Oil Prices

[shocka khan]

A pundit on Marketplace this evening was speculating that he thinks it may touch $20 a barrel before going back up.

Barbara Shook was on KHOU said same. I respect her because she worked for Kinder Morgan before she became an analyst. The folks at Kinder Morgan were very smart, When Kinder left Enron, he made Ken Lay give him pipelines on the way our, which ultimately resulted in him becoming a billionaire.

Barbara also stated that some outliers on the analyst side are calling $10.

Lastly, she said oil would get back to $70, but not until 2018.

[Dan]

Rich Kinder was literally the smartest guy in the room. He knew that the real value was in the assets.

[MoValley John]

Barbara Shook was on KHOU said same. I respect her because she worked for Kinder Morgan before she became an analyst. The folks at Kinder Morgan were very smart, When Kinder left Enron, he made Ken Lay give him pipelines on the way our, which ultimately resulted in him becoming a billionaire.

Barbara also stated that some outliers on the analyst side are calling $10.

Lastly, she said oil would get back to $70, but not until 2018.

Kinder didn't "make" Enron or Ken Lay give him pipelines, Enron was selling to raise capital. Enron was getting out of several gas pipelines and also getting out of Co2 generation and pipelines. Enron was really interested in a bunch of bullshit that had nothing to do with energy, most notably, they wanted to become the leaders in bandwidth technology and distribution. Pipelines were becoming a distraction.

If assets wern't extremely profitable or sexy, Enron wanted out. Outside of Northern, most of Enron's pipelines made less money. Enron needed Co2 to push natural gas in pipelines, but it wasn't sexy, they sold their Co2 production and pipelines. Kinder was bright and bought what Enron didn't want, but he didn't make Ken Lay give it to him. You live in Houston, you have nuggets of truth, but then you screw it all up by saying stupid crap.

[MoValley John]

Oh yeah, Enron still had an Omaha footprint, I know several people that were very close to the Kinder deal. If Kinder didn't buy the pipelines, somebody else would have, Enron was actively marketing them.

[MoValley John]

Rich Kinder was literally the smartest guy in the room. He knew that the real value was in the assets.

Enron didn't value their assets at all. They wanted to monetize everything they could. In the end, they were trading gas they didn't produce, storing it in caverns they didn't own and transporting it in piplines that they had already sold. Where Rich Kinder erred, was not being able to leverage Northern. Instead, in bankruptcy court, Warren Buffet stole Northern, Enron's only revenue producing asset, in what has been described as a corrupt deal.

[shocka khan]

Enron didn't value their assets at all. They wanted to monetize everything they could. In the end, they were trading gas they didn't produce, storing it in caverns they didn't own and transporting it in piplines that they had already sold. Where Rich Kinder erred, was not being able to leverage Northern. Instead, in bankruptcy court, Warren Buffet stole Northern, Enron's only revenue producing asset, in what has been described as a corrupt deal.

I think you're a little off here.

First of all, Rich Kinder was asked to 'walk the plank' long before Enron declared bankruptcy. Enron declared bankruptcy in 2001.
Second of all, Rich Kinder was offered a severance package by Ken Lay. IIRC, this was about the time Skilling joined the company. Rich asked for pipelines instead of money, Lay agreed and gave him the pipelines. I'm thinking (and I don't have the SEC filing in front of me) that they had to give Kinder all his deferred compensation which was a lot of money. Kinder asked for pipelines in exchange for money. Kinder left Enron in 1996.
Third, what Buffet did or did not do when Enron declared bankruptcy had nothing to do with Kinder getting the pipelines he requested when he was severed, as Kinder left in 1996 and Enron cratered in 2001.

[shocka khan]

Brittan's Telegraph now saying some investment banks (including Goldman and Standard Bank among others) say that $10 bbl oil is now possible.

http://www.telegraph.co.uk/finance/oilprices/12094394/Oil-price-could-fall-to-10-a-barrel-warn-investment-bank-bears.html

[pinstripers]

http://www.katc.com/story/30946491/bp-to-cut-4000-jobs-amid-oil-price-plunge?utm_medium=social&utm_source=facebook_KATC-TV_3:_Acadiana_s_Newschannel

[MoValley John]

Kinder purchsed pipelines from Enron. Kinder didn't force Ken Lay to give them to him. Kinder paid ~$40mm for the Enron assets. How he came up with the money is irrelevant, Kinder bought an Enron asset that was already being marketed for sale by Enron. Kinder didn't get anything for free, Kinder didn't force Ken Lay to do anything.

Let me quote your statement, "The folks at Kinder Morgan were very smart, When Kinder left Enron, he made Ken Lay give him pipelines on the way our, which ultimately resulted in him becoming a billionaire."

Once again, Kinder didn't make anyone give him anything. He bought the assets. When you make innacurate statements like this, its mindboggling. Do you really think using your money, however you got it, to buy an asset that already on the market equates "making Ken Lay give him pipelines on the way out" well that's the same as me "making the Toyota dealer give me a Camry on the way out." Nevermind I gave the guy cash for it. Your statement is akin to people thinking they won something on eBay. If your mind really works this way, and God I hope it doesn't, well, I feel sorry for you. Thenagain, it explains a lot.

The Northern Pipeline comment was in regard to the value of assets,Northern was the most profitable pipeline Enron owned. Kinder is a smart guy, he realized Enron was selling assets at below market. He pounced, but was given nothing. If he was really smart, he would have figured out a way to own Northern. Later, during bankruptcy, I believe KM was one of several bidders on the Northern pipeline. Warren Buffet's deal was approved. If what I've heard from several people in the gas industry is true, Buffett paid less than KM offered.

[shocka khan]

Kinder purchsed pipelines from Enron. Kinder didn't force Ken Lay to give them to him. Kinder paid ~$40mm for the Enron assets. How he came up with the money is irrelevant, Kinder bought an Enron asset that was already being marketed for sale by Enron. Kinder didn't get anything for free, Kinder didn't force Ken Lay to do anything.

Let me quote your statement, "The folks at Kinder Morgan were very smart, When Kinder left Enron, he made Ken Lay give him pipelines on the way our, which ultimately resulted in him becoming a billionaire."

Once again, Kinder didn't make anyone give him anything. He bought the assets. When you make innacurate statements like this, its mindboggling. Do you really think using your money, however you got it, to buy an asset that already on the market equates "making Ken Lay give him pipelines on the way out" well that's the same as me "making the Toyota dealer give me a Camry on the way out." Nevermind I gave the guy cash for it. Your statement is akin to people thinking they won something on eBay. If your mind really works this way, and God I hope it doesn't, well, I feel sorry for you. Thenagain, it explains a lot.

The Northern Pipeline comment was in regard to the value of assets,Northern was the most profitable pipeline Enron owned. Kinder is a smart guy, he realized Enron was selling assets at below market. He pounced, but was given nothing. If he was really smart, he would have figured out a way to own Northern. Later, during bankruptcy, I believe KM was one of several bidders on the Northern pipeline. Warren Buffet's deal was approved. If what I've heard from several people in the gas industry is true, Buffett paid less than KM offered.

nm

[Play Angry]

Oil breaking convincingly below $30 overnight, now at $29.43. Not a big deal from a technical standpoint but it seemed like that was a major psychological barrier. Oil in the $20s is sort of crazy to think about after the last dozen years.

[pinstripers]

http://finance.yahoo.com/news/why-the-heck-are-the-markets-tanking-165146322.html

[wsushox1]

Back above 30....not sure for how long