Credit deflation and the reflation cycle to come (part 2)

[sancho panza]

Interesting comment from @Cattle Prod the other day ref the next leg in oil coming via a weaker dollar.Luke Gromen et al have argued that Fed ending QE will mean recession,also Fed not ending QE will create price inflation and then recession.The 'hope strategy' lies in not ending QE.

Leaves the Fed at odds with ECB/BoE/BoC et al who have tapered/are planning to taper.But then they can without cratering their economies as they aren't the world's reserve currencies.

Are we on the verge of watching the next leg down in the dollar?If we are then that chimes with historical BK warning signs

I'd be interested if any people with some macro udnerstanding @DurhamBorn ?anyone else? could shed any light on whetehr the Fed doesn't have the room to taper that the otehrs do?I think that's key to me understanding where we are and I'm confussed on that.

Full Wolf post,in bold for skim readers.Fed polciy here is key in terms of timing BK imho.

https://wolfstreet.com/2021/09/09/the-process-of-ending-massive-money-printing-has-started/

The Process of Ending Massive Money Printing Has Started

by Wolf Richter • Sep 9, 2021 • 65 Comments

ECB is second giant to taper. Bank of Japan already ended QE. Bank of Canada shed 15% of its assets. Bank of England & Reserve Bank of Australia are tapering. Reserve Bank of New Zealand quit QE cold turkey. Riksbank will end QE this year. What’s taking the Fed so long?

By Wolf Richter for WOLF STREET.

The ECB has increased the assets on its balance sheet by a monstrous €154 billion ($181 billion) per month so far this year via an alphabet soup of programs, blowing by even the crazed money-printers at the Fed with their average rate of $123 billion a month. While there appears to be consensus at the Fed that “tapering” its asset purchases will begin this year and will be completed in the first half next year, with assets then remaining level, the ECB announced today that it will start tapering its asset purchases now.

And thereby it is way behind the Bank of Japan, the Bank of Canada, the Bank of England, the Reserve Bank of New Zealand, and the Reserve Bank of Australia. But ahead of the Fed.

Following in the footsteps of the Bank of England, which had denied in May that its tapering was tapering, and in the footsteps of the Bank of Canada, which had denied last October that its tapering was tapering – though it has since then cut QE to nearly nothing and shed 15% of its assets – ECB President Christine Lagarde also denied at the press conference today that tapering was tapering, and stressed that tapering was instead a “recalibration” of QE.

Markets eagerly swallow these taper denials hook, line, and sinker. Anything but tapering.

In the press release, the ECB said that the pace of net asset purchases under the Pandemic Emergency Purchase Program (PEPP) would be “moderately lower.” PEPP is the biggie in the alphabet soup of programs, running at about €80 billion ($95 billion) per month recently.

The ECB didn’t specify by how much it would reduce its purchases under PEPP, but said that it would “purchase flexibly according to market conditions.”

The asset purchases under PEPP will continue in diminished form “at least” until March 2022. After that, the balance would be level “at least” until the end of 2023, before the “roll-off” of those bonds might begin. The roll-off means that bonds mature and roll off the balance sheet when they’re redeemed and would not be replaced with new purchases. This has the effect of reducing the bond portfolio over time as bonds mature.

The other programs would go on as before.

The Targeted Longer-Term Refinancing Operations (TLTRO III) will continue. These are loans to Eurozone banks, now with a balance of €2.2 trillion.

The Asset Purchase Program (APP), the now relatively small classic QE program that existed before the pandemic and includes sovereign bonds, corporate bonds, covered bonds, and asset-backed securities, would continue at a monthly rate of €20 billion and would “end shortly before” the ECB starts raising its interest rates.

This is in line with the consensus among central banks, confirmed by the Fed, that QE needs to end before interest rates can be hiked, on the rationale that QE pushes down long-term rates, while raising policy rates pushes up short-term rates, which would wreak havoc on the yield curve.

As of this week, total assets on the ECB’s balance sheet rose to €8.2 trillion ($9.7 trillion), about $1.4 trillion more monstrous than the Fed’s monstrous holdings. The four largest groups of assets on the ECB’s balance sheet are:

• €4.6 trillion in bonds (mostly sovereign bonds, but also corporate bonds, covered bonds, and asset backed securities).
• €2.2 trillion in loans to banks under TLTRO III
• €515 billion in gold and gold receivables
• €477 billion in foreign currency assets

Shrinking its balance sheet is not new for the ECB. It has reduced its assets by one-third over a two-year period, cutting them from €3.1 trillion in late 2012 to €2.0 trillion in late 2014.

In early 2015, it kicked off a massive QE program that ended in late 2018. From then until March 2020, assets remained flat.

Starting in March 2020, the ECB went hog-wild. And now the ECB is trying to figure out how to get out of this without blowing up the Eurozone:

Lagarde said that the decision to taper – oops, I mean, to recalibrate – the asset purchases was unanimous.

Timidly following in the footsteps of:

The Bank of Japan cut its asset purchase to near-zero, without any hoopla, thereby not only ending the pandemic QE binge but also the third leg of the economic religion of Abenomics – namely massive money printing. The current rate of asset purchases is minuscule and the lowest since before Abenomics in 2012:

The Bank of Canada started tapering its purchases of Government of Canada bonds last October, ended its purchases of mortgage-backed securities, and shed its repos and Canada Treasury bills, with the effect of cutting is total assets by 15% since the peak in March:

The Bank of England announced its decision to taper its asset purchases in May, and has since cut its weekly bond purchases, on net, from about £4 billion a week to close to £2 billion a week through the summer:

Reserve Bank of New Zealand ended its asset purchases cold turkey in May without tapering to pull the plug on the #1 housing bubble in the world:

The Reserve Bank of Australia announced in July that it would start tapering its asset purchases from A$5 billion a week to A$4 billion a week. Total assets on its balance sheet declined last week for the first time all year:

The Riksbank of Sweden confirmed that it is going to end QE entirely by late 2021.

And what is taking the Fed so long? No one knows. Amid the most monstrously overstimulated economy and markets ever, the Fed is still printing $120 billion a month, though there appears to a consensus to not fall much further behind the curve than it already is and start tapering its asset purchases this year.

[DurhamBorn]

India v Pakistan v China is going to play out in someway.Its one of the biggest reasons natural gas comes up as one of the best assets to own.These countries will all try to outrun the other.India is miles behind China of course,but in macro it doesnt matter where you start,its the direction that matters.BP is rolling out fuel stations across India for instance,though to the green lobby they are called "convenience stores" 

[HousePriceMania]

5 minutes ago, sancho panza said:

Interesting comment from @Cattle Prod the other day ref the next leg in oil coming via a weaker dollar.Luke Gromen et al have argued that Fed ending QE will mean recession,also Fed not ending QE will create price inflation and then recession.The 'hope strategy' lies in not ending QE.

Leaves the Fed at odds with ECB/BoE/BoC et al who have tapered/are planning to taper.But then they can without cratering their economies as they aren't the world's reserve currencies.

Are we on the verge of watching the next leg down in the dollar?If we are then that chimes with historical BK warning signs

I'd be interested if any people with some macro udnerstanding @DurhamBorn ?anyone else? could shed any light on whetehr the Fed doesn't have the room to taper that the otehrs do?I think that's key to me understanding where we are and I'm confussed on that.

Full Wolf post,in bold for skim readers.Fed polciy here is key in terms of timing BK imho.

https://wolfstreet.com/2021/09/09/the-process-of-ending-massive-money-printing-has-started/

The Process of Ending Massive Money Printing Has Started

by Wolf Richter • Sep 9, 2021 • 65 Comments

ECB is second giant to taper. Bank of Japan already ended QE. Bank of Canada shed 15% of its assets. Bank of England & Reserve Bank of Australia are tapering. Reserve Bank of New Zealand quit QE cold turkey. Riksbank will end QE this year. What’s taking the Fed so long?

By Wolf Richter for WOLF STREET.

The ECB has increased the assets on its balance sheet by a monstrous €154 billion ($181 billion) per month so far this year via an alphabet soup of programs, blowing by even the crazed money-printers at the Fed with their average rate of $123 billion a month. While there appears to be consensus at the Fed that “tapering” its asset purchases will begin this year and will be completed in the first half next year, with assets then remaining level, the ECB announced today that it will start tapering its asset purchases now.

And thereby it is way behind the Bank of Japan, the Bank of Canada, the Bank of England, the Reserve Bank of New Zealand, and the Reserve Bank of Australia. But ahead of the Fed.

Following in the footsteps of the Bank of England, which had denied in May that its tapering was tapering, and in the footsteps of the Bank of Canada, which had denied last October that its tapering was tapering – though it has since then cut QE to nearly nothing and shed 15% of its assets – ECB President Christine Lagarde also denied at the press conference today that tapering was tapering, and stressed that tapering was instead a “recalibration” of QE.

Markets eagerly swallow these taper denials hook, line, and sinker. Anything but tapering.

In the press release, the ECB said that the pace of net asset purchases under the Pandemic Emergency Purchase Program (PEPP) would be “moderately lower.” PEPP is the biggie in the alphabet soup of programs, running at about €80 billion ($95 billion) per month recently.

The ECB didn’t specify by how much it would reduce its purchases under PEPP, but said that it would “purchase flexibly according to market conditions.”

The asset purchases under PEPP will continue in diminished form “at least” until March 2022. After that, the balance would be level “at least” until the end of 2023, before the “roll-off” of those bonds might begin. The roll-off means that bonds mature and roll off the balance sheet when they’re redeemed and would not be replaced with new purchases. This has the effect of reducing the bond portfolio over time as bonds mature.

The other programs would go on as before.

The Targeted Longer-Term Refinancing Operations (TLTRO III) will continue. These are loans to Eurozone banks, now with a balance of €2.2 trillion.

The Asset Purchase Program (APP), the now relatively small classic QE program that existed before the pandemic and includes sovereign bonds, corporate bonds, covered bonds, and asset-backed securities, would continue at a monthly rate of €20 billion and would “end shortly before” the ECB starts raising its interest rates.

This is in line with the consensus among central banks, confirmed by the Fed, that QE needs to end before interest rates can be hiked, on the rationale that QE pushes down long-term rates, while raising policy rates pushes up short-term rates, which would wreak havoc on the yield curve.

As of this week, total assets on the ECB’s balance sheet rose to €8.2 trillion ($9.7 trillion), about $1.4 trillion more monstrous than the Fed’s monstrous holdings. The four largest groups of assets on the ECB’s balance sheet are:

• €4.6 trillion in bonds (mostly sovereign bonds, but also corporate bonds, covered bonds, and asset backed securities).
• €2.2 trillion in loans to banks under TLTRO III
• €515 billion in gold and gold receivables
• €477 billion in foreign currency assets

Shrinking its balance sheet is not new for the ECB. It has reduced its assets by one-third over a two-year period, cutting them from €3.1 trillion in late 2012 to €2.0 trillion in late 2014.

In early 2015, it kicked off a massive QE program that ended in late 2018. From then until March 2020, assets remained flat.

Starting in March 2020, the ECB went hog-wild. And now the ECB is trying to figure out how to get out of this without blowing up the Eurozone:

Lagarde said that the decision to taper – oops, I mean, to recalibrate – the asset purchases was unanimous.

Timidly following in the footsteps of:

The Bank of Japan cut its asset purchase to near-zero, without any hoopla, thereby not only ending the pandemic QE binge but also the third leg of the economic religion of Abenomics – namely massive money printing. The current rate of asset purchases is minuscule and the lowest since before Abenomics in 2012:

The Bank of Canada started tapering its purchases of Government of Canada bonds last October, ended its purchases of mortgage-backed securities, and shed its repos and Canada Treasury bills, with the effect of cutting is total assets by 15% since the peak in March:

The Bank of England announced its decision to taper its asset purchases in May, and has since cut its weekly bond purchases, on net, from about £4 billion a week to close to £2 billion a week through the summer:

Reserve Bank of New Zealand ended its asset purchases cold turkey in May without tapering to pull the plug on the #1 housing bubble in the world:

The Reserve Bank of Australia announced in July that it would start tapering its asset purchases from A$5 billion a week to A$4 billion a week. Total assets on its balance sheet declined last week for the first time all year:

The Riksbank of Sweden confirmed that it is going to end QE entirely by late 2021.

And what is taking the Fed so long? No one knows. Amid the most monstrously overstimulated economy and markets ever, the Fed is still printing $120 billion a month, though there appears to a consensus to not fall much further behind the curve than it already is and start tapering its asset purchases this year.

Those charts are off the scale crazy.

You cant tell me there is not more to this whole covid thing.  IMHO it was either used as a great excuse to line the bankers/politicians pockets and/or there was a banking/financial collapse at the end of 2019 and they are keeping very quiet about it.  

[HousePriceMania]

5 minutes ago, DurhamBorn said:

India v Pakistan v China is going to play out in someway.Its one of the biggest reasons natural gas comes up as one of the best assets to own.These countries will all try to outrun the other.India is miles behind China of course,but in macro it doesnt matter where you start,its the direction that matters.BP is rolling out fuel stations across India for instance,though to the green lobby they are called "convenience stores" 

Dunno if you've seen this before

https://en.wikipedia.org/wiki/Water_scarcity_in_India

Water scarcity in India is an ongoing water crisis that affects nearly 1 million people each year.

I came across the issue when working in Indian once, concerns about increasing population and access to usable water

Its a catastrophe in the making.

[dnb24]

6 minutes ago, HousePriceMania said:

Dunno if you've seen this before

https://en.wikipedia.org/wiki/Water_scarcity_in_India

Water scarcity in India is an ongoing water crisis that affects nearly 1 million people each year.

I came across the issue when working in Indian once, concerns about increasing population and access to usable water

Its a catastrophe in the making.

If you think that’s bad- look at Chinese potable water- they are in serious trouble- in China it’s a catastrophe now- not in the making.

Kashmir holds a lot of keys- as @Cattle Prodsays- Turkmenistan/Uzbek gas pipeline is one, but it’s also right in the Himalayas- and source of clean water. 
 

China have serious internal problems- more than india- not enough food, not enough water, what water they have is polluted and can’t be used for growing. They have a population that is 60% urbanised, and now significantly ageing.

The actions of the maoists show they understand the problem- and they’ll shut up shop to the west, produce a command economy to try and hold onto power- and screw the millions who die- how this plays out macro wise- I don’t know. 

[sancho panza]

I've been promising myself a re examination of my BK checklist from Sept 20 2020.This is why I'm interested in more Dollar weakness as it will effectively line up with historical precedent

My assessment in red besides item

Second line additions were added March 18 2021

Sept 20 2020

1) oil price rise to $80+-nearly touched $76 Brent monthlies.

2) copper> $3.60-tick

3) GSR <45-got to 60 so far

4)DXY <85-got to 90 thus far

5) cable >$1.65-got to $1.41 so nowhere near

6) UST 10 year >2%-got to $1.74

Mar 18

To which I might add

EUR/USD>1.45(got to $1.23),copper/gold ratio>0.0002(got to 0.00016 so nearly a touch),UST 10yr-2yr yd >1.5(tick hit 1.59 chart below)

 

[Harley]

11 hours ago, DurhamBorn said:

Wont make any difference,massive demand for workers,way higher than furlough.People have taken the money,but pulled their retirement forward etc and many many others younger have tasted free money from Universal Credit and will do as little as they can.Again today iv had three job offers.In a day.Its nuts.I was chatting to the girl today who rang and she said they were losing people every day.They wanted top money if they had to even travel 45 minutes from home.They almost beg you.

Massive cycle turn underway.Huge liquidity is smashing headlong into structural changes.Every single extended chain that helped prices see deflation is now forcing inflation.The race is on for companies ,the ones who can shorten supply chains and pull more and more production close to base will survive it.Those who dont understand whats happening and are slow will be slaughtered.Road map told me to stick to de-complex assets,but now it really is with bells on.Government has created a monster and is lost,grabbing for tax that will just make things worse.

People wont work unless they get much more than welfare now,and welfare is higher than most jobs for anyone with kids.25% wage increases at the bottom end ,nothing will change that.

A friend is trying to recruit for her job.  On the second attempt.  Loads of applications (so it seems to me) but most of the good ones (those in good jobs) are not interested if the have to do 5 days a week in the office.  Presumably they do that now and want something better.  Two types of CEO atm.  Those who insist people come in the office and those talking about keeping staff and being better about things.  Some stories of employers changing their minds and telling staff they now have to come in more (e.g. from 2 days a month to pretty much 5 days a week).  A real battle it seems to me between the two.

[Harley]

39 minutes ago, sancho panza said:

Are we on the verge of watching the next leg down in the dollar?If we are then that chimes with historical BK warning signs

I don't do much macro but looking at the charts for DXY, it looks like it has the chance of running up on the monthly!  DYOR but just call me the happy contrarian!

[jamtomorrow]

6 minutes ago, Harley said:

A friend is trying to recruit for her job.  On the second attempt.  Loads of applications (so it seems to me) but most of the good ones (those in good jobs) are not interested if the have to do 5 days a week in the office.  Presumably they do that now and want something better.  Two types of CEO atm.  Those who insist people come in the office and those talking about keeping staff and being better about things.  Some stories of employers changing their minds and telling staff they now have to come in more (e.g. from 2 days a month to pretty much 5 days a week).  A real battle it seems to me between the two.

Yup - the sudden change in the balance of power between capital and labour, consumers and producers, is striking.

Might have to stock up on popcorn, before it gets expensive.

[Harley]

16 minutes ago, Cattle Prod said:

What's taking the Fed so long? Is it not that it is the only one of the major economies above doing fiscal stimulus, or handing out printed money to its people? As was pointed out the other day, Trump filled the Treasury account with Fed money early doors in the pandemic, and Biden has now handed most of it out. They are going to need significantly more QE to finance Bidens 'infrastructure' bill, which is mostly 'human infrastructure', i.e. handouts. If the Fed tapers, it means all those assistance programmes also taper. And as you allude to the reason that they can do this and the other countries can't is that they print the worlds reserve currency wich other countries need.

So other currencies should strengthen againt the dollar if they are tapering. You would think. The ECBs balance sheet is much higher as a % of GDP than the Feds, there is lots more room for them yet.

Can't crash things until most are on digital IDs?  Need them for rationing, taking assets, destroying value, playing god with money, etc.

[Bricormortis]

56 minutes ago, Hancock said:

No, but ive plenty of cash thats being inflated away in relation to the stock market at present.

Thing with these endless graphs and charts, is they're constantly predicting an impending doom.

lol that might be because of the impending doom.

Actually personally I take an interest in various indicators, XLU utilities ETF which is a large fund that takes institutional money to move it and is a safety play, also the  russell 2000 indicating how America views the prospects of Main St, and turns down first, American Transportation ETF XTN also, and I have recently become aware of the University of Michegan consumer sentiment index, which is currently dire.  Im not seeing major warning lights coming on just yet based on those I must admit but I dont feel good about where we are.

What indicators do others pay attention to ?

I do come across graphs that shock or inform me, so post them here occasionally for peoples consideration.

[Hancock]

7 minutes ago, Bricormortis said:

lol that might be because of the impending doom.

Certainly been a lot of doom behind us, but does the line that economist had predicted a dozen of the last 2 recessions apply!

[M S E Refugee]

David Hunter Retweeted

 

 

 

IG

 

@IGcom

·

9 Sep

 

Contrarian macro investor

@DaveHcontrarian

discussed his views on the markets. Hunter said we are in the final melt-up stage for markets, with 70-80% downside on the horizon. He expects a sharp drop in oil prices too next year down to $20 a barrel.

[Harley]

Looking at oil atm just summarises so much else in the markets which is why I'm just mostly sitting watching atm.  At price resistance, momentum is overbought and turning down, and the MACD is weakening.  But is this just a pullback before an break of resistance, a real blow off?  Oil's been here before.  Turns a bit only to reverse back up and break out for a final run.

PS:  And to make it worse, the weekly charts show momentum oversold but maybe correcting to the upside.  Quite unusual to see such a divergence between the weekly and monthly momentum.  Doing me head in!

[Hancock]

25 minutes ago, Harley said:

Doing me head in!

Like having a 16 hand in pontoon when the dealer has a 6, the dilemma of sticking or twisting is just too much to take.

And on that note i am going to get off my laptop, and visit the gym i joined last month and have only visited on 3 occasions.

[sancho panza]

1 hour ago, Bricormortis said:

lol that might be because of the impending doom.

Actually personally I take an interest in various indicators, XLU utilities ETF which is a large fund that takes institutional money to move it and is a safety play, also the  russell 2000 indicating how America views the prospects of Main St, and turns down first, American Transportation ETF XTN also, and I have recently become aware of the University of Michegan consumer sentiment index, which is currently dire.  Im not seeing major warning lights coming on just yet based on those I must admit but I dont feel good about where we are.

What indicators do others pay attention to ?

I do come across graphs that shock or inform me, so post them here occasionally for peoples consideration.

I remember kaplan saying Russell 2000 had peaked in 2018....jsut going to show even experts get it wrong.

I've played with key commodities.Copper normnall ypeaks before oil.Currently oil lagging copper.

Obviosuly dyor,but I can see a case for oil launching off the back of copper before the BK.

1 hour ago, Cattle Prod said:

What's taking the Fed so long? Is it not that it is the only one of the major economies above doing fiscal stimulus, or handing out printed money to its people? As was pointed out the other day, Trump filled the Treasury account with Fed money early doors in the pandemic, and Biden has now handed most of it out. They are going to need significantly more QE to finance Bidens 'infrastructure' bill, which is mostly 'human infrastructure', i.e. handouts. If the Fed tapers, it means all those assistance programmes also taper. And as you allude to the reason that they can do this and the other countries can't is that they print the worlds reserve currency wich other countries need.

So other currencies should strengthen againt the dollar if they are tapering. You would think. The ECBs balance sheet is much higher as a % of GDP than the Feds, there is lots more room for them yet.

That's my line of thought CP.A run of Fed printing for politcal reasons I can see happening.While the other worlds currencies strengthen versus USD and we get that classic USD weakness before the crash that sends commodities on one last leg up.This si teh DH thesis looking at recent writings.

Decl:we're long oil,so beware any posts from me saying go long oil.DYOR...

[DurhamBorn]

The CBs are all printing for political reasons because only fiscal injections can stave off systemic collapse.My call is that they need to lift every thing by 30% because thats the level where tax should increase faster than spending lowering deficits.Here in the UK though they are raising tax,the worst thing they could do right now.Its nuts.Unless they are trying to slow inflation with higher taxes while still getting fiscal injections from the BOE.That will end very badly.They should be lowering tax on work as fast as they can,mostly at the bottom to lower bottom end,and cutting welfare.

Printing looks 2/3s done here outside of a BK.Might get another £80 billion from the BOE.

[Barnsey]

Genuinely starting to think the Cons want to hand over to Labour in 2023. They can wheel out the magic money tree rhetoric once again in 2027.

 

[JMD]

On 06/09/2021 at 19:33, Harley said:

U.UN, on the TSX.

Harley, def. not asking for stock tips of course, its more that i am looking to understand the uranium market more, and do already hold some miners. Hoping you might be able to answer my question.

Do you know if the U.UN fund will, in future, also hold mining stocks? Perhaps i misunderstood the fund's investment intention, but after reading up it appears to 'only hold' the physical, e.g. like Yellow Cake? I ask because i do already hold Yellow Cake, and am not sure if there is a difference between the two?

[Ash4781b]

Just looking at the National living wage forecast from Low Pay Commission. They must have slipped this out back in March as I missed it. Edit £9.42 per hour National living wage. Presumably another load of costs on the employers NI. Ok if an employee can pass on the costs….
 

No wonder they binned the triple pension lock. Hope I can get on the right side of what looks to be a monumental standard of living adjustment. People are going to be angry ! 

https://www.gov.uk/government/consultations/low-pay-commission-consultation-2021

[Harley]

1 hour ago, jamtomorrow said:

Yup - the sudden change in the balance of power between capital and labour, consumers and producers, is striking.

Might have to stock up on popcorn, before it gets expensive.

I was thinking between the two types of CEO, but yes, more a three way punch up!  A labour market brawl indeed!

[Harley]

37 minutes ago, JMD said:

Harley, def. not asking for stock tips of course, its more that i am looking to understand the uranium market more, and do already hold some miners. Hoping you might be able to answer my question.

Do you know if the U.UN fund will, in future, also hold mining stocks? Perhaps i misunderstood the fund's investment intention, but after reading up it appears to 'only hold' the physical, e.g. like Yellow Cake? I ask because i do already hold Yellow Cake, and am not sure if there is a difference between the two?

It only holds the physical.  Sprott does also invest in mining companies but that's separate.  I looked at some companies and then bought the GCL (LSE) fund instead given it covers hard to get stuff and I could stick it my ISA.  Jonathan Davis mentioned it which was nice of him, although I'm annoyed my research did not id it (but then as he said, it's a small fund).  I may branch out though into some individual holdings.  I'll post and list to validate in case I missed any.   I recommend listening to that Uranium podcast I posted earlier.  One key takeaway is that the Sprott fund is providing/forcing price discovery on the market in that it said, for now, it would issue shares and buy more uranium when it was valued at a premium.  It may list on the US exchange later but will face objections from the utility companies on who's parade it may well have rained on (at least the ones that did not buy forward).  But I digress.  Bottom line, I personally like a mix of physical and miners, just as with PMs.

PS: Talking of PMs, gold may be getting ready to move up from its base and silver may already be on the off over the next few weeks?  Not a recommendation, just possible signs of strength, finally?  Miners and physical?

[Harley]

They can print what £400bn for their mates over covid but when it comes to us looking after granny, we have to pay higher taxes?

[Inigo]

4 hours ago, DurhamBorn said:

It could,but wont be.Im not sure how it would play out,the best fit would be Telefonica,but cant because of o2.Vod isnt out of the question.What the telcos are really doing though and need to is share more of their kit,and use co kit.That way they can stop competing as much.Use say the tower company to charge them all the same high amount,they then all have to pass the costs on,but all get the profit.

Whatever telcos are entering a much nicer cycle for them.It could take a while for value to surface,but it will in time.Inflation used to hit them as people used their landlines less to save money,but now inflation is a real tailwind.If they can pass on 4% inflation pa it should see free cash increase 12%+ ,one of the few areas that can leverage the increases,assuming regulators keep off the case and their debt books are well structured.

I just signed up for a new SIM with Three (slight saving compared to existing), I had to tick a box saying that I would accept the 4.5% price increase every April.

[Bricormortis]

I would be cautious on gold till the dollar gets below 91.70. There could be more downside.