Thursday, 18 December 2014

Petrobras, a worked example

Petrobras has $170bn of dollar debt

At $150 oil, petrobras dollar debt is 1.2 years production (not profit)
At $50 oil, petrobras debt is 3.6 years production.  That's everything till June 2018

At 0.5% interest and $150 oil that debt interest is 0.6% of production per year.

At 5% Interest and $50 oil, that debt interest is 18% of production.

Welcome to hell

Wednesday, 17 December 2014

The hits keep coming for Russia

Apple has suspended shipping web orders in Russia.
Which effectively means they have ceased shipping to Russia, writing off the models already in stores as impossible or uneconomical to reclaim.

So, who pulls out next?
I would say Intel but I think they have already been ordered out?

Tuesday, 16 December 2014

Putin orders sun not to rise in the east

Well, raises interest rates to 17%, but it amounts to the same.

This would be a 'blink'.

Russia can't possibly live in a world of 17% interest rates, so this is by definition a panic measure.
It might burn a few speculators who borrowed roubles to buy dollars, although I wouldn't bank on it, but it will push anyone still holding roubles to dump them.

Far better to say the situation is beyond the remit of the central bank.
The further the rouble falls the more powerful the central banks counter attack becomes.

It can try and crush the shorts at 50 roubles to the dollar, or at 100 to the $
Draining 40 trillion roubles from the system would wipeout any shorts

Monday, 15 December 2014

What's next for ebola

Couple of points SotG raises
Turns out we do need moon suites after all, which makes Ebola effectively untreatable en masse
You cant have every doctor, nurse, orderly and whoever in every hospital in a moon suit going through a second shower every patient, but that is what is required.

The Ebola treatment centres are nothing of the sort.
If we for a moment gloss over a 'full' facility taking a patient, the guards there were wearing military fatigues.  Not moonsuits.
Shortly, one of those guards is going to get sick, the other guards will panic and run.  Best case scenario (seriously) they machine gun the patients before they run and 'only' the infected but not yet symptomatic guards flee to spread Ebola to their home villages.

Worst case, a few hundred infectees (more?) wake up one morning, find the guards all gone and wander off in random directions.

Unless of course the patients arrive, walk behind the blue tarp, and are double tapped and rolled in to a ditch.
Which might explain the reluctance to take the boy.

Sunday, 14 December 2014

I honestly believe 2015 will change everything

2015 is set to be the change in UK politics for a century.

The Tories are relatively safe, but they ALWAYS have been, far more willing and able than any other party to react to the present, they will hold their coalition of everyone from white van man to white Lamborghini man.

The Lib Dems are finished.
As the third party their sappy clappy fair free all things to all voters was fine.  Under the harsh light of government authority, its been a disaster.
There achievements in power have been laudable, managing to frustate the tories at every turn, and yet the message has been one of painful austerity and mass starvation.
The orange bookers seized power much as the EU does, without having the EUs freedom from facing the voter.
Big winners, Greens I think, 

Labour are going to tear themselves apart.
The British Government has officially requested all of the data from the US on the UKs participation in its torture program.
Do we not already have that information?  You know?  Since its our participation?
So, we wait a few months for the Americans to say Yay or Nay and provide whatever they are prepared to provide.
And a few months from now is?  Why, its the election.  Labour are going to walk in to an absolute shit storm, expect every detail to be sensationalised until its gory enough to make headlines.  There will even be talk of Miliband facing prosecution under cabinet responsibility.

Big winners, Respect / Russel Brandism

The Tories might pick up some of the Lib Dems votes.
UKIP might absorb whats left of Labours rump, (so what, tortured terrorists)

Saturday, 13 December 2014

Transfer pricing. No bleep it applies to me

My current role, is as a useful sort of dude at a large multi national.
Employed by the UK branch, well, employed by a company that provides skills to a UK branch of a large multinational, but whatever.

Anyway, although my renumeration comes from the UK branch, I provide services to the French, Irish, German, Dutch and Russian, possibly others.

In theory, my time should be monitored and the sister companies charged for the time.
This doesn't happen, because any attempt to monitor my time gets slapped down, (I'm a bigger dick in real life than on the internet), and no one is insane enough to try and move cost out of and profit in to the high tax UK.

But, were that not the case?
Well, what should France be charged for the services the UK pays me to provide them?
Well, there's the obvious 3hrs a week?
But, there is then the cost of my nice air conditioned office?  The square footage rent, the council tax, a share of water, power, telephone, IT support, training ( unecessay, but they paid me to sit through the presentation), line management, cough, All of that has a cost.
In theory, you could rock up an actual cost levy to recharge.

But what about risk?
I might go postal and nuke the server. Or the coworkers.
I might just be shit.  There's a risk, and there should be a reward for that.

No point, beyond transfer pricing isn't all about high value patents and shell company ownership of the stationary supply contract.

Friday, 12 December 2014

Torture doesn't work?

I bet my left nut I could torture your phone number out of you.

Hollande is off his meds

2008 2009 2010 2011 2012 2013 2014
 France 1.01 1.10 1.12 1.04 1.10 1.05 1
 United Kingdom 1.04 1.28 1.23 1.15 1.14 1.12 1

Above is the French and British economies, in dollars, as a percentage improvement between the year and 2014.

So the UK is 4% above where it was in 2008, France is 1%
The UK is 15% above where is was in 2011, France 4%

The UK is 12% above 2013, France 5%

Hard to look at those numbers and see France "leaving the UK behind".

2008 2009 2010 2011 2012 2013 2014
 France 1.01 1.10 1.12 1.04 1.10 1.05 1
 United Kingdom 1.04 1.28 1.23 1.15 1.14 1.12 1
Germany 1.06 1.17 1.17 1.07 1.13 1.07 1

Or Germany for that matter

Tuesday, 2 December 2014

Don't be too quick to cheer Russia's fall

If Russian corporates start falling, what happens?
I mean, what are the insolvency / administration procedures?

If you owe the bank a hundred dollars and can't repay you have a problem
If you owe the bank a hundred billion dollars and can't repay, the bank has a problem.

I don't forsee a Russian insolvency court putting the interests of western investors anywhere high.
And even if they did, ownership of a Siberian oil field is unlikely to be in a banks wanted portfolio, and unlikely to be sellable at anything above fire sale prices.

Monday, 1 December 2014

on those case and body drops

Anyone graphing the ebola outbreak will have noticed a spike in cases on the 24th of October, and a spike in deaths on the 24th of November.

Whilst I'm sure we would all like to point the finger at a conspiracy theory, vaccine gone wrong, human trials etc.

The reality is far more likely that a low lever beurocrat in an province who can only be bothered issuing  his stats once a month