Jump to content
DOSBODS
  • Welcome to DOSBODS

     

    DOSBODS is free of any advertising.

    Ads are annoying, and - increasingly - advertising companies limit free speech online. DOSBODS Forums are completely free to use. Please create a free account to be able to access all the features of the DOSBODS community. It only takes 20 seconds!

     

IGNORED

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


spunko

Recommended Posts

11 hours ago, Names Is For Tombstones said:

Always fancied Barnard Castle. Been trying to talk the wife into it.

I worked there for 10 years for Glaxosmithkline.Lovely place.

Link to comment
Share on other sites

  • Replies 35.1k
  • Created
  • Last Reply
38 minutes ago, DurhamBorn said:

Historically low interest rates, which allow the government to borrow money relatively cheaply, were "almost a signal to me from the market - from investors - that here's the cash, use it to do something productive", Mr Javid said."

WTF.  He's talking (signalling) to himself then!

38 minutes ago, DurhamBorn said:

We should be very well placed on this thread to navigate.

Turning that into a practical watchlist is a very big jump though!!!!!

I'll do you a deal:  you suggest what to buy and I'll suggest when!

Link to comment
Share on other sites

44 minutes ago, Harley said:

WTF.  He's talking (signalling) to himself then!

Turning that into a practical watchlist is a very big jump though!!!!!

I'll do you a deal:  you suggest what to buy and I'll suggest when!

That is exactly what the market is saying.He is right and the right action is to take the cash now as long as its for investment not spending on welfare etc.He wont do enough at first of course as its likely they will print maybe a trillion.What he does alone in the UK isnt what will drive inflation,its the fact everyone else will follow.EU,US,China,everyone.The world is looking down the barrel of a deflation that guts the fabric of society.They need inflation,and they will get it,but as always they will over cook.

I have ladders in all these stocks below i expect to gain from the cycle ahead.Some of them are from cross market work.Cargotec for instance make forestry machines and port machines.Chems with exposure to the chems for oil drilling and farm animal food/boosters etc.I have lots of other shares, like big tobacco again etc,but they are for other reasons,income,balance etc.Im still adding to the below and opening ladders as i only have around 60% of capital allocated if the ladders all hit.So looking to add probably another 20 companies yet plus around 12 PM miners in i re-enter them.Iv quite a few other stocks like SSE etc,but i havent added them as they are already up 40% and i have no ladders set in them.

Telcos

Vod,BT,Telia,Telefonica,

Oil,

BP,Shell,Repsol ,Plains All American Pipeline,Southwestern Energy Company (SWN) Schlumberger,Vermillion Energy inc NPV,DPM Midstream

Potash etc

K+S ,Mosaic Co,OCI NV ,Intrepid Potash Inc (speculative but also produces langbeinite and de-icing for oil wells etc)

Transport,

Stagecoach, Go ahead,Cargotec Corporation,Royal Mail,Halfords (bought a tiny stake this week)

Chems

Evonik Industries,Solway SA

Steel

SSAB Svenskt Stal AB Ser B NPV 

 

 

 

 

Link to comment
Share on other sites

2 minutes ago, DurhamBorn said:

That is exactly what the market is saying.He is right and the right action is to take the cash now as long as its for investment not spending on welfare etc.He wont do enough at first of course as its likely they will print maybe a trillion.What he does alone in the UK isnt what will drive inflation,its the fact everyone else will follow.EU,US,China,everyone.The world is looking down the barrel of a deflation that guts the fabric of society.They need inflation,and they will get it,but as always they will over cook.

I have ladders in all these stocks below i expect to gain from the cycle ahead.Some of them are from cross market work.Cargotec for instance make forestry machines and port machines.Chems with exposure to the chems for oil drilling and farm animal food/boosters etc.I have lots of other shares, like big tobacco again etc,but they are for other reasons,income,balance etc.Im still adding to the below and opening ladders as i only have around 60% of capital allocated if the ladders all hit.So looking to add probably another 20 companies yet plus around 12 PM miners in i re-enter them.

Telcos

Vod,BT,Telia,Telefonica,

Oil,

BP,Shell,Repsol ,Plains All American Pipeline,Southwestern Energy Company (SWN) Schlumberger,Vermillion Energy inc NPV,DPM Midstream

Potash etc

K+S ,Mosaic Co,OCI NV ,Intrepid Potash Inc (speculative but also produces langbeinite and de-icing for oil wells etc)

Transport,

Stagecoach, Go ahead,Cargotec Corporation,Royal Mail,Halfords (bought a tiny stake this week)

Chems

Evonik Industries,Solway SA

Steel

SSAB Svenskt Stal AB Ser B NPV

Ta. I'll run me eye over them and get back.  Plus hopefully add to the list.  I also need to do some dissecting of ETF holdings like Sancho.  I've been busy (still am) on other stuff (this incessant rain and windy cold snaps makes things really hard) so have taken my eye off the ball.

 

Link to comment
Share on other sites

On 16/01/2020 at 08:22, feed said:

How do you find those places.  I'm about 18months - 2yrs from FIRE.  And potentially looking to do something similar.   

Any questions on setting up and living such a rural (and increasingly self sufficient) lifestyle.......!!!!!!

PS:  But just between the two (three?) of us!!!!!

Link to comment
Share on other sites

1 minute ago, Harley said:

Ta. I'll run me eye over them and get back.  Plus hopefully add to the list.  I also need to do some dissecting of ETF holdings like Sancho.  I've been busy (still am) on other stuff (this incessant rain and windy cold snaps makes things really hard) so have taken my eye off the ball.

 

I own about 30 other stocks,but they are for different reasons.I should add the likes of Drax to the above.For anyone thinking of just going and buying the above its crucial to remember some or even all of the above might/will suffer more before things get going.Leads and lags make a massive difference and it will take a long time for thing to feed through,at least 18 months from here and that could see big downside.Its why i have ladders in place.I also have much different allocations.Id happily own 3% in Shell,but only 0.3% in Halfords for instance.

It would be useful though if you could look at the technicals and perhaps give buy signals for people.It would help people with smaller amounts (or bigger amounts) who want to build a portfolio without ladders and with each company an outright buy.See what you come up with.

Link to comment
Share on other sites

On 15/01/2020 at 09:38, sancho panza said:

Absolutel;y.we're nearly the same age and I can't believe how long  the madness has gone on for......

You star! 

I've been looking for ONS income and wealth data but gave up.  Seems they moved to biannual. 

However, they now report a "feelings" index which like any govt index (CPI) is open to statistical shite! 

But, they linked to the real stuff for wealth, debt, and pensions.  I posted some on the "It's all about me" thread to try and inject a bit of objectivity into the discussion, albeit probably not wanted! 

But very useful for anyone doing macro stuff or wants to benchmark themselves as part of some financial planning.

Link to comment
Share on other sites

50 minutes ago, Harley said:

You star! 

I've been looking for ONS income and wealth data but gave up.  Seems they moved to biannual. 

However, they now report a "feelings" index which like any govt index (CPI) is open to statistical shite! 

But, they linked to the real stuff for wealth, debt, and pensions.  I posted some on the "It's all about me" thread to try and inject a bit of objectivity into the discussion, albeit probably not wanted! 

But very useful for anyone doing macro stuff or wants to benchmark themselves as part of some financial planning.

Your post was quality 

Link to comment
Share on other sites

2 hours ago, DurhamBorn said:

 

It would be useful though if you could look at the technicals and perhaps give buy signals for people.It would help people with smaller amounts (or bigger amounts) who want to build a portfolio without ladders and with each company an outright buy.See what you come up with.

This would be amazing for me as I'm thinking of transferring the four different private pensions I have into cash soon and start feeding them into this kind of thing.

It's not much but I don't want to lose it in a cycle turn and leave it to fund managers to reallocate what's left.

Link to comment
Share on other sites

18 hours ago, Democorruptcy said:

Probably trying to support the bottom of the housing market 4.5x joint income etc. To them house prices are THE economy.

Or reducing in work  bennie payments.

Link to comment
Share on other sites

TheCountOfNowhere
7 hours ago, DurhamBorn said:

See how its all turning out as we said over two years ago.The dis-inflation cycle ending is forcing the hands of governments.We wont be alone,the EU will follow and then the US and of course China.Javid is 100% right that the market is sending them a signal to spend on infrastructure.Its actually really good for the UK if he kicks this in quickly and might help us compared to the EU etc and before the input prices go up by large amounts.The message is clear and the road map is clear.Inflation might have one last fall,perhaps into outright deflation,but then it turns and heads up.The only question is how high.Low range says 8% by 2027,high range says 16%.

Im really pleased to see the government start to openly say all this.It shows our macro models showing the road map are on track.The reflation is now almost certain.We should be very well placed on this thread to navigate.

 

"Mr Javid said the extra growth would come from spending on skills and infrastructure in the Midlands and the north of England - even if they did not offer as much "bang for the buck" as projects in other parts of the country.

Historically low interest rates, which allow the government to borrow money relatively cheaply, were "almost a signal to me from the market - from investors - that here's the cash, use it to do something productive", Mr Javid said."

The dis inflation is ending? 

When did it start? 

Link to comment
Share on other sites

I still like such a phoney reading this thread!

It's like knowing all the materials needed to build a house are called down to types of brick and cement and no idea of what to do with them xD

Link to comment
Share on other sites

Bobthebuilder
6 hours ago, DurhamBorn said:

It would be useful though if you could look at the technicals and perhaps give buy signals for people.It would help people with smaller amounts (or bigger amounts) who want to build a portfolio without ladders and with each company an outright buy.See what you come up with.

This would be interesting for some of us i think. Im starting to build my SIPP and will buy stocks in £1k blocks as a long term hold.

Not taken as advice of course DYOR and all that, i will buy stuff i like anyway but would be nice to see a general direction of group mind thinking.

Thanks everyone as always.

Link to comment
Share on other sites

2 hours ago, Bobthebuilder said:

This would be interesting for some of us i think. Im starting to build my SIPP and will buy stocks in £1k blocks as a long term hold.

Not taken as advice of course DYOR and all that, i will buy stuff i like anyway but would be nice to see a general direction of group mind thinking.

Thanks everyone as always.

The stocks i put up above im buying them all in ladders.Lots more to add and hold lots of other stocks but its a good start to a reflation portfolio,we just cant know where they all bottom.Im confident as a whole they will hugely outperform the indexes,bonds and inflation by 2027.

Link to comment
Share on other sites

TheCountOfNowhere
8 minutes ago, DurhamBorn said:

1982

1990 had higher inflation that 1982.

2011 higher than 1983/1984.

Its all over the shop. 

Given they make up the numbers we could be anywhere. 

Add housing into the mix and inflation been through the roof since QE started. Highest inflation in British history perhaps. 

Nothing makes sense in the land of unregulated banker money printing madness. 

One things for sure, they're going to try and avoid the liquidity trap by spending on infrastrucutre. 

They are assuming we are living in normal times. Maybe we are maybe we're not. 

Am I right in saying... This dis inflation will end with inflation... Which will cause deflation {in asset prices} ? 

No wonder no one's got a clue what's going on. 😀

Link to comment
Share on other sites

48 minutes ago, TheCountOfNowhere said:

1990 had higher inflation that 1982.

2011 higher than 1983/1984.

Its all over the shop. 

Given they make up the numbers we could be anywhere. 

Add housing into the mix and inflation been through the roof since QE started. Highest inflation in British history perhaps. 

Nothing makes sense in the land of unregulated banker money printing madness. 

One things for sure, they're going to try and avoid the liquidity trap by spending on infrastrucutre. 

They are assuming we are living in normal times. Maybe we are maybe we're not. 

Am I right in saying... This dis inflation will end with inflation... Which will cause deflation {in asset prices} ? 

No wonder no one's got a clue what's going on. 😀

https://www.macrotrends.net/2016/10-year-treasury-bond-rate-yield-chart

Treasury Bonds are the key, not the inflation stat.  Worldwide commodities are in $.

Its already flattened off around 2%.

Link to comment
Share on other sites

1 hour ago, TheCountOfNowhere said:

1990 had higher inflation that 1982.

2011 higher than 1983/1984.

Its all over the shop. 

Given they make up the numbers we could be anywhere. 

Add housing into the mix and inflation been through the roof since QE started. Highest inflation in British history perhaps. 

Nothing makes sense in the land of unregulated banker money printing madness. 

One things for sure, they're going to try and avoid the liquidity trap by spending on infrastrucutre. 

They are assuming we are living in normal times. Maybe we are maybe we're not. 

Am I right in saying... This dis inflation will end with inflation... Which will cause deflation {in asset prices} ? 

No wonder no one's got a clue what's going on. 😀

Those are all business cycle moves withing a long term cycle.The US long bond topped out around 1982.Since then we have been in a dis-inflation cycle.Rates have trended lower and assets that increase in value with lower rates (houses for instance) have increased in price to assume the rates will remain where they are now.Houses are priced on rates at 0.5% (or actually around 2% mortgage rates).Road maps are so we can ignore mid cycle moves (or trade them with cross market work).

For instance Broccoli in 2007 was 180 on the RPI index.December it was 189.In 12 years its increased in price by around 5% or 0.4% a year.The rate of price increases fell to almost nothing.

The only real inflation in the system for a long time has been increased taxes and government spending.They have mostly gone into imports for consumption and China mostly has swallowed the dis-inflation.Thats all about to change.I think the dial will swing back all the way to 1982,perhaps past,but at the very least half way would be 7% on the long bond and 6% inflation on the CPI.That is the minimum target by 2028,though i expect much higher.

Input costs have started to rise over the last 18 months as the cycle is ending and that is seeing margins crushed.This disinflation will end with a debt deflation as is happening now and then a full on inflation cycle.Its that nobody expects and hardly anyone is positioned for.

47 minutes ago, Majorpain said:

https://www.macrotrends.net/2016/10-year-treasury-bond-rate-yield-chart

Treasury Bonds are the key, not the inflation stat.  Worldwide commodities are in $.

Its already flattened off around 2%.

Thats right,and the long bond is the key,the Fed plays around a lot with the shorter dated stuff.

Link to comment
Share on other sites

9 hours ago, DurhamBorn said:

For instance Broccoli in 2007 was 180 on the RPI index.December it was 189.In 12 years its increased in price by around 5% or 0.4% a year.The rate of price increases fell to almost nothing

Now I understand...seriously!...I have been struggling with the concepts on here from the beginning (despite going away and reading up), and thinking I get it only to find myself confused again...now with the Broccoli example I understand finance :-)

Link to comment
Share on other sites

Archived

This topic is now archived and is closed to further replies.

  • Recently Browsing   0 members

    • No registered users viewing this page.

×
×
  • Create New...