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

[RJT1979]

They are buying DOGE coins. Keep up. Silver thing never got much traction. I did 300pc on Doge. 

[geordie_lurch]

Monday and the whole of next week is going to be interesting but I'm not making a Black Monday call yet I don't think... I have set some cautionary stop losses and some optimistic limit orders just in case

[Harley]

2 hours ago, wherebee said:

So lots of chatter about a rotation into Bonds.

Does that affect our hivemind view on investment positioning?  I must confess I've never invested in Bonds (not my area of knowledge), but I bet someone on here has...

Yep. I noticed that from quite a wide variety of sources.  Government bonds of course and given the sources, US ones.  Also some prior talk about one more up for them.  They (bond ETFs) have not been doing well recently on their monthlies for me though but worth a closer look.  As the video guy said, a move into them by traders could be a signal so needs watching.  As does USD.

[MrXxxx]

For those 'slow to the GMC party' and finding it difficult the understand the post-talk part of this weeks Macrovoices podcast explains it beautifully, and also highlights the fact that it wasn't just the Reddit's that were responsible, but the 'sharks were actually feeding on themselves'!

Here Napier talk 1:08 onwards, and download the picturebook as it really helps (https://www.macrovoices.com/podcasts-collection/macrovoices-podcasts)

[Bricks & Mortar]

 

1 hour ago, Harley said:

So where next with their money?  How much?  Out of RH (whoops!) to where?  Another broker and to where?  Not sure into BTC as it stayed flat yesterday.  Still in RH and into AG, etc?  Having one big party this weekend? 

Ah.  I'd checked in the afternoon and saw it was taking off.  I see it fell back.
I'm also calming down as I've checked to see the total assets under management at Robinhood are a mere $20 billion, (the big brokers are in the trillions).
What's got me spooked is RH is preventing its users from buying AG, and 50 other stocks.
I'm still taking something out of my stock portfolio, and buying physical silver on Monday.  Got my eye on some 500g silver bars from thegoldbullion.co.uk unless I find a better price over the weekend.
I'll be watching what is said over the weekend before deciding how much to take out.  May only be 10% or so, if everything dies down.
 

[Lightscribe]

9 hours ago, Bricks & Mortar said:

I disagree strongly.  GME, (for the Redditors), was basically shut down yesterday, in collusion with the hedgies, while the price went from around $480, down to $113.  The hedgies are professionals, they could keep trading on their own platforms.  Surely they put more shorts on at $480, and covered their low price shorts at, or close to, $113.  They'd be pretty shit hedgies if they didn't.

But, I do think there's a risk of a market crash.  And I think its being set up to blame the Redditors, just like an open door and an invite inside from the cops at the Capitol a few weeks back.  Joe Biden has been elected on a "build back better" slogan.  This is the Party of Davos slogan.  I think think he, or rather, the Party of Davos, are wanting a global collapse, so they can get on with it.  From the Biden admin's perspective, the sooner this happens the better, as they can shuck off more blame to the Trump admin the closer it is to that time.  And also, the sooner it is, the more of their term they have left for the voters to forget.

For me, the SEC, President, Treasury Secretary, should have come out to condemn the market manipulation of Robin Hood, Citadel, Melvin Capital and the other brokerages who followed suit.  USA is the home of the free market, and they just bent it to all hell, in my opinion.  That they didn't, even though I wasn't playing, rang all kinds of alarm bells.  When it transpired they were doubling down, and manipulating AG today, (I didn't find out until after market close), I decided to pull a large chunk from NYSE on Monday, and bring it home, probably to cash.

EDIT TO ADD - I didn't explain this well enough.  The liquidity issue, is Redditors and other investors pulling their cash from the market as it's revealed to be rigged, and the administration reveal themselves to quite like it that way.  Did you check the bitcoin price today?  That was Redditors saying, "fuck this for a game of soldiers."

Yup. Those darn alt-right (notice how they are labelled even though Reddit is about as left as you can get). Oooh noooo that sucks look what these online Trump trolls have done they’ve gone and crashed the market! Online terrorists. 

Don’t worry, we can make it all better, we can purge the internet, track and censor everything to just government approved sources like China does. It’s for your own good.

[feed]

 

https://www.thetimes.co.uk/article/bosses-make-capital-gains-as-sunaks-tax-rises-loom-0wnb82v3g

Directors in UK-listed companies have sold hundreds of millions of pounds’ worth of shares this year as they cash in on the markets’ winter rally and act before any possible tax changes.

Wonder if they've had the nod 

[No One]

Ive been thinking, if the hedge funds that shorted the gamestonks and anc have to cover their losees, wont they have to liquidate their other stocks en masse? could that be a buying opportunity?

[JMD]

11 hours ago, Rave said:

Sorry to drag up something from days ago, I know we're all enjoying watching the GME fiasco now, but I find it hard to keep up to date with this thread.

Anyway for various reasons hydrogen makes a pretty poor fuel for internal combustion engines:

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

Extracting <40% of the energy in it by burning it in a reciprocating engine would be pretty dumb when you can get about 90% out of it using a fuel cell.

Ultimately however the main problem with compressed hydrogen as a fuel is that making it in the first place is so energy intensive that however efficiently you can extract the energy from it at the point of use, the round trip efficiency will always be poor. On a local scale where there is surplus renewable power with no way of exporting it, like on a Scottish island with a wind turbine or whatever, then producing hydrogen is better than simply wasting the power. However on a national scale the UK is a long, long way from having a surplus of renewable energy, and we are considerably more advanced, and blessed with renewable energy resources like wind and waves, than most of the rest of the world. It will be many years before hydrogen has a genuine contribution to make to reducing CO2 emissions, and indeed it might never make much of a contribution at all, particularly if, say, CO2 capture to make synthetic liquid fuels ends up offering better round trip efficiency.

I note that various 'hydrogen stocks' have multibagged over the last year. This in my opinion is very much a play on governments continuing to be run by scientifically illiterate fools in the future, rather than on a fundamentally good and viable technology. That might well continue to be a good play of course, I'm just saying  .

Insightful post Rave. Do you know of any co2 capture/sequestration companies that you think might do well? I think your also correct about the hydrogen/battery tech companies, like most of the tech sector, they are far too pricey - at least for me to buy anyway. But I would like to put some money into a few potential co2 capture companies, but I expect most of them are still private?

[Option5]

9 minutes ago, JMD said:

Insightful post Rave. Do you know of any co2 capture/sequestration companies that you think might do well? I think your also correct about the hydrogen/battery tech companies, like most of the tech sector, they are far too pricey - at least for me to buy anyway. But I would like to put some money into a few potential co2 capture companies, but I expect most of them are still private?

Equinor are building a system "Northern Lights Project"

[Democorruptcy]

3 hours ago, MrXxxx said:

For those 'slow to the GMC party' and finding it difficult the understand the post-talk part of this weeks Macrovoices podcast explains it beautifully, and also highlights the fact that it wasn't just the Reddit's that were responsible, but the 'sharks were actually feeding on themselves'!

Here Napier talk 1:08 onwards, and download the picturebook as it really helps (https://www.macrovoices.com/podcasts-collection/macrovoices-podcasts)

Blackrock filed 9.2m/13.2% of Gamestop shares for Dec 2020 on here 26th Jan

https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0001326380&owner=exclude&count=40

 

[JMD]

9 hours ago, Rave said:

Another bit of minor thread necromancy. In fact the lubricity of veg oil is better than dino diesel. You might have problems with the pump if it's cold and the veg oil thickens up; it might struggle to generate the pressure that common rail systems need, or pop seals etc. But generally, a modern diesel will run OK on veg oil...for a while.

The problem is that modern diesels are 'direct injection' as in they inject the fuel straight into the cylinder, rather than burning it in a 'pre-chamber' in the head. Straight veg oil contains glycerol, which doesn't burn all that well, and will eventually get under the piston rings and gum them up. When that happens the engine will sooner or later start sucking the sump oil up past the rings into the cylinder, at which point unless you stall it or deprive it of air it will run away until it seizes catastrophically.

The process of making 'biodiesel' is simply removing the glycerol. Once that's done it's functionally pretty much equivalent to dino diesel and any engine will run on it safely (except for the fact that the residues of the methanol and caustic soda used in the cleaning process can rot fuel hoses and seals).

(Excuse thread derailment, but cars, yellow reduced stickers and pizzas are sometimes given a free pass here!)                                                                                                                                                                           Could be wrong, but wasn't the late 90's Peugeot 405 considered a sweet spot, cheap and cheerful to buy, and in that the engine required no modification, though I think it was recommended to have a separate veg oil fuel tank so could switch to diesel tank on cold mornings?

[Hancock]

3 hours ago, Lightscribe said:

Yup. Those darn alt-right (notice how they are labelled even though Reddit is about as left as you can get). Oooh noooo that sucks look what these online Trump trolls have done they’ve gone and crashed the market! Online terrorists. 

Don’t worry, we can make it all better, we can purge the internet, track and censor everything to just government approved sources like China does. It’s for your own good.

I just showed that to my kid (10), and  she is aware of it stating they use it to teach her at school.. all about the environment, global warming, equality etc..

She had to write a story about Greta last week.

[Don Coglione]

9 minutes ago, JMD said:

(Excuse thread derailment, but cars, yellow reduced stickers and pizzas are sometimes given a free pass here!)                                                                                                                                                                           Could be wrong, but wasn't the late 90's Peugeot 405 considered a sweet spot, cheap and cheerful to buy, and in that the engine required no modification, though I think it was recommended to have a separate veg oil fuel tank so could switch to diesel tank on cold mornings?

I think that was the XUD engine, used in various Peugeots and Citroens.

[DurhamBorn]

Running numbers and i think core inflation will touch multi decade high of 3% at the start of this cycle ,so thats over 25 years high.Liquidity is there for that already.Market is positioned for the opposite to happen.Market is shaking out people of the inflation/cyclical trade before likely moves higher again in those sectors.

Normal move from Fed business cycle printing is around 2% gain in core inflation.Looking at liquidity its likely we will get 3%+ so touching or above 3% is very likely for the first stage.

The market is missing the message this will send.It is buy energy and things you use before others do.Given the lack of investment in oil and gas this last 5 years its likely mid term price targets could over shoot.The vaccine situation is a window into what happens when politicians make big mistakes.There is no bigger one than handing energy policy to 15 year old Swedes.

[Castlevania]

Not relevant at all, but Greta Thunberg’s second name is Tintin. 

[JMD]

53 minutes ago, Option5 said:

Equinor are building a system "Northern Lights Project"

Thank you Option5. That project you mention is exactly what I was looking for, makes for very interesting reading. Big oil is involved and I am already invested in that sector. But Fortune Oslo Varma is involved and I will see if I can buy some if the price is right. I think/hope waste-to-energy companies like them are an interesting (next cycle tech) play. 

[JMD]

4 minutes ago, Castlevania said:

Not relevant at all, but Greta Thunberg’s second name is Tintin. 

Not relevant you say?... Didn't Tintin have a dog called Snowy? Isn't Greta preoccupied with the ice caps? I think I'm beginning to join the dots!!!

[Rave]

6 hours ago, Bricks & Mortar said:

I've mis-written when I put the trade was shut down for the Redditors.  It was, instead, made "sell-only".  I think enough of them realised the game was up and sold while it was like that.

I haven't bothered to look at the volumes traded but as far as I can tell very few of the squeezers panicked and sold. Of course with the traffic made one way only it was possible to drop the price back down to $120 on very low volume, which in turn allowed RH and others to stop people out of their leveraged option positions, but that's all it will have achieved. The hedgies would in no way have been in a position to profit from a nominal drop from $480 to $120, there simply won't have been anything like the liquidity required.

[Rave]

1 hour ago, JMD said:

Insightful post Rave. Do you know of any co2 capture/sequestration companies that you think might do well? I think your also correct about the hydrogen/battery tech companies, like most of the tech sector, they are far too pricey - at least for me to buy anyway. But I would like to put some money into a few potential co2 capture companies, but I expect most of them are still private?

Unfortunately I know little about Carbon Capture and Storage, and less still about any potential investment plays on it. And the reason for that is...that I have instinctively written it off as another unscientific boondoggle; a method for capturing government subsidies rather than for capturing meaningful quantities of CO2!

I should say at this point that my only qualifications for pontificating on the subject of energy are my A-Levels in Physics and Chemistry. I flunked out of my university engineering course when it became apparent that I was good at understanding scientific concepts at a handwavy level and very poor at understanding the maths required to make practical use of them. Obviously I can use google and read wikipedia as well as the next man, but that's it.

So that said, my objection to CCS as a technology is that gaseous CO2 at atmospheric temperature and pressure is in a very low energy state, and so doing anything with it at all requires the input of a significant amount of energy. I guess that if you collect a relatively concentrated source of it, for example the exhaust from a gas turbine, then it might not take a great deal of energy to compress it into a storage tank....but it will presumably require quite a lot more energy to then separate it from the nitrogen and water vapour also present in said exhaust. And once you've got a tank of compressed CO2, what do you do with it? It has plenty of uses of course, but I suspect that if every thermal power plant were to start capturing, concentrating and storing all their CO2, then supply would quickly outstrip demand. Simply pumping it back into depleted gas fields and leaving it there is an idea with some merit, I suppose.

I guess I should really force myself to do a bit of the maths I detest and find out / work out exactly what the proportion of the energy produced by buurning fossil fuels would be required to adequately sequester the CO2 produced as a result. I suspect that it will be in the order of 50%, but I could be wildly wrong. Now if we were still in the era of being able to easily and cheaply extract new reserves of fossil fuels then we might be in a position to use it in a way that only half the available energy ends up available to us for useful purposes; but, with the possible exception of natural gas, which has its own problems as an energy source (difficulty of storage and transport, primarily) we are not in that position. In fact we already have to expend significant amounts of energy to extract fossil fuel reserves, and our overall Energy Return On Energy Invested (EROIE) continues to drop. We are not, IMO, in a position to cut it in half again by implementing CCS.

One system I do think is technologically and financially sound is the 'Thanet Earth' model of blowing the exhaust from a gas turbine power plant into a giant greenhouse, where the heat and CO2 concentration helps plants to grow more vigorously.

I think in general though that a more realistic way forward and hence probably a better investment play will simply be for humans to simply use less energy. We have already done quite a lot in that direction; I mean who uses incandescent bulbs any more when LEDs produce more pleasing light for a tenth of the energy input? I think also that an increase in energy prices will mean that people will frontrun the proposed ban on ICE cars in 2030 by simply using cars a lot less anyway as the cost of fuelling them rises precipitously. The days of dragging 1500kg of metal around in order to move one or two 80kg people will largely come to an end. I live in suburban London and I already see dozens of people every day using those little electric scooters to get about. They will do 15 miles at 15mph on about 4-5 pence worth of electricity. They're still not legal but sooner or later they will either be legalised or effectively decriminalised because there are now so many of them about that an organised crackdown on them would be impossible IMO. Meanwhile you can get a perfectly good, and perfectly legal, electric bicycle for £1000 which use roughly the same amount of energy per mile as the scooter. As the bikes and scooters become ever more of a commodity I expect prices to fall further, in inflation adjusted terms at least.

[Bus Stop Boxer]

6 hours ago, Bricks & Mortar said:

 

Ah.  I'd checked in the afternoon and saw it was taking off.  I see it fell back.
I'm also calming down as I've checked to see the total assets under management at Robinhood are a mere $20 billion, (the big brokers are in the trillions).
What's got me spooked is RH is preventing its users from buying AG, and 50 other stocks.
I'm still taking something out of my stock portfolio, and buying physical silver on Monday.  Got my eye on some 500g silver bars from thegoldbullion.co.uk unless I find a better price over the weekend.
I'll be watching what is said over the weekend before deciding how much to take out.  May only be 10% or so, if everything dies down.
 

Do you pay vat on those?

Cheers

Edit. Yes.

Edit

VAT free from here

https://www.silver-to-go.com/en/silver-coins/coin-bars/1-kilo-coin-bar-silver-stonex/

[Bricks & Mortar]

33 minutes ago, Bus Stop Boxer said:

Do you pay vat on those?

Cheers

Edit. Yes.

Edit

VAT free from here

https://www.silver-to-go.com/en/silver-coins/coin-bars/1-kilo-coin-bar-silver-stonex/

I was thinking they might not be charging VAT, but HM Customs will be looking out for stuff like that, and adding it as it comes into the country, for you to pay before they release it.  I have a friend who got similar on a dog kennel a couple weeks back.

[Noallegiance]

1 hour ago, JMD said:

 

 

2 hours ago, DurhamBorn said:

Running numbers and i think core inflation will touch multi decade high of 3% at the start of this cycle ,so thats over 25 years high.Liquidity is there for that already.Market is positioned for the opposite to happen.Market is shaking out people of the inflation/cyclical trade before likely moves higher again in those sectors.

Normal move from Fed business cycle printing is around 2% gain in core inflation.Looking at liquidity its likely we will get 3%+ so touching or above 3% is very likely for the first stage.

The market is missing the message this will send.It is buy energy and things you use before others do.Given the lack of investment in oil and gas this last 5 years its likely mid term price targets could over shoot.The vaccine situation is a window into what happens when politicians make big mistakes.There is no bigger one than handing energy policy to 15 year old Swedes.

Is there a force at work that could blow previous estimates about the cycle ahead out the water to the up side?

Just thinking aloud - stuff has been manipulated and micro managed for so long that a cycle swing on the opposite direction could be more violent than we suspect?

[reformed nice guy]

50 minutes ago, Bus Stop Boxer said:

VAT free from here

https://www.silver-to-go.com/en/silver-coins/coin-bars/1-kilo-coin-bar-silver-stonex/

 

6 minutes ago, Bricks & Mortar said:

I was thinking they might not be charging VAT, but HM Customs will be looking out for stuff like that, and adding it as it comes into the country, for you to pay before they release it.  I have a friend who got similar on a dog kennel a couple weeks back.

I bought 100 philharmonics from them in December for just under £2400 including delivery.

Same 100 would £2,602.50 with the risk of an additional 20% vat and handling charge...

I checked Chards and they are £3,498.60 for 100 maples.

Still cheaper to go for silver-to-go! About a £350 or so saving if you have to pay vat or almost £900 if your lucky and it gets through vat free

[Castlevania]

49 minutes ago, Cattle Prod said:

Oh dear, her parents really did screw her over.

I feel sorry for her. I think her parents and others used her to push their agendas, and sticking a child like that, especially an autistic one, into a public circus is negligent if I'm being generous. I'd expect the Miley Cyrus route for her but I suspect she'll be indifferent to it all. She'll end up hating her parents though.

What’s the Miley Cyrus route?