“…in leveraged loans & middle-market credit we see lenders getting coerced by equity sponsors” - Dan Zwirn

***Editor’s Note: The International Red Cross / Red Crescent is apparently active - on the ground, in Beirut - providing humanitarian support. They are accepting donations to support the disaster response efforts.***

REGULATORS.

Ideally, regulators should function something like the Japanese train system:

• Immaculately clean

• Fast

• And predictable, down to the second

Around the world, recent regulatory actions have resembled the mid-19th century American railroads…

• Dangerous, sometimes deadly

• Inept-to-corrupt

• Predictably unpredictable

The explosion in Beirut is the latest tragic example.

But putting fatal tragedies asides, chaotic regulatory regimes have - both directly & indirectly - made headlines this week for a variety of reasons:

• The DAPL pipeline appeal

• BNP’s Trade Finance review

• BP’s “managing down”of its oil business, on the basis of 2yrs worth of data

We’re not saying that there’s too much or too little regulation…

… but rather that there seems to be less-and-less of a rhyme-or-reason to regulatory action.

Arbitrary like the rules of the street.

An erratic environment that harkens back to the lyrics of a G-funk classic -

**Regulators**
We regulate any stealing of his property - Warren G

Unfortunately, there’s a growing edge in business & investing…

.. and - that edge - is in knowing / influencing what how government is going to regulate -

• If you’re watching, expect to see pandering

• If you’re playing, you’d better be lobbying

We don’t like it. We don’t endorse it.

We’re just saying - don’t be surprised to see private sector games become increasingly political -

LAREDO.

Laredo filed a 10-Q/A…

That’s generally not a good sign.

The reason:

“…we identified an error in the future production costs component of the estimated present value ("PV-10") of our reserves…

We’ve beat this topic to death…

So, here’s a couple noteworthy threads from others:

• @Teutoburg1

• @TomLoughrey_LFE, from ‘18

OTHER NEWS.

Fieldwood filed for Ch.11; how decom liabilities eventually play out w/ these assets will likely be a big story… but that’s not for today.

Michael Mauboussin (now at Morgan Stanley) published a short book (PDF link) on Public Equities & PE/VC.

We blindly recommend reading anything Mauboussin publishes.

• Hellfighters: Red, Coots & Boots and the story of oil well firefighters

• For the Gym Rats w/ a Sweet Tooth

• 33yrs ago this week, the US FCC rescinded the Fairness Doctrine…

• The RRC’s latest on flaring

• Ring update from Josh Pollard

Champions League, Hockey, MLB, NBA… pick your poison - we’ll be back on Tuesday - catch y’all then -