Wed. Oct 27th, 2021

We highlighted before the decline in capital by oil and gas companies (predominantly Western). Take a look at this chart, which shows how strong this drop is:

The irony of the situation is that this lack of spending in lieu of reserves is paving the way for a repeat of the oil crisis of the 1970s.

Attitudes toward oil (and fossil fuels) today in the West are very similar to attitudes toward the tobacco industry in the late 1990s. No one wanted to touch tobacco stocks with a 40-foot barge pole, and why should they? After all, tobacco was a dying industry as the rate of smoking decreased. Again, Westerners only looked at it through developed market glasses. They overlooked trends in emerging markets and China in particular, and are doing the same here, except on a really impressive scale.

Oh, and are you interested in guessing which was the best performing sector in the last 30 years? Yes, they were those “dirty” tobacco stocks. As the saying goes, history never repeats itself, but it often rhymes.


Staying with “dirty” things for another time … coal has just turned 10 years old.

Meanwhile, Reuters tells us how the coal comes out. We will gladly take care of it.


Check out this gem from all over Europe:

From the article:

Greece’s five-year bond yield fell below zero for the first time on Monday after the European Central Bank’s decision to keep pace with its asset-buying program spurred a rise in the area’s riskier debt euro.

Crazy as it is, it’s nothing new. It was in February when we highlighted the ridiculousness of all this in Insider Weekly:

Think that Greece, Cyprus, Lithuania, Slovakia, Spain, Portugal and Slovenia are already indebted to negative real rates. Trust me, these rates are NOT a sign of trust in government policies. They are anything but. They are an aberration of monetary policy pursued by central banks designed to hide real risk. The problem is that sooner or later everything explodes.

When our politicians tell us that negative returns reflect the confidence of any country’s markets, they are between their teeth. The ECB now owns 70% of the outstanding sovereign debt in the euro area and buys 100% of net issues after amortization, according to Pictet and the Financial Times. There is no market. This is completely unbreakable.

The emperor really has no clothes!


Our partner Kuppy was invited to Frank Curzio’s Wall Street Unplugged earlier this week.

If you enjoy reading our missives, you’ll probably enjoy them as Kuppy deals with many of the same topics we cover here. Among other things, the current environmental, social and corporate governance (ESG) fashion, and why it could be terrible for energy prices in the future. In addition, Kuppy adopts Reddit’s army of retail investors, as it finds its best ideas and some of its favorites right now. Listen to the interview here.


And you Follow Kuppy on Twitter, you may have noticed this gem of a slogan in your profile picture …

Increase volatility again

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