Sugarlips reacted to Errol in Credit deflation and the reflation cycle to come (part 2)
Interesting that he seems to think that nobody is calling for or expecting a gold pull back. On the contrary, I would say that most people who matter (i.e. people who've been watching gold for decades) would entirely expect a pull back. Wouldn't surprise me at all.
Possibly the more contrarian position is to call for no pull-back. This would catch out far more people, and leave those waiting for lower prices in the dust.
In any event, I certainly wouldn't bother selling gdx or gdxj. Presumably he is a trader. Otherwise, it's all just noise. Gold is still going to $10000+ (probably more like $15000), so bickering about whether it pulls back to $1500, $1700 or even $1200 just seems pointless.
It's the same pointless discussion that people have been having since 2000 - arguing about pull backs, when they should have just been buying regularly and ignoring the noise. This still applies. Gold is still massively cheap and would be even at higher prices than now.
Sugarlips reacted to JMD in Credit deflation and the reflation cycle to come (part 2)
Ok, please don't snigger or automatically dismiss as witchcraft(!) (btw, don't think you guys are like that) - but this is a question about the Benner cycle, based i think originally on the agricultural cycle (article link below). To be honest, cycle theory work is a bit beyond me, but many of the years do seem pretty accurate. The thing is, as the below faded historical document shows, this was published in 1875!
Extract below: Top line are crash-years, middle-line are market-high-years (is 1981 relevant?; however 1989, 1999, 2007, 2019 are - sorta - all there, at least for the macro investor they seem useful markers?)... So according to this, 2026 (approx) will be THE year to sell (divest completely/cash out)? And 2035 (approx) will be THE monetary meltdown crash?
I'm thinking that the Benner cycle predictions appear to be in tune with this blog's cycle timing. So is this prophetical/mere confirmation bias/or a latter day 'philosophers stone'? (no, not a harry potter reference!). Economic cycle theories have been mentioned here before, but is Benner perhaps the forefather of them all? What do others think?
I suppose all cycle theories are easy to dismiss. However, i did see this other article, written before the December 2018 crash. It explores the application of Fibonacci numbers to the Benner cycle (work done in 1967), and where the article author at one point writes (article's own bold/exclamation): 'The Benner Fibonacci is now suggesting a High right in 2018!'
Sugarlips reacted to Vendetta in Credit deflation and the reflation cycle to come (part 2)
I am of the same opinion.
This morning I have just sold off all my indices trackers:
(Emerging markets, S&P, and Japan)
.....which were the first shares I had bought ( at the March 2020 lows) since the year 2000! (I also sold everything 4 weeks before the collapse then in Mar 2000 - paper shares - those were the days! It’s so much easier now - so you get much bigger/quicker collapses and more volatility I reckon as a result).
I have also trimmed ‘a large’ SILVER position this morning and taken all the profits (a better than expected 35%) since buying in mid May.
What I have learnt? (obvious for others)
- Take profits and ‘trim’ regularly.
- Use profits to diversify or hold in cash ready for market correction.
- Always have a good holding of cash ready for next leg down/correction.
- Don’t buy ETFs (where possible) - Future exceptions for me will be ‘physical’ PMs
- Don’t buy Index trackers (etf) as they do not give a dividend - (mind they have been/can be very profitable)
- Buy big companies that will pay dividends long term
- ‘Ladder down’.
- Use efficient ‘tax vehicles’ (ISAs, SIPP etc)
- it takes 2-3 days for cash to clear if you want to transfer to other buying accounts
- Sector buys: Potash, Miners, Telcos, Oil & Energy, PMs
- Strategy is to (mainly) hold big large capital/asset resourced companies that can weather the downturn (pay off long term debt at low IR) and that will potentially pay large dividends over time - but and hold in ISA etc.
I am also planning to also go short on the NASDAQ in the coming days.
I have been tempted to add some more BP, RDSB, VOD, MOS, SDF at present but will sit on sidelines for now as I think there will be a big correction soon which will take those companies to even lower lows.
Could we see RDSB and BP sub £10 and £2.50 respectively? They look very cheap even now.
RDSB is currently £10.69..... 😳
Sugarlips got a reaction from Roger_Mellie in Musicians you really miss because they are dead
Some interesting choices so far, i'd add a few obvious ones, Prince, Bowie, Michael Hutchence, Robert Palmer all taken from us way too soon, plus some cool early rock n rollers like Eddie Cochran, Buddy Holly.
The one that hit me and i still miss a lot is George Michael, his musical output wasnt huge but the quality and heart and soul he put in to his work was outstanding. Its a real shame that Murdoch et al completly trashed him after the Beverley Hills incident and he was never the same basically a recluse, despite his seeming resilience in the media by way of self depreciating humour.
His later work and esp his vocal delivery holds up very well despite the abuse he seemingly put his body through with his drug use. RIP George, 53 is no age.
Here's his heartfelt cover of Elton John's 'Idol', well worth 5 mins of your time, it also has a lot of his idols in the clip, some will belong on this list..
Sugarlips reacted to AWW in Credit deflation and the reflation cycle to come (part 2)
Most of their customers will be locked into long contracts, so it won't be quite that easy. I also think that a lot of people get an unseemly amount of pleasure from owning a new phone. Pleasure will be in short supply, and it'll only cost fifty quid... (per month, for the next two years).
We tight-arses with our 2 year old second-hand iPhones on the Smarty network are far outnumbered by the above people.
Sugarlips reacted to Donald McFlurry in Credit deflation and the reflation cycle to come (part 2)
Good spot on the CPI stuff.
I think lot of capex in the last 20 years at telcos has been in dealing with two step changes in technology; the move to optical fibre, and the change in technology from circuit to packet switching.. Telefonica have been shutting down copper exchanges across Spain for the past few years and are ahead of BT that area, at least domestically. 5G networks are completely packet optical, so a lot of old equipment can be thrown away over the medium term as 2G and 3G networks are turned off. Another aspect of this has been the painful legacy of restructuring a business that has undergone huge changes in terms of staff and organisation. However, those big adjustments are all laying the groundwork for far lower expenditure in the future. Upgrades to capacity can be achieved on packet/optic infrastructure by swapping or adding equipment, rather than digging up the ground again. Operational costs are also reduced, with lower power footprint of exchange equipment, fewer active street cabs and increased reliability and quality of optical fibre.
Once those debt piles become manageable, they should generate very solid returns. Even more so in an inflationary environment.
Sugarlips reacted to DurhamBorn in Credit deflation and the reflation cycle to come (part 2)
The interesting bit in BTs results today was the small comment that hardly anyone will notice
"On Wednesday, Ofcom issued a consultation proposing to extend the regulatory enablers to rural parts of the country, following Openreach’s commitment to build to 3.2 million premises in these areas. If included in the final regulation this would see CPI indexation on Openreach’s legacy services across the whole of the UK, incentivising network builders to build and customer take-up in these areas."
Just as hoped/expected the regulators are allowing CPI indexing on price increases to get the build.Right now that doesnt seem much,after all the markets are looking backwards to dis-inflation,but once CPI hits 4%,5%,6% etc and these networks are being built out of earnings now and depreciated now,free cash will explode higher.This will feed to other telcos as well as it forces up base prices.
By 2025 i expect CAPEX to be falling hard at Telcos,while price increases are feeding through,possible free cash flow doubles or trebles over the cycle.Outlier even more.
Where telcos are in the cycle now reminds me of tobacco back during the tech boom.Nobody wanted them,but they consolidated the industry and ran prices up every year higher than inflation and delivered massive returns.I dont think telcos will do the same,but i do think they are now in a similar place and the market is missing it.
The dollar is getting really close to target now iv been lightening my silver miners as the dollar falls.I still think the 90 area is where things get interesting though 86 is an outlier still.
Governments are in a huge hole with massive changes jolting everything,as always happens at cycle turns.We are having to take some losses on some areas as we buy the ladders but easily outpaced by the areas that have doubled and more.
Here in the UK the changes will expose just how well off benefit claims (mainly with children) and government/council workers are compared to the private sector.There is zero chance the government get anywhere near the tax revenue they need,biggest structural deficit in history.Biggest cuts in history,or a huge run up in industrial investment and the inflation that goes with it.Thats where we are.The amount of liquidity building in the system is epic,prepare for the roaring 20s again.
Sugarlips reacted to Van Lady in COVID-1984: Compulsory Masks In Shops
Agreed. Masks are to try and get the population “back to normal” out and about spending. Personally I don’t spend much anyway but will be spending nothing other than essential food etc. because I dislike mask wearing.
Most people I know are behaving like me....spending less....only buying essentials....just going for walks, cycling etc.
Only anecdotal but my guess is that in general a lot of the population dislike the dystopian atmosphere that masks create and that the “behavioural nudge unit” have seriously misjudged the public. I’ve seen plenty of pics online of shopping centres/city centres/local restaurants and pubs etc with an obvious lack of punters!