Member Info for Temple_of_Doom

FT a week or so ago:

"Trump victory hands hedge funds $1.2bn win from bet against renewables"

Bloomberg

"The Climate Short: Hedge Funds Pile Up Huge Bets Against Green …

21 Oct 2024 · Despite vast green stimulus packages in the US, Europe and China, more hedge funds are on average net short batteries, solar, electric vehicles and hydrogen than are long "

As I've posted elsewhere ... one line of text from Trump on social media will change the dynamics for good and/or bad.

It's been obvious since the US sell off in August that Hedge funds have been grouping together to hit the renewable sector .. and the UK especially.

When the Hedgies pool together fundamentals go out the window. Play the noise if you can, and pick a point to hold for the rapid squeeze when it happens IMO.

Really should put the glasses on when typing …. rotated from GCP into NESF and then SEIT this morning. Spot US Nat Gas prices are up, £/$ is down, and should be good for SEIT that goes ex divi in a couple of weeks having been heavily oversold IMO post US elections.

The pre xmas short squeeze in this sector last November/December was hugely profitable … looking for the same again.

GLA.

"Call me all the names you like,"

Kindly explain exactly where:

"where online de-rampers presumably looking to spoof folk into selling can F*** O** as far as I'm concerned."

Is calling anyone in partuclar names.

One interpretation of the above, is that "AL75" is making a self "de-ramping" confession. Whether a correct interpretation or indeed an intperpretation that I might be thinking of, is something that I couldn't possibly comment upon.

"Ah well. Insults will get you nowhere in Trading. " ... and I gave my opinion - maybe go look up the Economic factors that are price drivers for this sector ... then work out the difference between an alleged "insult" and a suggested course of action.

Scalped 2p this morning on the small bear raid for £25K .... kept shares profit in the bank ... I do "trade".

GLA

"What's to like here, " ... Simples .... buy around 72p now as in March this year and sell at 84p .... the sector is being hammered where online de-rampers presumably looking to spoof folk into selling can F*** O** as far as I'm concerned.

"Biden gives billions to the World Bank before Trump takes over" - Biden in my view ... will give the funds to continue the "Green Legacy" - Trump can slow down progress but that's about it - in my view.

Never fight the shorters led press ....

"You’d have to be a total moron to waste these resources for the reintroduction of oil."

US oil production was maintained throughout the Biden administration from memory .... so the statement made by Trump was garbage in anycase - hardly a surprise.

USA has among the lowest trade-to-gdp ratios in the world implying its internal market is massive in both proportional and absolute terms. USA will be able to stand Trump tariffs .... with both winners and losers as happened during the last term with metal tariffs .... but if Trump ends the Ukraine war, fossil fuel prices will likely collapse as Russia comes back on line .. which it will .. and a different matter entirely.

I recollect the smile on Biden's face a few years ago, when Ukraine war first broke out, pointing out that USA had lots of Natural Gas to sell to the rest of the world.

Let's be clear - proponents of free speech actually mean the right to distribute Fake News ... it's driven Trump and populist political campaigns for 10 years and more .... it is what it is.

“ Hedge funds clean up with bets against renewables after Trump win

Investment funds made more than $1.2bn from by shorting the share price of 20 renewable energy sector companies, according to one estimate‘

As I posted before Trump win … sector is being shorted … and obviously so … plenty of noises made to this effect over the past few months. There will no doubt be some dark web that recruits major players hitting sectors but as also stated … one line from Trump on social media will change the scenario for better or worse.

Going back on Biden’s IRA will likely end up with on going law suits for damages … so changes will most likely affect on going contracts … where as GSF note in their recent presentation will reduce competition.

We have Trump led market … one post on social media by Trump can both add and take away 20% from stocks.

These are the new rules.

GLA

Financial markets have a huge element of poker play to them .... what the past week has shown, is how powerful US hedge funds are. It's not pleasant ... but I picked some more today. We will see.

If the Ukraine war ends quickly - Russia will be back on line and oil prices likely to collapse with oversupply. Money markets have no loyalty to warring sides. If the Isreal conflict ends at the same time, part of the negotiations for peace, will no doubt include Iran demanding world access for its oil products ... if Trump hacks off the EU by forming a protectionist USA, that will force closer EU Russia relationships and cheap Natuiral Gas for Germany.

Taken together, the above will squeeze the USA as a relatively expensive oil producer as happened last time Iran came back on line in 2015 - with the risk of frackers going pop.

There was a reason Biden had a wry smile, when Ukraine war broke out, pointing to the fact that USA had a lot of gas to export.

Actions have reactions and consequences.

From the capital markets day presentation: "However, retroactive withdrawal of support for existing investments, such as those in Texas and California, is not expected and could potentially improve their long-term profitability by reducing the scale of competing capacity in future years." I can possibly see Texas as a problem, but California is a Democrat stronghold ... I'd be more worried about fires in California taking out storage sites, myself.

Likewise Therosyl … save I loaded up on HFEL during the budget spike selling here 61p and next day at 60p … and reduced heavily on HFEL buying back … this morning being 10% gain given trading costs and just about breakeven on HFEL so we will see what pans out.

“Very heavy”

The UK is trying to curb wage spirals that is adding to inflation. Truss tried Reagonomics, while Sunak used higher interest rates for longer … where UK bankruptcies reversed and against world trend post 2016, rose until 2020, fell during furlough and are flat lining at levels last seen in 2009 … 650,000 UK folk retired early during Covid, government wants them back to work, and many will have to return as inflation eats into pensions.

What Reeves has done, IMO by adding to employer NI is force business to both shed and be careful about recruitment putting more pressure on earnings … this is quite clever … but it’s all designed to reduce wage demands … in effect forcing Brits to compete for lower wages … some benefit of Brexit. Tied with the above are wage demands by public workers, and civil servants, 100,000 more of which we have because of Brexit.

The above will take time to work through, if it does, but as it does we can expect UK debt to gdp to reduce, that will work through to bond markets and proxy bonds like NESF.

So, there is an 11% yield on offer here with external risks. I’m now very in this sector, and expect to be nicely rewarded as the above unwinds to our benefits.

GLA

The whole sector is down …. with an OBR error back in March … leaving Reeves with £20bn less borrowing room, if I read correctly, that leaves another gap to be filled. So more cuts on the way.

Grabbed some just now ...

Meanwhile, I bailed here on the budget spike, loaded up on HFEL, took more off the table at 60p as the rest of the sector collapsed late last week, bailed HFEL for pennies, as of this morning, back in here 2p cheaper. Good week.

Not one political party pointed out during the GE that BESS storage screwups cost the tax payer millions in the UK … that is unexplainable especially given so called “Green” advisors to Labour … Tory understandably would not want to admit to the failings.

Government itself wants to curb wage inflation, whilst keeping those walking out of the UK such as doctors and NHS staff happy … so it has a fine balance to play.

Increasing NI from employers, will force employers to shed under performers and dead wood from business … increasing unemployment that by itself will curb wage demands and wage spirals - a follow through from Labour of Tory strategy albeit a different mechanism.

The question of course is why UK is especially vulnerable at this point, being an energy producer, with CV19 done and dusted. The answer has been obvious for 8 years.