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


spunko

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1 hour ago, ThoughtCriminal said:

I see David Hunter is now saying that it doesn’t matter what the Fed does from here on in as it’s too late.

 It's been too late for years. Nothing to do with Covid.

 

37 minutes ago, Wheeler said:

For those that are interested, Incrementum have released the 2020 version of their In Gold We Trust report.

https://ingoldwetrust.report/wp-content/uploads/2020/05/In-Gold-We-Trust-report-2020-Extended-Version-english.pdf

 

This is a must read for anyone interested in gold, silver and the general geopolitical backdrop.

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6 hours ago, MvR said:

' 'Agree, they're a good listen.  I can't help but chuckle though every time I listen to them after some internet wag ( maybe here, but maybe not ), described their presentation style as "like the most boring date ever".  It does and all.. :) 

They are husband and wife so that maybe explains the 'awkward' presentation style.

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DurhamBorn
2 hours ago, Errol said:

 It's been too late for years. Nothing to do with Covid.

 

This is a must read for anyone interested in gold, silver and the general geopolitical backdrop.

Iv read those reports for many many years,but i think this years is the best i have ever read.The depth is superb.I would urge everyone to read it,because they are seeing an inflation cycle ahead like we have been seeing for a few years.I would also urge people to read the silver section twice,they dont usually do silver.

"We will be surprised if the decade or two ahead are not some of best years in silver’s long history."

"We do not know what the future holds, but we would be surprised if, in retrospect, silver will not have proven to be a wise investment for the next generation."

Couldnt agree more.Silver should be an amazing investment over the cycle,but where it leads other commods will follow.The road map was that governments and CBs would inject direct into the economy.However there was always that niggling doubt that they wouldnt do something as extreme as outright monetization.The fact they are,without even hiding it,actually encouraging fiscal spending says we are almost out of the inflection point and good to go.

Noticed tonight as well some bottom ladders in potash have now nearly doubled.This thread was full of people from nowhere saying everything was going to zero when those ladders were being bought.I also noticed Sibanye's price.Is anyone still holding big holdings from the bottom?.

 

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leonardratso

been buying this up for a while

https://www.trustnet.com/factsheets/o/mz4o/merian-gold-and-silver

not so cheap OCF and not as good perfomance as

https://www.trustnet.com/factsheets/o/a1ge/smith--williamson-global-gold--resources-b-inc,

but im not fussy,  as long as the net is cast high and wide.

 

 

 

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reformed nice guy
26 minutes ago, DurhamBorn said:

Iv read those reports for many many years,but i think this years is the best i have ever read.The depth is superb.I would urge everyone to read it,because they are seeing an inflation cycle ahead like we have been seeing for a few years.I would also urge people to read the silver section twice,they dont usually do silver.

"We will be surprised if the decade or two ahead are not some of best years in silver’s long history."

"We do not know what the future holds, but we would be surprised if, in retrospect, silver will not have proven to be a wise investment for the next generation."

Couldnt agree more.Silver should be an amazing investment over the cycle,but where it leads other commods will follow.The road map was that governments and CBs would inject direct into the economy.However there was always that niggling doubt that they wouldnt do something as extreme as outright monetization.The fact they are,without even hiding it,actually encouraging fiscal spending says we are almost out of the inflection point and good to go.

Noticed tonight as well some bottom ladders in potash have now nearly doubled.This thread was full of people from nowhere saying everything was going to zero when those ladders were being bought.I also noticed Sibanye's price.Is anyone still holding big holdings from the bottom?.

I have just read it as well. I like their aim of 4800 for gold!

Overall my portfolio is +12% with some of my bottom ladders making huge gains.

I got a whack of Sibanye at $4.21 but I was planning on holding long term. Is that a bad idea?

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DurhamBorn
1 minute ago, reformed nice guy said:

I have just read it as well. I like their aim of 4800 for gold!

Overall my portfolio is +12% with some of my bottom ladders making huge gains.

I got a whack of Sibanye at $4.21 but I was planning on holding long term. Is that a bad idea?

No they look fine,the bad idea was when i had a five figure holding and sold them because i had too much exposure to South Africa with Harmony and Anglogold as well.Cant complain,but wish id kept hold of some instead of selling them all.

 

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DurhamBorn
11 minutes ago, leonardratso said:

been buying this up for a while

https://www.trustnet.com/factsheets/o/mz4o/merian-gold-and-silver

not so cheap OCF and not as good perfomance as

https://www.trustnet.com/factsheets/o/a1ge/smith--williamson-global-gold--resources-b-inc,

but im not fussy,  as long as the net is cast high and wide.

 

 

 

Thats looks a great fund to simply buy and hold through the cycle.Nice solid exposure,diversified,but across the PM space not outside.Iv been thinking of buying into some funds myself.

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leonardratso
Just now, DurhamBorn said:

Thats looks a great fund to simply buy and hold through the cycle.Nice solid exposure,diversified,but across the PM space not outside.Iv been thinking of buying into some funds myself.

yar, ive been buying the 2nd one for quite a while, just trickling in every month fro £1.50 a trade, it was underwater for quite a while and i wondered if id ever get my money back, but then it really took off and i sold a ton of profit to fund my less well of shite. ITM has been stellar though i must admit, and HZM hasnt lagged neither, i wish i could say the same for the non aim stocks, but ive got faith and time - they will all come good i reckon. <-- famous last words.

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BadAlchemy

https://www.theatlantic.com/ideas/archive/2020/05/we-can-prevent-a-great-depression-itll-take-10-trillion/611749/

No time for meganumerophobia!

I thought this article chimed well with the thread. The idea of massive fiscal spending becoming more accepted/mainstream perhaps...

"Claiming that there is no risk to the government spending any amount of money over any time period would be dishonest. But those risks are somewhat knowable. Let’s consider three.

First, there’s inflation, the risk that too much money injected into the economy will cause prices on everyday goods to skyrocket. No one can say for sure if the U.S. is due for an inflation shock on the other side of this crisis. But for the moment, the U.S. is dealing with the very opposite problem—the risk of deflation. This week, the Labor Department reportedthat one measure of consumer prices, called “core inflation” (which does not include energy and other volatile indexes), suffered its largest drop in the history of the statistic. Inflation hawks might think they’re preventing some future crisis by withholding government aid right now. But you don’t let a drought destroy your crops because you’re afraid about some future flood.

Second, $10 trillion of economic relief and stimulus will dramatically increase U.S. debt. But with interest rates even lower than the expected rate of inflation, the federal government can essentially borrow money for free, and it should do so.

Third, some might worry that higher debts today could augur higher taxes tomorrow. But the inconvenience of possible higher taxes in, say, 2024 has to be weighed against the economic calamity of a great depression extending its shadow across the entire 2020s.

Conservatives and others might balk at the $10 trillion figure, for its sheer largeness. But this is no time for meganumerophobia. Rather than seeing trillion-dollar relief packages as “large” or even “bold,” you should see them for what they really are: an appropriate response to a once-in-a-century economic calamity. The U.S. can avoid another Great Depression. But it has to develop the civic stomach for fiscal-spending amounts that might have seemed impossible just months ago."

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9 hours ago, DurhamBorn said:

Iv read those reports for many many years,but i think this years is the best i have ever read.The depth is superb.I would urge everyone to read it,because they are seeing an inflation cycle ahead like we have been seeing for a few years.I would also urge people to read the silver section twice,they dont usually do silver.

"We will be surprised if the decade or two ahead are not some of best years in silver’s long history."

"We do not know what the future holds, but we would be surprised if, in retrospect, silver will not have proven to be a wise investment for the next generation.

It's a great report (if you've got a spare day to plough through the hundreds of pages!)

I have gone a bit silverbuggy in the last couple of months and, rather bravely, loaded up our Ltd Co bullionvault account with quite a chunky holding of silver. I'm tempted to add in more today. The pay off could be amazing over the next few years and it is money that is currently surplus to requirements. Obviously I don't want a worst case situation where the holding halves in value. However, if it does for some bizarre reason, we'll just work an extra year to make up the shortfall (because in that situation the normal economy is still working fine and we can earn very good money in our field of expertise). Therefore it feels like a sound bet although I have found it very difficult to commit as it is such as a contrarian move and any IFA would no doubt be horrified. *

We helped our two grown up children set up HL stock isas this year and they are holding Shell and Sibanye at the moment (only £500 each). I'm going to give them a couple of silver miners as well to invest in. My youngest has been reading up on macro economics (she's 20). Good on her!

* interestingly our accountant is intrigued rather than horrified.

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9 hours ago, DurhamBorn said:

No they look fine,the bad idea was when i had a five figure holding and sold them because i had too much exposure to South Africa with Harmony and Anglogold as well.Cant complain,but wish id kept hold of some instead of selling them all.

 

I took some profit in Sibanye for similar reasons. Also I was concerned that there might be a hit to platinum/palladium if the auto industry was devasted by covid-19. I'm left with a third of the shares I originally bought, but my holding has the same value now as it originally cost me. 

 

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28 minutes ago, Sasquatch said:

It's a great report (if you've got a spare day to plough through the hundreds of pages!)

 

There is a compact version but I didn't post a link to it because I am evil and wanted everyone to suffer reading the 356 pages of the full one!

https://ingoldwetrust.report/wp-content/uploads/2020/05/In-Gold-We-Trust-report-2020-Compact-Version-english.pdf

 

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11 hours ago, DurhamBorn said:

Iv read those reports for many many years,but i think this years is the best i have ever read.The depth is superb.I would urge everyone to read it,because they are seeing an inflation cycle ahead like we have been seeing for a few years.I would also urge people to read the silver section twice,they dont usually do silver.

"We will be surprised if the decade or two ahead are not some of best years in silver’s long history."

"We do not know what the future holds, but we would be surprised if, in retrospect, silver will not have proven to be a wise investment for the next generation."

Agreed, I've only read the last few 'In Gold we Trust' reports but this is best one so far. The silver chapter is epic, especially for us silver bulls, and it even quotes from Kipling's 'Gods of the Copybook Headings' so what's not to like! (knew I was being financially relevant when I posted the poem on here a few months back! ...anyway well worth googling if you don't know the poem, written 1919 but shows how big themes repeat and that lessons are never learned).

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On 26/05/2020 at 11:15, Shamone said:

Thanks Shamone, just now read this and it was a great read. Interesting stuff about how future tech/automation will be inflationary because there will be no cheap China competition. So load up perhaps on Japanese/Scandi tech. companies?

Though must admit Roubini's ideas around climate change science dont sit well with me, moreover he's plain wrong about the relocating of Jakarta's capital, as someone else on here has already said, the city is being moved because they built it on swamp land, nothing to do with climate change effects. I know that supposedly that the climate 'science is settled' (stupid remark, as science is never settled, but that's another topic), but anyway I guess his more substantive point about greater infrastructure spending will happen, and for us that is the much more important detail to know.

I found his comments on more and more future viruses/epidemics interesting (confirmation bias on my part perhaps?) because I think these potential epidemic/health crises - i.e. in terms of investment opps/gov. spending/gov. policy - could be at least as impactful as climate change. And in terms of gov. policy, I think we are already seeing first signs of this. Also, his theory about a warming Siberian perma-frost releasing all kinds of Neolithic nasties, is very sobering.

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geordie_lurch
2 minutes ago, Shamone said:

What does the hive mind think about HSBC? Hasn’t been this low since 1996.

My gut instinct tells me they are going to take hit after hit with China flexing their authority over Hong Kong in order to try and crush any challenges to the whole communist party which I think will get more frequent. I also think that the banks haven't even begun taking the REAL losses coming but I am very much an amateur at all this.

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DoINeedOne
7 minutes ago, Shamone said:

What does the hive mind think about HSBC? Hasn’t been this low since 1996.

Personally i just avoid banks

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Talking Monkey
15 minutes ago, geordie_lurch said:

My gut instinct tells me they are going to take hit after hit with China flexing their authority over Hong Kong in order to try and crush any challenges to the whole communist party which I think will get more frequent. I also think that the banks haven't even begun taking the REAL losses coming but I am very much an amateur at all this.

Thats exactly my take on HSBC and the wider banking sector, they will be worth buying in a few years but not now

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49 minutes ago, Harley said:

Want to know what a tonne of Silver Britannias looks like?  Ask Chards:

spacer.png

Ok Harley, tell Chards that we'll transport that '1 tonne' of silver anywhere they want for free... Don't want to be pedantic, but I count 78 (some obscured?) monster boxes ...therefore that would be: 78x500oz coins=39,000ounces. As 1tonne is 35,274oz, might we say split the difference (between us?!) and perhaps call the spare-coinage 'shrinkage' (retail industry term for goods that go 'missing' between the warehousman and the cashire). That's approx. £40,000 each at current prices, and as Del Boy might say - not a bad day's work Rodney!    

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1 hour ago, Harley said:

Want to know what a tonne of Silver Britannias looks like?  Ask Chards:

spacer.png

Let's hope the price of silver goes negative and this is how our bedrooms will look like... :) 

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jamtomorrow

Thanks @Cattle Prod, I was hoping you'd be able to contribute some informed insight and that didn't disappoint!

30 minutes ago, Cattle Prod said:

That's fascinating, for a number of reasons. I had no idea the press was so free in Russia for one. I was also tickled to see the well operator on the rig. His work area (the "doghouse") was considerably more modern than the north american rig I was recently on! Thanks for sending on.

That's actually what tickled my interest initially - exceptional to see an article like this come out of Russia-based press. Which means either they had the nod from the Kremlin (interesting!), or Putin's authority has receded somewhat (seems less likely, but would also be interesting)

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2 hours ago, BearyBear said:

Let's hope the price of silver goes negative and this is how our bedrooms will look like... :) 

A word to the wise, ground floor bedroom!

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