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


spunko

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6 minutes ago, Cattle Prod said:

Third post on Javiers thread here: competition. Japan is still far richer than China or India, how do you think they feel about their wealthy neighbour bidding up the spot market?

Screenshot_20210110-213224_Twitter.thumb.jpg.155300b6f59881203076adc0348329f7.jpg

India will be on the phone to BP in the morning to get on with their wells (though BP will refuse to rush), and send emissaries to Qatar. China will continue locking up Iran, and possiby extend an olive branch to Australia. All that will take years to fruition. In the meantime, those currently pumping gas make out like bandits. And we have a tiny slice of the action.

Yes BP are sitting pretty with India.Repsol will be making sure Indonesia understand whats going on as well and get a lovely deal for their huge gas find there.I reckon they will be getting the drills going in the Marcellus as well HH is at $2.70 and they make money above $1.9.

I see the real price action starting 2023 though,thats when gas goes into deficit on my roadmap.

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30 minutes ago, DurhamBorn said:

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

Mine is in the higher risk choice but they are all shocking. Selling big oil was nuts. Like you say disgusting since it’s the lowest paid paying for this shite.

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weekend boredoms - crypto trades 24/7, i was even at it on christmas day. It has no end of day, just a %age and volume reset every 24 hours. Take today, saw a 13% drop in BTC here;

image.png.00c73b986b37527c011e6a30f37bd8bd.png

i traded the fuck out of that with my £3.12 seed money, know what i mean.

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Yellow_Reduced_Sticker
On 08/01/2021 at 23:28, DurhamBorn said:

@Yellow_Reduced_Sticker im really really pleased your portfolio has done so well,i know you were down quite a bit for a while,but never let that bother you,or adding more positions.Glad you never listened to Credit Suisse when they said sell Royal Mail at £1.50 they were worth 90xD . 

I bought a few pairs of shorts on Ebay,i always buy shorts there on the coldest days of the year and my winter coats in summer on the warmest days,thats when they are cheapest.Got a pair of nice M&S blue shorts with tags on for £4.70 including postage and they had two 10 euro notes in the pocket ,now thats what i call frugal :D ,shame it wasnt a couple of silver Brits but you cant have everything.

Youl appreciate this one,it was my local club in the 90s,B| 

 

 
I NEVER listen to the likes of Credit Suisse et al...its always been charts AND director BUYING that make my mind up!
 
Bought MORE RMG when i saw the CEO Rico Back, filling his boots!
 
 
image.png.3cd3a234d0253c753cc06ad97410440d.png
 
 
Like a lot on here with NICE profits at the mo...(2 years living expenses for me Yes LIVING FRUGALLY of course xD ) ...what do ya do, sell out ? grab the profit and WAIT for the so-called BK to happen?
 
Its a difficult one, for me I'm really ONLY interested in the divis, as I'm mid-50's semi-retired ...maybe RETARDED! Thats what  @MrXxxx  would say/correct in this post!:Old:
 
Back in 2007 I sold ALL my shares, the biggest holding was unilever- yes things did collapse HOWEVER I didn't buy back...look at unilever today over £44 quid! :o SO today I probably HOLD and sit the BK out ...
 
Anyways...I like doing what I'm doing since exiting the WORK-place ...ie: MORE time for fishing, MORE time looking for YRS bargains, scavenging in skips, even selling scavenged stuff on ebay, just got into FB Marketplace, here's my TOP Tip:
 
Search: "free stuff near me today" Unbelievable what folks throw out, AND you can sell it on!!!!
 
Basically I've always been a bit of a I'm a schemer at heart AND now loving even MORE!
 
BTW, the music video you posted yeah GREAT, however my ALL TIME FAV...is TRANCE, have a listen to the video below, seriously for those who were/are into TRANCE, listen to the entire 30 minutes...ya'll have tears running down your cheeks.
 
This is beautiful Music. ALL of YOU Will LOVE it! :D
 
Peace.
 
 
 
 
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I'm sat here imagining myself reaching for the lasers. I really must do a proper week in Ibiza before I get too old and/or the clubs die off for lack of demand- I gather that Millennials and Gen Z aren't so into it 9_9 . Perhaps I'll have enough change left over after I swap my bitcoins for a house xD .

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Just now, Rave said:

I'm sat here imagining myself reaching for the lasers. I really must do a proper week in ibiza before I get too old and/or the clubs die off for lack of demand- I gather that millennials and Gen Z aren't so into it 9_9

Kinda sad I never went when in my 20s

And the disappointment I felt on my first night out clubbing locally as a teenager..."It's just the same shite as on the radio, but louder" :CryBaby:

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1 hour ago, Noallegiance said:

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

O.o

You should move to australia.  I get the end of the friday US market my saturday AM, and then the Oz market opens my monday morning.... :P

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On 08/01/2021 at 08:58, Barnsey said:

Confirmation somewhat of my house hunting experience shared on here in recent weeks

 

It's the mix that's selling or not selling that's key.LE2 shooitng higher with no and I mean NO volume at the bottom of the ladder.RM still not publishing spet figures.going to be an awful year for EA's with letting fees all but disappearing and transactions so low.This lack of flats/terraces selling isn't jsut a Leicester thing.

image.png.a3956a28d93767dace968afa643d4f2e.png

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5 minutes ago, Hancock said:

 Cambodia would be better so i'm led to believe.
https://rongsamloem.com/full-moon-party/

Im 45 and think ive still got it in me, then i realise i'm too old!

41 here, reckon I could manage at least one full night of dancing still, especially with some chemical assistance. If I have to spend the rest of the holiday shuffling very slowly between bed, hotel restaurant and sun lounger so be it...

As for Cambodia, it looks cheap and wild, but 1) you can't fly there by Easyjet, which negates quite a bit of the cost saving, and 2) I've seen The Beach O.o . Also even more likely than Ibiza to be full of insufferable wankers, I reckon xD .

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6 hours 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.

Thanet Earth isn't the only large industrialised greenhouse for growing tomatoes in Kent, a friend visited a new startup hydroponic greenhouse and they apparently have a rolls royce jet engine for heating the greenhouses, which seems a little extreme, but shows the scale they are working at.  Must be good money in tomatoes.

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22 minutes ago, Rave said:

41 here, reckon I could manage at least one full night of dancing still, especially with some chemical assistance. If I have to spend the rest of the holiday shuffling very slowly between bed, hotel restaurant and sun lounger so be it...

As for Cambodia, it looks cheap and wild, but 1) you can't fly there by Easyjet, which negates quite a bit of the cost saving, and 2) I've seen The Beach O.o . Also even more likely than Ibiza to be full of insufferable wankers, I reckon xD .

 

F1DC1F84-C1E3-4D85-98B0-2F4F093A5A7A.gif

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10 minutes ago, Inigo said:

Thanet Earth isn't the only large industrialised greenhouse for growing tomatoes in Kent, a friend visited a new startup hydroponic greenhouse and they apparently have a rolls royce jet engine for heating the greenhouses, which seems a little extreme, but shows the scale they are working at.  Must be good money in tomatoes.


The idea (as per Thanet Earth) is that you use some of the leccy from the gas turbine to run the grow lamps in the greenhouse at night, and flog the rest to the grid. Then you use the 'waste' heat from the exhaust to warm the greenhouse, and the CO2 to make the plants grow quicker.

Edit: I've driven past TE on a few occasions as my wife and in-laws like going to Ramsgate for reasons that are beyond my ken. It's most impressive! Plus if you know where to look there's an English Electric Lightning parked up round the back of Manston Airport :) .

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On 08/01/2021 at 14:35, dnb24 said:

Muratas have been acquired by CAP-XX- both seem big in Supercap development.

Evans capacitor have contracts with Northrop Grumman 

Maxwells UC has been integrated into Tesla as well as Zhejiang Geely group. 

Skeleton technology supply Kodak, wrights group, brush traction. Skeleton also work with MJR.

Panasonic also

Impressive dnb......haevn't got a clue what you're talking about.

ANd there was me thinking you were the resident healthcare expert...B|.You shoud let these posts flow more often.

On 08/01/2021 at 16:52, DurhamBorn said:

I sold Sibanye because i was cautious on having too much capital at the mercy of South African politicians and kept Hrmony instead.It would of made me around £30k if id kept it.Was i right to be cautious or wrong.Wrong at the moment,but could be right in a few  hours if something happened.Its a very tricky thing to get right.

Right at the wrong time.Story of my investing career particularly with regard to hosue prices in Leicester 2002AD.

 

On 09/01/2021 at 04:26, Sugarlips said:

Agreed. Is there any correlation between oil price and BK’s?

i vaguely recall the oil price being seriously depressed during the tech bubble/bust but it being at all time highs when the ‘08 Lehman moment happened.

I've psoted thsi before but it's always worth remembering oil price rises have perceded the three recesions before La Coruna.Very much depends how you handle the data herere,but given the man made nature of La Coruna,and the artifical nature it,I have taken some poetic licence and drawn some arbitrary lines on a graph somewhere.

Oil run ups have varied in length and size but they have been a reasonable warning sign before.Ergo,allowing some leeway gives a pre BK peak of up 160% of $23. gives a peak of $60.Allowing a more reasonable bottom at $35 given the distortions of La Coruna gives $91 Brent so circa $85 WTI.

It's all darts and donkeys tails but thats the historical guide Im working with

Prev post on oil price prior to last three recessions.

 

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On 09/01/2021 at 08:41, Loki said:

Not really for this thread but the lack of rioting over mass removal of rights, criminalisation of normal activities, destroying of businesses and families over the casedemic tells me we are nowhere near rock bottom. People are too comfy mentally and physically. Doesn't sound rock bottom to me.

They might have a whinge but for the most part they all just do as they are told.

you have to watch this video of the police in scotland ....simply can't beleive these are the same people who need a warrant to raid a crack hosue.

From what I'm hearing even the middle class corporate types are losing patience.Sorry for the derailment but begging the threads indulgence this one time for the sake of a wider audience.

 

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On 09/01/2021 at 10:19, Cattle Prod said:

The counter argument to that is that because the Dems have control now, they just inject the required liquidity anyway, party or not. If they do this, perhaps we could bypass the BK do you think @DurhamBorn?

THe BK is necessary on a few fundamental levels because

1) as a jsutification for the lqiuidty injectiosn that will be needed.

2) there has a to eb a sector rotation away from the leveraged/overblown particualrly big tech back to value/comodities.This won't be able to occur overnight.

3) Real estate is still overblown as are corporate bond markets.The banking system needs to clear itself of the bad debts and thereafter the govt needs to inject directly into the economy beacuse quite simply if they inject through the banks,the banks will jsut suck it in.

these are structural weaknesses that need a debt deflation to clear the ground for the reflation.

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3 hours ago, sancho panza said:

THe BK is necessary on a few fundamental levels because

1) as a jsutification for the lqiuidty injectiosn that will be needed.

2) there has a to eb a sector rotation away from the leveraged/overblown particualrly big tech back to value/comodities.This won't be able to occur overnight.

3) Real estate is still overblown as are corporate bond markets.The banking system needs to clear itself of the bad debts and thereafter the govt needs to inject directly into the economy beacuse quite simply if they inject through the banks,the banks will jsut suck it in.

these are structural weaknesses that need a debt deflation to clear the ground for the reflation.

I wonder if we're much closer than many expect? If markets are forward looking, and since things are as frothy as they are, with treasury yields rising starting to show up in $ strength, you can see where I'm going with this. There's a creeping in of forward guidance on the tightening front, suggestion of tapering bond purchases by Fed later this year, and the following suggesting prudence from Sunak (seems he's also an avid reader of this thread ;)):

The vaccine and suggested withdrawal of support from governments and central banks may actually be the virus for this bubble. How soon do markets want to recognise this?

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5 hours ago, sancho panza said:

It's the mix that's selling or not selling that's key.LE2 shooitng higher with no and I mean NO volume at the bottom of the ladder.RM still not publishing spet figures.going to be an awful year for EA's with letting fees all but disappearing and transactions so low.This lack of flats/terraces selling isn't jsut a Leicester thing.

image.png.a3956a28d93767dace968afa643d4f2e.png

We did a couple of viewings south of Brum in Warwickshire this weekend, EA very upfront that market has done well for >£500k, houses below stagnating, flats plummeting. Reckoned end of Jan will mark a tipping point for realisation that it's impossible to complete by end of stamp duty holiday. Didn't seem too optimistic about an extension.

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@Barnsey i think they taper once inflation hits 3%,though they could scale down a bit first.3% inflation is possible mid summer,my roadmap says August is possible,though the numbers are so skewered it might take 5% inflation before it shows up as 3%.

In the UK i think the BOE has room to print for around 12 months,but tapering as well back half of this year.Dishy will have a £150billion structural deficit minimum at that point.He could really do with a worldwide bust so they can inject another £800 billion.

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Just a FYI - 

 

I did some digging around today re my interactive broker account.  The Australian business is seperate and keeps client money in a seperate account with australian institutions in line with Australian regulatory requirements.  It's not clear whether equities and other assets are kept all in the same buckets.  I've relatively happy as the Oz gvt guarantee is still 250k.

The reason I raise this is that some of the european IB clients in forums are claiming - no idea if true - that they are only covered for 50k max if IB goes down, and others claiming that IB uses a hungarian operation for some accounts (?).

All sounds far fetched to me, esp the hungarian thing, but you might want to specifically ask your broker i) where are client account monies (cash and other assets) held (country and jurisdiction) and what is the investor guarantee cover applied - UK or other?

If there is a BK, I strongly suspect in some markets some banks and others will go to the wall.

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9 hours ago, Yellow_Reduced_Sticker said:
 
I NEVER listen to the likes of Credit Suisse et al...its always been charts AND director BUYING that make my mind up!
 
Bought MORE RMG when i saw the CEO Rico Back, filling his boots!
 
 
image.png.3cd3a234d0253c753cc06ad97410440d.png
 
 
Like a lot on here with NICE profits at the mo...(2 years living expenses for me Yes LIVING FRUGALLY of course xD ) ...what do ya do, sell out ? grab the profit and WAIT for the so-called BK to happen?
 
Its a difficult one, for me I'm really ONLY interested in the divis, as I'm mid-50's semi-retired ...maybe RETARDED! Thats what  @MrXxxx  would say/correct in this post!:Old:
 
Back in 2007 I sold ALL my shares, the biggest holding was unilever- yes things did collapse HOWEVER I didn't buy back...look at unilever today over £44 quid! :o SO today I probably HOLD and sit the BK out ...
 
Anyways...I like doing what I'm doing since exiting the WORK-place ...ie: MORE time for fishing, MORE time looking for YRS bargains, scavenging in skips, even selling scavenged stuff on ebay, just got into FB Marketplace, here's my TOP Tip:
 
Search: "free stuff near me today" Unbelievable what folks throw out, AND you can sell it on!!!!
 
Basically I've always been a bit of a I'm a schemer at heart AND now loving even MORE!
 
BTW, the music video you posted yeah GREAT, however my ALL TIME FAV...is TRANCE, have a listen to the video below, seriously for those who were/are into TRANCE, listen to the entire 30 minutes...ya'll have tears running down your cheeks.
 
This is beautiful Music. ALL of YOU Will LOVE it! :D
 
Peace.
 
 
 
 

This isn't an investing strategy, it a lifestyle recipe!....I think we should have a Dosbods `Man (or lady) of the Year` award...@YRS gets my vote! :-) :-) :-)

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