What We Learned This Week
That there is a certain Bond villain-like symmetry in that the CEO of ITC Global, a Houston-based satellite communication company acquired this week by Panasonic, is named Joe Spytek. I mean, the guy works with satellites and his name is Spytek? Can’t you just hear the Adele theme song? And …
The Oilpocalypse is coming … We reported this week that California had displaced Texas as the top state for job creation. California’s top ranking had less to do with what it was doing and more, or less, to do with what is happening, or not, in Texas. Specifically, oil. The drop in crude oil prices has had a devastating effect on Texas, which lost about 3,400 jobs in the oil business this January alone. And the way things look, things are only going to get worse, and not just in Texas. In North Dakota, the number of rigs drilling new oil wells dropped from 187 to 161 this week, the lowest level in half a decade, and predictions are that it could fall to 50 by summer. In Alaska, where about 90 percent of state government is funded by oil, enabling the state not to charge residents a sales or income tax, the drop in prices could cause such a budget shortfall that a 50 percent cut in capital spending for bridges and roads may be necessary.
That’s Putin it mildly … Russia, another region hit hard by the collapse of crude prices, saw more than $150 billion in capital get transferred out of the country last year, in part because the ruble lost its value, in part because interest rates soared and in part because, after the country’s invasion of Ukraine, international investors started staying away from the country. Also, some people just find the whole Putin riding a horse shirtless thing a bit creepy. But now, Putin is demanding that money come back. Speaking to a gathering of Russian business leaders, the shirt-clad Putin warned that if wealthy Russians did not bring back their money now they ran the risk of having their funds frozen. This is the second time he has made such a “request.” In December he even offered that those bringing their money back, even if that money was gained illegally, would be granted amnesty from prosecution. “He will not be asked about the sources of capital and methods of acquisition.” It’s basically the deal Putin got from the Russian people when they put him in power.