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


spunko

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37 minutes ago, Yellow_Reduced_Sticker said:

...This has gotta be the MOST contrarian article on Oil yet, I'm filling me boots!:Jumping:

IF Motley Fool were so smart ...WHY do they sell investment advice/newsletters?
 
From what ive seen Motley Fool get it MORE WRONG than correct with there tips!:P

AS EVER: DYOR!

Too right, what do they plan on filling their cars with in the next 5-10 years?  Unicorn farts?

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Fortuna Silver with 2020 guidance. Arguably not a silver miner anymore, but with 8mil oz silver and 110koz gold (production mid-points) this year at silly AISC it should be way, way higher.

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17 hours ago, sancho panza said:

My plan is to sell when the G+S ratio hits 40 or less or when I poop my pants.

40? Wow, I was eyeing 65-70 range and I thought I was being overly optimistic.

At 1800 gold, G/S ratio of 40 would equate to $45 silver. I'm all for it, but seems a touch unlikely.

It's a different story if your plan it so see through any dips or even a mid-term bust and hold all the way to 2025-2030.

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GOLD!!!!

Russia has bombed the Turks in Syria and got a few kills

Turks now crying to the Yanks for patriot missile systems to fight off the Ruskies!

Blimey WWIII here we come :S

And guess what???

DOW DOES NOT GIVE A SHIT!!!!

Trend IS your friend citizens xD

 

btfd.jpeg

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18 hours ago, Yellow_Reduced_Sticker said:

^^Love this!:D

DB, I have to get into the Metal Detecting game, as can't keep paying the weekly £7.50 for fish&chips here in the cotswolds!
 
With all the talk about hydrogen did a search and an interesting article from investors chronicle came up, Some of their tips did very well one hydrogen company did over 500% in 1 year!
 
HOWEVER you have to subscribe, well bugger 'em, ...i ain't paying :Old: used to read this back in the day for FREE in the library!
 
anyway think i found a way to read it for FREE!!! (it worked in firefox)
 
STEP 1/ Google "investorschronicle.co.uk hydrogen"
 
STEP 2/ click the end of link arrow and it will say: Cached
 
STEP 3/ click Cached
 
Voila :Jumping:...YOU can read said article for free, this may even work for FT and other news/mags etc... Another GREAT money saving TIP for us tight-wads on this FABULOUS Thread!
 
 
 
image.jpeg.11c13ae7e8a7be8a1c0aef46562f3410.jpeg
 
 

thanks YRS - that worked for me.

 

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19 minutes ago, kibuc said:

40? Wow, I was eyeing 65-70 range and I thought I was being overly optimistic.

At 1800 gold, G/S ratio of 40 would equate to $45 silver. I'm all for it, but seems a touch unlikely.

It's a different story if your plan it so see through any dips or even a mid-term bust and hold all the way to 2025-2030.

2020-Weak $ phase,gold up,silver up a lot more in per centage terms.

2021-G/S ratio hits sub 50 ergo we sell PM miners.Buy UST's,Big kahuna hits the beach at high tide.Sell UST's.

2022 Buy back PM miners

2025 Sell PM miners when G/S ratio goes sub 40.

That's my plan A.

Plan B is jsut to sit in PM mienrs till 2025.

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18 hours ago, sancho panza said:

I'm awaiting the full Q4 figures being posted  before doing any SCS scores as the latest data they're based on is 2018 for the whole ETF stuff. I do have a look at Q1- Q3 data for 2019 for companies I'm looking at buying but for comaporing across ETFs I use the full year data. So less acurrate but a better gauge of who's where.

I'll do them on computer this time(but I'm at Uni for 6 months so research time a little limited)

thanks SP, I remember now you mention about needing the Q4results/yearly data (apologies for pestering)

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Breaking news:

THE DOW is currently experiencing a 'SIZEABLE DUMP' of over 200 pips

So maybe 'The trend is your friend until the bend at the end' O.o

Confused, over and out.....

UPDATE: DOW HAS SHIT THE BED, DOWN OVER 400 PIPS

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14 hours ago, Cattle Prod said:

I do. I'm pretty much 100% gdxj apart from 3-4 fun companies (and fres/hoch/poly in my limited selection sipp). I appreciate the work the guys do on here, but I don't have the time for dd. I too sold Sib, but kept Harmony. So thats ok. Still have a little punt on Northern Dynasty minerals. That mine is big enough to float the Alaskan state budget which is suffering from loss of oil revenue. I can't see how it won't get sanctioned, realpolitik wise.

CP, Interesting info. that regarding Northern Dynasty, I have small amount in them. I sent a list of miners to Sprott (the PM fund manager) a few months back (posted their replies on here somewhere). Sprott were offering a free analysis of miners. I thought why not, so sent them a random list, but unfortunately their 'succinct analysis' of said miners was not that helpful, e.g. for Northern Dynasty they wrote 'uneconomic'. Anyway as I say I kept my holding in them, which comprises part of my very small allocation to high-risk PM miners. 

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4 hours ago, Majorpain said:

Too right, what do they plan on filling their cars with in the next 5-10 years?  Unicorn farts?

Actually that could explain a lot... I had always thought Gretta T. looked somewhat constipated! 

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29 minutes ago, Cattle Prod said:

Agree with you there, it's become contrarian for me. Look at Shell's dividend history, through wars, the GFC, its rock solid. Of course the past is not necessarily a guide to the future, and thats the "its all over" narrative. But as I've said, the energy future will belong to those with the cash. Tesla? Nah. Shell? Yep.

How much debt is Shell carrying? I believe BP has about $66billion, how are they going to 'roll that over' if interest rates increase?*

Tesla, yes lol loads debt - actually just googled it and *only* $13 billion xD

The stock market is so warped cos so many yankie corporates got involved in 'share buybacks' ie witness Apple, one mofo of a successful business with loadsa 'cash in the bank' so why not invest it in buying your own shares? (I think this is bloody twisted too lol) :Jumping:

The energy business is not so clear cut anymore with ncov on the rampage.....supply chain issues, millions dead, the demand might not be there for years to come????

*I think they can probably keep interest rates down forever as well, look at Japan.....ok I know they're not the reserve currency but the central bank prints the money, the government buys everything! :P

 

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6 hours ago, sancho panza said:

Which options did you get?I've had a look jsut now and can't find any.I'd be happy to buy options on FCG etc but none listed I presume because it's an ETF

Can you buy any on gold?

I trade a lot of GLD options on Interactive Brokers.  The /GC futures contract is a little big for me. The underlying GLD ETF still doesn't have the KIID document so you can't buy it directly, but the KIID restrictions don't apply to options. You can even "buy" GLD by selling an ITM put option and waiting for it to be exercised.

Gold tends to have a lot of false breakouts, so I've been having decent success in my options selling account over the last few months shorting calls against a long GLD position ( for bullish bias) and a couple of short puts for extra theta decay and further bullishness.

I'm also long some 150 march calls in my speculative account. They're full of premium right now as they're just in the money, so a dip will mean they lose money pretty quickly, so I'm slowly laddering out of these as the rally progresses, and selling short term ( 1 week ) calls against them, to counter the decay of the long calls.

 

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37 minutes ago, Cattle Prod said:

Something similar I think or a little higher. But Shell was doing I think 40bn a year in fcf last time energy prices were high. Thats what I'm buying for. I think thell easily handle it.

Ok cool that's a decent turnover :P

Jan 2016 they hit 1350p any idea what caused that? I'm defo a buyer there....50p stop loss ;)

Edit: to answer my own question I remember now diesel dipped to less than 1€ a litre in Europe.....and the £ was strong so it was incredibly cheap to travel around....

Don't know if there was any 'economic downturn' on the horizon? Probably just traders pissing about with their xmas bonuses xD

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20 minutes ago, MvR said:

I trade a lot of GLD options on Interactive Brokers.  The /GC futures contract is a little big for me. The underlying GLD ETF still doesn't have the KIID document so you can't buy it directly, but the KIID restrictions don't apply to options. You can even "buy" GLD by selling an ITM put option and waiting for it to be exercised.

Gold tends to have a lot of false breakouts, so I've been having decent success in my options selling account over the last few months shorting calls against a long GLD position ( for bullish bias) and a couple of short puts for extra theta decay and further bullishness.

I'm also long some 150 march calls in my speculative account. They're full of premium right now as they're just in the money, so a dip will mean they lose money pretty quickly, so I'm slowly laddering out of these as the rally progresses, and selling short term ( 1 week ) calls against them, to counter the decay of the long calls.

 

I've never understood all these calls n puts

Why don't you just gamble* with a spreadbet/cfd? 

*Gambling is tax free! :)

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36 minutes ago, confused said:

I've never understood all these calls n puts

Why don't you just gamble* with a spreadbet/cfd? 

*Gambling is tax free! :)

Spreadbetting and CFDs only allow you to bet on up or down from and entry point.  

Options let you take positions that reflect a more nuance market view, or more closely match your risk to your expectations and strength of opinion.

When buying options, you can limit your risk, as a stop order would, without actually getting "stopped out", so if you pick the bottom a little early, your trade can come back into profit when a spread bet would have been stopped out. The downside is the odds are always skewed slightly against you as the market prices options slightly above fair value. ( otherwise, nobody would bother selling them )

When selling options, you can use this price skew to put the odds of making a profit in your favour, the way casinos and bookies do, by giving up something in exchange, like the chance of large, fast profits. You make lots of small profitable trades, like a casino does, but have to manage your risk and capital carefully to ensure you can take the occasional, but inevitable, larger losses. 

Horses for course really. I've been trading over 20 years, and I'm still barely better than 50:50 when it comes to picking where price is going next, so I go for the less emotional, probabilistic approach instead.. mostly selling options for steady income, with some high reward, low probability long options trades on the side. 

( and a little spreadbetting, smallest scale possible, as a side distraction to stop me tinkering too much in my main trading accounts. )

 

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2 hours ago, Cattle Prod said:

Agree with you there, it's become contrarian for me. Look at Shell's dividend history, through wars, the GFC, its rock solid. Of course the past is not necessarily a guide to the future, and thats the "its all over" narrative. But as I've said, the energy future will belong to those with the cash. Tesla? Nah. Shell? Yep.

Agree 100%.Thats what everyone is missing.Its not that there is no future for oil,there isnt,not for energy,but to get to that point needs massive amounts of oil.

This is rough,but i think in the next cycle BP might get to the point where they have $25 billion free cash a year.If they roll back Capex,maybe $30billion+.They can buy all the green tech they want then.Then they might have 20 years where they can run Capex at simple safety levels and return all the cash.

In other news they are going to re-open the steel works in Teeside.New arc furnace the lot iv heard.The Tories opening a new steel works.In Redcar.A seat they won at the last election.All these things that everyone would say will never happen,is happening daily now.Next we might see Teesport given free port status.Anglo American opening a deep mine in the north east and the Tories opening a steelworks.Cycles are funny old things.

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Chewing Grass
15 minutes ago, Cattle Prod said:

I got a bit concerned when there was bought sandwiches at a lunch and learn, but it was a one off!

They have them at work but I know more than all the bullshitters put together so I never go.

Plus there is never any free lunch as the management have tight cunts.

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6 hours ago, kibuc said:

Fortuna Silver with 2020 guidance. Arguably not a silver miner anymore, but with 8mil oz silver and 110koz gold (production mid-points) this year at silly AISC it should be way, way higher.

Interesting. I've seen people here talking about 'cup and handle' patterns. Looks a bit that way on the Fortuna 1Yr chart perhaps (beginning around Aug/Sept last year) ?

Fortuna.JPG

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Bobthebuilder
42 minutes ago, DurhamBorn said:

In other news they are going to re-open the steel works in Teeside.New arc furnace the lot iv heard.The Tories opening a new steel works.In Redcar.A seat they won at the last election.All these things that everyone would say will never happen,is happening daily now.Next we might see Teesport given free port status.Anglo American opening a deep mine in the north east and the Tories opening a steelworks.Cycles are funny old things.

Really good news for the NE and about bloody time.

Im up in your neck of the woods next week for a bit of work, will salute as im passing Durham on the A1M.

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Chewing Grass
11 minutes ago, Cattle Prod said:

Is an arc furnace run on gas, or coal?

Electricity, its the future, and I imagine could be powered by off-peak windmills for zero-carbon steel, which is very high grade, especially if stainless as you don't get carbide precipitation when you weld it.

That is a big thumbs up from the Chewmeister.

 

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14 minutes ago, Cattle Prod said:

That's very interesting, and much quicker than I expected. Good news for Redcar and the UK, bad news for China. I only noticed my bloody wheelbarrow rusting through today after 2 years, no more cheap Chinese steel for me!

Is an arc furnace run on gas, or coal?

Electric.They use electrodes to produce the arc.They dont use pig iron though they are mainly for scrap (a blast furnace produces pig iron using coke and ore then getting oxygen into it).The beauty is you can run them when electric is cheap and knock them on and off.Another spin off of the fact the UK can produce lots of wasted wind power.

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4 minutes ago, Bobthebuilder said:

Really good news for the NE and about bloody time.

Im up in your neck of the woods next week for a bit of work, will salute as im passing Durham on the A1M.

Did something similar for the Don Juan of Dosbods when I passed the Stoke sign on the M6 over Christmas. xD

 

 

 

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22 hours ago, DurhamBorn said:

People wont be able to go into the specifics really as that would be 100% financial advice.So il say for myself,what im doing.

At 55 il put my SIPP (pensions) into draw down and take the 25% tax free cash.Il invest that into my ISA over time.Il then take £12.5k from my pension each year until state pension age when il then take about £4k (whatever it is that + state pension = tax allowance).From 55 until 67 while im drawing down that from my pension the income in my ISA will mostly be re-invested.£12.5k is well enough for me.

The only thing to remember is inheritance tax.If you over then it pays to leave the money in the pension as long as possible,but its a tricky choice.(pensions dont count to inheritance tax)

If your short of a few years for the state pension,if you have grand children under 12 and your son/daughter earns over £6200 a year you can claim the Specified adult childcare credit ,its for grandparents who look after grandkids.The credit comes from the child benefit so your son/daughter then dont get the ni credit but if earning over £6200 it doesnt matter as they get it of their earnings,im 2 years short and will be claiming it next year and the year after and will keep claiming it in case the government change the 35 years upwards at any time.Its free so might as well.

If not go self employed,sole trader,selling on ebay.Sell a few 2nd hand bits (or put sell on Facebook and sell a couple of items easy) and put tax form in at end of year with £100 turnover youl make no profit,then elect to pay the NI class 2 credits within the tax form ,it costs you £160 for a years credit not the £780 cost of buying a year.

How you draw down assets is personal and very very tricky.

For myself i have a portfolio bigger than my needs (i need £12.5k a year) so will simply withdraw the natural yield from the investments.I pretty much do that at the moment anyway from my ISA.

For ordinary people the state pension is very important.I actually think its generous and as long as you have prepared its a fantastic base.Myself i only need about £120 a week on top of the state pension to live very well,within a couple even easier.The problem is they keep pushing it back,so the key is to make your you have enough from 55 until getting it.I would expect to go from now to then with investments intact ,but if i didnt i could still be fine if i reached state pension age with half the assets i have now.

 

In addition to this dont forget that you can recycle £2880pa of your pension funds into another pension. The govt give you the tax on this so £3600pa actually goes in, so gifting you £720pa free...see pension recycling threads.

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20 hours ago, sancho panza said:

couple of her friends who are Directors have basically said they realise now they're jsut a number

One of the best bits of career advice I got was from someone on a board such as this "A career is a job where you don't get paid for overtime!". This and a number of other events made me change my perspective 180 degrees, I just wish I had `learnt the lesson` much earlier rather than wasting all those years!

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10 hours ago, BadAlchemy said:

Interesting. I've seen people here talking about 'cup and handle' patterns. Looks a bit that way on the Fortuna 1Yr chart perhaps (beginning around Aug/Sept last year) ?

Fortuna.JPG

I'm not a charts guy and I couldn't tell head-and-shoulders from an-old-woman-and-a-wheelbarrow. What I do know that a company projected to pump out 110koz gold at $570 AISC and 8moz silver at $10.50 AISC this year, not to mentions truckload of lead and zinc, should have a market cap in multiples of $600mil. And gold production goes to 180-200koz next year.

I understand that Lindero was meant to go into production a year ago and price plummeted when it didn't, but it's happening now. And yes, it's Argentina. Risky business. But still, $600mil? Na-ah, never.

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