Rhode Island Sues Big Oil

[Jan van Eck + 7,558]

You realize, I suppose, that it is an artificial linking.  It is not realistic to conclude that 3.5 trillion of asset value change in the stock exchange is directly linked to "announcements" about shale fracking. I find it hard to believe that any researcher can isolate only some announcement as the sole causative factor in today's complex world, including the large number of stock traders that have a vast number of individual motivations.  

[Tom Kirkman + 8,860]

Jan, my highly technical term for this type of research paper is "gobbledygook".   The amount of research and charts and equations that went into this paper seems utterly futile... that's just my own opinion.

On the other hand, in a pinch the paper can also serve as a cure for insomnia.

[Rodent + 1,424]

1 hour ago, Tom Kirkman said:

Okey dokey, getting back on topic about Oil and Gas...

 

um.... what?? not only wondering who wrote it but who the intended audience is. it lost me at "in order to understand"

[Tom Kirkman + 8,860]

35 minutes ago, Rodent said:

um.... what?? not only wondering who wrote it but who the intended audience is. it lost me at "in order to understand"

The intended audience is addressed as follows in the introduction:

==============================

"We adopt our methodology of constructing a portfolio that tracks underlying unobserved shocks by analyzing the cross-section of stock returns on the days of key announcements by the U.S. Federal Reserve (e.g., as in Savor and Wilson
(2014)). We examine several sets of monetary policy announcements, including scheduled FOMC meetings or specific announcements of unconventional monetary policy. We show that such portfolios track very closely the returns on a portfolio constructed using market betas. However, while monetary policy helps explain the stock market run-up immediately following the global financial crisis in 2009, such monetary policy mimicking portfolios do not help explain any of the high market returns over the recent time period, and thus do not take any explanatory power away from the shale mimicking portfolio. This exercise, while potentially interesting in its own right, serves to highlight the general applicability of our empirical methodology, as well as the robustness of our conclusions.

This paper proceeds as follows. We describe the data, the general economic setting, and our empirical approach in Section 2. Section 3 details our econometric approach and presents the results of our empirical analysis. Section 4 presents the set of robustness tests. Section 5 concludes."

[Tom Kirkman + 8,860]

Since I seem to have already dragged poor Marina's thread totally off topic, may as well continue : )  I got curious about the author of the Shale paper I've been quoting and providing screencaps above.

Seems the author wrote a paper back in December 2015 (about 1 year before Trump was elected) that generally says that the U.S. Shale Oil Boom will likely result in a shift toward Republicans being elected.

I'm still trying to wrap my head around this document.

www.nber.org/papers/w21789.pdf