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

[leonardratso]

2 minutes ago, No One said:

The double speak is mind boggling.

If LLOYDS, as they say, buy up existing housing stock, then they are using capital to increase demand for housing, and forcing the younger ones into rent slavery. So they aren't fucking helping anyone into homeownership quite the opposite, they are helping themselves.

 

These people should have been lynched in 2008.

hehe, they were

[No One]

1 minute ago, Yadda yadda yadda said:

Lloyd's would get lots of bad publicity for failing to look after property or messing around with deposits. Presumably they wouldn't try and charge extra fees every time a fixed term came to an end. They would have professional managers. Should be much better to deal with.

Just so long as it doesn't go all WEF and no-one owns anything.

Less stock to buy means Price goes up, which I think we are all against.

We want BTL LLs to go bust, not consolidated by LLoyds

[AWW]

This is just Lloyds l trying to prop up the value of the assets on their balance sheet. Frankly, it's bonkers. I wonder how cheap their borrowing costs will remain if they end up being even more dependent on UK resi...?

[Cosmic]

1 minute ago, No One said:

Less stock to buy means Price goes up, which I think we are all against.

We want BTL LLs to go bust, not consolidated by LLoyds

Easy, Lloyds calls in the loan, BTL scum can't pay/won't pay... Lloyds comes to the rescue with a derisory BMV offer...

Wishful thinking

[feed]

3 minutes ago, No One said:

Less stock to buy means Price goes up, which I think we are all against.

We want BTL LLs to go bust, not consolidated by LLoyds

House prices are a function money supply.  Not physical supply.  

[dnb24]

32 minutes ago, HousePriceMania said:

https://www.lse.co.uk/news/lloyds-bank-to-become-private-landlord---report-7kvhd89udpvb5wp.html

 

 

If you're not shocked, you should be

 

I’m not sure why you would be shocked- this has been nailed on for past 5 years. Individual Private landlords are done for,  but there will still be a requirement for rentals. Governments in the West will need to house their people especially as we get into the reflation and there is a realisation that there won’t be the same amount of jobs available as prior to 2020. Who better than to give the role to the banks- central bank money given straight to the banks to keep the plebs with a roof over their head- plus will be able to maintain a standard price- able to control inflation in this area to an extent. 
If/when digital currencies come in- even easier to work out who is living where, paying what/tokens for housing etc etc. 
You will own nothing and be happy- this has been hidden in plain sight for over a year now- it’s something that needs to be considered for all our financial planning. 
If you see the amount of building in East London- around excel centre- you would be shocked- it’s like Stratford circa 2010, a city of flats. These will be for the UBI class of the 2020s.

[Yadda yadda yadda]

1 minute ago, No One said:

Less stock to buy means Price goes up, which I think we are all against.

We want BTL LLs to go bust, not consolidated by LLoyds

Yes. Are they going to buy existing housing stock, convert no longer required office buildings or build from scratch? The article focusses on their relationships with developers. I can't see them wanting to buy and maintain the average existing UK house.

My answer was to the question of whether a private landlord or an institutional landlord was generally better for the tenant. Institutions are better than most private landlords.

[Cosmic]

2 minutes ago, Yadda yadda yadda said:

Yes. Are they going to buy existing housing stock, convert no longer required office buildings or build from scratch? The article focusses on their relationships with developers. I can't see them wanting to buy and maintain the average existing UK house.

My answer was to the question of whether a private landlord or an institutional landlord was generally better for the tenant. Institutions are better than most private landlords.

They won't be scraping rightmove for candidates that's for sure.

[Yadda yadda yadda]

5 minutes ago, feed said:

House prices are a function money supply.  Not physical supply.  

Combination of both. Theoretically this could be an increase in money supply.

[Calcutta]

Big companies running the privating rental sector is exactly what we need. See I've always had an eye on Lloyd's, it's just so far down on where it was, and they once gave me £50 for sending an angry email about my card being rejected by a dodgy Indian ATM. Trigger finger's getting itchy. 

[Jesus Wept]

30 minutes ago, HousePriceMania said:

https://www.lse.co.uk/news/lloyds-bank-to-become-private-landlord---report-7kvhd89udpvb5wp.html

 

 

If you're not shocked, you should be

 

I had this conversation 10 years ago. I said the only logical option was for banks to take over the assets and get the yield from them and become landlords. 
 

Never understood why they haven’t done it before? 

[23rdian]

14 hours ago, DurhamBorn said:

Exactly,my portfolio hit a record today,really really pleased how things have gone for people on here.A few mistakes along the way,but a lot of work from people has really shown through.I think we are all very well positioned for more gains,but we have work to do yet.Im really pleased @Cattle Prod was able to add his huge knowledge as my roadmap was screaming to go really heavy on oilies/gas and it helped to confirm that.

Aim of the thread was to help share knowledge so ordinary people could protect and grow their saved labour.I think so far we can easily say that it has been a huge success,and after all this time still a welcoming place for anyone,young or old,a few quid,or the end of a saving life.Experienced or not.Lots to navigate ,but im confident we are in the right areas.

@DurhamBorn 

Thanks for your posts, could you give a synopsis of what your are doing here for the newbies like me, are you buying oilies and miners due to the bond situation, hedging against inflation coming? Or have I got this arse about face?

I need to protect myself too and just wanted to clarify?

[Bricormortis]

48 minutes ago, dnb24 said:

I’m not sure why you would be shocked- this has been nailed on for past 5 years. Individual Private landlords are done for,  but there will still be a requirement for rentals. Governments in the West will need to house their people especially as we get into the reflation and there is a realisation that there won’t be the same amount of jobs available as prior to 2020. Who better than to give the role to the banks- central bank money given straight to the banks to keep the plebs with a roof over their head- plus will be able to maintain a standard price- able to control inflation in this area to an extent. 
If/when digital currencies come in- even easier to work out who is living where, paying what/tokens for housing etc etc. 
You will own nothing and be happy- this has been hidden in plain sight for over a year now- it’s something that needs to be considered for all our financial planning. 
If you see the amount of building in East London- around excel centre- you would be shocked- it’s like Stratford circa 2010, a city of flats. These will be for the UBI class of the 2020s.

Yeah that'll be it, building blocks of flats to warehouse people in,  also converting existing office blocks as per the plan for Plymouth's Money Centre, being converted to "apartments"  mostly 37 sq meters (50% of the flats ) to 45 sq meter dwellings. 

Not saying the  banks  offerings will be for midgets, some will be decent. 

Banks will be realising its only going to get dearer to get set up going forward so they might as well crack on.

And if you get everyone renting no need to fanny about with reposessions, just chuck 'em into the street.

[Bobthebuilder]

47 minutes ago, Calcutta said:

Big companies running the privating rental sector is exactly what we need. See I've always had an eye on Lloyd's, it's just so far down on where it was, and they once gave me £50 for sending an angry email about my card being rejected by a dodgy Indian ATM. Trigger finger's getting itchy. 

I bought a load of Lloyds back in 2009 ish around 30p thinking I was on to an easy winner. Sold a chunk at 70p to clear a debt a few years ago. Apart from that it's not really done a lot in 13 years. 2 or 3 divi payments at most I think. Still got them.

[BurntBread]

1 hour ago, HousePriceMania said:

https://www.lse.co.uk/news/lloyds-bank-to-become-private-landlord---report-7kvhd89udpvb5wp.html

 

 

If you're not shocked, you should be

 

Building new stock is probably a good thing (unless we get the promised mass exodus following Brexit), and institutional landlords will hopefully be better than most of the small-time BTL-ers.

However, I interpreted the "buy and rent out [...] existing properties" as being a euphemism for the fact they may get swamped by repossessions from bankrupt buy-to-letters. My (perhaps unrealistic) thinking is that there will be so many, that any attempt to sell them, as would be done in normal times, will crash the market and kick an unpluggable hole in Halifax/Lloyds' own balance sheet. They therefore need to keep them as assets on their books, at a price which doesn't include market discovery.

In that scenario, as a major player in PRS lending, they have no choice but to get into the business of actually renting out properties. Then, having made that decision, it's natural to also want to build your own, as they will be easier to manage & maintain, so make the whole division more profitable on average.

So, I'm suggesting it's driven by necessity, and reputational risk is just something they will have to put up with.

[feed]

Credit Suisse says BT Group to benefit from rising inflation, government bond yields

https://www.hl.co.uk/shares/share-research/share-tips/stockbroker-tips/credit-suisse-says-bt-group-to-benefit-from-rising-inflation,-government-bond-yields

The company was also set to benefit from the Chancellor's new deductions for investment, which was the chief reason why the analysts bumped up their target price from 190.0p per share to 200.0p.

 

[Hardhat]

Anyone else holding hydrogen stocks? ITM, AFC, CWR etc?

 

Taking a bit of a pasting past fortnight but they had run up massively over the previous two months.

 

Fundamentals still good for hydrogen imo, I'm holding for the long term, so just flagging up that if anyone was waiting for a pullback to enter this sector... the pullback has arrived.

[Noallegiance]

If I was a bank that's about to be bypassed by the BoE for lending into the economy I'd want to source a new income stream.

Creating products to secure mass income via either private enterprise or benefits for years to come is a winner. The initial capital outlay is not THAT relevant in the grand scheme, but much better to mop up any type of residential property at knock-down prices, no?

I'm wishful thinking. But an organisation with such close ties to government chooses now to announce a foray into private rentals? With house prices clearly in bubble territory?

[sancho panza]

4 hours ago, Cattle Prod said:

In reality it was a minority (17%) of institutional investors surveyed by Morgan Stanley on whether ICE car technology has zero value today. Going from there to that headline is an outstanding example of chinese whispers and how news gets twisted. Of course most people just read the headlines, I'm beginning to think that if you do basic due dilligence you already have an edge in the markets, it's crazy. 

Just got up after two banging night shifts.Is this the picture of insto money finally heading back into the oilies after 12 months off?

my March/April  oilies calls running sweet as nut.Some of which have been in the red 50% at times.

1 hour ago, dnb24 said:

I’m not sure why you would be shocked- this has been nailed on for past 5 years. Individual Private landlords are done for,  but there will still be a requirement for rentals. Governments in the West will need to house their people especially as we get into the reflation and there is a realisation that there won’t be the same amount of jobs available as prior to 2020. Who better than to give the role to the banks- central bank money given straight to the banks to keep the plebs with a roof over their head- plus will be able to maintain a standard price- able to control inflation in this area to an extent. 
If/when digital currencies come in- even easier to work out who is living where, paying what/tokens for housing etc etc. 
You will own nothing and be happy- this has been hidden in plain sight for over a year now- it’s something that needs to be considered for all our financial planning. 
If you see the amount of building in East London- around excel centre- you would be shocked- it’s like Stratford circa 2010, a city of flats. These will be for the UBI class of the 2020s.

I treally is beginning to look like quite a dystopian future for our kids isn't it?

I was speaking to an A&E sister last night at work and asked her when we get back to normal(because let's be honest,the Lockdown has been/is/is going to be an absolute disaster for generations to come) and she ,gleefully it seemed,told me that we're never going back to normal.There's a real ignorance amongst some in the medical community about the very real risks to ordered society posed by pursuing a 'zero covid' strategy.

She said the above to me,with an empty 6 bed triage area behind her(only in the last year has that happened).I came home,listened to radio 4 briefly on the way(my phone is screwed,otherwise I'd listen to Styxhexenhammer on video).It was wall to wall 'heroes of the NHS deserve more than a 1% pay rise' stuff,oblivious to the Debt to GDP ratio circling 250% if you include things like unfunded pension liabilites.

What have we done to our kids?

[Noallegiance]

16 minutes ago, Hardhat said:

Anyone else holding hydrogen stocks? ITM, AFC, CWR etc?

 

Taking a bit of a pasting past fortnight but they had run up massively over the previous two months.

 

Fundamentals still good for hydrogen imo, I'm holding for the long term, so just flagging up that if anyone was waiting for a pullback to enter this sector... the pullback has arrived.

Yes. I took some profit from them about a month ago. Sold AFC and ITM completely but still have a few thousand Powerhouse. The sector had a massive spike Dec-Jan and, whilst well down from the highs, don't look to me to have bucked the upward trend they were on anyway. Still nowhere near the previous high on PHE from early last decade (see attached).

I figured, as it's new, it's kinda like a tech play on underlying energy stock which I why I sold most for a handsome gain.

Looking to get back in post BK. Thought I'd leave some exposure for the melt-up just in case hence why I kept one. How did I choose PHE over the other two? Purely because Mr Abramovich owns them!

[sancho panza]

On 03/03/2021 at 14:28, DurhamBorn said:

Big hike in what companies can claim for capex is a huge giveaway,will spike demand for equipment and buildings etc.Every policy looks like to create inflation while making sure it flows in tax while freezing allowances.

 

Is the Budget not also a statmetn of how bad things must be out there in the real world if they've had to extend furlough to September 21?

Talking to a paramedic at work who used to be in theatres,he was telling me that some of the big Londinium West End places may never reopen as the costs jsut can't be covered.Talked about the jobs involved in theatres and how many related jobs may go to eg restaurant staff.

I can't believe cable is $1.40.I really can't.

On 03/03/2021 at 14:21, Cattle Prod said:

Interesting that you decided to compete with Rishi on timing of this Sancho  But I just wanted to say thanks lest it get lost, it's a really excellent guide. And listening to Rishi reeling of a list of spending and various funds the amount of which I've never heard the like of, a few of these goldies may end up being the most important things you own.

Edit:

F'n freeports now to go with super deductions, infractructure band and retail green bonds. Place is going to go bananas...it'll feel great! Then everyone will be poorer.

My pleasure CP.Hope they're of some use.Certainly got my attention when you look at how poor the oilies scores were a week or two back.

Where's that pull back in the oil price you've been prmising Brent $69.Shurely a sign?hic...

[BurntBread]

16 minutes ago, sancho panza said:

... oblivious to the Debt to GDP ratio circling 250% if you include things like unfunded pension liabilities.

I hadn't thought how that should be counted in the centuries-long charts of debt-to-GDP ratios. Paging @Frank Hovis: are we potentially at Napoleonic-war levels already, if we include the unfunded public sector pension liabilities, or would you treat them differently, from an enlightened accountant's perspective?

[Hancock]

1 hour ago, Calcutta said:

Big companies running the privating rental sector is exactly what we need. See I've always had an eye on Lloyd's, it's just so far down on where it was, and they once gave me £50 for sending an angry email about my card being rejected by a dodgy Indian ATM. Trigger finger's getting itchy. 

It was far better when councils were doing it.

What we need is cheap building land so there is no need for landlords.

[Noallegiance]

Just now, sancho panza said:

Is the Budget not also a statmetn of how bad things must be out there in the real world if they've had to extend furlough to September 21?

Talking to a paramedic at work who used to be in theatres,he was telling me that some of the big Londinium West End places may never reopen as the costs jsut can't be covered.Talked about the jobs involved in theatres and how many related jobs may go to eg restaurant staff.

 

I have some experience in this area.

Surrounding restaurants, taxis, take-away, hotels, general retail, logistics, supply of food, front of house, backstage, SFX rental, chaperones for children, costume warehouses, musicians, SFX operators, stage managers, makeup artists, actors, agencies, directors, choreographers, studio rentals (for rehearsal space), ticket offices. I may have missed some more.

It's quite the knock-on.

[DurhamBorn]

37 minutes ago, feed said:

Credit Suisse says BT Group to benefit from rising inflation, government bond yields

https://www.hl.co.uk/shares/share-research/share-tips/stockbroker-tips/credit-suisse-says-bt-group-to-benefit-from-rising-inflation,-government-bond-yields

The company was also set to benefit from the Chancellor's new deductions for investment, which was the chief reason why the analysts bumped up their target price from 190.0p per share to 200.0p.

 

Its amazing isnt it how these people react and have no roadmap at all.We knew all this 3 years ago and simply waited for a big drop as the cycle ended to buy.I got some at 95p.Very few people understand how inflation works and the few areas that benefit,we put the work in on this thread and have been richly rewarded so far.

Im trying to roadmap western currencies against Asian ones over the cycle and its proving difficult,but im seeing that we might see the regions currencies take up the running and im trying to see if it might be worth slicing profits and re-allocating to similar areas over there.

Its amazing really,but i wanted 65% over the cycle to equal what i think inflation might be and im nearly at 50% up including divis.On a big,quite conservative portfolio thats a hell of a return.Plenty of mistakes as well,mostly first ladder being too high,or slicing profits too early.