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Enquest told investors in H1 2018 that they were going to dope their finances by moving costs from 2018 into 2019. So this should have been priced in by early 2018 as that was when I first became aware of Enquest's intended financial manipulation as a PI.

Given this banks has done nothing but destroy investors money since 2007 why has there been no revolt by shareholders? Why are there only three posts on this board this morning when tends of thousands of people/shareholders are losing money through RBS's mismanagement? And finally why is there no popular revolt against the way share prices are distorted out of all proportion to what would be proportional based on economic fundamentals. For example there is no way that Ocado's market capitalisation should be double M&S's when so many citizens still prefer to go and choose their own food rather than just having the same items delivered by Ocado every week (which is an incredibly boring approach to life I feel personally, and more importantly I know many people who feel the same as me that it is a far more interesting experience to go and choose one's own food every few days, allowing oneself to be inspired by new choices in the moment, rather than to just waste one's life having exactly the same products delivered every week - this is just repeating the same experience over and over, and in my opinion this was not the purpose of life as you may as well just die after a couple of weeks if you just want to repeat the same week every week, every year, of your life).

Just like the official employment stats can't be correct based on one's own observations and sensible/reasonable inferences then so I have trouble believing oil demand is not falling.

The reasons for falling oil demand are threefold:
(1) Since 2008 there has been the largest transfer of wealth in history from the lower-middle class and middle-class to the wealthiest 1%. And 1% of people do not create much new demand - it is the 99% who have been left worse off that will far outweigh any increase by having to cut back on their consumption.

(2) Petrol prices have risen, whilst the oil price has fallen. For example in 2008 the price of crude was $140 and the price of petrol was £1.30. Now in 2019 the price of crude is $70 and the price of petrol is £1.30.

(3) As the USA loves cheap oil they have funnelled massive amounts of dollars (like $1 Trillion at least) at zero percent interest to Brazil, Russia, Iraq, Saudi Arabia to be spent on increasing oil production from these countries. ((Meanwhile PMO can't get access to cheap loans/funding from anyone - we get charged 7.5% and have to pay $200 million in fees per year just to roll over our existing loans)).

Lastly, an economy is mostly about energy - cheap energy enable businesses to be profitable, which enables banks to be profitable. Anyone with a fundamental view of the economy can see that banks first need to invest in lowering energy prices across the economy, and then (over the following decade/s) they will reap far larger returns from the capital they allocate to businesses within that economy. If you allocate capital into an economy that is suffering from a shortage of energy then you may end up allocating capital to 2,000 plausible/sensible business plans and 1,900 of them generate a loss for Lloyds banks. That's because macro economic factors always trump the micro. Hence Lloyds needs to solve the UK's macro economic problems (such as it's high energy prices) and then the return from it's capital allocated at the mirco level to businesses within the economy will improve enormously. However focusing on the micro is very unlikely to solve the macro problems - and if Lloyds are trying to generate increased profits by improving lending criteria or micro capital-allocation strategies then it will be less successful compared to if they helped solve the macro problems first, after which returns would improve given half-decent lending criteria for the part of the business dealing at the micro-level with the economy.

Or what's simpler is just to pay Iceland to generate all our electricity for us, as thermal power is proven/feasible in Iceland. And it's pretty simple to just run under-sea cables from Iceland to the UK. Anyway I personally don't think it's ethical to invest in nuclear - it generates too much waste and historically there have been repeated accidents and why should we trust that there won't be more accidents in the future? So for me nuclear is too high a risk and too polluting - as dealing with the waste is a problem that remains for a 1,000 years after the nuclear power stations has stopped giving the economy its electricity.

Anyway, forgive me, but you sound like another nutter if you are calling myself and Crowcast one then why not come and join us. Shareholders have seen no positive return on their capital for ten years here - it's not like Lloyds is doing a great job of allocating capital currently is it?

I'm serious that if Lloyds shareholders want a rewarding return they should stop looking for quick fixes and look to make capital available to businesses with ideas which have ideas to help transform the fundamentals of the UK economy. So yes, with oil a finite resource, this seems a reasonable time for LLoyds to be looking to invest in the people and businesses who are prepared to come up with long-term and sustainable solutions to the UK's energy/electric and fuel needs. Generating cheap, sustainable and clean electricity is very important, as this could be used to electrolyse water into hydrogen - hence if there is an oil crisis in 2020s it would be nice if the UK could switch 50% of cars to running on LPG and hydrogen rather than petrol/diesel. For me I think it's even more risky to think that the UK's 31 million cars and light vehicles could all become battery-powered by 2030.

Must be something serious wrong with the UK economy - Sterling is just constantly declining against the Dollar ever since the 1960s. Project this out a few decades into the future and if you convert your Sterling into Dollars now then in 2040 for example you could convert your Dollars back into a much larger amount of Sterling. However, as prices will have increased in the UK/inflation higher then it's not recommended to sell any assets to implement this strategy. But the point is the UK must be engaging in money printing to a faster extent than even the USA (which has fessed up to creating $4 Trillion in new Dollars since 2007).

Anyway, a weak currency is meant to create an economic boom - so perhaps the UK economy is booming and everyone has rewarding jobs and life is about as perfect as it can get for the overwhelming majority. Is this how your life is?

Down to $1.28 against the dollar now. Back in the 1960s it used to be $5 to the pound.

The UK's economic decline continues - the lesson for the past five decades has been don't hold Stirling - the UK government always inflates away your wealth faster, and with less respect, than the US government.


t

I think it comes down to lifestyles. The UK has quite a high level of convenience as long as you have a decent job. Also, another factor, is that Europeans often get taught English in school so can come to the UK already reasonably competent in the language. However, there are 27 countries in Europe, most with their own language, and so it is hard for a UK citizen to emigrate to Europe because most probably you would have to learn the language of your chosen country from scratch. Hence, I maintain that Europe has a lot to offer, being less densely populated and with more potential for economic growth - but for the above reasons it makes sense that it's easier for a Bulgarian to come and work in the UK, than it is for a Uk citizen to go and work in Romania. However does Romania/Bulgaria have more future potential for economic development than the UK - almost certainly as these countries are less densely populated with a greater amount of unused/under-utilised natural resources compared to the UK on a per capita basis.

It's a good point. I think it comes down to lifestyles. The UK does have quite a high level of convenience as long as you have a decent job. Also, another factor, is that Europeans often get taught English in school so can come to the UK already reasonably competent in the language. However, there are 27 countries in Europe, most with their own language, and so it is hard for a UK citizen to emigrate to Europe because most probably you would have to learn the language of your chosen country from scratch. Hence, I maintain that Europe has a lot to offer, being less densely populated and with more potential for economic growth - but for the above reasons it makes sense that it's easier for a Bulgarian to come and work in the UK, than it is for a Uk citizen to go and work in Romania. However does Romania/Bulgaria have more future potential for economic development than the UK - almost certainly as these countries are less densely populated with a greater amount of unused/under-utilised natural resources compared to the UK on a per capita basis.

Lloyds really need to come up with some innovative solutions to help power the UK economy ahead. As a bank it's no good just repeatedly giving money to the same people who've repeatedly failed to generate high-margin, sustainable, and ethical, returns from it.

However, both tidal power and geo-thermal energy seem more realistic than fusion, and yet cheaper than wind/solar (cheaper once their has been some initial R&D investment in tidal power and geo-thermal generation - because for whatever reason wind/solar have had a R&D headstart despite it likely being cheaper and greener over the long-term to use tidal and geo-thermal projects for electricity generation).

Anyway, hopefully Lloyds will focus on allocating capital according to 3 criteria:
(1) Highest margin/return
(2) Sustainability of returns/outputs
(3) Ethical criteria

The interesting thing is that one would expect the Earth's hot core to extend considerably nearer to the surface where there are features on the surface such as hot springs. Hence perhaps Centrica should send out a few engineers to investigate the ground near to all of the known hot springs in the UK. Then if it is found that the Earth's super-hot core is much nearer to the surface at such places - then it may be feasible to build thermal power stations in these locations - where water is piped from the sea, pumped down, and returns to the surface at a temperature of a few hundred degrees. Hence this would literally be free energy to turn into electricity via turbines. This would do a power of good for the finances of Centrica, as well as helping the UK to "go green" in a way which doesn't involve a simultaneous economic slowdown, or forcing people to cut back on energy usage through higher prices.

Regarding investing capital in growing production going forwards - well now that Solan is water under the bridge, (and PMO wasn't quite destroyed completely by the stupid decision to sanction it), then PMO is now cash-flow positive.

So why all the talk of more debt being needed to buy assets or to invest in new production projects. PMO's free cash flow should be $300-$400 million in both 2019 and 2020. Surely this is a good wedge of money to go towards financing the development of Zama and SeaLion. Although my preferred option would be to farm-out our stake in Zama pre-development: and to use the money raised to accelerate SeaLion. SeaLion having the necessary economics (the large field size plus the low tax regimen in the FI) to be truly transformative in value for the finances of PMO (and in turn the value attributable to the bondholders and the equity holders).

Dodger,

Absolutely it's true that Solan nearly destroyed all the equity value here - but that was bad management, to even allow one project to become such a white elephant that it pretty much ate up all of the hard won profits from four or five successful oil development projects.

Regarding investing capital in growing production going forwards - well now that Solan is water under the bridge, and the PMO wasn't quite destroyed completely by the stupid decision to sanction it, then PMO is now cash-flow positive.

So why all the talk of more debt being needed to buy assets or to invest in new production projects. PMO's free cash flow should be $300-$400 million in both 2019 and 2020. Surely this is a good wedge of money to go towards financing the development of Zama and SeaLion. Although my preferred option would be to farm-out our stake in Zama pre-development and to use the money raised to accelerate SeaLion which has the necessary economics (the large field size and the low tax regimein the FI) to be truly financially transformative in value for the bondholders and the equity holders here.

All oil companies made same mistake

No one in the sector geared up enough from 2002-2008 which is why crude prices hit $140 in 2008.

It's not surprising that several BODs then panicked and made bad decisions to try and correct a period of under-gearing. However 2009-2014 was a bad time to gear up and many companies have seen a vast destruction in equity value as aa result in the oil sector.

PMO have survived these terrible decisions be management (just), and they really need to employ a decent economist to make sure that in the future they are gearing up when no-one else is, and are selling assets when others are gearing up. Hence on this basis Solan would never have been given the go ahead simply because the timing was wrong - and also anyone with a iota of sense could have told them that the economics of scale didn't make sense to develop Solan when they had a far large resource in SeaLion to develop.

Why would anyone commute in to an area that has an unemployment rate of 60%?

Again what work is there to be done from hone given the nature of the businesses I observed in this area - very little or zero work would need to be done from home except for marking homework by the teachers at the school.

I find it more likely, and from what I have observed whilst walking the streets and glancing around, that a good proportion of people have just given up because they were led to believe that society was run by people who would try and create jobs/manage the economy and for the past decade they have been hit by massive job losses, utility bill incfreases, council tax increases, fuel price increases, unporecedented financial fraud, and pension cuts (or even a lot of fraudlent activity misselling pensions which has led to many losing everything).

The merger was a good deal for shareholders because in the grocery sector scale is vital and this was the only way to try and get to a similar scale that Tescos already has.

Yes ASDA were extracting their pound of flesh, but unfortunately the reality is their low quality strategy was working just as well as Sainsbury's "higher-quality" strategy. Hence, there was no reason in the current market for Walmart not to try and extract a decent premium for selling ASDA. But it was a premium that Sainsbury's could easily have afforded to pay and crucially it would have given them control of enough market share to actually implement some kind of long-term business strategy.

Now they don't have the muscle to do anything other than to be slowly withered away over the next decade because the UK has a heavy bottom end, socially, and this will benefit Aldi/Lidl/ASDA far more than it benefits Sainsbury's.

How can the CMA have turned down this merger - do they want another financial crisis - shareholders have been patient here and tried to allow Sainsbury's to navigate the clusterfuck of a UK economy the BoE has presided over. But with Lidl/Aldi/Coop being allowed to expand post 2008 with cheap land, after the banks were forced to mark down commercial property by 40%, then I do think the big losers here are the shareholders who are seeing their capital being frittered away supporting a UK grocery sector which has far too many supermarkets for the size of the UK.

Exactly, so M&S should not be looking to buy other businesses/expand when the economic outlook is extremely negative because we have had extraordinarily (emergency) low interest rates for a decade and must be so deep into the economic cycle that a recession is well overdue and he probability of one must be high.

Yeah, I also wonder who is deceiving who because the official stats stopped deceiving me about six or seven years ago.

Take a typical English village, albeit a large one, 5,000 houses/bungalows, so assume the population is 12,500.

The only jobs in this relatively job-friendly village are a local post office/corner shop (3 jobs), a high-school which they are lucky to have, (75 jobs), 2 small garages (10 jobs), a dentists (8 jobs), a medical practice (12 jobs), a pub (3 jobs full-time), and an Indian restaurant (8 jobs but part-time: so only 4 full-time jobs really), and a family-owned coffee shop (2 jobs). And that is the sum total of the employment opportunities in that village = 117.

So 117 jobs for 12,500 people and the official statistics claim "full employment" - if anyone actually believed the official statistics anymore they may as well believe that pigs fly. And none of those jobs are high value jobs such as in engineering or the extractive industries - all these jobs are peripheral "service sector" jobs and I'm not even sure teaching would be counted as well paid - so the only well paying jobs in this village are the six GPs and the 4 fully-qualified dentists.