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

[Bobthebuilder]

11 hours ago, Cattle Prod said:

Here you go. Using anything else is a waste of time:

Pre WW2 farmers mainly used horses to work the fields, it took a long time, hard work etc. It was a struggle to get all the wheat cut in the autumn, land ploughed and replanted before the next year's 8th of April, it was too late after that.

Post-war tractors were in use, the biggest change in farming since Anglo-Saxon times was the internal combustion engine.

These days they cut the wheat, work the land and next year's green shoots are growing before winter sets in.

I'm sure you have all seen the farmers burning the wheat stubble in fields now. They cut it long these days, they don't need so much straw any more (fewer horses see). So, they just burn it. They can afford to waste all that energy just going up in smoke.

[geordie_lurch]

I have a feeling this winter is going to be the darkest any of us have faced in our lifetimes due to shortages of energy, health, decent healthcare and empathy

 

[planit]

45 minutes ago, Hancock said:

I now need my savings to rise by 30% to buy a house that i could have got a few years ago.

Hence in the situation i'm in, and with the stock market at these levels, its more like gambling as opposed to investing to catch up.  Waiting for a BK seems to be a gamble between losing more to inflation for the chance of a big win, and its probably where i'm at.

I looked at putting 10/20k in major silver miners  at todays prices, but then see silver price is about 50% higher than what its been for most the last decade (with a potential bust on the horizon)... so decided to pass for now!

 

I think you need to try make sure your emotions are not driven by the emotions of the market. You want to be separate from it or kind of out of phase.

 

The way I see it is I try to work out what I think fair value is (ie for silver, is demand going to rise or fall over the next 3 years).

Then I look at market sentiment and see how much it is affecting the value of something I am interested in (ie a silver miner)

The worse the sentiment is and the more it is affecting the market price the happier I am because my risk is lower, I am buying at a steep discount.

 

After taking the plunge you end up at the difficult stage which is to trust your valuation more than what the market is saying (ie everyone posting that silver is worth $10 and the miner will half in value). Eventually the value will out.

In the mean time keep relooking at your analysis, has anything changed, be critical.

 

The reason I am so bullish on oil companies is that the negativity (in my opinion) has reached religious levels, people are blinded and deluded, they won't even look at evidence in their face. This doesn't happen very often so I am trying to take full advantage.

The spill-over from this movement leads to ESG pensions and funds which then has a knock-on affect to tobacco (as they can't invest in it) and others. I don't own any tobacco stocks currently but I do want to (they don't have the squeeze trigger that energy currently has).

 

Anyway, don't be too hard on yourself, read up as much as you can on market psychology and don't listen to anyone on this thread  

 

ps I assume you don't have a reason silver might drop 50% over the next year but if you do then please let us know. 

 

 

[Hancock]

2 minutes ago, geordie_lurch said:

I have a feeling this winter is going to be the darkest any of us have faced in our lifetimes due to shortages of energy, health, decent healthcare and empathy

Dangerous business getting involved in street fights

2 minutes ago, planit said:

ps I assume you don't have a reason silver might drop 50% over the next year but if you do then please let us know. 

Silver could fall 50% if there is a BK! 

I'm quite happy with how ive invested the money in my SIPP, irony is i was happy with my averages in BP/RDSB 290/1250ish,  and stupidly bottled buying with my house money last month at similar levels.

That is my dilemma in that SIPP money feels like monopoly money as its left for the future, other money is real!

Worst case scenario is if there isn't a bust, i'd have to work for 6/9 months (full time) to cover losses, if there is a bust i'd have the option of not having to work again.

[ThoughtCriminal]

I'd say that sums it up. 

 

The level of complacency is off the charts. 

[Don Coglione]

47 minutes ago, Bobthebuilder said:

Pre WW2 farmers mainly used horses to work the fields, it took a long time, hard work etc. It was a struggle to get all the wheat cut in the autumn, land ploughed and replanted before the next year's 8th of April, it was too late after that.

Post-war tractors were in use, the biggest change in farming since Anglo-Saxon times was the internal combustion engine.

These days they cut the wheat, work the land and next year's green shoots are growing before winter sets in.

I'm sure you have all seen the farmers burning the wheat stubble in fields now. They cut it long these days, they don't need so much straw any more (fewer horses see). So, they just burn it. They can afford to waste all that energy just going up in smoke.

Stubble burning was banned in the UK in 1993. As a kid, it was great fun tearing around a stubble field in a Land Rover, towing a burning tyre!

The unwanted straw is usually chopped up by the combine, then ploughed in with the stubble.

[HousePriceMania]

1 hour ago, Hancock said:

I now need my savings to rise by 30% to buy a house that i could have got a few years ago.

 

I know, and some cheeky **** has the audacity to say we're all cheeky ****s.

 

[Barnsey]

New Poundland branding...

[BadAlchemy]

Damn, missed it again. What goes up must come down with a thud!

 

[Bobthebuilder]

17 minutes ago, Don Coglione said:

Stubble burning was banned in the UK in 1993. As a kid, it was great fun tearing around a stubble field in a Land Rover, towing a burning tyre!

The unwanted straw is usually chopped up by the combine, then ploughed in with the stubble.

At my age, I still think of the 90s as relatively recent.

[Barnsey]

1 minute ago, BadAlchemy said:

Damn, missed it again. What goes up must come down with a thud!

 

Lost Southeastern franchise as someone was a tad naughty with £25 million 

[Don Coglione]

2 minutes ago, Bobthebuilder said:

At my age, I still think of the 90s as relatively recent.

You remember the 90s?!

[Noallegiance]

5 minutes ago, BadAlchemy said:

Damn, missed it again. What goes up must come down with a thud!

 

Shit the fuckin bed that's the first time I've timed anything that well.

Sold all my Go Ahead yesterday in the green.

That's made my day. In an non-gloating sympathetic kinda way.......ahem.......

[Talking Monkey]

44 minutes ago, Hancock said:

Dangerous business getting involved in street fights

Silver could fall 50% if there is a BK! 

I'm quite happy with how ive invested the money in my SIPP, irony is i was happy with my averages in BP/RDSB 290/1250ish,  and stupidly bottled buying with my house money last month at similar levels.

That is my dilemma in that SIPP money feels like monopoly money as its left for the future, other money is real!

Worst case scenario is if there isn't a bust, i'd have to work for 6/9 months (full time) to cover losses, if there is a bust i'd have the option of not having to work again.

I do think a bust is coming everything is ratcheting up to that point. So there'll be opportunity to enter into the long term investments at decent entry points. 

[Barnsey]

17 minutes ago, Noallegiance said:

Shit the fuckin bed that's the first time I've timed anything that well.

Sold all my Go Ahead yesterday in the green.

That's made my day. In an non-gloating sympathetic kinda way.......ahem.......

The stubborn contrarian in me is now wondering if I should start buying back in, ditched rail, can solely focus on buses now with an ageing population and increasing car costs 

[moneyscam]

48 minutes ago, ThoughtCriminal said:

I'd say that sums it up. 

 

The level of complacency is off the charts. 

I've been warning one particular friend who has swallowed the 'green economy' kool aid that green policies are economic illiteracy of the highest order and that he'll be starving or freezing to death far earlier than any worst case 'climate crisis' doom he can imagine. Falls on deaf ears of course as he imbibes CNN (!) as a trustworthy news source.

These chickens of green brain dead policies are only just starting coming home to roost and yet our governments are ploughing full steam ahead like mindless lemmings. If a simple economist like myself can see these things then so can committees of government apparatchiks so that leads one to question their motives. IMO theses are designed for future rationing and thus more control over the populace amongst the other measures they have implemented and will implement. I've long argued the next vector of govt control after covid will be the 'climate crisis' agenda and from where I'm standing these are the opening salvos.

[Hardhat]

1 hour ago, ThoughtCriminal said:

The level of complacency is off the charts. 

I spent 130 quid on a delivery of logs last week that should last me past Christmas. Two hours moving, sorting and stacking them but now theyre safely stored. I wonder what the price will be for the same delivery in January.

[Noallegiance]

LNG up 7.5% this morning.

Bigger spikes in 2000 and 2007, but we're on the runway.....

[Barnsey]

Couldn't have said it better myself 

 

[TNS]

If shell hits 18 I’ll be tempted to offload a few 

[Talking Monkey]

25 minutes ago, Barnsey said:

Couldn't have said it better myself 

 

He is proper funny, I pissed myself laughing at his intro

[DurhamBorn]

2 hours ago, geordie_lurch said:

I have a feeling this winter is going to be the darkest any of us have faced in our lifetimes due to shortages of energy, health, decent healthcare and empathy

 

Best winter i think for me.Since leaving work iv had the dumbbells out,loads of fast long walks,diet superb,lots of homemade soups etc,just had a broccoli one with seeded wholemeal bread,expert with the number 2 buzz cut now myself so a little sunbed sesh and some lovely white shirts and il be good to go, the cleaners in the bars in Durham will need to follow behind the women with a mop  ,and those girls in the vid would go down  easily,a little violence now and again is a good thing.

We are contrarians,we are prepared and il convert a few Durham Uni freshers over the next few months.

 

[Harley]

13 hours ago, macca said:

Labour did not really create any debt it was fairly flat on borrowing though the Blair years,, (I don't like Blair and never voted for him)

The financial Crisis caused all of the borrowing. (Banker fraud). But under Tories the borrowing has never ended and the debt has gone out of control whilst everything has been fucked to death and all of the money sent to corporations, friends, family and donors..

We have been asset stripped! in 11 years of Tory

40'000 less nurses 

22'000 less police

700 less police stations

23'500 less back of house police

97% of all rapist now just walk free..

They closed courts

They privatised prisoner rehabilitation to a mate and re offending rates jumped 70%

7000 less firemen

Less fire stations 

Council budgets cut 49.5%

adult social care destroyed

Legal aid destroyed 

sold everything including ramping up NHS destruction to private vultures of big USA corporations and offshore tax avoiders like virgin care that pays 0% tax

GP surgeries sold to USA firm with terrible record for care

and on and on

But they kept borrowing? where did the £1.6 trillion go?

Tories are criminals.. I hate Blair but this is legalised corruption now

While the population has gone up to suppress wages.  Feck all polos.

[JMD]

10 hours ago, sancho panza said:

But people buy junior PM miners to try and hedge CB incompetence and maintain their spending power.Seems perfectly reasonable and logical to me to try and give yourrself some leverage to the gold price if you think currncies could crash hard.

Interesting discussion SP, and exactly right, but can also expand this out i think, beyond the purely financial... 

After all, this thread is all about the Hedge, hedge, hedging (plus leveraging, if want to be pedantic). Moreover, unless i've got @DurhamBorn wrong, he frequently drops hints/anecdotes about how he repeatedly does this (hedging/leveraging) in his personal life - including for example his own joke? about his partner being a carer... for just in case he needs personal care later in life! (DB i hope i'm not maligning you or your better half - you have joked and written about this haven't you!?).

Perhaps i'm over thinking this... But the thread thesis - as i understand and appreciate it - is that employing a 'hedge fund' mentality to life is a practical and powerful strategy. I'm using the hedge fund metaphor in its 'traditional' macro-market/containment-of-risk sense. I don't of course mean operating an actual investment hedge fund. Instead, its more about how to achieve a successful/fulfilling/meaningful approach to life - perhaps think 'Zen and the Art of Hedge Fund Maintenance'. 

(I think there's a book in this stuff DB, please do consider writing one, gotta be a next-cycle best-seller!!)

[NogintheNog]

30 minutes ago, TheNickos said:

If shell hits 18 I’ll be tempted to offload a few 

I have done that at £15.20, then bought back BP a few weeks later. Was only a £1000 profit from my lowest ladder last year and I also bought some more of the City of London investment trust with the proceeds and some other ISA cash sitting there earning sweet FA!

That's the problem if you crystallise the gain where do you put it, unless of course you think the BK is very close....