CIO of Praetorian Capital. Kuppy’s Korner blog at https://t.co/fygVkh2Zbk Tracking Event-Driven strategies at https://t.co/UfYZR6ERSN. Opinions/not investment advice.
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Dec 8 • 8 tweets • 3 min read
1) I keep adding to $VAL on a scale like a proper baggie… This is by far my largest position...
~20% of the world’s 7G floater fleet in a sector that has consolidated to 4 core players + a massive high spec JU fleet at ~$4b EV just seems wrong.
2) They have almost $2b of contractual EBIT in backlog. They own half of ARO which is a fleet of modern JUs in Saudi. In a firesale, this is worth maybe $1b or $100m a rig?? Kingdom 2 just cost $200m to build. ARO also owes them a few hundred million.
Apr 10 • 7 tweets • 3 min read
1- In a functioning economic system, Brent Oil is the Central Banker. 2’s follow oil around on the screen and then the CBs reluctantly follow the 2’s around. But what happens if the President dumps a few hundred million bbl from the SPR and destroys the signal??
2- Then gold becomes the Central Banker. Except, we’ve been interfering with the gold price for years. So then, who becomes the Central Banker?? What if it is copper, or the Tin Barons, or Uranium, or some other minor metal?? Can’t play whack-a-mole on the whole periodic table…
Mar 27 • 8 tweets • 2 min read
1- Has anyone else noticed the spikes in gold that have peaked at around 7am EST this week…??
What could be causing this rally during European hours, only to be reversed when NYC wakes up…??
When the West buys gold, we think of it as another CUSIP in the portfolio. Something you buy and sell for trading gains. Something that you can use to hedge other portfolio positions.
When Asians buy gold, they buy for keeps…
Oct 3, 2023 • 6 tweets • 2 min read
1) Much as I predicted, markets are starting to waterfall. It has a very December 2018 feel to it. Difference is that in 2018, markets got cranky that JPOW pushed Fed Funds too tight with a bit of excess QT. This time is different…
2) This time, markets are watching the 10-year melt away and they’re starting to panic as 10s are the collateral for the whole financial system and there are now hundreds of $$ billions of MTM losses suffered through the collateral stack…
Sep 23, 2023 • 6 tweets • 2 min read
1) Assets sometimes undergo a sudden phase shift. Just like a liquid can become a gas when you add heat, the same can be said of public assets. It seems that uranium has now undergone a phase shift. The personality of the trading changed dramatically…
2) Think back to earlier this year. Uranium would rally a few dollars, then pull back. The spread stayed tight. It sometimes went weeks without moving a full dollar.
Sep 7, 2023 • 8 tweets • 2 min read
1) This is VERY bullish for SPUT, but there’s nuance: (conference chatter)
-Limited redemption is designed to ensure that the discount cannot permanently widen past a certain threshold (say 5%) + is limited to industry players + only certain limited windows of redemption/size
2) This is designed so that the trust never overwhelms the physical market with selling. I believe this will help to build liquidity while providing a release valve during times of market stress.
May 15, 2023 • 7 tweets • 3 min read
1) OIL THREAD - In April, we were drawing roughly 2m+ bbl/d with an expected expansion to roughly 4m bbl/d as OPEC+ cuts began in May. The question was - why was oil trading so sloppy. SPR was selling a few hundred thousand a day, but that wasn’t enough to move the needle.
2) A lot of oil traders frantically asked each other - what the hell are we missing? We looked under every rock, and we found a few wrinkles, but not enough to smash the price. Effectively, the only bear thesis was “recession, bro.” Then we started looking at the spec positioning
2) From left to right, St Eustatius, St. Kitts, Nevis, Montserrat…
Mar 28, 2023 • 8 tweets • 2 min read
1) The last 9 months sucked for CRBs. We suffered through CBs raising rates and convincing generalists that commodity demand would decline. We suffered through a Chinese lockdown that confirmed the bias of generalists. With the sharp reversals over the past few days…
2) I want to declare the pullback over. It has positively sucked since last summer. For those that survived and averaged down, it’s about to be another golden era for CRB longs. We’re about to have a phase-shift. Like when a solid turns to a liquid…
Mar 21, 2023 • 18 tweets • 7 min read
1) Wanted to post a summary of us all fighting the fire on Sunday. Once again, thanks to the Rincon and Anasco Bomberos who saved our home…
2) Our garden hoses did little against 30 ft flames. They were useful against smaller brush fires and for keeping flare-ups from growing, but did nothing against real flames. The road helps as a firebreak too, but big flames can jump the road…
Jan 8, 2023 • 7 tweets • 2 min read
1) I’m in Cerda, (the artichoke capital of Sicily) and the artichoke (carciofi) drives everything around here. Anyway, I’m rather obsessed with the sweet-bitterness, and went for the zillion course carciofi tasting…(warm up includes carciofi quiche and olive oil) 2) Olive oil
Dec 29, 2022 • 7 tweets • 3 min read
Now doing a 9 wine sampling of wines on Mt. Etna. Will see you guys again on Tuesday…
1) Everyone got excited this AM b/c the CPI came in a tad. Whoopee!! The bigger story is that China is re-opening. They gonna draw on every commodity globally. What do you think that does to CPI in 2023??
2) My hunch is we have a few more prints that show a slowing, everyone decides that inflation is abating, then they get stunned when inflation is teens in Q2/23 and JPOW doesn’t know WTF to do…
Dec 10, 2022 • 5 tweets • 2 min read
1) The coming slingshot in oil will stun people. Meanwhile, 2023 budgets are getting set this month. Do you think a BOD will approve a spending increase with the cash market in the low $70s?? Where will the supply growth in 2023 come from??
2) Production isn’t gonna increase much in shale. Russian production is rolling. Rest of world is suffering. Meanwhile, SPR at 1.5 + China rebound at 3 = 4.5m deficit. India is ramping demand at double digits. Same with MENA. Where will the oil come from??
Dec 1, 2022 • 5 tweets • 2 min read
1) This is setting up for a massive slingshot in oil. Everyone got short last week. They pressed it Monday. Meanwhile, we have structural deficits that are about to grow a few mil bbl/d if China opens. SPR is almost done draining. What if commercial stocks drain 5m bbl/ in ‘23?
2) Shale isn’t growing, Russia is shrinking, offshore Guyana isn’t ramping until later in the decade, North Sea is stillborne, Libya shuts off every other quarter, Canada cannot grow bc of pipeline capacity, Mexico is a mess, Saudi is going offshore b/c onshore is melting…
Nov 12, 2022 • 5 tweets • 2 min read
1) While everyone is fixated on sleuthing the real story at FTX/Alameda, I wonder if this isn’t merely the first act of the collapse of the rot in the PE/VC ecosystem…
2) Imagine a system where you get 10-year money, get fees for showing up, can mark it however you want, can trade pieces with friends at made-up valuations to set future values, complicit auditors/administrators and lots of leverage. Ask yourself if illegal shit happened…
Nov 11, 2022 • 6 tweets • 3 min read
1) Investing is hard. Valuation is important, but it doesn’t set the price of assets (a floor at best). Investors want positively inflecting businesses. They want to know that revs and earnings will grow. Otherwise, you’re buying $META at $200 b/c it is “cheap” on the way to $100
2) Today’s environment is difficult as so few sectors have YoY growth in revenue AND earnings. Sure, commodities (especially energy) are comping up huge. So are energy services, but a portfolio cannot just be made up of energy related business…
Oct 25, 2022 • 6 tweets • 2 min read
1) Someone has to say it already. There’s a trillion housing bears out there. We all know the bear thesis. Something, something, something, interest rates…
2) I have heard it all year while housing companies keep reporting record numbers. Here we are, and housing equities bottomed this summer when the 30-yr mortgage first hit 5%. It is 7.5% today and housing cannot make a new low. Actually look like they’re making bases…
2) From left to right, St Eustatius, St. Kitts, Nevis, Montserrat… 
