Kontrarian Korner

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I wanted to ramble on some of my thoughts on three situations that I’m paying the most attention to right now, and why I have been adding to Sable Offshore $SOC and Navios Maritime Partners $NMM . I also talk about Calumet $CLMT and what I’m watching there between now and mid-October. I’ll be writing part 2 today, which will focus on the rest the portfolio, different commodities, and sectors I have focused on over the last year and change. I’ll also write a bit about my thoughts on recent trades, and it should be out tomorrow morning.

Portfolio Weights

After talking with Vince Lanci VBL a while back, he said I should have Brynne Kelly on to talk about oil markets, and after the recent action in oil, I figured now was as good of a time as any. We talked about oil and natural gas, LNG, energy infrastructure, among other topics.

Podcast Summary

* Her view on owning energy equities, and why she prefers to get energy exposure directly through the commodities.

* OPEC spare capacity as the overhang on oil markets for now.

* Her thoughts on oil going negative in 2020, and how storage and infrastructure are a bottleneck for oil and natural gas.

* How she uses the shape of the futures curve to gauge sentiment and positioning.

* The regulatory risk for investing in energy infrastructure, and her thoughts on geopolitical risk.

* Her time horizon with a typical trade.

* LNG (liquefied natural gas), and why she’s skeptical that all of the planned projects will get built.

* Why interstate pipelines won’t happen in this environment, and hydrocarbon infrastructure will not be brought online without a political change or significant crisis.

* Book Recommendation: Short by Cortwright McMeel.

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This week I had Judd Arnold of Lake Cornelia Research Management on the podcast. We discussed two companies I have been very interested in, Sable Offshore $SOC and Navios Maritime Partners $NMM . Judd walked through the numbers on both companies and explained what he thinks the next couple years look like for both companies. We also discussed some of the names in the offshore space, which has had a rough month along with oil.

Podcast Summary

* The regulatory situation in California and how it impacts Sable.

* Why the recent settlement with Santa Barbara County took out a bunch of the risk.

* Sable’s path to production and the potential for future capital returns.

* The potential for carbon capture with Sable’s land holdings.

* The situation for Navios and his recent memo on the company.

* Why he’s bullish on Navios’ new builds, even though most shipping investors hate new builds.

* We discuss the options chains and why Navios LEAPS might be interesting for risk tolerant investors.

* We talked about China’s shipbuilding sector, The Jones Act, and why shipbuilding won’t come back to the US.

* Why he prefers Tidewater $TDW to Seacor $SMHI .

* His thoughts on Borr $BORR , Valaris $VAL and Transocean $RIG .

* Book Recommendation: The Invisible Billionaire: Daniel Ludwig by Jerry Shields.

Disclaimer

I own shares of Sable, Navios Maritime Partners, Tidewater, Borr, and Seacor. I also own calls on Navios and Transocean, as well as Valaris warrants. You should do your own research before making any investment decisions. Different investment strategies have different risk/return profiles which should be considered before making any decisions.

Kontrarian Korner is a reader-supported publication. To receive new posts and support my work, consider becoming a free or paid subscriber.

This is a public episode. If you’d like to discuss this with other subscribers or get access to bonus episodes, visit www.kontrariankorner.com/subscribe

This is a free preview of a paid episode. To hear more, visit www.kontrariankorner.com

I wanted to get something out early this week after the bloodbath for oil and the energy equities. Price drives narrative, and we saw that last week for oil. I’m still stubbornly bullish, but that doesn’t mean oil won’t go lower short-term. I do think that the risk/reward from here is skewed, but that doesn’t make last week any less painful.

Summary

* I went through some of the things I found interesting on oil, from inventories, to DUCs (drilled, uncompleted wells), sentiment, and positioning.

* I also talked about the potential for a dockworker strike, with a deadline of October 1st.

* I talked briefly about the shifting of the Overton Window on things like immigration, and the discussion around WWII and Winston Churchill.

* For paid subscribers, I explained my logic on recent portfolio moves, and why I’m very bullish on Sable Offshore $SOC and Navios Maritime Partners $NMM .

Kontrarian Korner is a reader-supported publication. To receive new posts and support my work, consider becoming a free or paid subscriber.

I was able to get Rudy Havenstein on the podcast last week for a great conversation. We talked about his investing strategy, real estate, inflation, and much more. If you don’t already follow him on Twitter, he’s one of the most entertaining accounts to follow.

I don’t see volatility as risk. I see risk as permanent loss of capital.

Podcast Summary

* His investing strategy, which is focused on the long term and looking for stuff that is out of favor. He’s heavy in energy but also has some stuff he has been hanging onto for three decades.

* His thoughts on real estate and chance that younger generations get a buying opportunity in the next couple years.

* Competition from institutions in the single family housing market.

* Private equity hollowing out different industries.

* We spent some time bagging on Paul Krugman and how the Fed and ZIRP contributed to wealth inequality and the generation divide, as well as the some of the division we see in the country today.

* American culture and the current state of affairs overseas.

* Book Recommendation: Deterring Democracy by Noam Chomsky

Kontrarian Korner is a reader-supported publication. To receive new posts and support my work, consider becoming a free or paid subscriber.

This is a public episode. If you’d like to discuss this with other subscribers or get access to bonus episodes, visit www.kontrariankorner.com/subscribe

Last week I had Matt Erickson of the Kingpilled podcast on the show to talk about the PayPal Mafia. We’re closing in on two months to election day, and I wanted to get him on to chat about some of the influential groups behind the scenes and what he sees coming for the rest of the year. Matt’s worth a follow, and you can find him on YouTube and Twitter.

Podcast Summary

* We go down the PayPal Mafia rabbit hole, talking about the influence of figures like Peter Thiel and Elon Musk.

* We discussed the Boomer Truth Regime, generational differences, and the parallels between the Boomer and Millennial generations, and the parallels between the Gen X and Zoomer generations.

* JD Vance being the first millennial politician on a presidential ticket, and the idea that he’s a life insurance policy for Trump.

* Elon Musk and the influence Twitter has on shifting the Overton window.

* America as an economic zone instead of a country, and the plan to bring manufacturing back to the country.

* The Trump Assassination attempt and how different events end up getting memory holed.

* Illegal immigration, mass deportations, and the importance of local governance.

* The Birth of the American Empire and where the country might be headed over the next 50 to 100 years.

* Book Recommendation: The Brothers: John Foster Dulles, Allen Dulles, and Their Secret World War by Stephen Kinzer.

* We also talked briefly about the recent Tucker Carlson Interview of Geoff Shepard on Watergate and Richard Nixon.

Kontrarian Korner is a reader-supported publication. To receive new posts and support my work, consider becoming a free or paid subscriber.

This is a public episode. If you’d like to discuss this with other subscribers or get access to bonus episodes, visit www.kontrariankorner.com/subscribe

This is a free preview of a paid episode. To hear more, visit www.kontrariankorner.com

This was one of my favorite podcasts I have recorded so far and I had to go listen to it a second time last night. I haven’t found many investors like PauloMacro that are as good at painting a picture of where we are today in financial markets and where we might be going. If you aren’t able to get enough from his Substack, you can also find him on Twitter.

Inflationary recessions create monetary illusions.

There are a lot of moving pieces in financial markets and geopolitics right now, and Paulo does a great job of setting the stage before diving into different commodities and opportunities in certain sectors. There were three takeaways that I think everyone should consider in their investing process:

* Why Paulo looks for commodities or sectors “going to sleep” or being invisible for a while.

* How positioning, sentiment, and narrative impact his investing process.

* Why there is no clear way to express the trade in certain situations.

This is a free preview of a paid episode. To hear more, visit www.kontrariankorner.com

A lot of people seemed to like this format, so I figured I would stick with it. I talked a bit about some of my thoughts on the inverted yield curve, interest rates, and recession. I also talked about oil and geopolitical risk, recent events in the coal sector, and current political events. For paid subscribers, I also talked about recent trades and Navios Maritime Partners $NMM .

Summary

* Some rough thoughts on a recession, rate cuts, and the inverted yield curve.

* Oil - On top of the events I discussed in Sunday’s post, I talked about Libya shutting down production and exports and Russia hitting energy grid targets in Ukraine. I also took a look at the oil to gold ratio, and compared prices today to where we were 10 or 15 years ago, adjusted for inflation.

* Coal - M&A activity, Peabody Energy $BTU activism, and Yancoal dividends.

* Politics - I had a quick rant on the Unrealized Capital Gains Proposal, the state of Europe (particularly Britain and France), free speech, and RFK endorsing Trump.

* I also did a quick portfolio update on Navios Maritime Partners, and recent trading activity for paid subscribers below.

Portfolio Weights

Last week I had Vince Lanci on the podcast. He’s a veteran trader and the author of the Gold Fix Substack. You can also find him on Twitter. We talked about the unnatural price action in oil, the precious metals and some opportunities there, as well as some of the interesting dynamics going on between the Fed and the Treasury. You can also watch the video on YouTube below.

Podcast Summary

* Vince’s expected path for oil over the next three to five years.

* His thoughts on how the election could impact that path.

* The paper market versus the physical market for oil.

* Hedge fund activity in oil shrinking while CTAs (trend followers) having a bigger impact.

* The WTI contract becoming an orphan contract.

* The Permian Basin and offshore vs. onshore production.

* Precious metals and some of the opportunities in the platinum miners.

* The Fed and the Treasury (aka Powell & Yellen) working against each other.

* Book Recommendations: The Wager by David Grann & The Origins Of Totalitarianism by Hannah Arendt

Kontrarian Korner is a reader-supported publication. To receive new posts and support my work, consider becoming a free or paid subscriber.

This is a public episode. If you’d like to discuss this with other subscribers or get access to bonus episodes, visit www.kontrariankorner.com/subscribe

I decided to keep this one free for everyone so I could experiment with a new format. I wanted to put out a quick update on what I think is interesting right now in the portfolio. Like all of my best ideas, the name came to me at 2:00 in the morning while I was staring at the ceiling waiting to fall asleep. If any of you have suggestions for features you would like to see on the Substack, or topics you want me to cover, feel free to send me a message or leave a comment.

Video Summary

* Calumet’s $CLMT recent C-corp conversion, and the potential catalyst of a loan from the Department of Energy in the next couple weeks.

* Borr Drilling’s $BORR recent Q2 earnings, additional borrowing, and new build delivery. Hint: the inflection is here and 2025 is going to be interesting.

* A large portion of Valaris’ $VAL fleet repricing between now and the end of 2025, along with the poor timing of their Q2 earnings report.

* Transocean $RIG insider buying.

* Peabody Energy’s $BTU increased buyback program and the exit of Elliott Investment Management.

* HFI Research’s piece on oil production and my thoughts on bearish oil positioning.

Disclaimer

I own shares of Borr Drilling, Transocean, and Peabody Energy. I also own calls on Calumet, Transocean, Peabody Energy, and Valaris warrants. You should do your own research before making any investment decisions. Different investment strategies have different risk/return profiles which should be considered before making any decisions.

Kontrarian Korner is a reader-supported publication. To receive new posts and support my work, consider becoming a free or paid subscriber.

This is a public episode. If you’d like to discuss this with other subscribers or get access to bonus episodes, visit www.kontrariankorner.com/subscribe