Rolling US Economy Into The Shitbin Thread

fifth turd

-2 Chainz

had the same thought as silby, 3/5 bank sounds like some weird redlining neo-confederate entrprise

can i get paid by jayapal on paypal?

So the investment advisor at our company is recommending the company invest in mortgage-backed securities. I don't know shit about investing, but it seems insane to me to invest in them right now given the amount of people out of work and who will be defaulting on their mortgages in the coming months/years.

The name "Fifth Third" is derived from the names of the bank's two predecessor companies, Third National Bank and Fifth National Bank, which merged in 1909.

Should've just compromised and gone with Fourth National Bank...

to some extent feature not a bug

imagine a business that has 0 income now, they can’t even keep workers on for the 25% or whatever numbers these policies use; keeping them afloat with cheap loans at least makes it possible the business survives to rehire

― flopson, Sunday, April 19, 2020 1:12 PM (yesterday)

that is what the EIDL loans were designed for, actually. The PPP loans were a bit different. One of the problems (in defense of the poor steakhouse chain) is that the government announced there would be a separate program for "mid-size to larger employers" but that was still "in the works." Basically, there needs to be more money supplied to these programs by the government.

rolling italian economy into the shitbin

https://slate.com/news-and-politics/2020/04/italy-workers-recession-coronavirus.html

am i reading this correctly? the U.S. benchmark for oil (West Texas Intermediate) is at $1.28 (!!) right now

https://markets.businessinsider.com/commodities/oil-price?type=wti

https://i.imgur.com/oYeCFeU.png

gonna get some for my house

a barrel of oil costs less than...pretty much anything you can buy

WTI has actually gone negative:

BREAKING: WTI crude oil futures trade at negative price for first time https://t.co/pOSyH6AVtP pic.twitter.com/XsoH1jG8WH

— Bloomberg (@business) April 20, 2020

So that's what mass margin calls on the commodity markets can look like.

all i know is i got gas for like $2.50/gallon last week and I think the last time it was that cheap was like almost 20 years ago?

$1.15 at the local Costco. Shame I've only maybe used a gallon in the past month.

probably need a pt 2 of this thread? when do we start sequels? 10k?

the WTI is currently -$18.65

hahaha everything is just bonkers this year

Basically, there needs to be more money supplied to these programs by the government.

This. The pandemic shutdown is exactly the kind of economic conflagration that calls for Bernanke's notorious 'dropping tubs of money from helicopters' kind of response.

I am very annoyed that the product I was using to short oil got liquidated at the beginning of April and I never bothered to find a replacement.

i wonder how kiev is doing.

does this mean that saudi arabia owes the rest of the world some money now?

I think it means that many owners of futures contracts for the delivery of oil at a given price were leveraged to the hilt with cheap debt and are now so desperate to dump those contracts they will pay you to take them off their hands. But, that is just a guess, because this is one of the weirder things I've ever seen a market do.

i haven't looked to see exactly what happened today but it's money/limited space to store oil and if there is no demand and countries keep pumping...

matt levine's explanation is pretty accesible (and sound afaict):

https://www.bloomberg.com/opinion/articles/2020-04-20/there-s-nowhere-to-put-the-oil

what if they leave it in the ground

costs too much to cap a well! not worth the bother! (this is why i live in one of the most expensive residential cities in america, and there's an active oil field 1/2 a mile away)

i would like michael bloomberg to buy all the oil while it's essentially free, and then not use it

i don't ask for much

excited for the entire middle of the country to become west virginia btw

in what sense? abruptly drained bereft of economic activity?

probably being hyperbpolic there. to the extent that happens, it's going to happen in very underpopulated/temporarily populated areas and fracking will be profitable again soon. but if this weird financial artificat propagates into real prices (which it will do to some extent) then this is going to be a pretty big economic shock to some very badly run state and local governments. state services in west texas are fucked, for example.

can they perhaps put it back in the ground, and then take it out again later

yes, or they could stick it in here https://www.youtube.com/watch?v=XuKF1-c1YsE

That's what the US Strategic Oil Reserve does. But that would take some planning and infrastructure to put in place and no one was planning for this.

i'm pretty sure that if this glut continues there will be huge ramifications for the middle east, and also i'm pretty sure that i don't really have a good idea of how that would happen. seems like a destabilizer for a very unstable region, though

Balmorhea is awesome. A fun day trip from Marfa.

this glut will continue for several more months at a minimum. it will crash and burn US and Canadian producers much further and faster than the middle east producers.

We should make a bunch of Oil Rooms (like in the Saatchi Gallery) everywhere.

it will crash and burn US and Canadian producers much further and faster than the middle east producers. why

North American producers probably employ fewer impoverished guest workers?

(for oil production I mean. obviously impoverished guest and undocumented workers are employed elsewhere)

oil makes up a shocking % of total exports for a lot of countries:

https://i.imgur.com/PjAweYx.jpg

not only that, in some of those countries it's also a huge source of government revenue

Wasn't it ME and Russian producers that Trump was so desperately trying to prop up for some unknown reason? (Pee tape)

US oil may be predicated on market making more expensive extraction techniques feasible (my guess why aimless made his comment but i don't want to assume and i'm curious what he's thinking) but middle eastern countries heavily rely on oil to a greater degree by gov and comprising more of their economy a decline would be far more severe in that regard.

why

Fracked oil and shale oil are much more expensive to produce than middle east oil. These make up a very large share of US and Canadian production. US and Canadian oil producers include numerous small-to-mid-sized companies that have limited capital resources compared to middle east producers, which are run by national governments with sovereign wealth funds. The big multi-national oil companies will not crash, but the small-to-mid-sized ones always have folded in droves during past gluts.

It seems to me that instability is so endemic in the majority of the middle east that this one added instability will be absorbed much like the other crises that arise so frequently. The armies will be fed, therefore the governments will stand, albeit shakily.

harder to feed ppl when oil revenue is dry tho

They know enough to feed the army before feeding anyone else.

Word

that bloomberg article is great!

If you don’t already get Levine’s newsletter then you should. He’s very good and very funny!

Do you have to pay for it? I used to read it all the time when I had a Bloomberg account but am too cheap to pay for one just for Levine's newsletter.