I don't think there is any misunderstanding. The issues are with local distribution, not generation or transmission. So it's simply a matter of prioritizing the restoration of distribution circuits which serve hospitals, seniors, etc. They don't need to have separate circuits and separate power plants that exclusively serve those loads in order for them to be prioritized.
There are some good arguments against that. It creates a deadweight loss by banning high utility private uses of the car (driving kid to hospital) and instead there would be an increase in low utility "work" uses of the car (delivering a single banana to a bodega). There is a parent out there who would be willing to pay $X to drive their kid to hospital, and a work vehicle user who would forgo paying $X by staying off the road, but under a blanket ban that won't happen.
It would also increase the incentive for people to play games like claiming their personal car as a "work vehicle", throwing a little advertising decal on the side, things like that.
I believe there is a distinction between profits for "transmission" specifically and for electric utilities more broadly. The FERC ruling that you reference is for PG&E's transmission assets, i.e. high voltage lines and transformers and such. I assume that their retail electric business is regulated by CPUC and has a different profit/revenue/whatever arrangement.
Similar to this is the Weyerhaeuser headquarters building [0] in Federal Way, WA. The campus is also home to the Pacific Bonsai Museum, which is a real gem. Not too far out of the way for anyone visiting Seattle (just a little ways south of the airport).
I was skeptical too, but it's plausible. According to the Federal Reserve's Distributional Financial Accounts release [0], the bottom 90%'s share of "corporate equities and mutual fund shares" in Q4 2023 was about 13% (5.24 / 39.94)
What exactly does "stat arb" mean in this context? I assumed it meant "statistical arbitrage", so I was expecting the article to talk about a pairs trading strategy or something in that vein, i.e. a strategy that relies on a statistical relationship. But this seems to be more what I would call "geographical" or "locational" arbitrage where they're trading price differentials in the same instrument between multiple venues.
I defined stat arb in the glossary at the end but probably should have included a more obvious link.
TL;DR: this is a pairs trading strategy that relies on the (very strong) statistical assumption that the price of a token on a centralized and decentralized exchange will converge.
My longer definition below:
Stat arbs: in finance, statistical arbitrage generally refers to any trade where a pair of assets should statistically move in a certain way. However, there are degrees of should. TradFi traders might reason that Meta and Google are both in the ads business, so if Meta is relatively expensive and Google is relatively cheap, they should short the former and long the latter. However, this is a weak argument. Perhaps Meta is just a better business or Google has structural problems. A stronger stat arb thesis is that Royal Dutch Shell used to be traded on both American and European exchanges. If the shares were trading at different prices on each, nearly risk-free profits are available to those who close the spread. This is what stat arb means in a crypto setting. AVAX may be trading at slightly different prices on Binance and on various blockchains.
Isn’t AVAX transferable between blockchains and Binance? If so, this isn’t “stat arb”, it’s just regular arbitrage. When the instruments are fungible, it doesn’t matter whether there’s a statistical relationship; your profit is guaranteed once you complete the trade, regardless of how the prices move later.
The Royal Dutch/Shell case is different because the two stocks were not actually fungible, so the trade would only have been profitable if the two prices eventually converged.
PS I enjoyed the article and it’s clear you’ve spent a lot of time thinking about this space. I just can’t resist chiming in when it comes to well-established terminology.
In theory, yes, the tokens should be transferable between the blockchain and the CEX, but this link breaks all the time and for various reasons (see the crypto problems section). Lots of things that “should” happen in regular, efficient markets don’t in crypto.
That said, call it whatever you want it. Most people in crypto call CEX/DEX stat arb to differentiate from true risk-free arbitrage, but I agree that people coming from a traditional trading perspective would call this pure arb.
You're right in principle, but larger interconnections aren't a panacea.
The reality of Uri is that the neighboring regions to the north (SPP) and east (MISO) were on the brink themselves (grid emergency and rolling blackouts in SPP), and the import capacity from their neighboring regions (i.e. the midwest) was constrained; they couldn't import more power from their neighbors. If Texas were part of the Eastern Interconnection AC grid (i.e. connected to SPP and MISO), I think fewer people in Texas would have lost power and more people in Oklahoma. SPP and MISO just didn't have any more power in those areas to ship them.
SPP & MISO have been interconnected with each other forever, they're on the same AC grid. But the capacity between their systems is limited, hence the blackouts in SPP. They just never bothered to build out the capacity because it hasn't made a lot of economic sense. I think that's the best counterfactual example of "what would have happened if Texas didn't have their own grid", and it suggests that the storm still would have been a problem.
The stacked line chart [1] of daily production by basin on the wiki page is very misleading. Following through to the source EIA data [2] and comparing Feb 2021 against Jan and March 2021 shows permian production down 19% from "average", the biggest decrease of the reported basins. The other basins you mentioned were between 13 and 18% below their "average". Of course this is a pretty big extrapolation from a monthly average number...
I agree with your general argument (retail consumers overwhelmingly do not face instantaneous price signals).
However, I think you can "panic buy" electricity. I live in a place with unreliable electricity. On hot days, I'm more inclined to cool my house with the AC earlier/colder than I would if I could absolutely count on the electricity being available. If the power goes out, at least my house is cool for a short while.
