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

[Harley]

Mote pension regulation on transfers and yes, climate change?

https://www.ftadviser.com/pensions/2020/06/25/lords-look-to-mandate-guidance-on-pension-transfers/?utm_campaign=FTAdviser news&utm_source=emailCampaign&utm_medium=email&utm_content=

Playing to my theme of increasing regulation in our new brave world of control.

[sancho panza]

[Loki]

Wow! @sancho panza

[sancho panza]

Landlord lock outs beginnign

Rumours abound about exactly who is funding the Landlord in search of a cheap precedent.

https://www.lincolnshirelive.co.uk/news/local-news/new-look-marshalls-yard-gainsborough-4256217

A major clothes retailer's store in Gainsborough is shut after a row about rent erupted with the shop's landlord.

New Look's store in Gainsborough will be shut down until further notice after Marshall's Yard, the shopping park that owns the store, 'changed the locks', according to a New Look spokesperson.

The clothes shop did reopen on Monday, June 15 with non-essential retailers all over the country, but their return was stopped in its tracks soon after.

The ongoing dispute is about rent payments, from which New Look requested a holiday during lockdown.

Government legislation introduced in March prohibits landlords from terminating leases due to a tenant’s non-payment of rent. This has been extended until September.

[Popuplights]

Commercial landlords are in for a world of hurt.

[jamtomorrow]

7 hours ago, Popuplights said:

Commercial landlords are in for a world of hurt.

Got a friend umming and ahhing about buying an office for his company. Thinking of increasing his offer. So I told him about the situation where I work - newly refurbished office for up to 150 people, current occupancy ... 1 (on a rota, just in case any machines need restarting for everyone else WFH).

Hasn't affected business at all - clients are in the same boat and therefore accepted the change without question (important IMO: this could never have occured so quickly without enforced synchronised legitimacy - whatever the rights and wrongs). Work is getting done to a high standard and the metrics show a slight improvement in productivity.

How long before companies like this realise they'll never use all their office space again and start divesting? Suggested he sit tight, could well be a buyer's market come Autumn.

Also wondering how a crash in the CRE office space sector will affect bank balance sheets (as though that coffin was short of nails)

[MrXxxx]

8 hours ago, sancho panza said:

Probabaly looking to draw out some more funding for their slush fund for retiring bankers.It was ever thus.

The people who cause the bubble are rarely the ones to see the end coming.

...or feel the real impact of their poor decisions!

[TheCountOfNowhere]

7 hours ago, Popuplights said:

Commercial landlords are in for a world of hurt.

You can't lose on pwopatee tho.  Expect bailouts from Comrade Sunak

[TheCountOfNowhere]

26 minutes ago, jamtomorrow said:

 Thinking of increasing his offer. 

And he's a business man ?

He should be thinking of halving it.

Let me guess....financial services ?

[jamtomorrow]

1 minute ago, TheCountOfNowhere said:

And he's a business man ?

He should be thinking of halving it.

Let me guess....financial services ?

Nope, very far from financial services and very good at what he does, minted. But terrible blind spot when it comes to properdee, like so many.

[Harley]

Excellent idea:  Global stocks follow Wall Street higher after bank rule change

"Overnight, Wall Street’s S&P 500 closed 1.1 per cent higher as financial stocks rallied after US regulators relaxed rules that prevent banks investing in or sponsoring hedge funds or private equity funds."

Banks want to own the world too, else risk becoming serfs like us.

Keiser is correct, RIP stock markets.

[sancho panza]

41 minutes ago, jamtomorrow said:

Got a friend umming and ahhing about buying an office for his company. Thinking of increasing his offer. So I told him about the situation where I work - newly refurbished office for up to 150 people, current occupancy ... 1 (on a rota, just in case any machines need restarting for everyone else WFH).

Hasn't affected business at all - clients are in the same boat and therefore accepted the change without question (important IMO: this could never have occured so quickly without enforced synchronised legitimacy - whatever the rights and wrongs). Work is getting done to a high standard and the metrics show a slight improvement in productivity.

How long before companies like this realise they'll never use all their office space again and start divesting? Suggested he sit tight, could well be a buyer's market come Autumn.

Also wondering how a crash in the CRE office space sector will affect bank balance sheets (as though that coffin was short of nails)

Intersting first comment in bold JT.I'm not surprised.Mrs P is one of the first back into the office because me and the kids get under her feet.Apparently tho,lot of people loving the at home work, therefore happier,probably put in more time due to less commuting

The wins for big companies are blindingly obvious in terms of rents etc but if the productivity is better............

I was in Liecester Tuesday and it's sad to see what was once a commercial hub for the Midlands with so much office space sat empty.I think we're going to go full Detroit here myself.The local Marxists are effectively unnopposed and sit there after each new road closure and reduction in parking spaces and wonder why the city centre is declining.

25 minutes ago, TheCountOfNowhere said:

You can't lose on pwopatee tho.  Expect bailouts from Comrade Sunak

Bit harsh on comrade..........

[sancho panza]

11 minutes ago, Harley said:

Excellent idea:  Global stocks follow Wall Street higher after bank rule change

"Overnight, Wall Street’s S&P 500 closed 1.1 per cent higher as financial stocks rallied after US regulators relaxed rules that prevent banks investing in or sponsoring hedge funds or private equity funds."

Banks want to own the world too, else risk becoming serfs like us.

Keiser is correct, RIP stock markets.

It's like the repeal of Glass Steagall taught them nothing.This reaffrims the long term thesis of the thread as its clearly risk on but also means the IMF was wrong about the crash.....whooda thunk it?

What could go worng?

https://www.cnbc.com/2020/06/25/bank-stocks-reverse-higher-as-regulators-ease-volcker-rule-jpmorgan-chase-rises-2percent.html

U.S. banking regulators are about to ease restrictions created in the aftermath of the Great Recessions, a development that sent bank stocks surging Thursday.

Federal Deposit Insurance Commission officials said on a call that they are loosening the restrictions from the Volcker Rule, allowing banks to more easily make large investments into venture capital and similar funds.

The banks will also be able avoid setting aside cash for derivatives trades between different units of the same firm, potentially freeing up billions of dollars in capital for the industry.

 

The Volcker Rule is part of the 2010 Dodd-Frank Act, which was passed in an attempt to prevent another financial crisis caused in part by irresponsible risk-taking at banks. The Volcker Rule was designed to prevent banks from acting like hedge funds. The general principle is that they are allowed to facilitate trades for clients, but not allowed to strap on risk for big proprietary bets.

But the rule, named for its proponent, the late Federal Reserve Chairman Paul Volcker,  also barred banks from making potentially speculative investments using customers’ FDIC-insured deposits. That included venture capital funds, although lawmakers have said the VC industry may have been unfairly grouped with hedge funds and private equity.

 

[sancho panza]

another in the what could possibly go worng series

https://themarketear.com/

 

@Cattle Prod for the back of ffag packet Bell curve assessments done in early April

[sancho panza]

15 minutes ago, Cattle Prod said:

New York looks good, but the USA as a whole doesn't. The uptick below is not statistical noise. It's an anomaly when looking at most countries data:

 

I'm trying to think what's different about the USA:

- Widespread protests: maybe, but still too small and localised to produce this uptick?

- Americas obesity epidemic + corona?

Perhaps it's just the dispersed scale of the country. Just like Corona is taking time to work through the world, like in South America and Africa now, perhaps it's taking time to work through population centres in the States, and the curve, on aggregate, looks like that. It's a big, sparsely populated country where people have just started travelling again. They are doing a lot of testing now, so I assume this will be controllable. I'm sure it'll give markets and oil a wobble when this reaches the daily deaths curve (2 week lag? 3 weeks?), but I very much doubt they'll lock down again.

 

Apparently the biggest growth group is in 20-29 years which in terms of deaths per million will be less effect.

I admit I've not read up on it much.Worth noting though as well that often these viruses mutate into wekaer to prolong their survival.Which may explain why increased cases aren't resulting in large increase in death rates.

USA is a big place so much like Western Europe,certain states would get hit first

[Castlevania]

1 hour ago, jamtomorrow said:

Also wondering how a crash in the CRE office space sector will affect bank balance sheets (as though that coffin was short of nails)

I think they’re a lot less exposed to office space than in the GFC. Pension funds on the other hand I expect to have big losses from both buildings they own and also from bonds to companies in that space.

Banks have a lot of indirect exposure to commercial property in general as they’ll have been pledged as collateral against business loans 

[DoINeedOne]

 

 

[Harley]

1 hour ago, DoINeedOne said:

 

 

I'm shocked, a true black swan event, not!  Whatever next!  Bit of a tart though - must be the longest going-into-administration ever!

[Popuplights]

2 hours ago, DoINeedOne said:

 

 

Timberrrrrr

[sancho panza]

29 minutes ago, Harley said:

I'm shocked, a true black swan event, not!  Whatever next!  Bit of a tart though - must be the longest going-into-administration ever!

The tart got old and saggy.None of the red meat eaters at RBS wanted to put anyhting in her any more.No matter the price.

Happens to us all eventually.

[nirvana]

4 hours ago, sancho panza said:

The general principle is that they are allowed to facilitate trades for clients, but not allowed to strap on risk for big proprietary bets.

you've sent a subliminal message there, bankers getting their 'big black one' ready......so bend over and prepare to take it like a good little serf 

[Castlevania]

5 hours ago, sancho panza said:

It's like the repeal of Glass Steagall taught them nothing.This reaffrims the long term thesis of the thread as its clearly risk on but also means the IMF was wrong about the crash.....whooda thunk it?

What could go worng?

https://www.cnbc.com/2020/06/25/bank-stocks-reverse-higher-as-regulators-ease-volcker-rule-jpmorgan-chase-rises-2percent.html

U.S. banking regulators are about to ease restrictions created in the aftermath of the Great Recessions, a development that sent bank stocks surging Thursday.

Federal Deposit Insurance Commission officials said on a call that they are loosening the restrictions from the Volcker Rule, allowing banks to more easily make large investments into venture capital and similar funds.

The banks will also be able avoid setting aside cash for derivatives trades between different units of the same firm, potentially freeing up billions of dollars in capital for the industry.

 

The Volcker Rule is part of the 2010 Dodd-Frank Act, which was passed in an attempt to prevent another financial crisis caused in part by irresponsible risk-taking at banks. The Volcker Rule was designed to prevent banks from acting like hedge funds. The general principle is that they are allowed to facilitate trades for clients, but not allowed to strap on risk for big proprietary bets.

But the rule, named for its proponent, the late Federal Reserve Chairman Paul Volcker,  also barred banks from making potentially speculative investments using customers’ FDIC-insured deposits. That included venture capital funds, although lawmakers have said the VC industry may have been unfairly grouped with hedge funds and private equity.

 

The banks got around the proprietary trading restrictions by simply calling it “hedge” P&L.

[sancho panza]

[janch]

Otavio (Tavi) Costa

 

@TaviCosta

 

 

We’re in the early stages of a major bull market for precious metals.

 

That is good news for one unloved group of stocks.

 

Wait until the Robinhood traders learn about the gold & silver penny stock.

[TheCountOfNowhere]

2 hours ago, sancho panza said:

Interest rates to rise....or the rich just piss themselves laughing at the poor people they're robbing ?