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

[DurhamBorn]

@Bobthebuilder we are on the edge of a boom up here its incredible whats flowing in.My dad was saying we should really buy 3 houses to rent out to leave to the grandkids and i must admit im thinking aout it.Only thing is id have to manage them and do the repairs etc.

I really wish what is coming up here wasnt in a way,our fantastic quality of life is going to go down some,loads of southerners etc.We are getting more and more immigrants and southern benefit scroungers as well because their housing benefit gets them a house up here.Already you can see the cheap ex pit villages being flooded with southern welfare claims and the locals up in arms about the anti social behaviour etc.

Irony if those southern HPI gains and my house is my pension etc transfers instead to the north and southern highly leveraged are left holding the baby.

[Hancock]

8 minutes ago, DurhamBorn said:

@Bobthebuilder we are on the edge of a boom up here its incredible whats flowing in.My dad was saying we should really buy 3 houses to rent out to leave to the grandkids and i must admit im thinking aout it.Only thing is id have to manage them and do the repairs etc.

I really wish what is coming up here wasnt in a way,our fantastic quality of life is going to go down some,loads of southerners etc.We are getting more and more immigrants and southern benefit scroungers as well because their housing benefit gets them a house up here.Already you can see the cheap ex pit villages being flooded with southern welfare claims and the locals up in arms about the anti social behaviour etc.

Irony if those southern HPI gains and my house is my pension etc transfers instead to the north and southern highly leveraged are left holding the baby.

It's going to be much worse than that, it'll result in the many 1000s of Teessiders scattered around the planet, who work in heavy industry coming back home for a job.

 

[AWW]

Shows how much things have changed DB. Not many having kids that young these days - most still getting themselves into life changing debt for a soft degree at 21. And not many in their 40s with spare rooms for parents, at least in my social circle.

[MrXxxx]

3 hours ago, AWW said:

Offspring can't "have their cake and eat it" though. If their parents go into a home, it needs to be paid for. And you can't expect someone with young kids at home to look after a pair of dementia patients. Quite often they don't have enough time after working to look after their own kids, never mind two more.

So why are they working so many hours?..to pay an overstretched mortgage?...whilst their parents are rattling about in a four bed house?...so why not combine households, reduced outgoings, and then reduce hours to allow time to care for family?....life is about choices, unfortunately a lot of people now put `things` before relationships, the difference being years after the former has gone in the dustbin you still have the latter (or the memories), it shouldn't be the other way around I.e putting your parents in the dustbin because you can't be bothered with the hassle, and a little personal sacrifice.

[reformed nice guy]

2 hours ago, sancho panza said:

Used Vehicle prices blow out, despite hedonic quality adjustments. A big driver in the durable goods CPI spike was the CPI for used vehicles, which exploded by 10.4% in April from March, a scary-crazy increase that we have seen for months in used-vehicle wholesale prices, which have blown out.

This chart shows the CPI as an index, not year-over-year percent-change, and so the Base Effect does not apply. Hedonic quality adjustments are heavily applied to used vehicles, as you can see from the astonishing fact that the index in 2020 was below where it had been 20 years earlier, even though actual prices of used vehicles have soared over those 20 years. It took this massive spike in April to put the index above where it had been in the year 2000:

 

I have seen this first hand.

Sheep farmer friend had an L200, about 10 years old, only 150k miles, sheep shit in every possible crevice. The chassis was fucked and held together by bodge weld jobs. He put it on Facebook market expecting £500, someone gave him £2600. They offered him £3100 but negotiated down when they saw it because the engine warning light was on and it had a light out.

They sent him a video a few days later because the chassis collapsed, middle of the truck touching the ground.

[AWW]

14 minutes ago, MrXxxx said:

So why are they working so many hours?..to pay an overstretched mortgage?...whilst their parents are rattling about in a four bed house?...so why not combine households, reduced outgoings, and then reduce hours to allow time to care for family?....life is about choices, unfortunately a lot of people now put `things` before relationships, the difference being years after the former has gone in the dustbin you still have the latter (or the memories), it shouldn't be the other way around I.e putting your parents in the dustbin because you can't be bothered with the hassle, and a little personal sacrifice.

I agree with you. If only it was that simple though. How many people live round the corner from their folks, who themselves are in a house with enough spare rooms and which aren't full of old crap that they won't get rid of? Uprooting kids from schools and leaving jobs to move in with those who need care is a bit more than a "little" sacrifice.

[AWW]

I guess the overarching point, which is more relevant to this thread than the discussion we're currently having, is that it was never sustainable for people to work for 35 years and then take a 35 year long retirement, with the last 10-15 years dependent on others for care. Even moreso when the generation providing support have to deal with the real terms wage decline, both parents having to work, and competition for housing that results from mass immigration of cheap labour.

It's the result of a litany of government and central bank policy failures stretching back many decades.

[Noallegiance]

55 minutes ago, DurhamBorn said:

@Bobthebuilder  

Irony if those southern HPI gains and my house is my pension etc transfers instead to the north and southern highly leveraged are left holding the baby.

Bring it on I say!

I'm very thankful that folk down here, instead of moving, are spending on extensions and kitchens.

Saves me doing it when I take it off them for a snip.

[MrXxxx]

27 minutes ago, AWW said:

How many people live round the corner from their folks, who themselves are in a house with enough spare rooms and which aren't full of old crap that they won't get rid of?

The parents are `dumped` in an old peoples home, followed within a couple of years by their crap being dumped in a skip...can't help but see the irony there, the `joys` of disposable societies in Developed countries...what price `progress` eh?!...next we will be told we can't show them affection for fear of spreading a deadly pathogen! :-)

[AlfredTheLittle]

1 hour ago, MrXxxx said:

The parents are `dumped` in an old peoples home, followed within a couple of years by their crap being dumped in a skip...can't help but see the irony there, the `joys` of disposable societies in Developed countries...what price `progress` eh?!...next we will be told we can't show them affection for fear of spreading a deadly pathogen! :-)

I've worked in old people's homes.... By the time somebody gets to that stage, they are in all honesty far better off dead, I hope neither my parents or me ever end up in a home.

The fundamental issue is probably the fact that so much money is made in keeping people alive as long as possible, whatever the cost in pain and suffering. Very similar to the whole covid thing of course. 

Of course people are still, just about, free to do what they choose, but as a general rule I can't see that much quality of life is gained overall through somebody sacrificing the years 50 to 70 in order to care for their 80 to 100 year old parents, I don't intend to do that myself.

[BWW]

On 11/05/2021 at 20:20, Castlevania said:

 

A. Fray Bentos comes in a tin

B. Hindu’s don’t eat beef

C. Indian food is excellent

D. Fray ....

[Talking Monkey]

6 hours ago, wherebee said:

If I get dementia I trust my eldest is smart enough to kill me in a relatively painless way.  Better all round.

 

Or did I say that already?

My dumbass nephews will have to have it spelled out with diagrams and detailed instructions. 

[DurhamBorn]

3 hours ago, AWW said:

I agree with you. If only it was that simple though. How many people live round the corner from their folks, who themselves are in a house with enough spare rooms and which aren't full of old crap that they won't get rid of? Uprooting kids from schools and leaving jobs to move in with those who need care is a bit more than a "little" sacrifice.

True,my dad lives in the next town,my daughter lives in my close ,my son three streets away,and my youngest daughter lives with a gypsy and owns land all over the place and would stick a static next to one of their barns and stick me in there.

My dad reckons once i start looking after my grandson when she returns to work we can go around the pubs with him as babies are great for pulling in the chicks,hes 81 

[Don Coglione]

59 minutes ago, DurhamBorn said:

True,my dad lives in the next town,my daughter lives in my close ,my son three streets away,and my youngest daughter lives with a gypsy and owns land all over the place and would stick a static next to one of their barns and stick me in there.

My dad reckons once i start looking after my grandson when she returns to work we can go around the pubs with him as babies are great for pulling in the chicks,hes 81 

Careful!

 

[harp]

4 hours ago, Noallegiance said:

Bring it on I say!

I'm very thankful that folk down here, instead of moving, are spending on extensions and kitchens.

Saves me doing it when I take it off them for a snip.

I’m South coast! Just exchanged on my house, which sold over the asking,£1.3m. Buying a probate for £400k. Needs probably at least £100k spent at current (covid rip off prices). Market  is fucking crazy for the upper end at the moment. Thought I’d take advantage of it! That money IS my pension as I’ll have no other apart from old age one. Time to focus the mind and spend wisely soon. 

[Lightscribe]

8 minutes ago, harp said:

I’m South coast! Just exchanged on my house, which sold over the asking,£1.3m. Buying a probate for £400k. Needs probably at least £100k spent at current (covid rip off prices). Market  is fucking crazy for the upper end at the moment. Thought I’d take advantage of it! That money IS my pension as I’ll have no other apart from old age one. Time to focus the mind and spend wisely soon. 

Well done. I applaud anybody who’s taken on the system and won. I remember you saying that you cashed out BTC too to pay off mortgage etc.

There may be others in your position, but few who understand the point in time we’re in, so will wade back into debt up to their eyeballs. You’ve hit the peaks on multiple fronts and you’ll be set up for what’s coming.

On HPC, WICAO managed to FIRE (and hats off to him), but in my mind he had no long term strategy going into an inflation environment (as he himself admitted he had no crystal ball, just chuck everything into a mix of funds and ride the wave)

[Harley]

6 hours ago, DurhamBorn said:

I had my first daughter at 21,her mam was 18 by two days,beautiful looking girl,still a fab looking woman now.I had my next two at 25 and 29 .Any one of my kids would move my dad in with them tomorrow as would i or my brother and i know my kids would do the same for me.I dont think people did vote for these policies at least up here.I dont know anyone up north who gave a shit about how much their house was worth up until 2004 and southern BTL moved in buying up all the terrace houses up here. .However,down south my uncle was forever going on about how much his house was worth.Now his two daughters cant afford to buy.

The people who did vote for where we are were welfare scroungers and a large chunk of public sector workers.The worst part is,for now they are the groups protected from rising inflation with inflation linked benefits and pensions.

Indeed.  I will look after all my family regardless.  I love them, owe them, and it's the right thing for me to do.  Especially after seeing the recent care home fiasco.  What goes round comes round, although there'll be few left for me.  Ignoring the decency stuff, and the demonising of swathes of people to make it more palatable, those who plan differently will no doubt add the costs of their own care to their financial plans for when their time comes.  I won't be assisting in those plans.  TPTB must be chuffed with their progress in creating a lonely bunch of losers, which is what will happen.

[Bricormortis]

I have had a bit of info off a  professional Technical Analyst. He reckons GDX has broken out of a 9 month downtrend channel, retested and should rise. Higher highs and higher lows expected. Caveat, depends a bit on the gold price which is testing resistance at the top of its downtrend channel.

He sees Yamana pulling back then goes to the stars.

Lets see if he is right or wrong. Not financial advice.

[harp]

8 minutes ago, Bricormortis said:

I have had a bit of info off a  professional Technical Analyst. He reckons GDX has broken out of a 9 month downtrend channel, retested and should rise. Higher highs and higher lows expected. Caveat, depends a bit on the gold price which is testing resistance at the top of its downtrend channel.

He sees Yamana pulling back then goes to the stars.

Lets see if he is right or wrong. Not financial advice.

It wasn’t David Hunter was it? 🤔

[Bricormortis]

25 minutes ago, harp said:

It wasn’t David Hunter was it? 🤔

Ha no, dont believe he a tech either. If that was his call atm I would maybe sell and run for the hills

[Hardhat]

1 hour ago, Bricormortis said:

I have had a bit of info off a  professional Technical Analyst. He reckons GDX has broken out of a 9 month downtrend channel, retested and should rise. Higher highs and higher lows expected. Caveat, depends a bit on the gold price which is testing resistance at the top of its downtrend channel.

He sees Yamana pulling back then goes to the stars.

Lets see if he is right or wrong. Not financial advice.

Any particular reason why for Yamana?

GDX allocation to Yamana is fairly small at 1.57% so some direct exposure might be good if there a a compelling case.

[Bricormortis]

12 minutes ago, Hardhat said:

Any particular reason why for Yamana?

GDX allocation to Yamana is fairly small at 1.57% so some direct exposure might be good if there a a compelling case.

I dont know what the reasoning is based on fundamentals. 

[DurhamBorn]

Yamana looks really cheap to me and iv been buying.It also owns a huge gold/copper deposit about to be developed.12 billion of copper minimum in that project and a good few million oz of gold.

It sold one of its mines far too early,but that did clear debts.

Harmony also has a huge copper project ,but it looks a long way from being built.

[Harley]

1 hour ago, DurhamBorn said:

Yamana looks really cheap to me and iv been buying.It also owns a huge gold/copper deposit about to be developed.12 billion of copper minimum in that project and a good few million oz of gold.

It sold one of its mines far too early,but that did clear debts.

Harmony also has a huge copper project ,but it looks a long way from being built.

Lots to like with fundamentals and technicals typical of its cohort.  Main downside to me is the 2% yield as 3% is my minimum.  Maybe I need to be flexible this one time!  Or stick with the higher yielders I currently hold.

[Harley]

Anyone using the Dragon portfolio and how did you go about implementing it as a UK retail investor?