Venezuela: April 30th Coup Attempt

Last week had an interesting coup attempt occur in Venezuela. From various articles, it appears that opposition leader Juan Guaido thought he had the support of the following Maduro loyalists:

Defense Minister Vladimir Padrino
Supreme Court Chief Judge Maikel Moreno
Presidential Guard Commander Ivan Rafael Hernandez Dala
Spy Chief Manuel Figuera

How did things unfold on Tuesday, April 30th?

From Reuters:

Venezuelan opposition leader Juan Guaido on Tuesday made his strongest call yet to the military to help him oust President Nicolas Maduro but there were no concrete signs of defection from the armed forces leadership. Early on Tuesday, several dozen armed troops accompanying Guaido clashed with soldiers supporting Maduro at a rally in Caracas, and large anti-government protests in the streets turned violent. But by Tuesday afternoon an uneasy peace had returned and there was no indication that the opposition planned to take power through military force.

Los Angeles Times Festival of Books. American History: Leaders & Moments that Shaped Our Modern Country

I went to the LA Times Festival of Books (April 13-14). I'm posting my notes on the various panel discussions I attended.

The second panel discussion I attended was "American History: Leaders & Moments that Shaped Our Modern Country."

Here are edited panelist biographies via the LA Times website. 

Susan Page is the Washington Bureau chief of USA Today, where she writes about politics and the White House. Susan has covered six White House administrations and ten presidential elections. Her book "The Matriarch: Barbara Bush and the Making of an American Dynasty" was recently released.

Miriam Pawel is the author of "The Browns of California: The Family Dynasty that Transformed a State and Shaped a Nation," a finalist for the 2018 L.A. Times Book Prize in History and a Los Angeles Times and San Francisco Chronicle bestseller. She is a Pulitzer-prize winning editor and reporter who spent twenty-five years at Newsday and the Los Angeles Times.

Jon Ward has chronicled American politics and culture for two decades, as a city desk reporter in Washington D.C., as a White House correspondent who traveled aboard Air Force One to Africa, Europe and the Middle East, and as a national affairs correspondent who has traveled the country to write about two presidential campaigns and the ideas and people animating our times. His most recent book of nonfiction, "Camelot's End: Kennedy vs. Carter and the Fight that Broke the Democratic Party," was released earlier this year.

And the following are my notes from the panel discussion: 

Libya: Haftar in Tripoli - World Powers Standing on the Sidelines?

The Libyan National Army (LNA -- power base in Eastern Libya) is now fighting in Tripoli.

From Reuters:

Haftar’s Libyan National Army (LNA), which is allied to a rival administration in eastern Libya, mounted an offensive on Tripoli three weeks ago but has failed to breach defenses in the city’s south despite heavy fighting. The battle for the capital has all but wrecked U.N.-backed efforts for a peace deal between the rival factions and threatened to further disrupt Libya’s oil industry.

One thing I've mentioned in previous blog posts on the subject of the LNA launching an attack on Tripoli I just didn't see this as some easy victory for the LNA (unless the LNA was really able to buy the support of various militias around Libya; currently, it would seem this support isn't at the level needed).

Los Angeles Times Festival of Books. Exposing Truths: The Stories Affecting America

I went to the LA Times Festival of Books (April 13-14). I'll be posting my notes on the various panel discussions I attended.

The first panel discussion I attended was "Exposing Truths: The Stories Affecting America."

Here are edited panelist biographies via the LA Times website. 

Mona Hanna-Attisha. Author of What the Eyes Don't See, a first-hand account of the Flint water crisis, Dr. Mona Hanna-Attisha is an associate professor of pediatrics and human development at Michigan State University.

Eliza Griswold’s latest book, "Amity and Prosperity," was released in June 2018. It recounts the true story of how fracking shattered one Pennsylvania town, how families brought it to light, and how, after years of fighting against the abuses of the oil and gas industry, the people finally prevailed.

Beth Macy is the author of three New York Times-bestselling books. Her latest book, "Dopesick: Dealers, Doctors, and the Drug Company That Addicted America," is short-listed for the Carnegie Medal and was described as a "masterwork of narrative nonfiction" by The New York Times.

And the following are my notes from the panel discussion:

Wall Street Journal: Public Pension Problems

The Wall Street Journal recently had an article up on government pensions. The basic direction is that even though we've had a significant bull market, public pensions are still having issues.

Liabilities of major U.S. public pensions are up 64% since 2007 while assets are up 30%, according to the most recent data from Boston College’s Center for Retirement Research . . . In the 1980s and 1990s, double-digit stock and bond returns convinced governments they could afford widespread benefit increases . . . The Illinois Supreme Court in 2015 threw out cuts by the legislature that were expected to save tens of billions of dollars . . . The Maine pension fund, which back in the early 1980s assumed a long-term investment return of 10%, now assumes a rate of 6.75%. If that rate were just 1 percentage point higher—where it was about 10 years ago—the projected $2.9 billion shortfall, most of which must be paid off over the next decade, would drop by more than half to $1.1 billion.

Algeria and Sudan: Populist Uprisings and the Military

The LA Times and The Atlantic both take a look at recent events in Algeria and Sudan where protests have recently occurred and presidents have fallen. Both presidents have been pushed out by the military. The LA Times takes a more negative view of recent events while The Atlantic takes a more positive view.

Until events go in a different direction, I believe the LA Times slant is more accurate:

“There’s definitely an effort on the part of the old regimes to maintain power, just as we saw in the previous rounds of uprisings in Egypt and elsewhere,” said Timothy Kaldas, a nonresident fellow at the Tahrir Institute for Middle East Policy, in a phone interview on Friday . . .  Meanwhile, Western nations, wary of the post-2011 turmoil that brought the rise of Islamic State in Syria and Iraq, and millions of refugees to Europe’s shores, appear likely to fall in line, despite their lip service in support of democratic reform.

Libya: Haftar March to Tripoli Supported by the Saudis?

Per the Wall Street Journal, but quoting from Al Jazeera as I don't have a subscription to the Wall Street Journal:

Days before Libya's renegade General Khalifa Haftar launched an offensive on the country's capital, Tripoli, Saudi Arabia offered tens of millions of dollars to help pay for the operation, the Wall Street Journal has reported . . . Citing senior advisers to the Saudi government, the Journal said the offer of funds - accepted by Haftar - was intended to buy the loyalty of tribal leaders, recruit and pay fighters, and other military purposes.

I have held the position that Haftar was just bluffing. His allies (United States, France, Britain, Italy and the United Arab Emirates) were telling him to halt his advance. There were other coastal cities in Libya (Misrata and Zawiya) that were coming to the aid of Tripoli.

Algeria: President Abdelaziz Bouteflika forced out of power

Quick summary of what is going on in Algeria:

Protests are currently ongoing in Algeria. The protests revolve around demands for their President, Adbelaziz Bouteflika, to resign and be replaced. He has been the president since 1999, two decades. He suffered a stroke in 2013 and has rarely been seen in public. He decided to run for a fifth term, which resulted in the protests.

With that . . .

On Tuesday (April 2nd), Lt. Gen. Ahmed Gaid Salah, the army chief of staff, told President Abdelaziz Bouteflika to leave office.

This is only my second blog post on Algeria and in my first one I speculated that the military would wait until they had a successor in place who would be acceptable to both the elite and the protestors. I guess not.

Libya: Haftar currently heading to Tripoli

I don't know much about Libya. I recently argued that Haftar (leader of the Libyan National Army - LNA) was simply trying to negotiate a higher percentage of the oil revenue with his threats of marching to Tripoli. Other than wanting more oil revenue, I felt there were two drawbacks to him marching on Tripoli: first, various nations that back the LNA are telling Haftar not to march on Tripoli; second, various cities around Tripoli are not eager to support Haftar. Oh well, currently, it looks like his troops are on the march towards Tripoli.

Al Jazeera has the following:

"Haftar would like to force the hand of the UN and those attending in a way that does not exclude him, fearing that this conference may start a whole new path for Libya in the next few years and that he may not be included in that process," said Hafed Al Ghwell, a fellow at the Foreign Policy Institute of Johns Hopkins University.

IMO 2020: Council of Economic Advisers

Oil Price has an article up from Economist Philip Verleger where he discusses IMO 2020. IMO 2020 is the new fuel standard issued by the International Maritime Organization that starts in January 2020. It requires the sulfur content used by ships must be at 0.5 percent. Current limits are at 3.5%. Verleger believes that a large disruption will result due to this transfer. His article looks at a recent report from the Council of Economic Advisers. The key quote from the CEA report can be found on pages 294/295.

The shortfall will likely trigger higher prices, though estimates of price shocks to fuels including diesel, gasoline, and jet fuel vary substantially.

The reason behind this is that they see a short-fall ranging from 0.2 MMbpd to 0.6 MMbpd. I'm not exactly sure how they're coming up with that range.

Algeria Protests: Military Position

Protests are currently ongoing in Algeria. The protests revolve around demands for their President, Adbelaziz Bouteflika, to resign and be replaced. He has been the president since 1999, two decades. He suffered a stroke in 2013 and has rarely been seen in public. He decided to run for a fifth term, which resulted in the protests.

As Al Jazeera wrote:

Despite his ailing health, Bouteflika continued enjoying the support of Algeria's powerbrokers, including the military, and went ahead to win presidential elections in 2014. 

So though I don't know anything about what is going on Algeria (as this is my first blog post ever on Algeria), I have to suspect that there is a high degree of corruption going on in the country.

It appears that the military in Algeria holds a large amount of power. Below I have various quotes from three articles.

Libya: Haftar heading to Tripoli?

Both Reuters and Bloomberg both wrote articles about the possibility of the Libyan National Army (LNA), led by Khalifa Haftar, marching on Tripoli. As a reminder, the LNA is based in Benghazi, eastern Libya.

Reuters was up first on March 9th. It is mentioned that this was all set in motion by the actions that the LNA took recently in southern Libya. This military move caused concern at the U.N., which backs the Tripoli government. And I suppose that with the success in taking control of oil wells in the south, the LNA got a boost in confidence to aim for total control of Libya.

He [Khalifa Haftar] has not said whether he wants to march on Tripoli, which would dramatically escalate tensions. But his Libyan National Army (LNA) has hinted heavily that it might do so — if Haftar is not recognized as the country’s overall military commander, his aim since he began assembling the force in 2014. “The same sources said there is coordination with some units inside Tripoli and its suburbs for the army to enter Tripoli.”

California State Workers: salary spiking by not taking vacation

The LA Times has a recent article about how state workers aren't taking vacation time and therefore increasing their payout at the time of their retirement.

Now I'm not going to condemn someone for saving some vacation days. I've been paid for unused vacation time from every job I've left. What is concerning is the degree to which some individuals are doing to save their vacation time.

Just some high level facts from the article.

The state owes $3.5 billion for unused vacation time. Annual payouts have increased from $167 million in 2008 to $299 million in 2018. The article seems to hint at two possible reasons why there is this dramatic payout increase. First, Baby Boomers are retiring. Second, the state is starting to offer payouts of up to 80 hours per year.

Per the article, here are the rules in place and the fact that they aren't being followed:

California mandates that vacation balances for most employees be capped at 640 hours. Sporadic enforcement of the rule, coupled with an increasing number of state workers retiring, has led to a 60% rise in the number of six-figure payouts since 2012, when 280 employees each cashed in unused paid leave totaling $100,000 or more, The Times’ analysis found.

Venezuela: Migration/Conoco Phillips/Oil Production Forecast

Migration

Yahoo had the following to say about migration out of Venezuela:

"Without any significant change that could reverse the economic, political and social crisis in Venezuela, the total number of migrants and refugees could reach between 5.39 and 5.75 million by the end of 2019," said the report commissioned by OAS Secretary General Luis Almagro.

This seems to increase the range that the Miami Herald wrote in December when they stated that the U.N. Refugee Agency had an estimate of 5.4 million by the end of 2019.

The Yahoo article seems to have an estimate of anywhere between 2.7 million to 3.4 million have already fled Venezuela from between 2015 and 2018. Not sure which numbers are from where, but one comes from the Organization of American States while the other comes from the United Nations.

WSJ: Another Shale Take Down Article

The Wall Street Journal has written another article on shale. They previously wrote an article about how shale production estimates were too aggressive. Now this article is about the parent-child problem. For shale, the parent is the original drilled well while the child are wells drilled near to the original well. From the article, it appears that child wells are drilled anywhere from 275 feet to 600 feet from the parent.

Some thoughts from the article:

1. The argument that wells could be drilled closer together and yet produce the same amount of oil resulted in shale corporations to raise close to $57 billion in equity and debt in 2016.

2. The article discusses how Laredo touted it could drill 32 wells on a unit. Now they've reduced that to between 16 and 24 wells. Since the promise was that each well could pump 1.3 million barrels of oil and gas that means that their forecasts are off by at least 10.4 million barrels per unit (1.3 x (32 - 24)).