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


spunko

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7 minutes ago, Ash4781b said:

Thanks . Yeah and that’s massive impacts for councils both on the investment side and the business rates revenue. I’m pretty much there in thinking a lot of Local authorities/ councils will need bailouts from central  (some already are bankrupt). It’s not really discussed much about the early council bailouts. Of course central will transfer this (and maybe pension liabilities) to central else without the council tax rise cap we’d be seeing bills rising double digit percentages. That would result in riots so it’s being managed.

council rates here in Australia are one thing that really bloody scares me re future wealth.  There is no way to minimise or reduce unless you go the benefits route (which I might in time).  Around Melbourne, I think three councils have had to be taken over by the State due to corruption or general fuckwittery, but of course the pensions keep getting paid...

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JimmyTheBruce
22 hours ago, Harley said:

Bang, right there.  Privatisation of value and income streams under the guise of wokedom.  "No one else wants" or should that be "no one else allowed to have"?

From what i read, it sounds like the Caesar's sell-off of all the non-US William Hill assets is going to go to private equity too.  Was a bit disappointed at just getting cash in return for my faithful support of a UK company.

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Castlevania
3 hours ago, Ash4781b said:

Vacant commercial unit upon vacant unit in my local town centre (Kent). It’s significantly deteriorated since the last lockdown. Loads more units have been mothballed. Have the commercial property losses started showing up yet ? Surely the scale of the losses will be jaw dropping. I have no idea what other towns are like but this is the worst I have ever seen it. 

Check your pension. The default balanced portfolio that my defined contribution pension was in had a significant exposure to commercial property (around 15% from what I recall). I put the lot into a SIPP once I actually got around to paying attention to what my pension was being invested in. 

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Castlevania
3 minutes ago, JimmyTheBruce said:

From what i read, it sounds like the Caesar's sell-off of all the non-US William Hill assets is going to go to private equity too.  Was a bit disappointed at just getting cash in return for my faithful support of a UK company.

I was expecting it to be chopped up. 888 to take the online side and Fred Done the shops (although there might be some competition concerns with that).

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Bricormortis
22 hours ago, geordie_lurch said:

I know a few people have mentioned the direction the car trade is headed but not seen this model pushed before in the UK i.e not PCP or leasing

The following is from Volvo:

No long-term commitments. Change car or cancel with 3 months’ notice.
 
All-inclusive. With an option to add insurance or use your own.
 
No hidden costs. No deposit. Just a clear monthly fee.

https://www.volvocars.com/uk/care-by-volvo/

Volvo xc 60 from £ 799 a month ?.....no thanks.

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sancho panza

Cross post from the sceptics thread.

Brilliant 40 mins interview on  here with former Professor of Pathology and Dr of 30 years,John Lee.He covers most of the major issues with covid the disease and explains how the Lockdown hasn't/won't work,how it's been counterproductive,why many NPI's such as masks don't work.

All in all,if you watch one video from the last year on Covid,it should be this one.

 

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JimmyTheBruce
50 minutes ago, Castlevania said:

I was expecting it to be chopped up. 888 to take the online side and Fred Done the shops (although there might be some competition concerns with that).

I read Apollo were front-runners for the stores, but who knows.  If Fred runs his shops anything like his online operations I'm not sure why he'd bother, you'd only be allowed in once before being banned.

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Jesus Wept
48 minutes ago, Bricormortis said:

Volvo xc 60 from £ 799 a month ?.....no thanks.

That’s how much my car costs to run a year (original purchase price £3k):

Insurance: £179

Maintenance: £300

Tax & MOT: £160

Depreciation:£150

..... and I still sit in the same traffic and go about the same speed and listen to the same music as the Volvo driver..... with the added bonus that I have £9000 extra per year for spending.....

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DurhamBorn
1 hour ago, JimmyTheBruce said:

From what i read, it sounds like the Caesar's sell-off of all the non-US William Hill assets is going to go to private equity too.  Was a bit disappointed at just getting cash in return for my faithful support of a UK company.

Iv made a lot of money on the gambling sector over the years,but its a prime example of how useless out political class are.The UK had the world leading companies in a sector that would produce massive future cash flow from massive world markets.What did politicians do?,regulate the companies far too hard just because some idiot sticks all his wages in the fruity.

We would of ended up with probably three out of maybe five big worldwide players.Instead some parts are being picked off.

When i bought the sector i expected that 20 years later id probably of been getting a 50% a year divi on my original investment.However instead most has been sold now for capital gains.

 

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Noallegiance
4 hours ago, Ash4781b said:

Vacant commercial unit upon vacant unit in my local town centre (Kent). It’s significantly deteriorated since the last lockdown. Loads more units have been mothballed. Have the commercial property losses started showing up yet ? Surely the scale of the losses will be jaw dropping. I have no idea what other towns are like but this is the worst I have ever seen it. 

I don't visit my local town centre. I don't own a stab vest.

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supernaut
26 minutes ago, JimmyTheBruce said:

I read Apollo were front-runners for the stores, but who knows.  If Fred runs his shops anything like his online operations I'm not sure why he'd bother, you'd only be allowed in once before being banned.

 

You do ultimately get kicked from a shop ( they call it SP only ) but i have lasted quite a while taking the above market price boosts on an individual shop basis, one particular shop i lasted nearly a year with a very healthy profit from doing so.

Since lockdown 3 re open the value has tailed off a fair bit from what i was used too.

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DurhamBorn
20 minutes ago, Vendetta said:

That’s how much my car costs to run a year (original purchase price £3k):

Insurance: £179

Maintenance: £300

Tax & MOT: £160

Depreciation:£150

..... and I still sit in the same traffic and go about the same speed and listen to the same music as the Volvo driver..... with the added bonus that I have £9000 extra per year for spending.....

Roughly the same as one of mine.I paid £5k 10 years ago.I depreciated it over 10 years at £500 a year considering its worthless now if i sold it apart from a couple of hundred for the cat and scrap.

I have averaged like you about £300 a year in maintenance,so £800 a year to keep on road and depreciate to zero.£66 a month over 10 years.I think thats fantastic and of course dropping all the time now as its just maintenance.

I have been considering buying something newer now.I was looking at a £6k 6 year old diesel Focus last week and repeat of keeping 10 years,but im going to wait and see how mine keeps doing.It really needs all the belts changing,tensioners and water pump etc but cant be arsed.

Iv also got an 07 estate that just sits on the drivemostly i gave my partner a grand for 2 years ago,i spent £500 on it changing all the brakes,calipers,disks etc.I did like to keep a spare for the kids etc if they needed it,or me,but now iv retired i dont need two cars so should really get rid,but cant bring myself.My dad pays the insurance on it though and uses it if his is ever in for anything.

He has a £3k PUG diesel 10 plate.He paid £3300 3 years ago,and has so far spend £500 on complete new brakes,calipers,disks,i did the lot as wasnt worth doing twice.Cracking car his.Even if you depreciated it to zero now its only cost £112 a month all in,and should easily have another 5 years minimum with £300/£400 a year on it.

The problem with more modern cars is all the senses etc.Far too much to go wrong,so when i do buy something il want it as basic as i can get it.My PUG i hook up it up in the car park outside the test garage and clear all the engine faults xD

 

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3 minutes ago, DurhamBorn said:

My PUG i hook up it up in the car park outside the test garage and clear all the engine faults xD

Get a wireless OBD2 adaptor and you can keep clearing it while they're doing the MOT

(Apparently):ph34r:xD

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Castlevania
48 minutes ago, DurhamBorn said:

Iv made a lot of money on the gambling sector over the years,but its a prime example of how useless out political class are.The UK had the world leading companies in a sector that would produce massive future cash flow from massive world markets.What did politicians do?,regulate the companies far too hard just because some idiot sticks all his wages in the fruity.

We would of ended up with probably three out of maybe five big worldwide players.Instead some parts are being picked off.

When i bought the sector i expected that 20 years later id probably of been getting a 50% a year divi on my original investment.However instead most has been sold now for capital gains.

 

If you were buying when the market was throwing up last March you’d have made a killing. William Hill did very nicely for me. I also got lucky with the timing of the takeover last Autumn as I was able to take the capital and pile into big oil and Potash companies when they were on the floor. 

GVC has also done well, and I have been taking profits (they’re up almost 200% since I bought a load in the Summer of 2019), although I think they’ll be eventually taken out too.

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Yadda yadda yadda
4 hours ago, PrincessDrac said:

LINK

Sleepy Joe Biden Prepares For Stealth Food Stamp Increase of up to 20% Without Congressional Approval.

Do you think it's because there are 20% more people on food stamps or do you think it's because prices are up 20%?

A review of the so-called Thrifty Food Plan, ordered by Biden two days after he took office, could trigger an automatic increase in benefits as soon as Oct. 1, a day after expiration of a temporary 15% boost in food stamp payments that Biden included in his $1.9 trillion Covid-relief package.

I guess food stamps can only be spent on food. Or sold at a discount for cash on the black market. Typically people on food stamps will be living in the same neighbourhood and shopping in the same stores. Prices are certain to have increased to take advantage of the increased income. Can't undo the previous 15% boost to stamps as the prices won't come down again.

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Talking Monkey
4 hours ago, sancho panza said:

Cross post from the sceptics thread.

Brilliant 40 mins interview on  here with former Professor of Pathology and Dr of 30 years,John Lee.He covers most of the major issues with covid the disease and explains how the Lockdown hasn't/won't work,how it's been counterproductive,why many NPI's such as masks don't work.

All in all,if you watch one video from the last year on Covid,it should be this one.

 

Absolutely awesome interview that, thoughtful and measured. 

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DurhamBorn

Where were they all two years ago,or a year ago,?.Of course the MSM is starting to get on our roadmap,but as usual they are very simplistic and missing almost everything.For instance they havent figured yet that its companies with almost fixed depreciation and locked in rates on debt that will be the follow on gainers after the energy space.Telcos especially.They are also missing the fact we could get a massive crash if they tighten too quickly,Inflation and tightening will be a terrible mix for the highly leveraged.The article and almost everyone seems to think governments have a cycle to print without worry,but the CBs will stop a few months after inflation holds above 3%.Government wont even be able to fund day to day spending then never mind investment.

https://www.telegraph.co.uk/business/2021/05/02/spending-spree-boost-commodity-prices/

British factories are reporting the steepest increase in input prices for four years, according to PMI business surveys run by IHS Markit. Manufacturers in turn are passing on those costs, with price hikes on a scale not experienced for a decade.

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Optimistic

BREAKING NEWS: 🚨

 

THE U.S. NONPROFIT DIGITAL DOLLAR PROJECT WILL LAUNCH FIVE PILOT PROGRAMS OVER THE NEXT 12 MONTHS TO TEST THE POTENTIAL USES OF A U.S. CENTRAL BANK DIGITAL CURRENCY, THE FIRST EFFORT OF ITS KIND IN THE UNITED STATES.

 

Just saw this on Gold Telegraph!

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Noallegiance
33 minutes ago, DurhamBorn said:

.The article and almost everyone seems to think governments have a cycle to print without worry,but the CBs will stop a few months after inflation holds above 3%.Government wont even be able to fund day to day spending then never mind investment.

 

Are you saying that the time of the magic money tree disappearing is imminent?

I thought CB balance sheets were to go stratospheric in response to the bust?

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BurntBread
23 minutes ago, Noallegiance said:

Are you saying that the time of the magic money tree disappearing is imminent?

I thought CB balance sheets were to go stratospheric in response to the bust?

David Hunter's interview from up-thread was expecting an inflation scare this Summer, and a mis-step from the FED (too much tightening) then pitching the economy fairly quickly into outright deflation. However, he is expecting inflation to re-surface as a persistent and growing problem from 2024.

I'm guessing DB has a similar time-frame (?), but I would be interested to know if DB thinks the taps will be turned off this Summer, or mid-cycle (2024). I'm guessing that DH's view would be governments have one last chance to print for infrastructure during the economic bust, next year.

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DurhamBorn
2 hours ago, Noallegiance said:

Are you saying that the time of the magic money tree disappearing is imminent?

I thought CB balance sheets were to go stratospheric in response to the bust?

They will,but until the bust arrives they will taper once inflation goes over 3%.Government has about 6 months to get its structural deficit under control i expect.Most companies etc go bust in the recovery,not the downturn.It will be very interesting to see the government once the BOE stop buying gilts.Of course the FED needs to stop first.

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DurhamBorn
1 hour ago, BurntBread said:

David Hunter's interview from up-thread was expecting an inflation scare this Summer, and a mis-step from the FED (too much tightening) then pitching the economy fairly quickly into outright deflation. However, he is expecting inflation to re-surface as a persistent and growing problem from 2024.

I'm guessing DB has a similar time-frame (?), but I would be interested to know if DB thinks the taps will be turned off this Summer, or mid-cycle (2024). I'm guessing that DH's view would be governments have one last chance to print for infrastructure during the economic bust, next year.

I think they will cut down on QE ,but they might use rate increase as cover to keep some printing going to fund government a while longer.So an interest rate increase yet still some printing and that would really blindside the market.They have printed over half what i expected now.

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Lightscribe
3 hours ago, Optimistic said:

BREAKING NEWS: 🚨

 

THE U.S. NONPROFIT DIGITAL DOLLAR PROJECT WILL LAUNCH FIVE PILOT PROGRAMS OVER THE NEXT 12 MONTHS TO TEST THE POTENTIAL USES OF A U.S. CENTRAL BANK DIGITAL CURRENCY, THE FIRST EFFORT OF ITS KIND IN THE UNITED STATES.

 

Just saw this on Gold Telegraph!

https://www.reuters.com/article/us-cenbanks-digital-usa-idUSKBN2CK0S6
 

I think a lot will be surprised on how quickly digital currency rolls out. With cash carrying viruses, it’s the perfect springboard...

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