Category Archives: markets

Sue, Settle, and Biden’s Demand for Producers to Produce

Posted on by
Reply

There was a time when a million acres of land were available in California for oil and gas leasing and hydraulic fracturing (fracking).

Then California’s Attorney General, Governor, and “other state agencies” sued, claiming that the Bureau of Land Management’s environmental impact analysis was inadequate. BLM then settled. Under the terms of BLM’s sue-and-settle agreement,

until the Bureau conducts a supplemental environmental review of the project, new oil and gas leases will not be granted in central California….

Three guesses when that review will be begun, and you get a pass on the first two.

This is the duplicity with which President Joe Biden (D) inveighs against oil and natural gas producers for not producing more.

To Repeat

Posted on by
Reply

In a Wall Street Journal article centered on the problems volatile energy prices cause for central banks, there’s this allegation:

The pass-through of higher energy prices to other goods and services, along with their volatility, could make it harder for the Federal Reserve to tell what price shocks are temporary and thus set interest rates appropriately.

Wrong answer.

I’ve said it before, but it bears repeating. Instead of trying to play the market, or even to time it, the Fed needs to set its benchmark interest rates at levels historically consistent with the 2% inflation rate that it’s historically used for its target inflation rate, and then sit down and shut up.

Full stop.

Part of the Agreement

Posted on by
Reply

…on Reduced-Build Back that Senators Joe Manchin (D, WV) and Chuck Schumer (D, NY) settled on last week is this Progressive-Democratic Party gem, and which illustrates in no small part the depth of the betrayal that is Manchin’s agreement.

The Senate drug agreement would require the Health and Human Services Secretary to “negotiate” prices for 10 of the top-spending drugs in Medicare starting next year and 20 by the end of the decade. If drug makers don’t accept the government’s offered price, they would get slapped with a 95% excise tax on their sales. Take his offer or else.

If that’s not the opening shot in the destruction of the American pharmaceutical industry, it’s certainly the beginning of the end of the industry’s interest in innovating and in leading the world in innovation.

That’s to the severe detriment of every American citizen who gets sick.

Some Lipstick for the Pig

Posted on by
Reply

Here’s some of what’s in the Build Back Reduced bill—formally styled Inflation Reduction Act—that Senator Joe Manchin (D, WV) and Senate Majority Leader Chuck Schumer (D, NY) agreed, which Manchin euphemizes as an all-in energy policy:

[T]he Interior Department would be required to offer up at least two million acres of federal land and 60 million acres of offshore acreage to oil and gas producers every year for the next decade. If Interior officials fall short, they wouldn’t be able to advance some permitting aspects of the wind and solar projects on federal land.

Offer up. But at what price? And for what duration before the leases expire? Look for the Biden administration to use lease pricing to actively discourage producers from buying leases, to slow walk the subsequent permit applications that would enable the leases to be acted on, and to use the failure to get the permits on time as excuses to terminate the leases/allow them to expire.

Is the Iron Curtain Come to California?

Posted on by
Reply

It seems that the University of California Los Angeles has decided to move from college’s PAC-12 Conference to the Big 10 Conference, effective with the 2024 academic/athletic year.

It seems also that California’s Governor Gavin Newsom (D) is unhappy about the alma mater of Lew Alcindor, later becoming the NBA great Kareem Abdul-Jabbar, joining the exodus from the State, if only functionally and not physically.

Nobody said, “Mother may I?” to Newsom, and that angrifies him as much as UCLA’s decision to go out from a West Coast conference to a more economically sound area of our nation.

I read about it (is how I found out). No big deal. I’m the governor of the state of California. But maybe a bigger deal is that I’m the chair of the UC Board of Regents. I read about it. Is it a good idea? Did we have a chance to discuss the merits (of the decision)? I’m not aware anyone did. So it was done in isolation. It was done without regental oversight or support. It was done without any consideration to my knowledge.

Now, it may be that there is/was a contractual obligation for UCLA to advise the Board of Regents of the school’s discussions and intentions. However, Newsom didn’t mention any of that in his plaint—only that His Nibs wasn’t consulted.

Regarding those more economically sound areas of our nation—in the new era of Name, Image, and Likeness requirements that allow college athletes to personally profit form the use of their NIL material—here is, UCLA’s Athletic Director Martin Jarmond:

…the move was mostly about increasing “exposure” in the NIL era. By opening the school up to potentially more nationally televised games and East Coast markets, Jarmond says they can now provide an enhanced opportunity for student-athletes to find “their voice and their brand and what’s important to them.”

But not so fast: His Nibs is looking for ways to block the move.

Trust me when I say this: We are not going to be looking into. We are already looking into it within (and have been) minutes after reading about this in the newspaper.

No veiled threat there….