Natural gas prices are headed higher

EU is going to have a bad winter as gas supplies are dwindling. LNG and coal are the only solution. 

SPR Vs. Oil Price

Whenever the U.S. strategic petroleum reserves get drawn down, oil goes down as supply hits the market.

Oil CAPEX Vs. Oil Prices

Oil CAPEX is at decade lows and should support higher oil prices.

Whenever CAPEX is low, prices will start rising.

Natural gas is cheapest energy

Natural gas is the cheapest energy form and is likely to go higher. 

Fertilizers trading below cost of production

Fertilizers might have bottomed because of high natural gas prices.

Plants are shutting down.

Wealth between generations

This environment is getting worse per generation.

Food production has not kept pace with food prices

Food prices will not come down until production rises.

 

2 years of negative GDP growth

We are going into a very long recession. I recommend to be in cash and gold.

Commodities 2022 Vs. 2008

Something is very different in this recession compared to 2008. 

Copper to go in surplus in coming years

It is time to sell copper miners for now.

 

Natural gas will never drop

Natty will never drop. Anyone who thinks natty and food will drop again is dreaming.

Natural gas is the cheapest energy available and many will use it.

And gas supply is going to be flat.

FOMC Meeting: Huge Rate Hikes

The Federal Reserve is planning to hike rates until 3.5% by the end of this year.

Meanwhile GDP growth hits 0%.

 

India Gold Imports Vs. India Agriculture Exports

When Indians earn lots of money from agriculture, they buy lots of gold.

Yardeni decreases outlook for SP500

Yardeni decreased the outlook for the S&P500 from 3825-4335 to 3315-4080 in 2022 and from 4400-4950 to 4125-4675 in 2023.

New:

Old:

 

Velocity is rising

Remember this formula. Money supply is up, velocity is up and goods produced are declining.

Guess what will happen with prices?

Hurricanes Vs. Oil/Gas Production

Hurricanes are good for the price of oil and gas.

 

Annualized Return of Stocks/Currency Vs. Gold

Belangp created a nice corrrelation here.

What is the annualized return stocks vs gold today?

What is the annualized return of currency vs gold today?

Germany Material Shortage

No building materials.

Warehouse Stock Level Inventories of Commodities

Something is in short supply...

Railroad Surcharge Vs. Fertilizer Prices

When freight costs rise, the price of the good transported will rise with it. In this case fertilizers.

 

Gasoline Price Vs. Biden Approval Rating

Even this is a correlation.

 

Annualized Return on Equity

A way to look at the annualized equity return is based on this formula: (equity+debt)/market value of equity. The black line shows the annualized stock return that investors earned over the subsequent 10 years.

Farmland Vs. Fertilizer

As farmland goes up, more farmers will need to use fertilizer. Therefore, farmland is correlated to fertilizer.

 

Gold Forecaster Index: Energy Trumps Gold

 

Affordability Fertilizer

Fertilizers are less affordable now, but this should change when food prices skyrocket.

 

Oil Production Fail

OPEC+ fails.

The result is that energy companies are making money on an oil price rise.

Refinery Margins

Refineries are making big bucks. This also means that crude oil should go higher as refineries will keep demanding for that crude oil.

Cycles

I think we are in the Market Top section, which means we should be in energy stocks. 

Sprott Inc. Portfolio Update May 2022

Sprott Inc. filed their holdings.

Buys: Notable is Vale, Exxon, Steel Dynamics. Some gold mines: Kinross Gold, Sibanye, Newmont, Vizsla.

Sells: Vista gold, Mcewen, Kirkland, Gatos Silver and euro.