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Ok, Id buy that hypothesis. $30 persist for many months, over exposed outfits fold, better capitalized outfits (majors & secondary?) acquire assets, price recov
by donavanm 7y ago
Ok, Id buy that hypothesis. $30 persist for many months, over exposed outfits fold, better capitalized outfits (majors & secondary?) acquire assets, price recovers, it takes months to recover instead of weeks due to organizational/legal/logistic lag. The volatility is whats extending the time scale. But on a medium time horizon we still have lots of US production at $60 a barrel.
- cinquemb 7y agoI agree with what both of you are saying, and if someone is willing to extend credit at ~$60 to the frackers again, it will happen. The question is who… banks aren't doing so well right now (else why the need for JPM at the discount window, more pomo, more frbny broker-dealer repo, and equity on major us banks testing 5 year lows, whos ficc revenue growth at ZLB will be pretty much non existent or even contracting more than it already has).