Does anybody like UCO here as a spec?

UCO and SCO just seem so rigged. I used to buy and sell them for small gains. I was looking back at what I paid a few years ago for both and they both are negative from the same points in time.

Ridiculous questions - seeing oil close that far negative, not having really ever invested in the market before - is now a good time? How can I quickly buy while this far negative?

I'd like to know that trick, for sure. With my water meter, you shut it off it is off.

Like em all long term!

There is a bull market going on in online and anything related and bear market in everything else.

Can't find much to buy in sectors i like. Did buy some IBB and DIS at close.

My former Oil & Gas law professor partner who passed away last year is rolling over in his grave right now! Lost everything in the 80's and became a professor as a result.

Like then, there have been fortunes made and lost today with the move on May futures. I'm wondering which hedge funds got that trade right.

June contracts on WTI are still trading at $21.

There is no place to store Oil and no demand for it.

Is it going to get much better by June?

I have the same question. What exactly do I buy (USO?) and hold for a few years if I think oil will rebound to over $40/barrel?

https://www.cnbc.com/2020/04/20/coronavirus-mohamed-el-erian-sees-us-economy-contracting-10percent-14percent-in-2020.html

El Erian's viewpoint. I'm going to be on a private Q & A conference call with El Erian and Allianz CEO Walter White (not Breaking Bad lol) on thursday.

I'll provide a little summary fwiw after the call.

I was lazy and didn't do this yet. Very glad I waited.

Just woke up and missed all the chaos, is there somewhere I can go on TDAmeritrade to just buy straight up oil contracts? The last time I asked this the only tip I got was oil stocks, and when I browsed around I couldn't seem to find straight up oil contracts on there.

Thanks in advance for any help

With oil being this low, why is gas in CA still so expensive?

Taxes Oregon is the same way.

Combination of a couple of things.

1. CA uses specially blended gas that isn't readily produced anywhere except in CA refineries. Thus we don't get the benefit of an open market when it comes to buying gasoline. If CAs gas was the nationwide standard, our prices wouldn't differ much from many other states. From an environmental standpoint our special blend, in conjunction with more energy efficient powertrains, have lead to better air quality so the trade off is worth it, IMHO at least.
2. Taxes. So long as our highway infrastructure is funded largely by the gas tax, the less of it we use, the higher the tax has to be to fund these needs and even then the funding is woefully short of what's actually needed. If we taxed gasoline at what we should tax it at to properly fund highway construction/maintenance, you'd be paying very close to $10/gallon... No one would take that without a fight...

Jeff

Thanks for the article. Let me see if I understand. If I buy USO, it may go up (particularly if the Fed starts buying it) or down (if it dissolves for next to nothing like XIV. I could buy a short-term futures contract like the June 2020 contract at 22.36 or a longer-term contract like the May 2021 contract at $35.34. Or I could buy stock in small oil companies which could soon be BK or large oil companies like Chevron. Do I have any of that right?

Alternatively, since I live in Houston, I could just wait for real estate to crash and invest in a rental property. Another falling knife.

That article is just flat wrong. He is saying the May contract went down today because of USO, but USO hasn't owned any of the May contract in over a week. It currently owns 20% July and 80% June.

USO would have been slaughtered today if they still owned May.

Here's their roll schedule. April 13th was the last day they owned any May contracts.

roll (resized).JPG

Yah I read they recently had to change their structure because of huge inflows. There's some limit, either in their charter or legally, to how much of a particular contract they could own. The inflows pushed them over that limit so that's why they currently have some July in addition to the June. Historically they would have been 100% June right now.

If you're not already, since you have a TDAmeritrade account, download and use Thinkorswim.

Devastated here Looks like we may have lost one of our great air carriers = less competition = higher prices.
Really sad because they were great to fly with.
Appears shareholders lost everything.

Are you guys expecting any of your air carriers to fall over ?
VA (resized).JPG

I was going to post this and did not get to it.

https://www.cnn.com/2020/04/20/business/virgin-australia-richard-branson/index.html

" Richard Branson offers his island as collateral as Virgin Atlantic and Virgin Australia face collapse"

"In an open letter to employees, Branson said the survival of Virgin Atlantic and Virgin Australia was important to provide much needed competition to British Airways, an IAG (ICAGY) subsidiary, and Qantas (QABSY). "If Virgin Australia disappears, Qantas would effectively have a monopoly of the Australian skies," he noted."
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Unlike how the UK is working with its airline companies, the US has offered up 6 months bailout money to out airliners. That money is supposed to go for employees wages. I hope no company cheats.

United Airlines is taking the 6 months of bailout money. On 6 months and one day, UAL will then lay off employees and ground some planes.

Boeing Aircraft has said it expects some lean years. How lean? Don't know.

What is Airbus doing where you are at?

I am trying to think of all the industries that revolve around aviation: Aluminum, electronics, all kinds of machine shops and casting shops will take out the machine tool industry. Machine tools use lots of steel. Rubber tires. Landings eat up tires. No landings no tires. Paint sales will take a hit with less planes are being built. There are a lot of jobs in these industries.

I have no answers. Only questions.

EDIT: I always liked reading about Richard Branson and how he started a record company, Virgin Mail Order Records, and parlayed it into an airline company(s).

I believe that the boutique gas that we get does lock us out of the open market, so I will take that as a legitimate reason, not that I am happy about it. Taxes are higher than every other state and, amazingly, the other states have roads as well, so I disagree about your last point. Even allowing for the increased taxes, there is a higher price for gas than taxes would dictate.

https://aviationbenefits.org/economic-growth/

65 million jobs and 3.6% of worldwide GDP per the article above

I burned myself with Delta (DAL), bailed out after a 44% loss. I still don’t think Delta will go bankrupt but a lot of airlines here don’t have much cash on hand, and I think some will. Some will reorganize and some will just go away, like TWA and Pan-Am.

I would guess the larger ones will survive, but the budgets are probably done. Frontier, Spirit, Sun Country, etc.

Gee, I guess some of these companies will have to go out of business. Because, well, that’s life.

That’s what people say!

You’re flying high in April! (Well, maybe not so much).

Shot down in May!

What do you say Ice? Bullish?

Back to normal soon? RARING BACK!?

I look back a little bit about the 1918 epidemic and try to extrapolate some. Just looking for a parallel.

1918 the flu hit while we were at war I Europe. WW I was over in 1919. And then came the Roaring 20s with a stock market that was on fire (lots of margin lending). There is a gap between the war being over and the Roaring 20s getting started. I'd like to find some more on that. Especially, what juice got the Roaring 20s started.

And now, almost everybody has a car and tons of job producing doodads laying around. And, as you allude to, 65 million aviation jobs with many at long term risk. I wonder if we are going to have a Roaring 20s in our era?

When one considers how much of our daily life is dependent on regular and frequent flight schedules it sort of boggles the mind. Any business shipping perishables is going to have major challenges if flights are cut back. We did have daily flights to Las Vegas. I don't know if those will continue. If they go away, Las Vegas will feel it.

This could turn into a real long discussion. Some day in the future.

Nice link BTW.

Everything is too big to fail now. Didn't you know?

I think that's what is propping up the stock market so much. Nobody is really worried about companies going bankrupt because they think the Fed will bail them out. Does anyone think a bank will fail? No, so nobody is selling their stock. The automakers might be in serious trouble too yet no one thinks they will fail because they'll get a bailout.

I believe what's really happening hear is that the Fed has taken the fear out of the market. But it's creating an even bigger longer term issue here, if companies aren't afraid to fail, they'll just keep taking bigger and bigger risks.

Nobody stockpiles cash like they should. Apple, Microsoft, Berkshire all stockpile cash for when bad things happen. That's the way it should be. If you didn't plan for a rainy day, then you'd better be talking with lenders and figure your stuff out rather than depending on the government to do it. It's only been a month, some of these companies act like it's been 5 years, lol.

All of these oil companies in trouble just let them go under if they can't find their own financing. If it's worth doing then someone will pick up the pieces and continue on later. The biggest ones will be fine.

The market isn't working naturally at all. Risk and value is all out of whack because the Fed took out the risk. You have to purge weaker companies sometimes, that's just the way it goes.

There are a lot of oil jobs at risk in Texas. And all of these fracking companies are built on mountains of debt. Chesapeake might disappear.

Texas holds 38 electoral votes. I say no more.
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Shake Shack saw the light and took the high road and is not taking the money. I still have no respect for SS for even dipping its hand in the till, but maybe SS will start a trend.

You know the saying from circa 2004 (that still seems new to me- ha), "Don't hate the player. Hate the game". If it's legal, don't blame someone for doing it. It shouldn't be legal. The loophole is the government's fault. Shame on them for directing tax dollars where it shouldn't go.

This whole concept of what a "small business" is bullshit anyway. To me a small business is the local hardware store (Do those even exist anymore?) or the barber, or a mom and pop restaurant.

It's even worse than that though, I guess some banks were prioritizing the bigger loans because they would get a bigger processing fee or something. That was the rumor today I guess.

Downloaded Thinkorswim and this is super helpful, thank you!

Still got some research to do on how the oil contracts actually work so I don't buy something stupid, but using this program to see it all is very helpful.

All of you guys dicking around with oil right now are playing with fire. There are much better and safer parts of the market to be looking at right now unless you know what you are doing.

Sell your pins and do this?

C2ED2DA8-1D56-491C-8C58-E8035ABE37BF (resized).png

Or this...

1800E75B-FDDB-4511-85BC-74BBA5459E71 (resized).jpeg

With oil tanking.....see what i did there?
Ive been watching railroad stocks this past month. Lower fuel cost and demand for supply chain.....
What's the consensus?
Also keeping an eye on the mouse, DIS. Thinking in about a week to two, this could hit $90 a share again.

I am still short my TZA. I was too early setting up my 2 entry trades. My risk level does NOT keep me up at night. But fear keeps me from adding more.