Friday, March 27, 2020

The whole world is going to be super stabby.


The last week or so I've been having a lot of conversations with Mr S. about China. I feel they are in a very dangerous spot.  When you inflict this much financial damage to every country on Earth - when this crisis is under control - countries are going to want their pound of flesh.

My feeling is that countries are a little like gangs. If one gang kills someone from another gang - they will come back and kill two people. But since (hopefully) we are more civilized - they will just financial starve them. No company can depend completely on China for their needs again. Countries also can not afford to trust China in the same way.

Last night though Mr S. took it up a notch. He says to me - you think people are going to be mad at China..... just wait until they get mad at Saudi Arabia. Initially I'm like - yeah... and.

He goes on to say - Saudi Arabia just put all the other gulf states out of business. This is where my eyes grow wide because I always assume people are just trying to hurt us. Be he's right. None of the gulf countries can make any money now. And they are not exactly a rational culture. Let's all hope that none of this spreads to bullets.

Also the chart above is Louisiana light crude. Now at -6.50. On Doomberg two weeks ago someone claimed oil would go to negative 3 bucks barrel. At the time I wasn't sure. But I hope you have all emptied all your bathtubs so we have a place to put oil. Said in the most sarcastic way.

I'm not really sure where the Saudi's are going with this. They either need the money really badly, or they are probably going to war with some of their neighbors.


  1. The article I just read talked of the Saudis being able to keep up with low prices for ten years.

  2. Seems unlikely. But they do have a lot of space to store things. Seems to me that if they were floating on that kind of money they wouldn't need to take that oil company IPO. But it is an interesting game of chicken.

  3. Capital of Texas RefugeeFriday, March 27, 2020 6:12:00 PM

    "The last week or so I've been having a lot of conversations with Mr S. about China. I feel they are in a very dangerous spot. When you inflict this much financial damage to every country on Earth -- when this crisis is under control -- countries are going to want their pound of flesh."


    Here's my version: not only do I want twelve hundred bucks back of my tax money from DJ Twelve Hundred Dollar Jesus without the Fed cranking up the money printer (BRRRRRRRRRRRRRR), but also I want to be fully made whole in terms of economic losses by the Chinese.

    The new company management has been trusting me to continue "negotiations" with some of our old vendors, which initially they might have viewed as a mistake, but they seem to be on board with me telling them what we really think.

    You'd have been entertained with how one of the remaining Chinese vendors got fired ...

    But you'd have been even more entertained when that vendor called up one of our somewhat less than public shell companies to see if we'd be purchasing more units shortly after I'd fired them for specific performance and a bunch of other crap, only to get me again on the phone.

    "Hi asshole, let's continue our conversation, we're not done firing you yet."

    Totally worth it. :-)

    As far as I'm concerned, unless the Chinese are personally cutting me million dollar plus checks and cutting an even bigger one for the company, the Communist Party of China lying cocksuckers can eat a bowl of dicks.

    BTW, the container's on the way now and there are pallets of stuff that were picked up by A Major International Air Freight Carrier for delivery to our people.

    Some of that consists of prepper supplies so they can shelter in place as much as possible while providing support.

    Also, because I can't take our people out to celebrate completing the job, what I had to do instead was buy everyone a stack of fast-food gift cards, since now you can't even have a private room full of healthy people having a celebration without some wise-ass going on about how we're harming the fucking country or something.

    Right now I could rent out a Waffle House (especially one of the ones that had to close), have them lock the door, and have a private celebration, and there would still be someone bitching about it.

    So if you see something, don't say something, just shut the fuck up. :-)

    Our people abroad got a bunch of grocery gift cards and bank wire transfers so they can load up on whatever they can still find locally, but I will say this: if that isn't enough fucking toilet paper that I've sent them, I'm going to be demanding some doctor's visits, because something's seriously wrong.

    Because of this somewhat hastily organized raiding party that went after a bunch of prepper supplies and also a bunch of product assembly components, so far we're not letting anyone go ... except for Chinese vendors.

    And now you know why my journey started in Wyoming.

    Technically because someone in my family married a Mormon, I'm deemed to be part of the LDS, and so I leveraged a little bit of that. It's nice to have some local backup when you roll into town with a lot of actual physical cash and start buying vehicles and supplies with cash instead of checks or credit.

    Also, I think some of our company's people understood that if they volunteered for this unusual assignment that they'd be considerably less at risk of getting laid off, and they're right.

    But I am not unreasonable in demanding that China's little experiment with snaffling bio-weapons from a long chain of "outside sources" should result in huge pay-outs to everyone affected ...

  4. Capital of Texas RefugeeFriday, March 27, 2020 6:18:00 PM

    Also ...

    The Saudis are massively cash-strapped.

    Everything you hear from the Saudi government about that is a Middle Eastern form of "face saving", and the truth is that their budgets were blowing up and that they didn't have enough money to maintain them past 2021 even before this.

    As for "when this crisis is under control", fuck that ...

    I want money, blood, and circuses from the Chinese right fucking now.

    If the Chinese can perform a very public execution of Winnie The Flu for the benefit of a global audience, that might stave off some of the people less reasonable than I am from wanting a lot more of their heads.

    When they're done, they can send the skull to Donald Trump.

  5. One of my friends/customers owns a travel business. She's pissed and has said that if they make it through this that they WILL NOT sell any kind of ticket to China. You want to go to China then you find another travel company.

  6. I don't remember if it was your blog or another one that noted that demand is way down for regular gas but that diesel is still in high demand. What it means is that you still have to crack the oil to get the diesel but the other products are taking up more and more storage and thus not able to supply the diesel in the long run.

  7. Rob "The article I just read talked of the Saudis being able to keep up with low prices for ten years."

    Yeah, but other OPEC countries can't. The Saudis will drive the other gulf countries into bankruptcy. This is either desperation or aggression. (or both)

  8. Mr Snarkolepsy,
    The Saudis are actually at the point of collapse. They are a welfaire country and only have one product. You know it's bad when all the 'royals' start flying to their homes in Bermuda and suchlike places.