Energy Regulation Could Totally Change

June 17, 2022
Leyendecker Executive Search

June 17, 2022

China is willing to mutually support Russia on core interests and matters of paramount concern, such as sovereignty and security, as well as [achieve] closer strategic cooperation.

President Xi Jinping on a call with Putin

THOUGHTS FROM DOUG

The more people there are in the world, the more waste and carbon we create. So why is there no carbon tax for having a baby?

Two significant economic changes we probably need to ponder: Because of constant fiscal and monetary stimulus over the last twenty-plus years, our domestic economy benefited greatly from the wealth effect—that is, the growth of financial asset values. Now this is reversing course. And over the last forty-ish years globalization became the world’s primary economy driver. Now this is also reversing course.

Here’s a graph of the rise in oil prices. Here’s a graph of inflation. Does inflation cause the price of oil to rise, or are higher oil prices really behind inflation?

Oil and gas prices could come down with higher interest rates, which generally lead to a higher dollar. A rising dollar has historically put a lid on commodity prices. But those higher interest rates will eventually lead to a wave of corporate debt problems, lower home sales and a recession. So maybe inflation starts to look better before the November 2022 election, but then the economy may look worse after. Maybe that’s why many pundits are calling for a recession in 2023 and not this year. Get the program here? Lower inflation before the November 2022 election and hold off a recession until 2023, which leaves enough time before the November 2024 election to “fix” it.

You think a windfall profits tax that takes money from oil and gas companies is going to incentivize those companies to reinvest more or less? If they invest less, then they produce less.

By the way, has Wall Street been earning windfall profits over the last couple of decades as Washington unleashed massive amounts of monetary and fiscal stimulus?

Why are global central banks tightening monetary policy when many parts of the global economy look weak, or worse, seem headed into recession?

Sixty years ago, pizza was an exotic food in the US. Today we seem to have nothing but exotic foods and exotic everything else. All around, people are trying to sell us luxury apartments, luxury homes, luxury appliances, luxury countertops and floors, luxury cars, luxury watches, luxury vacations and…you get the picture. In sixty years, we went from the land of a little to the land of luxury. What can we expect over the next sixty years?

It’s times like these that make me wonder if chaos isn’t really the norm and order really the anomaly.

THE ECONOMIC VIEW

US home equity values have doubled
Is there a bubble in home equity?
As average rents break $2,000 a month

CBO’s economic outlook through 2032
Trillion dollar deficits forever.

Are we already in a recession?
Philly Fed index goes negative

Monthly supply of new homes
Great graph. What’s your prediction?

THE INFLATION BOGEYMAN

Future oil supply is not enough
Oil prices and inflation may remain high.

Making computer chips
Has become much more expensive

Food prices to keep going up
Say food makers and restaurants.
Global food prices at record high
Food export bans will not help prices

Global inflation map
What it looks like around the world.
Is Japan ready for inflation?
South Korea’s inflation explodes

SOME GOOD NEWS

Real personal expenditures keep growing
Industrial production keeps growing
Corporate capital spending keeps growing

THE LABOR VIEW

You want a government job
It pays better than the private sector.

Companies want workers in the office
Workers say, nah.

Yet workers may be worried
That job cuts are coming.

Unemployment has to rise
If we’re going to beat inflation.

MEANWHILE IN EUROPE

Some European factories are closing
They relied on cheap Russian energy.

There’s a looming new Brexit fight
As if Europe doesn’t have enough problems.

The ECB is going to tighten policy
While figuring out how to save bond investors.
Emergency meeting called to consider volatility
ECB has to buy some national debt
As countries jack up rates to fight inflation

PLAYING WITH FIRE

Ukraine could be admitted into the EU
Is this map Putin’s ultimate ambition?
Europe can’t cut Russian gas anytime soon
Bulgaria has lots of shale gas but…
Russia suspends Japan fishing agreement
Western business losses top $59B
Does Ukraine have enough support?
Iran facilitating Russian trade with India
Russian crude shifts to Asia
Oil prices a boon to Russia
Oil exports to India explode
Russia lowering gas supply to Europe
Israel and Egypt could supply gas to EU
Xi suggests continued support for Russia
Allies pledge more support to Ukraine
Russia needs more soldiers
Russia is taking over Ukraine’s internet

GLOBAL

Iran and Venezuela cozy up
Birds of a feather…

Thailand decriminalizes pot
They need tourists to return.

Global nuclear arsenal set to grow
China says their ramp-up is justified

THE FINANCE WORLD

When bear markets recover
Is this event-driven, cyclical or structural?

SEC investigates Goldman’s ESG funds
More virtue signaling than substance?
SEC goes to war on greenwashing

Are stocks undervalued yet?
Has investing become an addiction?

Zombie companies face a slow death
As higher interest rates eat their cash flow.

THE CRYPTO MEME

Here come the crypto bankruptcies
Is this the next subprime crisis?

Crypto “based on greater fool theory”
Says the all-knowing Bill Gates.

Class action lawsuits may be coming
To a crypto near to you.

Big crypto lender freezes withdrawals
Is a run on the crypto bank in motion?
The crypto music has stopped

TECHNOLOGY

Apple wants to end passwords
Here’s how it would work.

Single molecule electronics
Might be on the way.

EV truck start-up will liquidate
So starts the EV market rationalization.

THE NEXT NORMAL   

Rebuilding our auto industry
Supply chain changes are doing it.

The regenerative farm
Improving soil without fertilizers.

Everything in the world is a disaster
But we’re just fine, right?

THE WAR ON CARBON

There are lots of corporate liars
About their carbon emission reductions.

Cow and sheep burps may be taxed
New Zealand throws down the gauntlet.

EV battery metal prices to drop
Suggests Goldman Sachs.

THE CHINA SYNDROME

China calls US a bully
Vows to eventually take Taiwan.
And suggests Taiwan Straits are off limits
As they launch third aircraft carrier

US and China try to bring down tension
Is China buying time to get ready for Taiwan?

Japan launches new China strategy team
David isn’t afraid of Goliath.

THE WASHING-TONE

Supreme Court is about to rule on energy
It could totally change the regulatory game.

High oil and gas prices test a carbon tax
Are we ready for permanent inflation?

The issues Americans worry about
Numero uno is an easy guess.

MAKING A BETTER YOU

The vagus nerve
Can one big nerve fix many things?

Struggle to sleep well?
Here’s what you may want to try

The art of listening
Good listeners are better people.

HOW ABOUT A BREAK

The best small US towns to visit
Kicking back in low density.

Asteroid treasures recently reached earth
They are going to teach us a lot.

Want a totally unique vacation?
Visit rural Japan

SONG OF THE WEEK

“Danger Zone”
Kenny LogginsTop Gun hit.
Lyrics

VIDEOS OF THE WEEK

1982
Was the best movie summer ever

The firefly dance
When humans aren’t around.

Is CGI creating new realities?
How do we manage this?

CASTING AROUND THE PODS

What went wrong with GE?
Jeff Immelt tells the story.

FROM THE HEADHUNTER’S KITCHEN

Great pesto recipes:
Basil pesto
Kale pesto
Wild garlic pesto
Micro greens pesto
Pea shoots and pistachio pesto

Garlic’s long march
From foul to fabulous.

Sriracha shortage could last for months!
Oh my!
Here’s the cause

IN CASE YOU MISSED IT

The Leyendecker View: Does Government Debt Even Matter?
June 10, 2022

The Leyendecker View: Moore’s Law Is Almost Dead
June 3, 2022

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