Clearing Out The In-Box -- December 7, 2021

Saudi Arabia:

• needs $100-oil to pay for $1 million missiles to shoot down $10,000 "flying lawn mowers" targeting oil fields and infrastructure. Link here.
• monetizes pipeline for $15.5 billion; Blackrock buys in; link here;

Global warming:

• St Petersburg: sets all-time cold record for this day in history; - 21°C; previous record set in 1893.

AAPL:

• $2.7 trillion market cap;
• JP Morgan says iPhone 13 demand "healthy"; link here.
• one analyst suggest Apple will sell 300 million iPhones next year (2022); record some years ago was 230 million; needs to be fact-checked

COP: Michael Fitzsimmons over at SeekingAlpha. I agree with everything he says. Almost everyone replying says the same thing: buybacks are worthless for investors. 

Geopolitics: Biden administration reportedly mulls "nuclear option," i.e., disconnecting Russia from the SWIFT payment system in case they invade Ukraine. Likely outcome:

• WTI to $500
• Wheat to $50/bushel
• by the way, it looks like Russia's wheat crop this year is not doing well at all; previously posted. What was the bread basket of the USSR? Okay, the dots are starting to connect. 
• current US price for wheat: $8 / bushel 
• by the way, this talk about disconnecting Russia from SWIFT was already "a thing" back in May, 2021, when the European Parliament passed a resolution to do just that; link here.
• sounds like Brandon doesn't have many original ideas of his own; extends back to law school, some might say
  

Peak oil: recurrent them on the blog -- OPEC+ may be hitting oil production limits; more and more stories of same. today, from Energy Intelligence, Russia may be hitting oil production limits.

AAPL, again:

• one of the four safest dividend stocks; listed first at this Motley Fool article;

MSFT:

• being touted as "company of the year (2021)"
• market cap at $2.44 trillion; one strategist says MSFT could have $3-trillion market cap by mid-2022;
• AAPL market cap today: $2.71 trillion
• AAPL reportedly increasing iPhone shipments by 30% in 1H22; link here.
• company's goal: 300 million+ iPhone shipments in 2022
• talk of a bigger year overall fueled by the iPhone 14 to be released in the fall of 2022;

A bunch of hot air? Not really; also used to cool MRI scanners. Update on helium. Hottest commodity play of 2022? Link to Tom Kool. These stories surface every three-to-five years.

ConocoPhillips Unveils $1B Variable Dividend -- Rigzone -- December 6, 2021

The story:

ConocoPhillips unveiled a $1 billion variable dividend as the second-largest driller in the Permian basin aims to boost investor returns in the new year. 

The new quarterly dividend will be set based on forward oil prices, cash flow and other factors and could result in eight cash payouts every year beginning in January 2022, according to a statement Monday. It’s the latest effort by the company to raise shareholder return after posting the highest quarterly profit in a decade. ConocoPhillips has said it plans to hand out about $7 billion in total to investors in 2022, a 16% increase from 2021. 

The company also said it will spend about $7.2 billion with shale operations counting for about 60% of that total. That’s up from about $5.3 billion this year. The spending boost comes just months after a pair of major acquisitions that made it the second-biggest oil driller in the country’s largest oil basin.

The recent purchases of Concho Resources Inc. and Royal Dutch Shell Plc’s Permian assets enabled ConocoPhillips to surpass Chevron Corp. as the Permian’s No. 2 crude producer, according to research firm Enverus. ConocoPhillips is keen to expand in shale at a time when it’s getting more difficult to win regulatory approval for a major Alaskan development that’s been held back by environmental challenges in the courts.

It's also interesting, and many folks forget, COP (BR) is one of the bigger operators in the Bakken. 

Clearing Out The In-Box -- December 6, 2021

Football:

• record-setting college TD passer;
• his team loses to Wisconsin-Whitewater, 51 - 21, quarterfinal.
• Texas high school football playoffs.
• College "bowl" games: only one still MIA -- the "toilet bowl."

James Bond: license to kill fun.

Nvidia: soaring chip demand eases "deal setback." Link here.

Russia's wheat exports: tumbling. And Bloomberg says Russia sets next export target at 9 million metric tons. Needs to be fact-checked.

Free cash flow. OMG. OXY. Link here. 

CAPEX upstream and cost to find a new barrel of oil. Why is crude oil so cheap? 

Natural gas: prices plummeting.

Above-average temperatures across the US for next two weeks: link here.

Shale oil: why share prices not responsive to higher oil and gas prices. SeekingAlpha. Same old stuff.

OPEC:

• basket price: link here.
• production, Saudi Arabia: link here.

EU/UK energy crisis:

• winter weather in sharp focus as European gas stocks dip below 70%;
• Sweden quietly re-starts oil-fired power plant to alleviate Polish crunch.
• it just got worse; biggest victim so far in the UK when Bulb failed;
• continues to rage: power prices reading through to $150+ / bbl of oil;
• electricity prices across much of Europe surging; amazing to see how expensive it's gotten in Poland; link here;
• there is an explanation why even France, with all its nuclear reactors, has such high energy prices; helloooo .. it's part of the EU.

Port crisis continues. Update. Smoke and mirrors.

Investing:

• ETF fees.
• Reserve ratio definition. Or "required reserve ration (RRR)."
• Required rate of return definition.

Apple: ready to break out (again)? Financial Times. 

Transitory inflation: supply chain woes. 

Covid-19:

• the farce will never end.
• South Africa stats.
• weekly US "flu" report.
• Sixth Circuit Court frustrates Biden; Biden may have opened a can of worms not worth opening;
• prior to the Biden mandate: trending toward 750,000 vaccines per day being administered; now, trending toward 2.2 million vaccinations being administered daily.
• Covid-19: less dangerous and less symptomatic than the "common cold"; link here. Analogy: the Spanish flu; we discussed this at the beginning of the Covid-19 outbreak. The only president that could have handled this much better? Barack Obama.

Southern surge:

• no longer on anyone's radar scope; haven't seen a story in weeks on this issue;

The end of globalization.

• Omicron: final nail in the coffin.

Technology:

• six best note-taking apps for the iPad in 2021; I keep forgetting one doesn't need to type to take notes any more; can use the "pencil" and simply write.

Apple, The M3, The M1, And AWS -- December 4, 2021

M3: Apple's chipmaking partner TSMC has kicked off pilot production chips built on its 3-nm process, known as N3. Previously posted. Link here.

Instant! AWS and the M1 Mac mini: link here. To better understand this jargon, read the social media comments at the linked story.

Amazon today announced that its Elastic Compute Cloud (EC2) service is now offering a "preview" of M1 Mac mini instances in the Amazon Web Services (AWS) regions of U.S. East and U.S. West, with other regions to be available when the instances are fully released.

An "instance" is a virtual server available for rent through Amazon's EC2 service for running apps on AWS infrastructure. Intel-based Mac mini instances were already available since last year, but M1 models will provide improved performance, allowing developers building apps for the iPhone, iPad, Apple Watch, and Apple TV to benefit from faster builds.

TSMC Ready To Produce 3NM Chips -- December 2, 2021

Link here.

When we last checked in, INTC was struggling with 10-nm chips, by which time Apple had moved onto 5-nm chips and placed the M1 chips in new computers being released in 2021.

Now this:

Apple's chipmaking partner TSMC has kicked off pilot production of chips built on its 3nm process, known as N3, 

From the linked article;

The report claims that TSMC will move the process to volume production by the fourth quarter of 2022 and start shipping 3nm chips to customers like Apple and Intel in the first quarter of 2023.

As usual, this process advancement should allow for performance and power efficiency improvements, which can lead to faster speeds and/or longer battery life on future iPhones and Macs. The first series of Apple silicon Macs powered by M1 chips already deliver industry-leading performance per watt while running impressively quiet and cool.

The first Apple devices with 3nm chips will likely debut in 2023, including iPhone 15 models with an A17 chip and Apple silicon Macs with M3 chips — all names are tentative. The Information's Wayne Ma last month reported that some of the M3 chips will have up to four dies, which the report said could translate into those chips having up to a 40-core CPU, compared to the 8-core M1 chip and 10-core M1 Pro and M1 Max chips.

In the meantime, Macs with M2 chips and iPhone 14 models are expected to use chips based on TSMC's N4 process, which is another iteration of its 5nm process.

Considering The Glut Of Natural Gas Just Across The State Line(s), This Is Truly Outrageous -- December 1, 2021

ISO NE: link here. Upper end of the 7th decile.

 

The Australian Connection: Daimler Benz EV Trucks -- December 1, 2021

As mentioned previously, Daimler Benz will start rolling out EV trucks starting January, 2021, aiming for eight trucks / day at one facility. Previously, this facility would roll out 20+ trucks / day. The EV production at this particular facility is only part of total production; it continues to produce diesel trucks. 

Daimler Benz on the west coast has a huge penetration in Australia. Australia leads the way in autonomous truck use -- Mining Technology, August 23, 2021.