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

[ThoughtCriminal]

5 hours ago, stokiescum said:

Your lucky I’m a totally effeminate guy with a cat but I do like a beer 

Well I was going to say get a safe and a dog, but it may just be easier to buy Gold 😆

[jamtomorrow]

20 hours ago, Transistor Man said:

No idea. They used to get very good royalties per phone, especially in the 3G era. However, Apple want to design their own modems now. I guess eventually integrating them on their A-series SoCs. 

Agree - they might well be in a strategic dead end, caught between the trend where the OEMs (Apple, Samsung) bring chips in-house and the sudden structural changes following the NVIDIA/Arm merger. How do they get out of that squeeze?

[jamtomorrow]

15 hours ago, Democorruptcy said:

I have no comment about those 2 firms just a warning about HL dividends. (Again.... I know I go on about it but one day it might help someone).

RDSB today THE a classic case. Yesterday the dividend on HL was displayed as 11.05%, it is currently 3.84%. Yesterday they announced the dividend for Quarter 4, 2020 was $0.1665 and unchanged compared to Quarter 3 2020. Why the huge drop then? It's because up until today they were calculating the dividend based on the last annual dividend i.e. the 4 quarterly payments of $0.47 in 2019. The 4 quarterly payments in 2020 were $0.16, $0.16, $0.1665 and $0.1665

In my mind their 11.05% yesterday was totally misleading. Yesterday we already knew the 3 payments in 2020 were 1/3 of the same quarters in 2019. I think it would be better if the dividend figure was for a rolling year, i.e. in this case yesterday should have been based on $0.47, $0.16, $0.16 and $0.1665. 

Also any firm that isn't currently paying a dividend should state "N/A" instead of a misleading figure you won't be paid!

Haven't yet found a site I trust - I get my divi data from each company's Investor Relations site.

I think one of the problems is all the weird and wonderful approaches to structuring dividends. Different divi intervals, some companies like to do one big one with a few top-ups rest of the year, then there's the scrip issues.

And even with a regular annual divi payer, how do you summarize the recent history? Average? That would over-emphasize older divis. Weighted average? That might make a blip look rosier than it should.

All rather hard to summarize consistently with a single number on an investing platform.

This is definitely one area where I DMOR

[afly]

8 hours ago, ThoughtCriminal said:

Is it the security aspect you're concerned about? 

 

I've got over 50k in the house from cash in hand jobs, but I'm 6"3 and 18 stone and I've got a 40kg German shepherd who's a total fucking psycho, so burglars aren't high on my radar. 

Required a double take 

Busy boy either way 

[UnconventionalWisdom]

17 hours ago, Democorruptcy said:

To be fair it could have been worse, a "BT and Vodafone" would have torpedoed 2 thread darlings.

Edit to ask:

How much was the 4G router and what's the point of it instead of a phone? Is it to save using the battery on a phone? I have an unlocked phone and just turn the wifi hotspot on, if I want to tether my laptop or smart TV. It seems more mobile and there's the camera.

I ditched broadband a couple of years ago as my mobile provider offered unlimited data for 18 quid. Hotspot is usually good but connecting with a usb cable helps for video calls. My phone didn't allow to change to 5GHz so could was stuck at 2.4GHz.  Has worked well as I've used it non stop during lockdown. Often need to download stuff for work.  Is certainly the future

[UnconventionalWisdom]

12 hours ago, Loki said:

"Excess savings" gotta love it 

They want us to spend our money on tat

[UnconventionalWisdom]

12 hours ago, DurhamBorn said:

Hopefully they will load up a few more,most woke institutions sold into the lows and most weak hands will be shaken out for the cycle.It will take several knockdowns to also kick out the iv made 15% im out people each run up.The focus on "green" is relentless and sentiment is on the floor.Its almost universal that people think $60 is a long term ceiling as they think supply can come back.They are in for a shock later in the cycle when its treble that.

We use to develop tech with Tata steel. They appeared as top of list of the most polluting companies. Our social media representative was asking if we still worked with them (implying we shouldn't). Crazy as the steel making process is inherently difficult to make green- not their fault. Issue is that social media gives people a platform and noone wants to challenge when it is professional. She of course will continue to drive in her car made of steel and constantly use buildings made of steel but that goes over her head.

[Noallegiance]

Anyone know if there tends to be a lower balance limit to which negative rates are applied?

[nomadic]

21 hours ago, Bricormortis said:

data harvesting and surviellence. Thats the ghastly future.

I am determined to repel this kind of future as much as possible and that's partly why I moved to the continent where it's easier to hide out! 

This thread has been so valuable to me as it's upped my 'financial prepping' game, which is as important as having a multi-layered tinfoil hat! (Mine would be made of a silver/uranium mix.)

Inflation over the cycle is a huge concern. I used to think that swapping in and out of currencies would continue to bear fruit, but of course, it's all going down with the USD.

Shame, as I have done really well out of mid to long term currency trades, but glad I have had early warning of the impending currency resets and agendas.

My goal in life has always been to stay ahead. I was a digital nomad long before the term was invented. I remember when updating my websites in Bali involved a USB stick and a cyber cafe. Would have loved 3G back then!

Technology has enabled me to have unbelievable freedom in my life. Now it's the biggest threat, but maybe opportunity too.

[DurhamBorn]

28 minutes ago, Noallegiance said:

Anyone know if there tends to be a lower balance limit to which negative rates are applied?

It would be done at the BOE where banks park money over night.Banks would have to choose how to use it on their customers/account holders.In theory it would force banks to lend more and carry less capital,but the BOE should know that isnt the problem.The economy doesnt need bank lending,it isnt big enough for where we are in the cycles.It needs massive and sustained government fiscal pulses.In other words the BOE is talking shit.Negative rates would pull liquidity from the system,not add to it and cripple velocity as M3 falls hard.

The problem with western economies is we dont have enough economic backbone to pa for all the scrounging demands on the system.You can cut those demands,increase the economic backbone,or some of both.

[Shamone]

22 hours ago, Cattle Prod said:

It was just over 9 months ago that it was below $20 and the world was screaming it was all over (including my boss ). The idiots on Nest may well have tagged the bottom. Let me know if you hear they are getting back in so I can dump everything! 

I have to say, this year has been some test of contrarian conviction. We're not out of the woods yet, a pullback is overdue, but I think it's fair to say the overall thesis has been good so far. There is no way I would have been able to hold and add through all that without a roadmap. I had my own convictions coming into this thread, but I needed them tested and challenged, and they were on here. Let's hope for more to come.

 

Nest is a fucking disgrace. I work under the tax threshold but my pennies still go into that    bastard.

[Shamone]

12 hours ago, stokiescum said:

I need a way to invest in the stock market but not be in the stock market .if my projections are correct I could have 12/14k of cash in my house by the years end which is pretty stupid

A relative? Failing that, they could buy PM for you. My local dealer pays cash , albeit about 20% off spot.

[reformed nice guy]

3 hours ago, jamtomorrow said:

Agree - they might well be in a strategic dead end, caught between the trend where the OEMs (Apple, Samsung) bring chips in-house and the sudden structural changes following the NVIDIA/Arm merger. How do they get out of that squeeze?

I looked into the sector and bought infineon, Taiwan semiconductor and ASML.

Infineon as a non Asian fab to reduce risk. Taiwan semi as they basically make everything now and ASML using the decomplexify idea because ASML make the machinery all semiconductor companies need to make their wafers. ASML sell the shovels!

[Harley]

2 hours ago, Noallegiance said:

Anyone know if there tends to be a lower balance limit to which negative rates are applied?

In other countries with it yes.  Varies but seems quite a high limit.  Also time exceptions for house sales, etc, I think, in at least some.

[Harley]

1 hour ago, nomadic said:

I am determined to repel this kind of future as much as possible and that's partly why I moved to the continent where it's easier to hide out! 

This thread has been so valuable to me as it's upped my 'financial prepping' game, which is as important as having a multi-layered tinfoil hat! (Mine would be made of a silver/uranium mix.)

Inflation over the cycle is a huge concern. I used to think that swapping in and out of currencies would continue to bear fruit, but of course, it's all going down with the USD.

Shame, as I have done really well out of mid to long term currency trades, but glad I have had early warning of the impending currency resets and agendas.

My goal in life has always been to stay ahead. I was a digital nomad long before the term was invented. I remember when updating my websites in Bali involved a USB stick and a cyber cafe. Would have loved 3G back then!

Technology has enabled me to have unbelievable freedom in my life. Now it's the biggest threat, but maybe opportunity too.

Really nice to have you on board and posting.  Looks like some great experiences, knowledge and POVs.

[Harley]

13 hours ago, Democorruptcy said:

A lot of money will go into property and that's all they care about.

I wonder if we will see a sea change on this come the Budget, etc.  They need the money velocity now to get the economy moving, raise tax, and create cost (not asset) inflation.  Property (bar a fair bit of stamp) and other assets stop this happening.  We may even see steps to unlock these and other assets.

[Harley]

13 hours ago, Democorruptcy said:

If negative rates come in, what about the NS&I guarantee?

Sorry, I don't understand.  What do negative rates have to do with the "guarantee"?

[Harley]

12 hours ago, DurhamBorn said:

I think the BOE mentioning negative rates is simply to provide cover for more QE.Its a bit like government floating out tax horror stories before the budget only for them to not be true,so people then dont notice the more subtle shafting they get instead.

MoneyWeek doubts it as well:

https://moneyweek.com/investments/stocks-and-shares/bank-stocks/602733/negative-interest-rates-unlikely-uk-bank-stocks?utm_campaign=money-morning-newsletter&utm_medium=email&utm_source=newsletter

But maybe the banks will kindly charge move overt account fees instead of the negative rates we were never going to have!

[Democorruptcy]

12 hours ago, stokiescum said:

I’m 55 I’ve got a small pension I can cash when I want it’s only 33k obviesly  I won’t has it will fuck my universal credits up .however I know you can legally pay debt off with it . I need to look at selling my house and borrowing cash off my mum to buy another then cash my pension in and pay her off ie is it legal .ok it’s gameing the system I know but I need to look into if it’s legal 

£33k in what sort of pension?

Quote

 

You must get regulated financial advice, by law, if you have a:

• final salary or career average pension (known as a ‘defined benefit’ pension) worth more than £30,000 and you want to transfer it to a defined contribution pension scheme
• defined contribution pension worth more than £30,000 with a guarantee about what you’ll be paid when you retire (e.g. a guaranteed annuity rate) and you want to give it up to do something else with your pot

https://www.pensionwise.gov.uk/en/financial-advice

 

 

[Hancock]

7 minutes ago, Harley said:

But maybe the banks will kindly charge move overt account fees instead of the negative rates we were never going to have!

Id sooner pay a fee for having an account then relying on those who go overdrawn to fund it. 

[Democorruptcy]

4 minutes ago, Harley said:

Sorry, I don't understand.  What do negative rates have to do with the "guarantee"?

NS&I have always said 100% of your savings is safe because they are backed by the Treasury. IF the BoE did negative rates, IF banks applied it on your savings the balance would drop, IF NS&I applied it to your savings the balance would drop and you would lose money but they have always said 100% of it is safe. They have never said you could lose money if we apply negative rates.

[King Penda]

7 minutes ago, Democorruptcy said:

£33k in what sort of pension?

 

SERPS but it would screw my uc money up then I would have to account for how I spent it .however you can use it to pay debt off .

[Harley]

Ignore the bitcoin title (although what's touched on is good) - Raoul Pal sees a BK too?

https://www.spreaker.com/user/11996645/210202-raoul-pal

Amusing to listen to Merryn being somewhat in awe of the guy!  And using that MacroVoices podcast strapline about upvotes = better guests!  Might even have hired a sound engineer, or Raoul brought along his own!

 

[Harley]

12 minutes ago, Democorruptcy said:

NS&I have always said 100% of your savings is safe because they are backed by the Treasury. IF the BoE did negative rates, IF banks applied it on your savings the balance would drop, IF NS&I applied it to your savings the balance would drop and you would lose money but they have always said 100% of it is safe. They have never said you could lose money if we apply negative rates.

Sure, in that sense, but TBF the guarantee is about a bust not rates, one way or the other.

PS:  Versus inflation they, and probably everyone else, are already paying negative rates!  Indeed, it might be a bit more obvious and actionable if they did bring them in!

[Democorruptcy]

7 minutes ago, Harley said:

Sure, in that sense, but TBF the guarantee is about a bust not rates, one way or the other.

I don't want TBF, where money and governbankment are involved.