2/24/2020

Hello there,

I hope everyone had a good weekend. The NBA was back in action so if you didn't have a good weekend then that is on you. The Thunder got back into the swing of things with a bang by defeating the current 2 seed in the West in the Denver Nuggets. Chris Paul was masterful again in the clutch as he scored roughly 113 points in the final two minutes to lead OKC to a 113-101 victory. Then OKC followed that up with a blow out win over the once vaunted Spurs in which 8 OKC players scored in double figures. That is a franchise record by the way. OKC is looking really good. Lately, I have been starting to think that maybe Chris Paul can be a dude in the playoffs for OKC... No. I can't talk myself into that. I don't want to get my hopes up. The Thunder are perfectly built to win a title except there is no dude. Unless... No, NOPE. Can't let myself go down that road but it may be inevitable. A major development for the Thunder that occurred over the weekend is that it officially inducted a second player into the "Andy Struck CAPS/no caps" player club. Previously, only the almighty DION Waiters was in that club. He was the founder because there would be times when Dion would play phenomenally and he carried himself like MJ in his prime, which garnered him DION status. Then there would be times in which it looked like Dion had never played basketball before and he carried himself like MJ in his prime, which garnered him dion status. With that in mind, I would like to officially announce the second member in this club: Luguentz "Lu" Dort. I can't imagine he has ever been awarded such a prestigious honor. DION showed up about half of the time and dion the other half. Right now, DORT shows up about 75% of the time and dort 25%. So the DORT/dort ratio is already stronger than the DION/dion ratio was at its peak. Go be an all caps version of yourself today. In this week's #bucketsblog, the Trump Administration is sanctioning Venezuela some more because #whynot, another energy commodity gets infected by the coronavirus, Russia is telling OPEC that it's not me; it's you, Mr. Trump is getting bored of only fighting China in a trade war so he's turning his eye towards another major Asian economy, last week's Democratic debate became a bit fiery, and Nevada felt the Bern in a big way.

February 24, 2020

When your fastball isn't working, throw another fastball

• Unless you are playing the Houston Astros anyways. Then it doesn't matter what pitch you throw because they are going to steal your sign and let their hitter know what's coming via a sweet drum solo on a trash can. Do not fret though, Astros fans, because that type of scandalous behavior will win you a World Series and basically come with zero repercussions on the back end. Well, except for every single pitcher in the league will be targeting your top players with a good old fashioned bean ball to the ribs. Anyways, this whole blurb isn't about the Astros surprisingly. President Trump and his foreign policy machine decided to throw some more sanctions at Venezuela in an attempt to put a halt to the country's ability over the past few months to side step existing U.S. sanctions on its oil exports. The U.S. and a handful of other western countries are throwing their support behind political opposition leader Juan Guaidó who challenged current "president" Nicolás Maduro in Venezuela's last "election" and won, according to western countries, but lost according to Maduro's regime. Long story short, the U.S. has been leading up the charge to replace Maduro with Guaidó but ran into a snag when it found out that Russia was throwing its support behind Maduro. The U.S. has sanctioned Venezuela heavily, especially on oil and gold exports, thinking that it would eventually bleed Maduro's government dry enough that he would be forced to step down. However, Russia has been providing back channels to Maduro that has been enabling him to keep some of his country's oil and gold exports going and thus allowing him to weather the storm. Now though? America found out about the back channels and have, you guessed it, sanctioned those involved with helping Maduro export Venezuela's oil and gold. Rosneft Trading SA, subsidiary of Russia's oil giant company called Rosneft, and its head of trading and board member, Didier Casimiro, and any company caught doing business with this unit or Didier will be sanctioned as well after a three month wind down period passes. Rosneft has said the sanctions are illegal. Surprising right? Secretary Mike Pompeo took to the old Twitter machine to say this:

• For reference on how much business Rosneft has conducted with Venezuela on its oil exports, the Wall Street Journal had this data at hand:

• Safe to say that Rosneft saw America's sanctions that were applied early on in the power dispute and just said eh, whatevs, and carried on with its business. Venezuela is becoming quite the battle ground for a smaller version of another Cold War.

Another commodity gets infected with the coronavirus

• It's not like natural gas prices needed another bear signal, but the commodity is getting one anyways. The coronavirus is already hammering global oil markets pretty hard and apparently it became bored of just picking on oil so it decided to set its sights on the already beaten down natural gas market. China is a top three global importer of liquefied natural gas (LNG) and the largest overall importer of natural gas in the world as the country is trying to improve its air quality by switching its power generation fuel from coal to natural gas. Coal emits roughly double the amount of greenhouse gas emissions into the air as natural gas does. This has helped natural gas overtake coal as the largest power generation fuel in America and has also greatly increased global demand for the product. The future demand of natural gas is bright as well. Oil and gas super major, Shell, forecasts that nat gas and renewables will supply 80% of the growth in global energy demand over the next 20 years and that LNG specifically will have a 4% annual growth rate. The medium to long term future of gas demand looks great, but the short-term looks terrible. The international index for East Asia is called the Japan Korea Marker (JPM) and it dipped below $3/mmbtu last week which was good for a record low. Things may not be getting better soon as China is expected to turn away 49 LNG cargoes between February and April, according to New York based ship broker Poten & Partners. Forty-nine cargoes is about 3.3 million tons of natural gas which is equal to 171 mmbtu which translates to 385 million Russell Westbrooks. For reference, the U.S. main price index for natural gas (Henry Hub) has been hanging out below $2/mmbtu for the past few weeks making everyone become broke in the E&P world. Short-term gas prices are worse than referees calling a foul at the end of the best all-star game ever so the game would end on a free throw. Long-term gas prices are like the OKC Thunder's future: bright and full of hope, but not here yet.

The coronavirus is also breaking up relationships

• The relationships between OPEC, specifically Saudi Arabia, and Russia over the last few years has been more like a Russ and snake relationships than an MJ and Pippen relationship. Both countries can tolerate each other but eventually a break up was always going to happen. In this instance, Russia is snake. Everyone take a second to high five the closest person to you and when they look at you confusedly, you just tell them "you know why" and walk on. The Saudi's, Kuwait, and United Arab Emirates (UAE) are thinking about breaking off their supply cut deal they have had with Russia for the past four years that has been an attempt to help balance oil markets and keep oil prices from being negative $40/bbl. This "big three" wants to further curtail production by a collective 300mbpd temporarily to fend off reduced demand from China as it sorts through its coronavirus issue. Russia is saying, naw, we good, and wanting to keep production where it is at. In February, Russia rejected Saudi's proposal to have OPEC+Russia cut production by 600mpbd. Russia believes the drop in demand due to the coronavirus is being overstated and the production levels don't need to be further reduced. Saudi's energy minister, Prince Abdulaziz bin Salman, believes otherwise and has compared the virus to "a fire that needs to be put out," according to a person familiar with the matter that has connections to the WSJ. The ranges on estimates of how much demand destruction will occur are pretty wide. The International Energy Agency (IEA) projects that "demand for oil is likely to be 435,000 barrels a day less in the current quarter compared with a year ago." Then Vitol Group, the world's largest independent oil trader, "cut its forecast demand for the quarter to 98.3 million barrels a day, down 2.2 million barrels a day from its previous forecast for the period." Either scenario would represent the first quarterly decline in oil demand since the financial crisis, according to the WSJ. If the coronavirus has done anything positive, it has at least broke up a team that Russia was on and propelled it to isolation and probably is forcing the country to use burner accounts on Twitter to defend its actions.

Next up on America's trade war list? India

• The trade war with China is about to be old news. The Trump Administration is beginning to turn its trade war eye towards India. This country has always represented a Shai Gilgeous-Alexander type of economic potential but has long remained a black box to the outside world. India has long embraced protectionism despite making somewhat recent efforts to open up its country's doors to the outside world. Prime Minister Nerandra Modi led his party, called the Bharatiya Janata Party (BJP), back to power in 2014 on a platform that had a simple mantra: "minimum government, maximum governance." Indian leadership had long been reluctant to allow foreign investment, but a foreign-exchange crisis that occurred in the early 1990s led the country's citizens to vote in a new party to power that was designed to liberalize the country socially and economically. This party was the BJP. After this party gained control in the early 2000s, India experienced a period of rapid growth. However, the growth was always going to be stunted because of "extensive regulations, licenses, state control of banks and other key industries, and capricious policy-making continued to hamper entrepreneurship and investment," according to the WSJ. Fast forward to now, and the BJP is back in power for the most part, but is still running into internal issues on how to expand its economy by making it easier for foreign investment to flow in. The country currently has one of the highest import tariffs in the World Trade Organization at 17%. It was raised to this level in 2018 by Mr. Modi. BJP has an issue of needing to tend to a core part of its base in small business owners and protect them from having to compete with massive companies while also trying to expand its overall economy via foreign investment. The BJP is trying to copy China's model of economic expansion but needs to successfully walk a fine line between protectionism and globalization. China had massive industrial potential and it has taken full advantage of it. Enough to where current U.S. leadership decided to kick off a massive trade war with it. India may be up next on the trade war list if current American leadership continues to see Mr. Modi and the BJP set high tariffs on imports that Mr. Trump may see as unfair and an attempt to take advantage of U.S. companies and their products.

Fireworks erupt at last Wednesday's Democratic Debate

• Unfortunately for the late entry, Mike Bloomberg, all of the fireworks went off in his face. Elizabeth Warren and her band of other Democratic presidential candidates went at the billionaire relentlessly the entire debate. Surprisingly, Bloomberg acted shell shocked the entire time and it was as if he did not anticipate being grilled about his "stop and frisk" policy he implemented while mayor of New York City nor did it look like he anticipated being raked over the coals for having several NDAs in place with former female employees at his massive financial data company, Bloomberg LP. He was absolutely ripped the entire time, but it likely won't matter in the end. He has already dropped about $400mm on his campaign and its not like throwing another $400mm in order to make up for his poor debate performance will hurt him. The dude is worth north of $60B. He could spend 10% of his wealth on his campaign, lose, and not lose any sleep over it. How wild is that? Perhaps his best two moments is when he basically asked how Sanders is a socialist despite being a millionaire and owning three houses. It is amazing that his supporters don't really see the irony in what he is running on versus what he is. Bloomberg's other okay moment is when someone asked about his taxes being released and he said they are currently being processed and that he "can't go to Turbo Tax." Haha. I can though. Other than that, it seemed like Warren won the debate. Buttigieg and Klobuchar had good showings as well. Sanders was his usual fiery self and Biden kind of looked like if you told him it was 1988 then he would have went along with it and thought it was true. The race is heating up and Super Tuesday is fast approaching as it is set to take place on March 3rd. Fourteen states will vote on that day including Oklahoma. After Super Tuesday, there should be a clearer picture of which Democratic candidates have a legit shot at winning the right to represent his or her party in the general election and face off against President Trump.

(Photo credit: Etienne Laurent/Shutterstock via the Wall Street JournalI)

Feel the Bern wins Nevada

• Senator Bernie Sanders has some far left policies that he is running on that may not resonate with the majority of Americans, but he knows how to motivate his core base of supporters better than anyone else in the Democratic field. That ability paid off in spades in the Nevada caucuses as he dominated the field and walked away with a resounding victory on Saturday night. He brought home 46% of the popular vote. Next in line? Former Vice President Joe Biden at just under 20%. Nevada was supposed to be a turning point for the rest of the Democratic field versus Mr. Sanders as it was the first state that was considered "diverse" when compared to Iowa and Vermont. Joe Biden was supposed to have a commanding lead among black voters because of his ties to former President Barack Obama. Now? A WSJ/NBC News poll has Biden and Sanders tied when it comes to the black vote. That is some substantial ground that has been made up by Sanders in the last couple of weeks. South Carolina is up next and is set to take place on Saturday the 29th. After that? Super Tuesday. Over one third of Democratic convention delegates are up for grabs on that day. This will also be the first set of ballots that Mike Bloomberg will appear on as he skipped the first four states altogether. He has spent $160mm on advertising in Super Tuesday states according to political-ad tracker Kantar/CMAG. Next up on the spending list is activist billionaire Tom Steyer who has spent $37mm in Super Tuesday states. Mr. Sanders ranks third as he has spent $11mm in those states so far. Nothing beats spending a Houston Rockets salary cap level of money like winning though. Mr. Sanders is gaining what could become unstoppable momentum. This has caused some in the Democratic party to express concern of how a Sanders led ballot could hurt down ballot Democratic candidates as they would have to not only run against Republican policies, but also might have to distance themselves from socialist policies that Sanders embraces. Rep. Jim Clyburn of South Carolina, a top member of House Democratic leadership, said on ABC’s “This Week” that “I do think it would be an extra burden for us to have to carry. This is South Carolina, and South Carolinians are pretty leery about that title ‘socialist.’” Mr. Bloomberg is basing a lot of his campaign on how his camp doesn't believe that Sanders can take on Mr. Trump. “The stakes are too high in this election to choose a candidate who appeals to a small base like Sen. Sanders. As Mike has said, nominating Sanders will be a fatal error. To beat Trump, we need Democrats, independents and Republicans to win," said Galia Slayen, a spokeswoman for Mr. Bloomberg. Several talking heads discussed similar concerns during Nevada caucus coverage on Saturday night. If 2016 has taught us anything though, it is that a person who knows how to ignite a fire under his or her core base can win big.

Thoughts of the week:

• A few weeks ago, I developed an NBA Player Hierarchy that shows the progression of steps that players climb over their careers. It starts at the basic need to stay in the league and its crowning achievement is reaching Kawhi Leonard in the 2019 playoffs level. It is the NBA’s equivalent of Maslow’s Hierarchy of Needs. Below is my version of an NBA Player Hierarchy and where Thunder players ranked originally (in red text) when I first developed this in November-19 and where they rank currently (in blue text), according to me. Wherever the player is ranked, that player needs to have a firm “yes” to that question before he can move up the ladder. Wherever a player is currently means that he has not definitively answered “yes” to that question. All rankings are based on today’s version of that player. CP3, for example, was probably at level 8 at his peak. Rankings:

1. Does the player belong in the league?

• Nov-19 Ranking: Burton, Dort, Hall, Nader, Patton

• Current Ranking: Patton (out of the league now despite dropping 45 points in a G-League game this year. Traded to Dallas a week after that game for Isaiah Roby and then the Mavs waived Patton), Hall (waived by OKC in Dec-19), Roberson (sadly because I don't know if his bum knee will ever let him play in the league again...), Hervey, Roby, Burton, dort

2. Can he be a rotation guy?

• Nov-19 Ranking: Bazley, Diallo, T-Ferg, Muscala, Roberson (due to injuries or he would be at level 4…)

• Current Ranking: Diallo, T-Ferg, Muscala

3. Can he be a starter?

• Nov-19 Ranking: Noel

• Current Ranking: Bazley, Nader, DORT

4. Can he close games?

• Nov-19 Ranking: Schroder

• Current Ranking: Noel

5. Can he be one of the best three players on the team?

• Nov-19 Ranking: CP3, Gallinari, SGA, Adams

• Current Ranking: Schroder, Gallo, Adams

6. Can he be the best player on the team and win games late by himself?

• Current Ranking: SGA

7. Can he be a top 20 guy in the league and consistently get his team to at least round 2 of the playoffs?

• Current Ranking: CP3

8. Can he be a top 10 guy who might be able to take his team to a conference finals?

9. Can he be a top 5 guy and get his team to the finals?

10. Can he be that DUDE and win the finals?

11. Kawhi Leonard