YouSaid · the spoken record

Jonah van Bourg

lines on the record: 109
first: 2024-06-25
most recent: 2024-06-25
sittings or episodes: 1
sources: podcast

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“Six or seven standard, well, six or seven. I don't even think it's standard deviations. It's just, I don't know what the unit of this is. It tends to be a great signal top. So whenever that happens, I'm projecting it probably happens late next year. I'm out. I'm probably going to keep a little bit just because you always learn a little bit more when you have your finger on the pulse and some skin in the game, but I'm not going to be shy about selling when it gets there. That's my target. Usually, MBRV below two is when you buy and MVRV above six is when you start to lighten up.”
2024-06-25 · Forward Guidance · Oil & Crypto Trader Jonah van Bourg: Altcoins Going to Zero, Bitcoin Bull Move Is Just Getting Started, and Oil Vol Is Overpriced · IDENTIFIED FROM THE TRANSCRIPT
“How do I explain this quickly? It's like a price adjusted market cap. It's the price at which basically adjusted by the price at which Bitcoin has last traded, right? So you can tell like when Bitcoin moves hands, there's like a way to measure that. You can monitor things called UTXOs. Basically, it's a measure that shows you the difference, the ratio of the market cap of Bitcoin to the market cap of last transacted Bitcoin. And it shows you whether the space is like wildly in the money or wildly underwater. And then the Z part stands for Z-score, which is like, are you, it just basically translates that ratio into standard deviation space. So are you like historically underwater or historically euphoric and partying with all your money as a Bitcoin space? So when MVRVZ hits like”
2024-06-25 · Forward Guidance · Oil & Crypto Trader Jonah van Bourg: Altcoins Going to Zero, Bitcoin Bull Move Is Just Getting Started, and Oil Vol Is Overpriced · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, so great question. I don't have a plan in price or time space. I have an indicator that I look at. It's called MVRVZ. It is the ratio of market value, which is market cap to realized value, which is like a”
2024-06-25 · Forward Guidance · Oil & Crypto Trader Jonah van Bourg: Altcoins Going to Zero, Bitcoin Bull Move Is Just Getting Started, and Oil Vol Is Overpriced · IDENTIFIED FROM THE TRANSCRIPT
“Like, in addition to it holding its value during these times, like let's say you're China and you hold or you held $8 to $10 trillion worth of US securities on your balance sheet and the U.S. is starting to talk a little nasty to you and threaten to cut off your banking lines and punishes your neighbor Russia. And you want to invade Taiwan and do all sorts of things the U.S. doesn't want, you're probably going to start looking at letting some of those trillions roll off. And you have to replace it with something, right? Like gold and Bitcoin are out there. They're not going to get debased by the US or sanctioned. So I think it's as much as I don't like gold or identify with it or understand it, like it's structurally, it makes it's kind of hard not to be bullish, you know?”
2024-06-25 · Forward Guidance · Oil & Crypto Trader Jonah van Bourg: Altcoins Going to Zero, Bitcoin Bull Move Is Just Getting Started, and Oil Vol Is Overpriced · IDENTIFIED FROM THE TRANSCRIPT
“Larger than that, right? So really, really bad pill to take, or they just print us out of it again. I think that no one has the courage to take the former path or the mandate. And I think that everybody's going to go take the latter path. And then I think that's when you get your parabolic move in Bitcoin. That's when you get hyperinflation. That's when you get fiat debasement. And I think that's what probably drives to our point earlier in the conversation, you know, kind of like more adoption of Bitcoin and you probably get more gold getting stashed on balance sheets too. And central banks for one reason, which is that”
2024-06-25 · Forward Guidance · Oil & Crypto Trader Jonah van Bourg: Altcoins Going to Zero, Bitcoin Bull Move Is Just Getting Started, and Oil Vol Is Overpriced · IDENTIFIED FROM THE TRANSCRIPT
“Printing more money, transferring risk from the balance sheets of private individuals and companies onto the central bank's balance sheet, buying of the purchase en masse of mortgage-backed and other debt obligations that should have been borne by the consumer put on the government's balance sheet and paid for by basically printing. To me, like Bitcoin and gold protect you against that. And so if whatever the next crisis comes along, central banks and treasuries and presidents of the world and prime ministers have two options. Option one is to take the medicine that should have been taken in 2008 and again in 2020 and again in whatever this next crisis is. So that'll be like three pills, but the compounding effect of it all will be more than one plus one plus one equals three. It'll be something.”
2024-06-25 · Forward Guidance · Oil & Crypto Trader Jonah van Bourg: Altcoins Going to Zero, Bitcoin Bull Move Is Just Getting Started, and Oil Vol Is Overpriced · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, pocket of strength when it should be weak is usually bullish I'm totally with you there. I mean, I'm starting, I think of gold and Bitcoin in the same light. They're not necessarily inflation hedges or debt hedges. They're debasement hedges, right? The medicine that our American economy should have taken in 2008 and again in 2020 was evaded via debasement, right, by cutting and printing”
2024-06-25 · Forward Guidance · Oil & Crypto Trader Jonah van Bourg: Altcoins Going to Zero, Bitcoin Bull Move Is Just Getting Started, and Oil Vol Is Overpriced · IDENTIFIED FROM THE TRANSCRIPT
“It's interesting. I think there are like theoretically there should be a strong correlation between printing a lot of money and inflation and the price of gold going up and debt creation. But oftentimes it doesn't happen. For example, like there's a ton of debt creation from the 1980s to 2000 and the price of gold went down a lot. So yeah, anything can happen. I feel like positive real rates, it is really correlated with inflation adjusted interest rates. So real rates going from negative to positive has been a hindrance to gold and yet it has rallied despite that, which you could say it's gold's overvalued relative for that. Or you could say. I don't know”
2024-06-25 · Forward Guidance · Oil & Crypto Trader Jonah van Bourg: Altcoins Going to Zero, Bitcoin Bull Move Is Just Getting Started, and Oil Vol Is Overpriced · IDENTIFIED FROM THE TRANSCRIPT
“Doldrum days. Then, in terms of gold, central banks have bought a lot of it, which is what I expect them to do with Bitcoin. But, you know, if you look at the S&P priced in gold since the 20s, I think it's like flat. I mean, I honestly. As the dollar becomes this increasingly abused, like ever more valueless piece of toilet paper that gets inflated and abused into oblivion by fiscal profligacy that us millennials can't control, but it impacts us so much. Like things like gold should perform, even though I don't like gold or like the idea of gold or own any gold or like the look of it. I know other people do. much like Bitcoin, what else is there when they're just running the printing press? Like night and day. I don't know. What do you think about that one?”
2024-06-25 · Forward Guidance · Oil & Crypto Trader Jonah van Bourg: Altcoins Going to Zero, Bitcoin Bull Move Is Just Getting Started, and Oil Vol Is Overpriced · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, so uranium quick hit humanity solved climate change in 1942. I don't for the life of me understand why there aren't more countries other than basically China and India building a ton of nuclear reactors. Like what the F is going on there. I don't get it. I just don't get it. So I want to be bullish uranium. And I own a little bit of the ETF and my PA, not a lot, but like I just, I'm literally sitting here wondering when are the governments going to start firing up these nuclear reactors? Like it makes no sense whatsoever to just keep stalling and delaying. I don't get it. So that's a hard trade. You're basically the market's not efficient enough for you to take a good bet on that one. I don't think there's a symmetry either. The prices run up quite a lot from the post Fukushima.”
2024-06-25 · Forward Guidance · Oil & Crypto Trader Jonah van Bourg: Altcoins Going to Zero, Bitcoin Bull Move Is Just Getting Started, and Oil Vol Is Overpriced · IDENTIFIED FROM THE TRANSCRIPT
“I did another ticker. That's a good one. Yeah, so liquefaction is turning it into from a gas into liquid and then regasification, a good word, is turning it from liquid back into gas. And so I would be bullish, well-managed regasification project at demand centers like Europe if they can get their ducks in a row in terms of the global fungible price of natural gas. I would be bullish the hubs and bearish Bearish the current price of LNG because I think there's only going to be more liquefaction going on. The hubs, meaning where it comes out of the basically the places where it's aggregated and priced.”
2024-06-25 · Forward Guidance · Oil & Crypto Trader Jonah van Bourg: Altcoins Going to Zero, Bitcoin Bull Move Is Just Getting Started, and Oil Vol Is Overpriced · IDENTIFIED FROM THE TRANSCRIPT
“Interesting. So you said natural gas is a really interesting space because now there's a liquefied natural gas LNG market. So it's a global market. Of course, that has to be converted from natural gas to liquefied natural gas. Are you a bull on, I don't know if it's called refining, but the process of liquefaction, of turning natural gas into LNG, a company that does that would be, for example, Chenier, whose ticker happens to be LNG.”
2024-06-25 · Forward Guidance · Oil & Crypto Trader Jonah van Bourg: Altcoins Going to Zero, Bitcoin Bull Move Is Just Getting Started, and Oil Vol Is Overpriced · IDENTIFIED FROM THE TRANSCRIPT
“Much and it's not you don't have a monopoly on it, but like it's volatile, it's important, it's necessary. So I would encourage the world to start thinking about your listeners to start thinking about what manufactured products like gasoline are commodities and would the world be better off with a futures market for those commodities that they become liquid and fungible and wouldn't trading expertise make it easier to transport those vital manufactured commodities from places of surplus where there's too much manufacturing regions to places of deficit, maybe emerging economies where there's demand. To me, that's the commodities blue sky space where I hope young people become entrepreneurs.”
2024-06-25 · Forward Guidance · Oil & Crypto Trader Jonah van Bourg: Altcoins Going to Zero, Bitcoin Bull Move Is Just Getting Started, and Oil Vol Is Overpriced · IDENTIFIED FROM THE TRANSCRIPT
“Like carbon a bit further out the risk curve, maybe rice. And then I think that there are also, you know, I don't want to spill the beans on what I'm personally excited about on the air yet at the risk of sounding like a fool. But after this whole conversation about refined products, I think that I would encourage your audience who are obviously very educated macroeconomic thinkers to imagine, you know, what is gasoline? It's something that's been manufactured, right? Raw inputs came in, crude oil and some natural gas came in and out came gasoline, right? Or out came Naphtha or out came diesel. What else out there has been manufactured that's kind of a commodity product, right? Something where you wouldn't necessarily want to do a startup to make it because the price is not going to go up that way.”
2024-06-25 · Forward Guidance · Oil & Crypto Trader Jonah van Bourg: Altcoins Going to Zero, Bitcoin Bull Move Is Just Getting Started, and Oil Vol Is Overpriced · IDENTIFIED FROM THE TRANSCRIPT
“Could look at commodities for which there are already liquid futures markets like milk and cheese. I'm not saying that I think those are going to be exciting markets. I don't. I think that financial innovation will make, let's say, a market like rice more liquid and interesting, perhaps crypto will be that. I also think that tokenization will probably make markets like carbon, regional markets global, right? Microsoft or Apple as part of their decarbonization initiatives if they don't have access to a local voluntary carbon market in the United States, they may feel comfortable buying a token that guarantees the proof of carbon removal in Indonesia. Some financial innovation will probably commoditize things.”
2024-06-25 · Forward Guidance · Oil & Crypto Trader Jonah van Bourg: Altcoins Going to Zero, Bitcoin Bull Move Is Just Getting Started, and Oil Vol Is Overpriced · IDENTIFIED FROM THE TRANSCRIPT
“So, when you say things that are not considered a commodity and they become a commodity, to me, I think of interest rates, which were not considered commodity in the 1970s and before, but then they became one with euro dollar futures, LIBOR, which are the same thing. interest rate futures, tenure note, it's always a constant maturity type thing. What are you referring to?”
2024-06-25 · Forward Guidance · Oil & Crypto Trader Jonah van Bourg: Altcoins Going to Zero, Bitcoin Bull Move Is Just Getting Started, and Oil Vol Is Overpriced · IDENTIFIED FROM THE TRANSCRIPT
“I believe that people will start to view things as commodities in the future which are not currently being viewed as commodities. And what I mean by that is I believe that there will be a vast commoditization, financialization, and either futurization or tokenization of many different markets that ultimately fuel a lot of human consumption and productivity. I believe that firmly and I think that's a space to watch in the coming decades and it's something that I'd like to personally participate in.”
2024-06-25 · Forward Guidance · Oil & Crypto Trader Jonah van Bourg: Altcoins Going to Zero, Bitcoin Bull Move Is Just Getting Started, and Oil Vol Is Overpriced · IDENTIFIED FROM THE TRANSCRIPT
“In commodities, but I think like the natural gas market is just so exciting because gas has just become a global commodity for the first time with the rise of LNG. And this is like the ultimate plug to make us a little bit cleaner as a human power consuming entity on this planet before we can go fully sustainable. So I think gas markets are by far going to be the most volatile, the most interesting, and also generate the biggest profits for the international oil companies, sovereigns, and trading houses alike. So I think natural gas is the big one to pay attention to. And then the other sort of thing that I think is really exciting and commodities, aside from that, renewable environmental products space I just talked to you about is, and this comes from my experience in crypto, people will”
2024-06-25 · Forward Guidance · Oil & Crypto Trader Jonah van Bourg: Altcoins Going to Zero, Bitcoin Bull Move Is Just Getting Started, and Oil Vol Is Overpriced · IDENTIFIED FROM THE TRANSCRIPT
“The petroleum space has always been my sort of my passion. Like, I just love oil so interesting. I think there are two areas in the commodities world that people should focus on. I think the first area is obvious. It's natural gas because natural gas is kind of like that lily pad between the carbon intensive commodities like coal and oil and the renewable low carbon future that we all aspire to. And, you know, obviously there are emerging commodities like they're called environmental products like biogas, biodiesel, renewable, like it's called SAF jet fuel, like basically you take like chicken oil or whatever the byproduct of making a McDonald's burger is and you turn it into diesel. I don't know how that world works. It's an emerging market.”
2024-06-25 · Forward Guidance · Oil & Crypto Trader Jonah van Bourg: Altcoins Going to Zero, Bitcoin Bull Move Is Just Getting Started, and Oil Vol Is Overpriced · IDENTIFIED FROM THE TRANSCRIPT
“That's right. So basically, if you're going to buy a refiner, like ask yourself, where are the refineries and what is the margin look like in that area? Like don't just like, well, it's good market for refined products, economies growing. So I'm going to buy a refiner. Be like, okay, am I buying a European refiner? What are refining margins like in Europe? What part of Europe, Med or Northwest Europe? And what are they going to look like for the next five years and why? Right. Like our refinery is getting taken offline and there's not a lot of competition or the like 12 different refineries getting built. Is there the world, the Africa's biggest refinery called Dangodi getting built to Nigeria about to export like an enormous amount of refined product into that region depressing the price of refined products, but doing nothing to the price of crude, right? Like, you know, you have to ask yourself these questions. It's harder.”
2024-06-25 · Forward Guidance · Oil & Crypto Trader Jonah van Bourg: Altcoins Going to Zero, Bitcoin Bull Move Is Just Getting Started, and Oil Vol Is Overpriced · IDENTIFIED FROM THE TRANSCRIPT
“Just to connect your point earlier about how just because of bullish crude market doesn't mean their fining margins are high in non-US markets in 2010, the price of oil from 2010 to 2014, it only went up, but that doesn't mean that refining margins were good.”
2024-06-25 · Forward Guidance · Oil & Crypto Trader Jonah van Bourg: Altcoins Going to Zero, Bitcoin Bull Move Is Just Getting Started, and Oil Vol Is Overpriced · IDENTIFIED FROM THE TRANSCRIPT
“Rotterdam and Antwerp. That's where all the refining is in northwest Europe. Then there's the Mediterranean, like huge, huge refineries in Greece and southern France and Spain and all these places. Then Turkey. Then there's eastern refining margins. So let's call it two regions. There's China and then there's non-China. Anyway, so if you break the world up into three regions, you can have like the 2010s where margins in Europe were just like horrendous for a decade and margins in the US were okay and margins in Asia were excellent.”
2024-06-25 · Forward Guidance · Oil & Crypto Trader Jonah van Bourg: Altcoins Going to Zero, Bitcoin Bull Move Is Just Getting Started, and Oil Vol Is Overpriced · IDENTIFIED FROM THE TRANSCRIPT
“Refining stocks should be up, right? Like it's no, it's not quite that simple. It's basically refiners make money when the refining margins are high, which is basically when the difference between the price of crude oil and the price of refined products is wide. They also make money when there is volatility in what's called the margin, which is the difference between the price accrued and the price of refined products. So when there's volatility, they can capture opportunity. And then beyond that, there's one extra layer of complexity, which is margins are very different in different regions. So let's just break the world into three parts. There's the North American refining margins. Texas is kind of the hub of all that. Then there's, let's call it European fining margins. You have two regions with huge refinery systems. One is Northwest Europe. That's like the UK and something called ARA, Amsterdam.”
2024-06-25 · Forward Guidance · Oil & Crypto Trader Jonah van Bourg: Altcoins Going to Zero, Bitcoin Bull Move Is Just Getting Started, and Oil Vol Is Overpriced · IDENTIFIED FROM THE TRANSCRIPT
“So it's interesting. Everybody likes to look at refining stocks as like people just don't get this. I'm sure your listeners do because they're educated, handsome slash beautiful, amazing people who take the time to understand these topics in depth. But most people just think like, oh, crude oil's up.”
2024-06-25 · Forward Guidance · Oil & Crypto Trader Jonah van Bourg: Altcoins Going to Zero, Bitcoin Bull Move Is Just Getting Started, and Oil Vol Is Overpriced · IDENTIFIED FROM THE TRANSCRIPT
“Priced in dollars per ton, but they have different molecules or different sizes. So you have to multiply them by different numbers to get a volumetrically equivalent crack between jet fuel and diesel. Like there are all these little minutiae of things that are trading back and forth in that world, but I don't think anything's particularly interesting inside of the diesel complex right now, or sorry, inside of the distillates complex. It's more just like distillates, I think, have bottomed out and we're going to start to see some like, I think a sustained rally in distillates, provided the economy doesn't crap out, which is my base case. You have to underwrite something, right?”
2024-06-25 · Forward Guidance · Oil & Crypto Trader Jonah van Bourg: Altcoins Going to Zero, Bitcoin Bull Move Is Just Getting Started, and Oil Vol Is Overpriced · IDENTIFIED FROM THE TRANSCRIPT
“Just distillates in general, like think of it as a complex, right? Like they kind of trade together. The distillates complex, like we discussed, rallied like crazy for the first three months of the year on demand and then stopouts vomited into oblivion in the following three months. And now it's just starting to recover as of a couple days ago. You know, they're sort of some of the early indications like physical diesel barge prices like the price at which you buy literally a barge, like a river barge worth of diesel in China. Like those are starting to pick up. It's good leading indicator. All this stuff's happening. So it's like kind of, there's some green shoots in that market, but ultimately they're, you know, within that market, there are things called regrades, the difference between the price of jet and the price of diesel. You have to adjust it for dollars per barrel because it's...”
2024-06-25 · Forward Guidance · Oil & Crypto Trader Jonah van Bourg: Altcoins Going to Zero, Bitcoin Bull Move Is Just Getting Started, and Oil Vol Is Overpriced · IDENTIFIED FROM THE TRANSCRIPT
“Just like fall apart and blow up and literally. And then suddenly there's not enough gasoline, right? Our pipeline will blow up. So yeah, there's optionality to that or hurricane knocks out a couple of refineries and there's not enough gasoline. Anyway, so gasoline's got this like sort of upside option. Basically, the so that's what's going on there. So that stuff's starting to rally after a period of weak demand. Jet fuel and diesel, they're both distillates. So refineries kind of switch back and forth between making one or the other a little bit more fungibly and easily.”
2024-06-25 · Forward Guidance · Oil & Crypto Trader Jonah van Bourg: Altcoins Going to Zero, Bitcoin Bull Move Is Just Getting Started, and Oil Vol Is Overpriced · IDENTIFIED FROM THE TRANSCRIPT
“Gasoline is a summer trade. So let's start there. Gasoline rallies in the summer. Why? Because summer is driving season. That's when most gasoline gets used. So basically if you're a commodities trader and you get long gasoline cracks when everybody's buying gasoline, usually the world is kind of prepared for that seasonality of gasoline. It's like, you know, you're probably wondering to yourself, like, does the price of ice cream spike in the summer? Like, well, no, but I mean, the thing about gasoline is like occasionally, there's more demand than people anticipate. And you also have this optionality from buying gasoline in the summertime when like occasionally a refinery will just like explode by accident. It's called unplanned maintenance, right? When let's say it's like 50 degrees Celsius in some refinery in the Middle East, then it'll just blow up or some old refinery in Pennsylvania.”
2024-06-25 · Forward Guidance · Oil & Crypto Trader Jonah van Bourg: Altcoins Going to Zero, Bitcoin Bull Move Is Just Getting Started, and Oil Vol Is Overpriced · IDENTIFIED FROM THE TRANSCRIPT
“You know, it's ultimately refined product crack spreads are, I would say, a mean reversion game. The more risk tolerance you can wear in casino parlance, the more times you can double down at the blackjack table, you know, the more money you can make on these obvious mean reversion trades. It's just about your entry price, your timing, and whether you can stay solvent longer than the market remains irrational on the refined product side.”
2024-06-25 · Forward Guidance · Oil & Crypto Trader Jonah van Bourg: Altcoins Going to Zero, Bitcoin Bull Move Is Just Getting Started, and Oil Vol Is Overpriced · IDENTIFIED FROM THE TRANSCRIPT
“At times quite elastic, at times inelastic, like the refinery is ultimately going to be able, it's a mean reversion trade. If something's, if the get-in's too good in some refined product, all the refiners are going to go make it. It's a waterborne market. It's going to find its way to the places where there's a deficit and then the prices are going to come back down. And vice versa, you know, so that's kind of how it works. Like if there's a massive oversupply of something like refineries are going to stop making it basically. And then the price is going to come back after people in Germany are like, wow, so in Germany, diesel is called gas oil and it's used to heat homes, right? So if diesel goes too low, then, you know, in Germany, people are going to be like, wow, I can buy an entire winter's worth of heat for pennies on the dollar. Let me just go and like fill up the tank in my backyard. You know, like commodities markets are really interesting like that.”
2024-06-25 · Forward Guidance · Oil & Crypto Trader Jonah van Bourg: Altcoins Going to Zero, Bitcoin Bull Move Is Just Getting Started, and Oil Vol Is Overpriced · IDENTIFIED FROM THE TRANSCRIPT
“So, I'm just going to like go all in on NAFTA for a little while. Oh, actually now, no one wants shampoo and plastic, Ziploc bags anymore and everybody wants gasoline. So I'm going to stop making NAFTA and make more gasoline because that's where the, you know, it's like whack-a-mole, right? I'm oversimplifying it massively. But basically, because of these LPs and because of the end user demand, you know, being”
2024-06-25 · Forward Guidance · Oil & Crypto Trader Jonah van Bourg: Altcoins Going to Zero, Bitcoin Bull Move Is Just Getting Started, and Oil Vol Is Overpriced · IDENTIFIED FROM THE TRANSCRIPT
“They have what's called an LP, a linear program that tells them, hey, I'm seeing this much demand at what's called the rack when big trucks with tanks pick up gasoline or, hey, I'm seeing this much demand for jet fuel. Hey, I'm seeing this much demand for fuel, which is what powers. big oil tankers and cruise ships, the biggest ships. They have demand. They can see demand in real time for these refined products. They can switch between them so they can do more hydro cracking or less they can make more naphtha, which is a precursor to plastic or less. They can make more gasoline or less. So when the price of, when the when basically the price of a refined product relative to crude moves too much to the upside, they'll make more of it because they're like, oh, my LP tells me that it's like I should be making NAFTA because everybody wants plastic and nobody wants jet fuels.”
2024-06-25 · Forward Guidance · Oil & Crypto Trader Jonah van Bourg: Altcoins Going to Zero, Bitcoin Bull Move Is Just Getting Started, and Oil Vol Is Overpriced · IDENTIFIED FROM THE TRANSCRIPT
“That's right. And the people who did that then lost their jobs for sure. I mean, ultimately refineries, okay, so there are certain things that the human race can't do without, right? Like transportation. It's always going to be there. You're going to buy it at most prices. But when something like COVID comes along, like you could just work from home. And so people stop driving and cracks for a lot of crack spreads for a lot of these refined products like went at times negative. So basically these big shocks create opportunities for mean reversion traders to come in and scoop up the pieces. Ultimately, like there's only one buyer of crude as we discussed earlier in the podcast. It's a refinery, right? And refineries are very economically rational actors for the most part.”
2024-06-25 · Forward Guidance · Oil & Crypto Trader Jonah van Bourg: Altcoins Going to Zero, Bitcoin Bull Move Is Just Getting Started, and Oil Vol Is Overpriced · IDENTIFIED FROM THE TRANSCRIPT
“Okay, that's interesting. I was able to find a chart very interesting of the price of Brent crude oil and the price of jet fuel and then the crack spread between them. And so that shows it was not a big spread for most of 2020 and 2021. Then with Russia's invasion of Ukraine as the price of oil spiked up, the price of jet fuel spiked up even higher. So you had a huge explosion in jet fuel price. And it's lower than. Tell me about that mean reversion trade because I can imagine someone in January 2022 saying that the crack spread for jet fuel has gone up. So it's time to short that crack spread and then them just getting destroyed.”
2024-06-25 · Forward Guidance · Oil & Crypto Trader Jonah van Bourg: Altcoins Going to Zero, Bitcoin Bull Move Is Just Getting Started, and Oil Vol Is Overpriced · IDENTIFIED FROM THE TRANSCRIPT
“The relationship between the distillate or the refined product and the price of crude oil is what like industry people like me will get involved with. And that's usually a lot less transparent to people. And ultimately, the story this year was like, oh my God, road fuels go into infinity. It's, you know, the economy is picking back up. It's doing better than expected. Oh my God, distillates are incredible. Oh my God, somebody's stopping out and driving it even higher. Oh, wait, actually, there's not enough demand to sustain these levels and it crashes back down. So distilled trading is all about mean reversion. You find some of the best traders in the distillates world are mean reversion traders. They learn to fade these highs by selling them and buy the lows. They're not like the kind of people you meet in crypto who are just these massive momentum traders.”
2024-06-25 · Forward Guidance · Oil & Crypto Trader Jonah van Bourg: Altcoins Going to Zero, Bitcoin Bull Move Is Just Getting Started, and Oil Vol Is Overpriced · IDENTIFIED FROM THE TRANSCRIPT
“Known for being the best hedge fund in commodities was massively short diesel all the way up, stopped out, fired their portfolio manager, and the global price of diesel moved of dollars per ton on that stopout. It finished around March, and then it's just careened back down into Hades from then until basically two weeks ago. So that's been like the thing about refined products trading, when you talk to people on the street about refined products, the one they identify with is gasoline, the one they identify with the second most is jet fuel. They can be like, oh, my, you know, plane ticket price is higher. Oh, filling up with the pump. It was like cheaper this week than it was a couple months ago. Usually what they're seeing is the price of crude oil, but like the individual.”
2024-06-25 · Forward Guidance · Oil & Crypto Trader Jonah van Bourg: Altcoins Going to Zero, Bitcoin Bull Move Is Just Getting Started, and Oil Vol Is Overpriced · IDENTIFIED FROM THE TRANSCRIPT
“The year at quite a low price. It rallied in a straight line for three months on bullish economic prospects and cheap crude oil. Rising crude oil is linked to diesel, but cracks were rallying as well. So it was sort of the margin to produce this stuff was relatively healthy for a refiner. And then it sort of peaked out sometime around mid February or early March, I forget. Hedge funds a hedge fund that was short, a massive hedge fund.”
2024-06-25 · Forward Guidance · Oil & Crypto Trader Jonah van Bourg: Altcoins Going to Zero, Bitcoin Bull Move Is Just Getting Started, and Oil Vol Is Overpriced · IDENTIFIED FROM THE TRANSCRIPT
“Yes, it is. So distillation is the process of boiling something, taking the steam, the cooling the steam back down. And whatever you get out of that is a distillate. So you can get distilled water from distilling water. It's like slightly less minerally cleaner water. If you distill oil, you end up with products like diesel, which people put in trucks. You end up with jet fuel, you know, stuff like that. So the big trade this year in refined products has been this round trip in diesel, where to start the year, the price of diesel was quite low. And diesel is usually like considered to be the input product for economic activity, right? Because trucking, you know, like a lot of people are buying toys on Amazon and you need more trucks to move it around basically. So that's the basic explanation. Anyway, so diesel started.”
2024-06-25 · Forward Guidance · Oil & Crypto Trader Jonah van Bourg: Altcoins Going to Zero, Bitcoin Bull Move Is Just Getting Started, and Oil Vol Is Overpriced · IDENTIFIED FROM THE TRANSCRIPT
“Gasoline's actually not a distillate. You have to recombine some distillates and do some fancy chemistry to make gasoline.”
2024-06-25 · Forward Guidance · Oil & Crypto Trader Jonah van Bourg: Altcoins Going to Zero, Bitcoin Bull Move Is Just Getting Started, and Oil Vol Is Overpriced · IDENTIFIED FROM THE TRANSCRIPT
“2022, yeah. Yeah, no. I mean, the best trade of the year in oil has been selling options. It's called the implied daily move or the implied break even. There's like a price where you break if you buy a straddle, you break even if the price of oil moves that many dollars and cents per day. At the beginning of the year, it was like 180. Now it's like a dollar 10, right? That's a huge sell-off in the price of oil options. Yeah, selling vol because of all this slack in the system. And by vol, I mean volatility options, right? That's been the trade this year in oil.”
2024-06-25 · Forward Guidance · Oil & Crypto Trader Jonah van Bourg: Altcoins Going to Zero, Bitcoin Bull Move Is Just Getting Started, and Oil Vol Is Overpriced · IDENTIFIED FROM THE TRANSCRIPT
“It's bad, it's very, very bad. Wars start over oil. So, um, Yeah, basically. I would never buy, like you buy calls, you buy options when you expect the market to move fast. I would never buy a front end oil call unless it was just so friggin' cheap after years and years of oil doing nothing or oil being in a permanent sell-off.”
2024-06-25 · Forward Guidance · Oil & Crypto Trader Jonah van Bourg: Altcoins Going to Zero, Bitcoin Bull Move Is Just Getting Started, and Oil Vol Is Overpriced · IDENTIFIED FROM THE TRANSCRIPT
“I am a crude oil permeable because I believe that unless OPEC is in a market share war like it was in 2020 or 2014, they're artificially propping up the market and it tends to grind higher. And I occasionally have gotten lucky on this or managed to get in at a very low price like in 2000 mid-2020 or early 2016. You know, with the exception of 2022, it's very rare to see the price just go look like it's going to go to infinity. And even in 2022, Joe Biden showed up with, you know, more than 100 million barrels worth of physical crude oil to just like flood the market to prevent that from happening because that's a game changer if you end up in an oil shock like in the 1970s, right? That people lose their jobs and some people lose their heads over that. You know, it's like crazy. It's”
2024-06-25 · Forward Guidance · Oil & Crypto Trader Jonah van Bourg: Altcoins Going to Zero, Bitcoin Bull Move Is Just Getting Started, and Oil Vol Is Overpriced · IDENTIFIED FROM THE TRANSCRIPT
“Permian growth was starting to taper off back then. What was happening in 2018 was that Wall Street was getting sick of lending money to Permian producers and receiving a negative yield on that money, negative return on investment. So the money tap was starting to dry up Permian production growth was starting to taper off. The narrative was shifting from like drill baby drill pump as much as you can to like fiscal prudence and profitability. Kind of like what you're seeing in the SaaS market right now, you know meanwhile the global oil markets were tight economic growth globally was robust demand growth was robust and all it would take was one Libyan supply shock to send the thing into the stratosphere like the crude oil is a crude oil does not have a lot of like it has tremendous elasticity of price with respect to demand so like you're not going to stop driving to work because gasoline price”
2024-06-25 · Forward Guidance · Oil & Crypto Trader Jonah van Bourg: Altcoins Going to Zero, Bitcoin Bull Move Is Just Getting Started, and Oil Vol Is Overpriced · IDENTIFIED FROM THE TRANSCRIPT
“Like that was the last bit of spare capacity in the market at that time. That was the only slack. Now there's slack everywhere. Russia has slack. Saudi Arabia has slack. The United Arab Emirates has slack. Kuwait has slack. Iraq and Nigeria pretend they have slack, but they don't. They're pumping max. Iraq too. But yeah. Get the drift.”
2024-06-25 · Forward Guidance · Oil & Crypto Trader Jonah van Bourg: Altcoins Going to Zero, Bitcoin Bull Move Is Just Getting Started, and Oil Vol Is Overpriced · IDENTIFIED FROM THE TRANSCRIPT
“Because Ukraine, like people thought Russia wasn't going to be able to export. So let's ignore that. And oil was fragile as ever was kind of, I would say 2018. In the summer of 2018, every producer was pumping max and demand growth was so robust and supply was like threatening to come offline in Libya and all these other places where if you'd lost even half a million barrels a day in a world where the human economy was the global economy, humans were consuming almost 100 million barrels a day. So you lose even half a percent of that. Like the price could have shot up by 30, 40, 50 dollars a barrel. And then Trump did something to alleviate that. He waived the sanctions on Iranian oil to let a little bit more of it out to prevent that price shock outcome.”
2024-06-25 · Forward Guidance · Oil & Crypto Trader Jonah van Bourg: Altcoins Going to Zero, Bitcoin Bull Move Is Just Getting Started, and Oil Vol Is Overpriced · IDENTIFIED FROM THE TRANSCRIPT
“Think at $90, I don't think extra production. Right now, the price of Brent, which is the global waterborne crude that comes from the North Sea between England and Norway, like that's sort of between $85 and $88 a barrel right now. So that's the market that the Saudis and every other OPEC producer will look at. The WTI, the one that used to be relevant is like landlocked crude in Texas. And, well, it's not landlocked anymore. But I mean, that's a bit lower because of freight, but that's not the price that people pay attention to or the relevant people pay attention to. So let's say the price is like basically already close to 90. If the price were to go to 100, maybe you'd see a little bit more production, but OPEC has said they're going to unwind their cuts later in this year. They're not like really trying to unwind them now. They want the revenue. So ultimately, like if the price were to suddenly go to 110, there'd be a lot of oil hitting the market. To me, the last time the oil market was truly, truly like very fragile. And let's go pre-Ukraine.”
2024-06-25 · Forward Guidance · Oil & Crypto Trader Jonah van Bourg: Altcoins Going to Zero, Bitcoin Bull Move Is Just Getting Started, and Oil Vol Is Overpriced · IDENTIFIED FROM THE TRANSCRIPT
“So, you think when you said producers could put a lot more supply in the market if they wanted to, that means there's a lot of spare capacity that if the price goes up from 80 to 90, boom, a lot more supply goes on the market, you're not going to have 80 to 90 and then no one else is going to stop that train. And we go to 140, 150.”
2024-06-25 · Forward Guidance · Oil & Crypto Trader Jonah van Bourg: Altcoins Going to Zero, Bitcoin Bull Move Is Just Getting Started, and Oil Vol Is Overpriced · IDENTIFIED FROM THE TRANSCRIPT
“So consumption could be supplemented by some of these reserves that are being held by governments, much like what happened in 2022. So there's a lot of extra oil that could hit the market. Normally, or if there's a huge sell-off, that's, I think, where you could potentially run into a big price move and some problems for the economy. But I don't think there's going to be a big sell-off because the global economy is growing robustly, you know, ultimately OPEC and Russia, their friends and OPEC plus are keeping a lot of oil off the market. So really the big move that the crude oil market's exposed to is a down move. And I just don't have the view that there's going to be like a massive COVID style macroeconomic catastrophe in the near term, like a demand shock that it would take to catalyze that move. Don't see it.”
2024-06-25 · Forward Guidance · Oil & Crypto Trader Jonah van Bourg: Altcoins Going to Zero, Bitcoin Bull Move Is Just Getting Started, and Oil Vol Is Overpriced · IDENTIFIED FROM THE TRANSCRIPT
“Right now, crude oil is not the most exciting trade from the perspective of a retail investor. Like retail investors like to watch things go super high or oh my God, crude oil went below zero. How's that even possible, right? Right now we're in a situation where there's a lot of slack in global crude oil markets. And what is slack? Slack means that producers could produce more and consumers could consume less, right? So let's say that the price skyrockets for, I don't know what reason, Saudi Arabia could pump an extra $1 or 2 million barrels a day. I think one, they say two. Consumers could theoretically consumers being refineries. They could draw from stocks. There's a global strategic petroleum reserve ecosystem. China has a lot of oil and tanks. So does the U.S.”
2024-06-25 · Forward Guidance · Oil & Crypto Trader Jonah van Bourg: Altcoins Going to Zero, Bitcoin Bull Move Is Just Getting Started, and Oil Vol Is Overpriced · IDENTIFIED FROM THE TRANSCRIPT
“Spending to store or compute on RWEV, like the only way that you're getting that as a token holder is like through buy and burn or something that seems kind of nebulous, like the money needs to actually just flow straight through into your wallet in order for it to be a layup trade, you know. Until then, you're still basically hoping that no one else around you sells and other fools come in to buy. Not that you're a fool for buying our weave, but you need people to keep lifting it in order to earn the types of returns that you expect from your investment, earn your 100x.”
2024-06-25 · Forward Guidance · Oil & Crypto Trader Jonah van Bourg: Altcoins Going to Zero, Bitcoin Bull Move Is Just Getting Started, and Oil Vol Is Overpriced · IDENTIFIED FROM THE TRANSCRIPT