Good Friday Report

Because markets are closed I assumed Brent would be on sabbatical for one day.  So here is some financial news of the day, in capsules.

From the NYT:

Owners were supposed to be able to get up to $2 million. Now they’re being told the cap is $15,000 — if they can get any answers at all.

From the WSJ, a Q&A session at noon EDT:

https://www.wsj.com/live-qa/ask-wsj-what-to-know-about-small-business-relief-and-unemployment/4AD53F8C-85FC-4125-9494-A29B8F561CBF?mod=article_inline

Also from the WSJ:

Saudis, Russians Bury Differences, but Mexico Threatens Oil Deal

Mexico exits talks, putting oil truce at risk; negotiations to continue Friday

From The Economist, an article explaining a Russian “dump” of Venezuela enriching a Putin ally at the expense of the Russian people:

ROSNEFT is responsible for 40% of Russia’s oil output, but it is much more than just another oil firm. A large chunk of its shares are owned by the Russian state. Its boss, Igor Sechin, is one of Vladimir Putin’s closest henchmen. …

Bear this in mind when trying to make sense of the announcement, on March 28th, that it has sold all its Venezuelan assets to an unnamed Russian government entity.

Thanks to a low oil price, sanctions and the Maduro regime’s spectacular corruption and ineptitude, Venezuela is in no position to repay all its debts. But this is not too much of a problem for Rosneft, since it can dump its Venezuelan assets on to Russian taxpayers. They will no doubt be delighted to hear that they have paid for this with 9.6% of Rosneft’s own shares (worth more than $4bn), thus reducing their stake to just over 40%. The deal gives Mr Sechin ever tighter control of the firm.

The main aim of the deal, it seems, is to help Rosneft escape the consequences of doing business with a pariah. Over the past two months America has penalised the company’s trading arms for handling Venezuelan oil. These sanctions are global in scope and affect its customers, too. Sinochem International, the trading arm of a Chinese state-owned refinery, has rejected Rosneft’s oil. The Kremlin’s solution is to distance Rosneft from Venezuela while reassuring the Venezuelan kleptocracy that it still has Russia’s backing. “I received a message from brother president Vladimir Putin who ratified his comprehensive strategic support for all areas of our [relationship],” tweeted Mr Maduro.

 The Kremlin would like cheap oil to drive American shale producers, whose costs are higher, out of business. This is a risky game. Russia has alienated the Saudis, who might draw closer to America as a result. Rosneft can survive oil at $25 a barrel. But under Russian law the royalties it pays to the Russian state fall sharply as the oil price slides. As covid-19 spreads in Russia, Mr Putin will have to draw on the country’s reserves to help ordinary people cope. Mr Sechin’s sleight of hand has solved a problem for Rosneft, but not for Russia. ■

 

[copied right, 2020]

 

 

25 Responses

  1. A Good Friday Report as an open thread.

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  2. Hawley’s plan, adapted from UK and German strategies, makes sense to me. That is, during enforced virus shut downs, the Federal Gov pays THROUGH THE EMPLOYER a stipend wage to all regular workers who are furloughed. Hawley suggests 80% pay up to the national median pay level. Once all fiscal barriers are seen to be piffle, as is happening now, one looks for the best way to spend the printed money. And I agree this beats direct welfare to the unemployed because it breathes the barest of breath into the employer, as well.

    As I recall my UG economics, FDR screwed around with direct gov programs that worked at some levels but not to the point of stimulating the economy back to real growth. Only his last experiment, PWA, which did public works THROUGH PRIVATE contractors and employers, actually had a growth effect.

    So I think the first term R Senator from MO, who has degrees from Stanford and one of the Ivy law schools, is on to something.

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    • Too bad there’s no Smoot in congress now for him to co-sponsor with!

      But, yes, that sounds better. I doubt any approach is going to be idea–because of the speed with which they are trying to respond.

      The folks complaining about the unemployed potentially getting more money than they normally get paid to be unemployed–for a brief period–really need to stop that, IMO. Under the circumstances it’s not a good look. There are much better hills to fight on.

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  3. “Feared”?

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    • Yes, he misspelled the word “hoped”

      I think the lightly affected states are going to get people back to work by the end of the month.

      FWIW, if hospital workers aren’t getting the virus, then it is clear masks and gloves work. No reason why the government can’t say “return to work, but wear masks and gloves for the time being”

      Liked by 1 person

      • Don’t get me started on masks. . .

        N95s work. Anything less than that works only to prevent you from spreading the virus to other people if you are sick. I’ve been told that I’m trying to kill everyone on PL for saying that, so I guess that makes me as bad as you guys. 🙂

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        • Why is that going to kill people? You advocating a reckless lack of social distance to go with it?

          You’ll never be as bad as us. We’re the worst!

          Liked by 1 person

        • But I still loves you guys anyway!

          No, in fact I pointed out that, if wearing masks and not worrying about social distancing prevented transmission of the virus, it never would have gotten out of Asia. That just increased the clamor of how I was trying to kill people.

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        • Because of course you have no relevant experience that informs your opinion either from the Army or working in a medical field.

          Plum Line is is a perfect example of people being collectively dumber than they are individually.

          It’s been interesting to watch the degradation of the conversation level there over the ten years since I’ve been commenting there. Perfectly mirrors the body politic at large.

          Greg used to have some interesting insights into Senate Democrats, but now every column is just a repeated version of “Trump is the worst ever”. It’s just mindless.

          Liked by 1 person

    • I am often . . . intrigued . . . by most folks in the media (and elsewhere, I suppose) inability to understand just how much they don’t know and often can’t know about something. “Feared” or “hoped”–no different that “fearing” or “hoping” for a dimensional portal to open in the center of Times Square. They had practically nothing to base those projections on and no reason to expect them to be accurate and plenty of reasons to expect them not to be. We had no accurate data on which to judge mortality rates or infection rates, we had and have no data to judge herd immunity or how many folks are naturally asymptomatic, and given the apparent incubation period and limited testing we can assume–and should assume–the initial trajectories are measuring the ability to test, and not infection rates.

      But whatever. And really, were the southern states that much slower than northern states? Or is this just an anecdotal-based assumption, with a bias against the hicks and rubes of MAGA country?

      I don’t know. But my assumption there seems a lot more likely to me than the initial projections of infections and deaths–and based on more data and historical context.

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      • It’s obvious that red state booger eating Trumpers don’t know enough to come out of the rain. Plus, justice demands they die from the Wuhan flu. They know this in their bones and they don’t need an MD behind their name to believe it.

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      • from what we are seeing in Westchester county, the cases are a function of population density. Which is why Southern Westchester has it bad as a percentage of population while Northern Westchester does not.

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  4. I don’t know if any of you respect The New Yorker or not but this is a really good biography of Dr. Fauci’s work to date. I try to stick to the science side of things right now and whatever legitimate data I can find a decent interpretation of. I continue to have very little respect for Trump or his handling of this crisis but it gives me a measure of confidence that someone like Dr. Fauci has some influence on him.

    https://www.newyorker.com/magazine/2020/04/20/how-anthony-fauci-became-americas-doctor?utm_source=pocket-newtab

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    • We have no idea what the level of immune response is–in almost all cases, some people are going to be practically immune, either entirely or because of their current biological status (hormones, nutrition, previously contracted contagions can all make a difference). Not mention testing may pick up more than one strain, some of which may be no worse than a common cold. Potentially.

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  5. I wouldn’t have pegged Joy Reid as a tax protester.

    Homophobe, yes, but not an anti-taxer.

    Liked by 1 person

  6. It is entirely predictable, although no less fascinating to me for its predictability, to see the contrast between the treatment of the Ford allegations against Brett Kavanaugh and the more serious and recent Reade allegations against Joe Biden. I think it pretty much proves that no one really cares much about actual sexual assault and political figures. They only care about how such allegations can advance, or not, their political/electoral goals.

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    • It’s also indicative of which side get more automatic propaganda support from the media and other institutions.

      The NYT suggesting that the story is not really getting covered because Joe Biden is not as important as Kavanaugh, or as newsworthy, is so bizarre. But it’s what they are left with because they don’t want to go on the attack against the accuser and run afoul of the more devoted #MeToo folks.

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