying by the hour. They switched to paying by the shift. The problem disappeared immediately.

2. People rationalise terrible behavior when their incentives point that way, and they do not even know they are doing it. A doctor in Nebraska was removing perfectly healthy gallbladders for years. When Munger asked an old colleague whether the doctor knew he was harming patients, the answer was no. he genuinely believed the gallbladder was the source of all medical evil and that removing it was an act of love. That is incentive-caused bias at its most extreme.

3. Psychological denial is real, and it is not just for weak people. A family friend's son flew off a carrier in the North Atlantic and never came back. His mother, a completely sane woman, simply never believed he was dead. Reality was too painful, so she distorted it until it was bearable. Munger says we all do this to some extent, and it causes terrible problems.

4. Consistency and commitment tendency are one of the most powerful forces in the human mind. Once you have stated a position publicly, you are psychologically locked into it. Max Planck said the really important new physics was never accepted by the old guard. A new guard came along that was less brain blocked by its previous conclusions. If this happened to the deans of physics, Munger says, imagine what it does to ordinary people.

5. The Chinese brainwashing system used on prisoners of war worked better than torture. They did not start with big demands. They maneuvered people into making tiny little commitments and declarations and slowly built from there. The same mechanism operates in every cult, every sales system, and every ideology that gets deeply embedded in people's heads.

6. Pavlovian association shapes buying behavior at a level most people never consciously process. Munger estimates three quarters of all advertising works on pure Pavlov. Coca-Cola does not want to be associated with funerals. They want to be associated with the Olympics, wonderful music, heroics. The association itself changes how people feel about the product at a subconscious level. Raising the price of a product can actually increase its market share because price and quality are associated in the human mind, and people use price as a signal of value.

7. Persian messenger syndrome is alive and running every major organization. The Persians killed the messenger who brought bad news. Bill Paley in his last 20 years, did not hear one thing he did not want to hear. everyone around him knew bringing bad news was dangerous. The result was that one of the most powerful men in media made terrible decisions for two decades because reality never reached him.

8. Social proof causes otherwise intelligent people to follow each other off cliffs. When one oil company bought a fertilizer company in the 1970s, practically every other major oil company rushed out and did the same. There was no rational reason for oil companies to own fertilizer companies. But if Exxon was doing it, it was good enough for Mobil. Every single acquisition was a disaster.

9. The efficient market theory persisted in academia for decades despite Berkshire Hathaway existing as a living contradiction. One economist kept adding sigmas to explain away the anomaly. two sigma, then three, then four, eventually six sigma. Munger's observation: It is better to add a sigma than change a theory just because the evidence comes in differently. That economist later went into money management himself and sank like a stone.

10. Contrast bias warps perception constantly and invisibly. Put your hand in hot water, then room temperature water. It feels cold. Put your hand in cold water, then room temperature water. It feels hot. same bucket. The human sensory apparatus has no absolute scale, only a contrast scale. Real estate agents exploit this deliberately. They show you two overpriced, awful houses first, then take you to a merely overpriced house, and it feels like a bargain.

11. The frog in slowly heating water is the business version of contrast bias. If something bad comes to you in small pieces, you are likely to miss it entirely. Munger says he has known many high-powered brilliant businessmen who were destroyed this way. not because they were stupid but because each incremental change was too small to trigger alarm. The contrast was never large enough to notice.

12. Authority bias is so powerful it can make trained professionals watch a plane crash. In flight simulator experiments, when the pilot, the authority figure, does something that any trained co-pilot knows will crash the plane, 25% of the time, the co-pilot sits there and lets it crash anyway. They have been trained to know better. The authority relationship overrides the training.

13. Deprivation super reaction syndrome explains why people go insane over small losses. Munger's neighbor had a 180 degree view of the harbor. the neighbor put in a pine tree about 3 feet high that turned it into a 179 and three-quarter degree view. They had a blood feud that went on for years. The New Coke disaster is the corporate version. Coca-Cola told customers they were changing a flavor and triggered a deprival super reaction so powerful that Pepsi was weeks away from releasing old Coke in a Pepsi bottle. smart engineers. brilliant lawyers. armies of psychologists. All missed it.

14. Envy and jealousy are far more powerful than greed and almost entirely absent from psychology textbooks. Munger says Warren Buffett has said half a dozen times that it is not greed that drives the world but envy. In a thousand-page psychology textbook, the index entry for envy and jealousy is blank. One of the most powerful forces in human behavior and academia essentially ignores it.

15. Gambling addiction is not explained by variable reinforcement alone. Skinner thought he had fully explained gambling by showing that variable reward schedules pound in behavior more powerfully than fixed ones. But the people who design modern slot machines know things Skinner did not. Lotteries where you pick your own number get far more play than lotteries where the number is assigned to you. People who commit to a number believe it has more validity because they chose it. Near misses on slot machines trigger deprival super reaction syndrome. It is four or five psychological tendencies working together, not one.

16. The most dangerous situations are when multiple psychological tendencies combine toward the same end at once. Munger calls this the lollapalooza effect. Tupperware parties use four or five tendencies simultaneously. Moonie conversion methods combine multiple tendencies and work extraordinarily well. alcoholics anonymous achieves a 50% no drinking rate when everything else fails because it also combines multiple tendencies toward a constructive end. The Milgram experiment is not just about obedience. it involves authority bias, consistency and commitment tendency, and contrast effects all working together. That combination turns human brains into mush.

17. Boards of directors are structurally designed to fail as corrective mechanisms. The top executive is the authority figure. He is doing something questionable. You look around, and nobody else is objecting, which is social proof that it is fine. He flies you around in the corporate jet and raises your director fees every year, which triggers reciprocation tendency. Munger's rule: boards only act when the behavior gets so bad it starts making them look foolish or threatens legal liability. That is the only forcing function that reliably works.

18. John Goodfriend of Salomon Brothers destroyed his career and reputation because he did not fire a trusted employee who had lied to the government. Every psychological tendency pointed toward keeping the man. He was a close colleague. His wife was known. He was part of a group that had made over a billion dollars for the firm. He said he had never done it before and would never do it again. Goodfriend looked into his eyes and believed him. The man did it again. The lesson: everyone who gets caught embezzling says they have never done it before and will never do it again. That is what they all say.

19. Darwin avoided confirmation bias by deliberately seeking out disconfirming evidence. Munger says Darwin was not especially smart by ordinary standards of human acuity. Yet he is buried in Westminster Abbey. Munger studied how Darwin worked and realized he had psychological tricks worth learning. Darwin always paid extra attention to evidence that contradicted his theories. Munger started doing the same and credits it as one of the most important intellectual habits of his life.

20. Why is the most important word in communication? Carl Braun designed oil refineries with spectacular skill, and you got fired in his company if you wrote a communication without explaining why. not just who, what, where, and when, but why. Braun knew that in a complex system where things can blow up, a communication system that always explains the reason behind an instruction works dramatically better than one that does not. Forstein, the general counsel of Salomon, told Goodfriend on multiple occasions that he had to report the employee's misconduct. He explained it was the right thing to do. He never explained what would happen to Goodfriend personally if he did not. he failed to use the most powerful tool of persuasion. Goodfriend ignored him. When Goodfriend went down, Forstein went with him.

[Ancient Archer @Ancient__Archer]

@nickcollins1953 Beautifully said!
Bravo!!

[Ancient Archer @Ancient__Archer]

@manurishiguptha Bhaang khaye ho kya?
Oil will stop flowing very soon to vehicles. Not following the news from Iran or what?

Open your eyes

[Ancient Archer @Ancient__Archer]

@sidhant_sarthak @PMOIndia @ncert

[Furkan Gözükara @FurkanGozukara]

LMAO 100s of millions of people would love this movie to be real brutally cooking Trump administration 😭🤣😂

[JH @CRUDEOIL231]

What is the North Sea physic mkt, and how should the gap between the paper and physical markets be resolved?

Every time I post about the physical market, I see a lot of complaints about why oil prices aren't rising further. Many ppl even criticize me, claiming I’m not explaining things properly.

First, I’ll summarize the basic components of the North Sea market.

ICE Brent Futures: A financially settled paper contract used primarily for broad directional hedging and speculation without the intention of physical delivery.

EFP (Exchange of Futures for Physical): A swap that acts as a bridge, allowing a trader to convert a paper futures position into a physical cargo contract.

Forward Brent: A standardized OTC physical swap for future delivery. It represents actual oil but remains non-dated bc the exact loading schedule is not yet determined.

Dated Brent: The global benchmark price for physical crude. It is assessed daily by agencies like Platts based on actual trades of the most competitive grade within the BFOET+WTI basket, triggered once specific loading dates are confirmed (typically 10-30 days prior).

CFD: A short-term swap representing the price difference between Forward Brent and Dated Brent. It is used to plot the physical forward curve and assess whether the market is in contango or backwardation.

DFL (Dated to Frontline): A swap that links the physical Dated Brent assessment directly to the front-month ICE Futures contract, managing exposure between the physical and financial markets.

Diff (Grade Basis): The premium or discount applied to a specific physical cargo relative to the Dated Brent benchmark. Driven by crude quality, logistics, and refinery demand, this unhedgeable spread is where physical traders generate profit.

This alone should be enough. From there, I’ll explain how the gap between the paper market and the physical market actually closes.

A massive divergence between Dated Brent (physic) and ICE Brent futures (paper) typically indicates acute near-term physical tightness relative to forward expectations.

If Dated Brent remains at $120-130/bbl leading into the expiration of the front-month ICE Brent futures contract (currently around $100/bbl), the futures contract must converge toward the physical price.

The convergence is not optional; it is mathematically enforced by the exchange's settlement rules and market arbitrage. This operates through three primary mechanisms:

1) Cash Settlement via the ICE Brent Index

ICE Brent futures are cash-settled upon expiration and do not involve physical delivery. Expiring contracts are settled against the ICE Brent Index.

The Index is a calculated average of trading activity in the relevant physical Forward BFOET(Brent, Forties, Oseberg, Ekofisk, Troll)+WTI Midland market during the final trading days of the futures contract.

Bc Forward Brent and Dated Brent are intrinsically linked, a physical market sustaining $130 will generate an ICE Brent Index near $130.

Consequently, any futures positions left open at expiration are forcibly settled at this higher Index price.

2) The Arbitrage Channel (EFP Mechanism)

If a $30 spread exists between paper and physical markets, traders will immediately exploit the arbitrage using the EFP mechanism.

Traders buy the undervalued ICE Brent futures at $100 and simultaneously sells a physical Forward Brent cargo at $130. They execute an EFP to swap their long paper futures position into a long physical Forward position.

The newly acquired long physical position cancels out their short physical position, locking in a profit (minus the EFP swap cost). To execute this arbs on a large scale, traders must aggressively buy ICE futures. This massive purchasing volume forces the futures price up until the gap closes and the arb window is eliminated.

3) Forced Short Covering

Market participants holding short positions in the ICE Brent futures market face extreme risk if the physical market disconnects to the upside.

Knowing the contract is destined to cash-settle against a $130 physical Index, paper shorts cannot afford to hold their $100 positions into expiration.

They are forced to buy back their futures contracts to close their positions before the expiry date.

This forced buying—often resulting in a short squeeze—accelerates the upward momentum of the ICE futures price, driving it into alignment with the physical market.

Through the combination of final index settlement and active EFP arbs, the paper market is structurally tethered to physical reality as expiration approaches.

#oott #iran

[JH @CRUDEOIL231]

I actually wrote this back on March 18th to explain things to my Korean friends, but I'm posting it here on X as well since so many ppl still seem to get it wrong.

Global Total Crude Inventory = Commercial MOI + Commercial Available Inventory + Surplus crude + SPR

The world looks like it’s overflowing with oil, but prices don’t wait for all 2 billion barrels of global inventory to vanish before they spike. Every single time oil crossed $100/bbl, it was the same story.

Take the US as the prime example. Right now, US commercial crude inventory is sitting around 440 million barrels, but that number physically cannot drop below 280–300 million.

You might say, "What the hell are you talking about? Just draw it down, you idiot lol." But let’s look a bit closer.

That "Commercial MOI" I mentioned stands for Minimum Operating Inventory. This isn't oil sitting in a refinery tank or a hub ready to be used instantly.

MOI is the volume physically locked in the system you cannot pull out. It’s the baseline required just to keep the entire US oil system running.

Here are the main components:

1) Linefill: This is the oil filling the entire pipeline network across the US. bc of the "push from one end to get out the other" structure, about 110–120 million barrels must stay in the pipes at all times.

2) Tank Bottoms: This is the volume at the very bottom of storage tanks that pumps literally can’t reach. Estimated at around 80–90 million barrels.

3) In-transit & Working Stock: The minimum volume sitting on tankers, barges, or waiting at refineries to be blended and fed into the units. Without this base feed, the refinery simply stops.

Just combining Linefill and Tank Bottoms (Unavailable Stocks) gives you ~200 million barrels. Add the Working Stock needed for operational flexibility, and ~300 million barrels becomes the actual hard floor.

I used the US as an example, but you probably get the point by now. The "Global Total Onshore Inventory" figure includes all that MOI—Linefill, Tank Bottoms, etc.

Since it’s global, we don't have the exact numbers, but this MOI accounts for 60-70% of the total figure. Minimum Working Stock is another 20-25%.

Most of those 2.3 billion barrels are scattered across tens of thousands of kilometers of pipelines and the bottoms of thousands of storage tanks.

The vast majority is essential just to keep the system alive; it’s physically impossible to gather it all in one place and dump it onto the market.

Therefore the actual available crude—the delta actually moves prices and balances—is much smaller than ppl think. That’s why the oil market sees massive price swings even over a quarterly shift of just 1mb/d.

Think of the "buffer" I mentioned as cash on hand for immediate liquidity. The rest of those 2.3 billion barrels? That’s like your factory equipment.

No matter how much equipment you have, if you run out of cash, you go bankrupt. The oil market is the same; once that tiny sliver of available crude vanishes, the system hits a crisis and faces desperate bidding.

Right now, we are in the phase of burning through the "excess cash" in the corporate account. And we're doing it very fast. Next we'll start dipping into personal savings.

But like most business owners, there isn't actually much cash in the personal account. It’ll run dry in no time.

Now imagine if you knew as long as you kept the factory running, you could eventually pay off the debt and fix the cash flow—but right now you don’t have a single cent of available cash. What happens?

To keep the factory from going under, you’d do anything to scrape together cash for the electric bill and payroll. You’d sell your kid’s iPhone or even put your wife on the street—you’d do anything desperate to get that cash.

Once we hit that stage, prices go absolutely vertical. Bottom line: when the buffer is gone, you have to start withdrawing all available commercial inventory. The pace will be lightning fast.

Even the ppl who were sitting on the sidelines hoping for the war to end will start bidding desperately bc they need oil 'right now'. I’m not just acting calm or pretending I’m okay with this taking a long time.

Even if you believe a long position is the way to go, there’s a specific process and setup must be cleared for the environment to force prices up. And it won't take that long.

Until then I expect vol to be absolutely violent in both directions.

#oott #com

[Lou Pai, CEO, Enron Energy Services (parody) @EnergyPeddler]

The hardest thing to figure out is Iran’s willingness to make a deal. From reading the press, you’d think the two sides are very close.

But, in a scenario where Iran wants to play games, they’d also be following the same strategy. Make it look like you want a deal while letting the time pass and the energy market gets tighter and tighter.

That was basically the thesis behind being long. I didn’t think this would end until oil products prices reached panic levels. $4 gas and $5 diesel are high, but not freak-out levels by any stretch.

So until that happened, I didn’t think Iran would be willing to make a deal because they’d be leaving a lot of leverage on the table.

Their acceptance of a ceasefire surprised me. I didn’t appreciate that maybe they are getting close to their max pain tolerance also. Or maybe it is a strategic move intended to save them from getting shelled while the energy market continues to tighten.

Been very hard for me to give up on my thesis that Iran would play for maximum leverage in the oil market before cutting a deal, but at some point you have to look at the tape and seriously consider if you are wrong.

There are all kinds of other factors at work. Initial margins have been raised, longs and shorts have both been crushed. Longs especially now can’t seem to hold on at all. @IliaBouchouev has pointed out that books are vol targeted and we are realizing so high that no one can hold positions. The market is a mess.

I do think the market remains too sanguine on the prospect of Iran making a deal and that energy flows will resume to normal shortly. But I’m about as doubtful now as I’ve been since the conflict started that I’m just wrong.

Interestingly, we are entering the phase of the market where onsite draws should start materializing quite strongly. Iran has basically already accomplished the hard part. SPR releases, sanctions waivers, oil on water drawdown, getting the snot bombed out of them. 4-6 weeks later the last cargoes that left the Strait have discharged.

The timing of this whole capitulation in prices is super bizarre. Makes little sense if you’re Iran to fold now. But that is what the market is saying. Conversely, it is the perfect time to feign that you are serious about making a deal. Lull your enemy into some false comfort while the shortages kick-in in earnest.

Idk, whole thing doesn’t make any sense. @mb_ghalibaf you should read this shit and tell me what’s happening.

[Ancient Archer @Ancient__Archer]

@Dark90e @cirnosad India invented chess
Look it up

[Maj Manik M Jolly,SM @Manik_M_Jolly]

One of the greatest videos EVER 😂😂

She’s standing in protest to support ‘gays of Hormuz’ while ‘straights of Hormuz’ are being targeted.

Yes, you read it right. Watch the video 😅

[Ancient Archer @Ancient__Archer]

@majinsayan Creating indians??
The Indian text you quote is in Sanskrit. Read a bit and improve ur knowledge. We have manuscripts thousands of years old. We still have a tradition of memorizing the Vedas that is still being continued.
Don't get confused with whites ruling India for a while

[Ancient Archer @Ancient__Archer]

@homam108 Sir, from your own analysis I learnt about the importance of stationary planets. Most of Israel's wars have started close to Jupiter or Saturn station. March 11 is Jupiter station. March 3 is eclipse. March 1-2 is Purim. That's when it'll start

[Ancient Archer @Ancient__Archer]

@Shankarraman @homam108 Why? Is Trump Muslim? Or is he going to hold off striking Iran then just because people will be fasting?? What's the logic

[Ancient Archer @Ancient__Archer]

@ChowkidarChokra @AskAnshul @captrajlakhani @grok @BBC @BBC not acceptable to have such people in your office in India. Fire this guy immediately

[Ancient Archer @Ancient__Archer]

@Intel_Sky @grok is the USS George H.W. Bush inbound to Iran?