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

[M S E Refugee]

Below Fair Value: XOM ($45.46) is trading below our estimate of fair value ($3218.22)

 

Significantly Below Fair Value: XOM is trading below fair value by more than 20%.

[M S E Refugee]

1 minute ago, M S E Refugee said:

Below Fair Value: XOM ($45.46) is trading below our estimate of fair value ($3218.22)

 

Significantly Below Fair Value: XOM is trading below fair value by more than 20%.

Could this be correct?

This is from my Simply Wall St subscription.

[Talking Monkey]

1 hour ago, DurhamBorn said:

Its to keep people working.The UK has a massive amount of people who wont work and they need paying for.People who at 55 have enough to retire have probably worked hard for decades,so the government wants them to work hard for longer.

Another problem they have is people getting a big inheritance in their mid 50s as then can often retire.Lots of the reason house prices have suited governments is because the higher the debts,the less likely someone can retire.Our whole system is set up so the middle 40% pay for all the scroungers below them so it can all go through them all and end up with the 1%.

Pension freedoms are a fantastic thing yet very few people understand them.Maybe its good for us that they dont.

Makes sense DB. Agree with you that pensions are a great thing. The only part that worries me is for us that won't be able to access our SIPPs till sometime in the 2030s we will be accessing at the worst time possible ie during a potential epic depression. I'm probably running too far ahead and shouldn't think that far ahead. I wonder if there are any strategy points re the interplay of mortgage, ISA , SIPP for guys who will retire in the 2030s rather than 20s

[Loki]

5 minutes ago, M S E Refugee said:

Below Fair Value: XOM ($45.46) is trading below our estimate of fair value ($3218.22)

 

Significantly Below Fair Value: XOM is trading below fair value by more than 20%.

Looks like something broke somewhere but imagine if that had happened in trading hours 

[Chewing Grass]

7 minutes ago, Talking Monkey said:

Makes sense DB. Agree with you that pensions are a great thing. The only part that worries me is for us that won't be able to access our SIPPs till sometime in the 2030s we will be accessing at the worst time possible ie during a potential epic depression.

There will be a point where the government will seize all the assets in Private Pensions, grant the holder an enhanced State Pension and then leverage up their booty 120x.

[Talking Monkey]

Just now, Chewing Grass said:

There will be a point where the government will seize all the assets in Private Pensions, grant the holder an enhanced State Pension and then leverage up their booty 120x.

I actually do worry about that and as each month goes by and yet more government idiocy comes to pass my worry increases

[King Penda]

10 minutes ago, Talking Monkey said:

I actually do worry about that and as each month goes by and yet more government idiocy comes to pass my worry increases

Means test is what they will do ie loose your government pension

[JMD]

1 hour ago, Bobthebuilder said:

About 2 years ago on this thread I mentioned Thanet Earth. Big supermarkets behind them apparently but look a very interesting set up.

Thanks, I actually do remember your original post, time flies! But just checked and they are still part of the privately owned Fresca consortium. Disappointing and really frustrating - private capitol and markets are a real bugbear of mine as its becoming an increasingly larger part of the economy, with fewer and fewer ipo's happening each year. Real shame as it is the kind of thing I'd like to own.

[Loki]

7 minutes ago, JMD said:

Thanks, I actually do remember your original post, time flies! But just checked and they are still part of the privately owned Fresca consortium. Disappointing and really frustrating - private capitol and markets are a real bugbear of mine as its becoming an increasingly larger part of the economy, with fewer and fewer ipo's happening each year. Real shame as it is the kind of thing I'd like to own.

Not to worry, sounds like the inputs are energy and fertiliser 

[JMD]

2 hours ago, Democorruptcy said:

I don't think you have joined the dots!

If people 55 can access pensions and then afford to stop working it creates movements up the jobs ladder. They get off the top rung, several others are freed including the bottom rung to create a job for someone who might be unemployed and claiming benefits. I once argued a similar point with David Blanchflower that low rates kept older people working longer and blocked the jobs ladder because they didn't get off.

Also if people get access to spend their pensions early, it reduces the chance of them leaving a large inheritance. After the pension is gone it will be equity release next!

Talking of joining the dots... I noticed your post disclaimer and it got me thinking. For clarification, are you a friend of democorruptcy, or are you a friend of a friend of democorruptcy?! FOFOD? (Ie similar to freegold project, if you know it). I really think we should be told.

[Democorruptcy]

5 minutes ago, JMD said:

Talking of joining the dots... I noticed your disclaimer and it got me thinking. For clarification, are you a friend of democorruptcy, or are you a friend of a friend of democorruptcy?! FOFAD? (Similar to freegold project). I really think we should be told.

This post is me. Hang on I'll check. Yes, it's definitely me. My friend is the one who has made or might make, a post that could get me into trouble for wrongthink.

[JMD]

28 minutes ago, Loki said:

Not to worry, sounds like the inputs are energy and fertiliser 

I agree and have lots of those already. I am fully onboard with the decomplex trade ethos here- think/hope food agri tech is an acceptable part?

[Loki]

1 minute ago, JMD said:

I agree and have lots of those already. I am fully onboard with the decomplex trade ethos here- think/hope food agri tech is an acceptable part?

I think it's as inflation-loving as they come, unless people gonna eat their Teslas. 

[Loki]

12 minutes ago, Cattle Prod said:

I'll be cognisant of a liquidity/BK smash, but I don't think it'll be worse than March for this sector, how could it?! Oil was zero! The temptation is there to slice and rebuy at a discount, but I think I'll just hold. Dyodd of course.

Thanks for this.  Been asked by the folks re: ISAs and suggested oilies might be a good first buy as they should stand up better if/when the BK hits.  Always a relief to see an expert thinks the same.

[DurhamBorn]

6 minutes ago, Cattle Prod said:

Canary in the coalmine here, ladies and gents:

I've highlighted Japan here before as an energy bellwether (like why they kicked off in WWII) before, because they simply don't have any natural/fossil energy resources. Shut down your nuclear baseload and reap what you sow. As I tell my son when he Greta-s me, enjoy being cold. I can almost feel China amd India looking at Japan right now..."not gonna be me".

The UK is on thin ice, but at least has recognised it and is revamping nuclear. Will need lots of gas in the meantime though. California is risking societal breakdown with their woke energy policy. Germany has wasted hundreds of billions on the Energywiende, and will be burning lots of filthy brown coal as a result. Well done you idiots, now go and build some nuclear and gas plants, schnell.

I think we're coming to an inflection point. You can be as woke as you like, but not if you're cold. Reality is starting to bite. Good thing we placed our bets 50% ago. Ive found it's much harder to stay invested if you buy in after the first run up.

I'll be cognisant of a liquidity/BK smash, but I don't think it'll be worse than March for this sector, how could it?! Oil was zero! The temptation is there to slice and rebuy at a discount, but I think I'll just hold. Dyodd of course.

 

Its incredible to think how almost the whole world was against the sector when we were all buying,headlines about how these companies were finished etc etc.For me the thing il always remember is when those woke funds running NEST and all those low paid workers pensions sold all their integrated oilies,at the bottom.Great for us,but disgusting for the likes of me sons workmates who earn £11 an hour and all pay into NEST pensions.Just another example of lefty woke rubbish taking from the poor/low paid.

Gas is going to explode in price this cycle and treble in value in todays numbers over 20+ years,much greater inflation adjusted.The oilies have played a blinder.What the MSM and investment community dont understand is big oil loves wind,solar etc because they are only a small threat to them.The real threat is nuclear,because only a solid baseload pushes gas out.By investing in wind themselves they have helped push the narrative around the world away from nuclear.

Big oil doesnt care if oil use falls 20% over 20 years as likely,price increases will make up for that.What they care about is gas use exploding when most of the gas isnt where it needs to be.

Wind power will do very well,but it simply cant replace gas for baseload in most areas of the world.BP and Shell number 1 and number 2 in the FTSE before this cycles over.That will be lovely to see the wokes faces when that happens.

[Rave]

On 08/01/2021 at 10:44, Barnsey said:

 

Maybe I'm missing something...but on the face of it that appears to be a really, properly silly graph? What does the 0% signify? Why not start Bitcoin in 2010 when they were worth a fraction of a penny and run it up to 1,000,000% or whatever? Rather than just plotting "Tech" why not plot, say, Google/Alphabet's entire existence from being founded in 1998 to being worth $1.2Tn now...I mean how many % is that?

While this is on the face of it a statement of the blindingly obvious, I think that "bitcoin is a bubble" types are prone to selective blindness on the matter, so: just because some stock or commodity is in a bubble, doesn't mean that it has no intrinsic value. Tulip bulbs can be planted; Tesla make quite impressive cars, houses can be lived in. I would contend that the value of the Bitcoin network, and its utility as 'digital gold'/ a wealth store mean that it is highly unlikely to ever go back to zero. And so another blindingly obvious point is: its value is what the market says it is. What's the intrinsic value of physical gold? Is it $250/oz like it was in 2001 or whenever it was that Brown flogged a load of it, or is it $1800 like in 2011, or now?

The other point I wanted to make is, rather handily, illuminated by a reply to the silly graph tweet above:

 

Previous run ups to new highs have run for 8-10 months after exceeding the previous highs; and the previous two major peaks have been 15-30x the previous high. I get that past performance is not a guide to the future, but at the present time, at merely 2x the previous high and barely a month after having exceeded it, this latest run up appears, to me, to be in the 'barely got going' phase, if this latest run were to resemble the previous ones.

Decl: I hodl a quantity of bitcoin. Edit: and some physical gold and silver.

[Shamone]

6 minutes ago, DurhamBorn said:

Its incredible to think how almost the whole world was against the sector when we were all buying,headlines about how these companies were finished etc etc.For me the thing il always remember is when those woke funds running NEST and all those low paid workers pensions sold all their integrated oilies,at the bottom.Great for us,but disgusting for the likes of me sons workmates who earn £11 an hour and all pay into NEST pensions.Just another example of lefty woke rubbish taking from the poor/low paid.

Gas is going to explode in price this cycle and treble in value in todays numbers over 20+ years,much greater inflation adjusted.The oilies have played a blinder.What the MSM and investment community dont understand is big oil loves wind,solar etc because they are only a small threat to them.The real threat is nuclear,because only a solid baseload pushes gas out.By investing in wind themselves they have helped push the narrative around the world away from nuclear.

Big oil doesnt care if oil use falls 20% over 20 years as likely,price increases will make up for that.What they care about is gas use exploding when most of the gas isnt where it needs to be.

Wind power will do very well,but it simply cant replace gas for baseload in most areas of the world.BP and Shell number 1 and number 2 in the FTSE before this cycles over.That will be lovely to see the wokes faces when that happens.

Those NEST pensions are truly rubbish. I pay a small amount into one to get a few pennies from my employer but the choices you get are crap.

[Loki]

@DurhamBorn I'm sure you've already said but buggered if I can find it - search comes back blank.  What are your favourite gas companies (if you don't mind)

[DurhamBorn]

5 minutes ago, Shamone said:

Those NEST pensions are truly rubbish. I pay a small amount into one to get a few pennies from my employer but the choices you get are crap.

Its disgusting,a complete racket.Im working for a Fortune 500 company and the pension choices are terrible.All tracker funds really,track UK,world growth etc.The fees are low,but its shocking the choices.Of course the bosses outside of DB pensions will have their paid into SIPPs no doubt.

Iv just actually been reading how NEST invest and its even worse than i thought.The first 5 years they invest people in what they call "foundation" and they only aim for inflation after charges to avoid any big falls that might scare the little snowflakes.Unreal.Its the first years that compound the most,not the least,nuts.

https://www.nestpensions.org.uk/schemeweb/nest/aboutnest/investment-approach/nest-retirement-date-funds.html

All of our members’ money is invested responsibly and sustainably. We assess how the companies, sectors and economies we invest in are run, and their impact on people and the planet

[DurhamBorn]

10 minutes ago, Loki said:

@DurhamBorn I'm sure you've already said but buggered if I can find it - search comes back blank.  What are your favourite gas companies (if you don't mind)

Repsol,BP,Shell,ENI and a few smaller ones at small stakes.

[Rave]

On 09/01/2021 at 14:33, supernaut said:

Yes sports. Managed to stumble across an angle that I scarcely could believe myself having been in the game since 2006 as a low level bonus abuser, like I say has since been shut only in terms of bookie sharpened odds so not viable anymore. 

I will not be more specific just in case. 

I'm not surprised they sharpened up if you took them for six and a half bags! I'm pretty sure that I was personally responsible for forcing one of the big bookies to have to keep an eye on their Over/Under 10.5 Corners odds rather than just setting and forgetting them, and I only took them for a few hundred quid!

It's been a few years, I guess I should probably see if they've forgotten again when their shops reopen. But given the advent of automated coupon scanning, I'll be surprised if they have.

[Loki]

@Cattle Prod  

Bloody global warming innit...now can we have some LNG...please

http://global.chinadaily.com.cn/a/202101/08/WS5ff7b2eba31024ad0baa1447_2.html

Quote

 

He said that global warming has caused warmer winters in most years since the 1980s, but can also lead to colder winters such as in 2010, 2011 and 2012.

"From autumn 2020, global warming has begun to melt arctic sea ice and reduced it to the second lowest on record, weakening the polar vortex-air that spins around the stratosphere over the Arctic area," he said.

"Usually, the vortex locks cold air inside, but this winter's weaker vortex has released more cold air that moved southward to Eurasia."

Song added that global warming causes both hotter and colder weather.

"Global warming leads to unstable climate and extreme weather events including rainstorms, cold fronts and heat waves," he said.

La Nina, a fluctuation in sea-air interactions that causes the cooling of ocean surface water, also contributed to the coldness.

"The phenomenon helped cold air move south on a large scale in most parts of China," Song said.

 

And I thought the Chinese were big on history and cycles...it's the Sun, stupid.

[Noallegiance]

I must be getting old. Weekends are now slightly more boring because markets are closed.

[Loki]

Just now, Noallegiance said:

I must be getting old. Weekends are now slightly more boring because markets are closed.

I've been thinking that too! 

(In order to keep emotion out of my ISA, I fun trade on 212)  

Not like there's anything else to do at the moment

[Noallegiance]

1 minute ago, Loki said:

I've been thinking that too! 

(In order to keep emotion out of my ISA, I fun trade on 212)  

Not like there's anything else to do at the moment

Crawley's win today was the most excited I've been in a year!