spookysilver

Founder & CIO - India Pvt Mkt Funds | ex coder, consultant, iBanker | Student of History | On Arts, Macro, Gold, Geopolitics, Physics, #booknotes #ArtInvestLive

[spookysilver @spookysilver]

Random musings
--------

1)
Have you read The Godfather?

If the Families try to take out Sonny, and eventually do take out Sonny, that doesnt mean they are at war with Sonny.

2)
And sometimes, the good son uses up all the bullets on a shooting range so that the bad son has none left to use.

3)
What our current generations doesnt understand is - that intelligence isnt enough.

Knowledge of history, 3000 years of history, is also needed to understand how the world works.

Since they dont realise, they refuse to aquire knowledge even when thrust onto them.

This is very convenient for the rulers, who created the managerial class (politics) and companies (nation states) for this very purpose - of creating diversions, from their wealth, and games.

[spookysilver @spookysilver]

The yen is now in the plaza accord range.

It had moved from 240 odd at time of accord signing to 140 odd within 3 years of signing.

At 160 odd right now, with many saying its fair value being 200-210, were it not for BoJ...

...we are effectively seeing that jpy is perhaps behaving sovereign, with boj managing the path of transition to avoid jerks...

If true, then free liquidity to the world via jpy carry trade is gone. And a new deflationary force via jp mfg prowess is being reborn...driven by front loaded capex as you rightly point out ..

If this trend is real, and it lasts, and its structural then we shld start seeng its effects by turn of the decade....

[spookysilver @spookysilver]

gold falling
--------
My sense is that the gold paper longs (hedges against a weak $) are being unwound

Hedges are being unwound as near term outlook has shifted to a strong $

Part of the shift is bec of US Treas. Secy talking up the $ a few days ago

Part is due to the whole commentary around fed rate hike expectations

Overall, a strong $ expectation is geopolitical.

Till this remains, gold shld keep sliding down.

The thesis breaks as soon as there are disruptions - either in physical gold market, or in $ expectations (macro or geopolitical)

[spookysilver @spookysilver]

@EvanWritesOnX Can you explain this further - when and how - they "bought their sovereignty"

[spookysilver @spookysilver]

I don't think that conks is Zoltan.

I have carefully read each report by Zoltan that is in public domain, which includes pretty much everything while at CS and everything while at the Fed. And I have read much of what Conks writes.

The two are in no way comparable.

The charts of conks don't even make any sense (to me at least). They look all nice and elaborate. But they don't mean anything. They don't for a useful input into either furthering one's understanding or one's analysis. But if one understands the first principles of macro economics, Zoltan makes a tonne of sense.

[Lee Roach @leevalueroach]

I have read approximately 3,000 10-Ks in my life. I have read my wife’s emotional state correctly maybe 11 times. This is troubling because the skills should transfer. Both require you to look past the headline. Both require you to read the footnotes. Both require you to notice what was said last quarter that is not being said this quarter.

I can spot a goodwill impairment from 40 pages away. I cannot spot that my wife has been quietly furious since Tuesday. In a 10-K I notice when management changes the word “challenging” to “dynamic” and I correctly interpret this as a warning. In my marriage my wife changed the word “fine” to “fine.” and I did not notice the period. The period was the entire disclosure.

I missed it. I read a footnote last week in a packaging company’s annual report that disclosed a related-party transaction worth $400,000 and I caught it in 90 seconds. My wife told me three times this month that she was tired and I interpreted this as “tired” when in fact it was a Level 3 disclosure requiring immediate management response. I have a system for 10-Ks. I read the MD&A first, then the risk factors, then the cash flow statement, then the notes. I have no system for my wife. She is a company that does not file. She reports continuously and without warning and the format changes every quarter. Her risk factors are not enumerated.

Her MD&A is delivered through sighs of varying length and I have not yet developed the ear. Last week she said “do whatever you want” and I did whatever I wanted and it turns out the correct interpretation of “do whatever you want” was “do not do that specific thing” and I have no idea how I was supposed to know that, and yet, looking back, the signals were all there. The signals are always there. I have been trained to find signals. I find them in companies I will never meet. I miss them in the person I have lived with for nine years. My wife has started saying things like “you would notice this if I were a stock” and she is correct. She is correct. If she had a ticker I would have already built a 6,000-word model on her. I would know her seasonality.

I would know her capex cycle. I would know which quarters historically run hot. Instead I treat her like a private company and I am surprised every time the auditors arrive. I am going to bed now. She said good night in a tone. I do not know what the tone meant. I will find out in the morning. Or I will not. The 10-K of my marriage is filed in real time and I am, as always, three quarters behind.

[spookysilver @spookysilver]

@gave_vincent @PauloMacro Then the victors inspire Schacht to reform the bundesbank and make bunds great again.

[spookysilver @spookysilver]

Yesterday
-----------

Hearing Mr Warsh's press conference yesterday reminds one of Lou Gerstner who made an elephant (IBM) dance (change).

But when elephants dance, it sets the stage for next several decades.

K street in DC is unlikely to get much sleep for the rest of the year as it seeks to shape the dance moves at the Eccles.

But

But yestwrday we also saw images of a treaty being signed at Versailles. The last big one at Versailles was signed 10 decades ago, which set the stage for world war II within 2 decades of signing and a new world for the next 8 decades. The choice of location reveals the continuity of how power is held in this world.

The issue in the 1920s treaty wasnt the terms per se. It was repatriations. Which led to formation of BIS in Basel and of financial power moving from fiscal authorities to monetary ones. And It was BIS that ultimately determined the allocation of financing of world war II. Of picking winners. But it wasnt so clear to observers at the time of Versailles what these next 2 decades of moves on the chess board were going to be, except to a very few.

Yesterday was a monumental day.
A treaty at Versailles.
The Fed announcing introspection.
(When was the last time BoE did so?)

Yesterday should end up being marked in future-history as such.

[spookysilver @spookysilver]

Perhaps, the FPI exit needs to be seen as a key part of a geopolitical negotiation using levers of fx rate & energy availability, among others.

The FPI exit (gift-wrapped as an AI story) hurts the fx rate....wherein RBI, facing the proverbial trilemma, while holding on to rates, needs to choose btween fx rate (price level) and flows (BoP)...

The whole situation is helped by the rise of Passive (price insensitive) over the past decade.

Your eloquent 5 min clip well establishes the broadly steady state of valuations amidst this selloff.

We have seen this story unfold before, in Eurasia, and in a much more destructive way - '94, '97...et al

[spookysilver @spookysilver]

@nourxalnasser Its not their fault, usually.

Partly biologics (wiring)

Partly circumstances (true education, social setup)

There is very little autonomic agency involved. Mostly.

[spookysilver @spookysilver]

@LukeGromen @monetaryskeptic Well said

And this, is the crux of the matter...

When you
- start exporting raw materials (oil in this case)
- and stop importing finished goods (via all the friendships renewed under tariff wars)

Then, what exactly is the point of "power" - whether uni or multi polar?

[First To Hear It @firsttohearit]

REPORTER: You mentioned that, staying on as Fed governor, you intend to keep a low profile. Could you give us a little more detail on what that looks like?

JEROME POWELL: *ducks down*

[spookysilver @spookysilver]

@mtmalinen Nyet. To my knowledge.

[spookysilver @spookysilver]

I did not understand your point.

At the end of the day - one can either seek popularity or seek thoughtfulness. The two are mutually exclusive, for most people

Just like Power vs Morality. The two are mutually exclusive, for most.

Mainstream media is a popularity according platform. To seek extreme thougthfulness from it, is perhaps to place too high a burden on it.

Mr Arora knows it more than others as he is among the few that has been able to pursue both popularity and thoughtfulness.

Perhaps his similar expectation from Mr Borate reflects his aspiration from Mr Borate.

And Mr Borate's claim that he is in fact exceeding that expectation...currently falls short in eyes of Mr Arora.

My submission is that the fund managers by-and-large, bith long-only and alts, both inst and retail, stand behind a far higher guilt on this accord, than the media community...

[spookysilver @spookysilver]

To be fair,
And respectful,
@Iamsamirarora, pls consider that:

One cannot expect a well meaning (i dont know Mr Borate, and assume he is well meaning) journalist to be sharply aware of investment plumbing, when MOST fund managers themselves arent. Not everyone has your level of understanding.

Because slogans, sharp wit, analogies raise capital, not thoughtfulness, which is attention sapping and boring...for both inst and retail LPs.

Your point is valid, but its perhaps better directed at the industry "stalwarts" who have built fund raising engines and dont care much about the investments side...and who frequent front pages of newspapers, spreading FALSE GOSPEL.

[spookysilver @spookysilver]

@Iamsamirarora Because thoughtfulness has not much of an audience any more. Gone are the times of Lincoln.

ELI5 rules.

[spookysilver @spookysilver]

Random musings
--------

1)
Have you read The Godfather?

If the Families try to take out Sonny, and eventually do take out Sonny, that doesnt mean they are at war with Sonny.

2)
And sometimes, the good son uses up all the bullets on a shooting range so that the bad son has none left to use.

3)
What our current generations doesnt understand is - that intelligence isnt enough.

Knowledge of history, 3000 years of history, is also needed to understand how the world works.

Since they dont realise, they refuse to aquire knowledge even when thrust onto them.

This is very convenient for the rulers, who created the managerial class (politics) and companies (nation states) for this very purpose - of creating diversions, from their wealth, and games.

[spookysilver @spookysilver]

@Safi_Ptesanwi Thanks. So it continues....

[spookysilver @spookysilver]

Whats happening to energy infra fires/explosions?

(Edited to include more details)

Non War related
(12 incidents in 50 days)
------------------

01 Mar - Esmeraldas, Ecuador, Fire at largest oil refinery (Petroecuador)

05 Mar - Channelview (Petromax), Texas, USA, Refinery fire

12 Mar - Texas, USA, Energy infrastructure incident

23 Mar - Port Arthur, Texas, USA, Refinery explosion & fire

03 Apr – ONGC Bombay High, Off Mumbai Shores, India

09 Apr - Dos Bocas, Mexico, Refinery fire

14 Apr - Sakti, Chhattisgarh, India, Boiler explosion at Power Plant

15 Apr - Geelong, Australia, Major fire/explosions at Viva refinery

16 Apr - Haripur, Pakistan, Gas pipeline explosion

20 Apr – HPCL Rajasthan, India, Plant was to be commissioned shortly

20 Apr – Myanmar, Energy infrastructure incident

21 Apr - Texas, USA, Energy infrastructure incident

Gulf War
----------

02 Mar - Ras Tanura, Saudi Arabia, Drone strike on oil refinery; fire

17 Mar - Fujairah, UAE, Oil industry zone fire from drone strike

18 Mar - Ras Laffan, Qatar, Missile strikes on LNG facilities; extensive damage/fires

19 Mar - Mina al-Ahmadi, Kuwait, Drone strikes on refinery; fires

19 Mar - Yanbu (SAMREF), Saudi Arabia, Drone strike on refinery

Ukr War
--------

03 Apr - Ufa (Novo-Ufimsk), Russia, Ukrainian drone attack on refinery; fire/shutdown

04 Apr - Russia (specific facility), Drone attack on energy infrastructure

05 Apr - Kstovo (Nizhny Novgorod/Lukoil), Russia, Drone damage to refinery & oil pipeline; fire

06 Apr - Novorossiysk, Russia, Ukrainian drone strikes on Black Sea oil terminal; fires

16 Apr - Tuapse, Russia, Ukrainian drone strike on oil refinery/port; fire

18 Apr - Russia (two facilities), Ukrainian drone attacks on energy infrastructure

20 Apr - Tuapse, Russia, Ukrainian drone strike on oil refinery/port (repeat attack; fire)

I may yet have missed some

[spookysilver @spookysilver]

@Cheekybaua Perhaps some people are not liking the nature of geopolitical winds blowing in the deserts and expressing it thus...

[spookysilver @spookysilver]

@thecoastguy Here's a quick listing:

https://t.co/VzQBjy9pGi

[spookysilver @spookysilver]

Whats happening to energy infra fires/explosions?

(Edited to include more details)

Non War related
(12 incidents in 50 days)
------------------

01 Mar - Esmeraldas, Ecuador, Fire at largest oil refinery (Petroecuador)

05 Mar - Channelview (Petromax), Texas, USA, Refinery fire

12 Mar - Texas, USA, Energy infrastructure incident

23 Mar - Port Arthur, Texas, USA, Refinery explosion & fire

03 Apr – ONGC Bombay High, Off Mumbai Shores, India

09 Apr - Dos Bocas, Mexico, Refinery fire

14 Apr - Sakti, Chhattisgarh, India, Boiler explosion at Power Plant

15 Apr - Geelong, Australia, Major fire/explosions at Viva refinery

16 Apr - Haripur, Pakistan, Gas pipeline explosion

20 Apr – HPCL Rajasthan, India, Plant was to be commissioned shortly

20 Apr – Myanmar, Energy infrastructure incident

21 Apr - Texas, USA, Energy infrastructure incident

Gulf War
----------

02 Mar - Ras Tanura, Saudi Arabia, Drone strike on oil refinery; fire

17 Mar - Fujairah, UAE, Oil industry zone fire from drone strike

18 Mar - Ras Laffan, Qatar, Missile strikes on LNG facilities; extensive damage/fires

19 Mar - Mina al-Ahmadi, Kuwait, Drone strikes on refinery; fires

19 Mar - Yanbu (SAMREF), Saudi Arabia, Drone strike on refinery

Ukr War
--------

03 Apr - Ufa (Novo-Ufimsk), Russia, Ukrainian drone attack on refinery; fire/shutdown

04 Apr - Russia (specific facility), Drone attack on energy infrastructure

05 Apr - Kstovo (Nizhny Novgorod/Lukoil), Russia, Drone damage to refinery & oil pipeline; fire

06 Apr - Novorossiysk, Russia, Ukrainian drone strikes on Black Sea oil terminal; fires

16 Apr - Tuapse, Russia, Ukrainian drone strike on oil refinery/port; fire

18 Apr - Russia (two facilities), Ukrainian drone attacks on energy infrastructure

20 Apr - Tuapse, Russia, Ukrainian drone strike on oil refinery/port (repeat attack; fire)

I may yet have missed some

[spookysilver @spookysilver]

@BGatesIsaPyscho Here's a quick listing

https://t.co/VzQBjy9pGi

[spookysilver @spookysilver]

Whats happening to energy infra fires/explosions?

(Edited to include more details)

Non War related
(12 incidents in 50 days)
------------------

01 Mar - Esmeraldas, Ecuador, Fire at largest oil refinery (Petroecuador)

05 Mar - Channelview (Petromax), Texas, USA, Refinery fire

12 Mar - Texas, USA, Energy infrastructure incident

23 Mar - Port Arthur, Texas, USA, Refinery explosion & fire

03 Apr – ONGC Bombay High, Off Mumbai Shores, India

09 Apr - Dos Bocas, Mexico, Refinery fire

14 Apr - Sakti, Chhattisgarh, India, Boiler explosion at Power Plant

15 Apr - Geelong, Australia, Major fire/explosions at Viva refinery

16 Apr - Haripur, Pakistan, Gas pipeline explosion

20 Apr – HPCL Rajasthan, India, Plant was to be commissioned shortly

20 Apr – Myanmar, Energy infrastructure incident

21 Apr - Texas, USA, Energy infrastructure incident

Gulf War
----------

02 Mar - Ras Tanura, Saudi Arabia, Drone strike on oil refinery; fire

17 Mar - Fujairah, UAE, Oil industry zone fire from drone strike

18 Mar - Ras Laffan, Qatar, Missile strikes on LNG facilities; extensive damage/fires

19 Mar - Mina al-Ahmadi, Kuwait, Drone strikes on refinery; fires

19 Mar - Yanbu (SAMREF), Saudi Arabia, Drone strike on refinery

Ukr War
--------

03 Apr - Ufa (Novo-Ufimsk), Russia, Ukrainian drone attack on refinery; fire/shutdown

04 Apr - Russia (specific facility), Drone attack on energy infrastructure

05 Apr - Kstovo (Nizhny Novgorod/Lukoil), Russia, Drone damage to refinery & oil pipeline; fire

06 Apr - Novorossiysk, Russia, Ukrainian drone strikes on Black Sea oil terminal; fires

16 Apr - Tuapse, Russia, Ukrainian drone strike on oil refinery/port; fire

18 Apr - Russia (two facilities), Ukrainian drone attacks on energy infrastructure

20 Apr - Tuapse, Russia, Ukrainian drone strike on oil refinery/port (repeat attack; fire)

I may yet have missed some