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

[DurhamBorn]

13 hours 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.

You mean borrow at 0.1%,invest in hedge fund,buy out companies when their shares are on the floor?.Equity is the only defence against the elite for the ordinary investor,and like you say the banks know that and want a way around it.

[DurhamBorn]

Intu made the classic mistake of having all their debts secured on individual properties rather than all unsecured debts.That means once cash flow drops individual creditors can take control of assets.There is no incentive to wait as its easier to wipe the equity out.One of the big themes of the next/this new cycle is that equity will be used to fund more instead of debt.Its one of the big reasons government needs to (and will) spend more because the corporate sector will be de-leveraging.

[Castlevania]

Tony Pidgley of Berkeley has died. 

https://www.google.co.uk/amp/s/amp.ft.com/content/16dba54b-1a62-4a13-a47b-521a9c4d01d4

[MrXxxx]

10 hours ago, DurhamBorn said:

You mean borrow at 0.1%,invest in hedge fund,buy out companies when their shares are on the floor?.Equity is the only defence against the elite for the ordinary investor,and like you say the banks know that and want a way around it.

But Caveat emptor...equity is only worth something whilst your chosen investment exists!

[UnconventionalWisdom]

On 26/06/2020 at 07:59, jamtomorrow said:

Work is getting done to a high standard and the metrics show a slight improvement in productivity.

Hopefully a permanent change. Too much life is wasted on commutes. I live in the commuter belt and have meetings once in a while in London. Everyone looks so miserable. 

Further hit to BTL, everyone will want a big place away from city centre and not a slavebox in Croydon. 

[jamtomorrow]

Chanced upon this EROI/ESOI analysis of powergrid storage options from 2015, it's quite long (but readable and interesting) so I'll just paste an interesting tidbit that caught my attention, and the conclusions: https://pubs.rsc.org/en/content/articlelanding/2015/ee/c4ee04041d#!divAbstract

(Apologies in advance if already posted, and if anyone has seen something similar of more recent vintage, I'd be interested)

First up: there can be a surprisingly wide range of situations where it makes more sense (in terms of energy economics) to curtail (i.e. dump) over-generation rather than store it. That surprised me, and it's a recurring theme in the study. 

Here, they're exploring the effect of different storage technologies on effective EROI over the range of over-generation (phi). Conclusion: wind's a tough gig for storage, in terms of energy economics:

And those overall conclusions - I was surprised by the bit in bold, especially considering it was 2015 - I thought renewables EROI still fell quite some way short of dino fuel.

5 Conclusion

Energy storage in hydrogen is a technically feasible option for grid-scale storage, and is already in pilot demonstrations. Because of its low round-trip efficiency, it may be overlooked in spite of its potential advantages, such as high energy density and low rate of self-discharge. In order to examine the potential benefits and drawbacks of hydrogen as a grid-scale energy storage technology, we apply net energy analysis to a representative hypothetical regenerative hydrogen fuel cell (RHFC) system. We introduce and apply a method to determine the energy stored on invested (ESOI_e) ratio of a reference case RHFC system.

We find that the reference case RHFC system has a higher ESOI_e ratio than lithium ion battery storage. This indicates that the hydrogen storage system makes more efficient use of manufacturing energy inputs to provide energy storage. One reason for this is that the steel used to fabricate a compressed hydrogen storage cylinder is less energetically costly, per unit of stored energy, than the materials that store electric charge in a battery (electrode paste, electrolyte, and separator). However, lithium ion batteries remain energetically preferable when considering the operation of the system, as well as its manufacture, due to their higher round-trip efficiency (90%). This is reflected in the overall energy efficiencies of the two storage technologies: the overall energy efficiency of a typical lithium ion battery system is 0.83, compared to 0.30 for the reference case RHFC system. This highlights that in spite of its relatively efficient use of manufacturing energy inputs, the round-trip efficiency of a RHFC system must increase before it can provide the same total energy benefit as other storage technologies. Higher RHFC round-trip efficiency relies on improved electrolyzer and fuel cell performance.

When storing overgeneration from wind turbines, energy storage in hydrogen provides an energy return similar to batteries, in spite of its lower round-trip efficiency. The aggregate EROI of wind generation augmented with RHFC storage is equal to that of the same wind facility augmented with lithium ion battery storage, when up to 25% of the electricity output passes through the storage system. For spilled power from solar photovoltaics, storage in hydrogen provides an EROI that is slightly higher than curtailment, though lower than batteries. As with other storage technologies, energy storage in hydrogen coupled to wind generation provides an overall EROI that is well above the EROI of fossil electricity generation.

[Popuplights]

https://www.dailymail.co.uk/news/article-8465567/Boris-Johnson-promise-workers-bore-brunt-austerity-WONT-pay-revamp-economy.html

Nice story to support DBs government investment ideas. 

[DurhamBorn]

I sold a few silver ladders friday.Most were up 50%+ in a few months,and my base aim for the cycle is around 65% return compounded over 10 years (minimum) so given they had landed 7 years worth in a few months il allocate elsewhere.Still hold plenty of course.

One il be adding is Telenor.I got a few,but my ladders are mostly down another 17% from here so im going to leave those in place,but pick some up now.I think they are the best play on mobile in South East Asia,avoiding China.They could take a bigger fall if we do get a big smack later in the year.They also have a very interesting unit that is a world leader on machine to machine talking.Its an outside chance,but it could end up very valuable.

 

 

[jamtomorrow]

1 hour ago, Cattle Prod said:

Another mention of capital controls, and this one is a cannonball across the bows. I was just nodding off reading a Moneyweek article on the IMF snd World Bank, and the last paragraph made me sit up: 

Can anyone verify this policy reversal? Huge if true.

I almost feel like it's the other way round - deglobalization is just what you have to put up with if you're entering a fiscally driven industrial cycle, because national Governments simply won't be able to build their sandcastles if the tides of internationally mobile capital are sloshing in and out and all around the place.

It's more than just protectionism, although there will certainly be plenty of that once national Governments have picked their winners. It's also that Governments will want a monopoly on picking winners, ergo the market is just going to have to take a back seat.

Whilst national economic self-isolation does seem ironically apt for our times, it would be greatly preferable not to be having to worry about jurisdictional risk. But here we are

[DurhamBorn]

Has anyone bought Nutrien on HL and got the US version instead of the CAD one?,im just being quoted the CAD one.

[leonardratso]

18 minutes ago, DurhamBorn said:

Has anyone bought Nutrien on HL and got the US version instead of the CAD one?,im just being quoted the CAD one.

hmm dunno about HL but lloyds quotes me last NYSE price;

Last closing price 33.03 (USD)
Listed on Market: NYS

fact i cant even get the TSE one. ill have a play.

[Castlevania]

1 hour ago, DurhamBorn said:

Has anyone bought Nutrien on HL and got the US version instead of the CAD one?,im just being quoted the CAD one.

Does it matter? It’s the same share just listed on different exchanges. Or is there a bigger bid offer spread or something?

[Talking Monkey]

1 hour ago, DurhamBorn said:

Has anyone bought Nutrien on HL and got the US version instead of the CAD one?,im just being quoted the CAD one.

I bought the CAD version on HL, had a cursory look for the US one at the time but couldn't find it. I assumed it was the same thing so didn't try hard but would be happy to be educated if there is any difference in performance I assume other than an FX component there isn't

[JMD]

13 hours ago, jamtomorrow said:

Chanced upon this EROI/ESOI analysis of powergrid storage options from 2015, it's quite long (but readable and interesting) so I'll just paste an interesting tidbit that caught my attention, and the conclusions: https://pubs.rsc.org/en/content/articlelanding/2015/ee/c4ee04041d#!divAbstract

(Apologies in advance if already posted, and if anyone has seen something similar of more recent vintage, I'd be interested)

First up: there can be a surprisingly wide range of situations where it makes more sense (in terms of energy economics) to curtail (i.e. dump) over-generation rather than store it. That surprised me, and it's a recurring theme in the study. 

Here, they're exploring the effect of different storage technologies on effective EROI over the range of over-generation (phi). Conclusion: wind's a tough gig for storage, in terms of energy economics:

And those overall conclusions - I was surprised by the bit in bold, especially considering it was 2015 - I thought renewables EROI still fell quite some way short of dino fuel.

5 Conclusion

Energy storage in hydrogen is a technically feasible option for grid-scale storage, and is already in pilot demonstrations. Because of its low round-trip efficiency, it may be overlooked in spite of its potential advantages, such as high energy density and low rate of self-discharge. In order to examine the potential benefits and drawbacks of hydrogen as a grid-scale energy storage technology, we apply net energy analysis to a representative hypothetical regenerative hydrogen fuel cell (RHFC) system. We introduce and apply a method to determine the energy stored on invested (ESOI_e) ratio of a reference case RHFC system.

We find that the reference case RHFC system has a higher ESOI_e ratio than lithium ion battery storage. This indicates that the hydrogen storage system makes more efficient use of manufacturing energy inputs to provide energy storage. One reason for this is that the steel used to fabricate a compressed hydrogen storage cylinder is less energetically costly, per unit of stored energy, than the materials that store electric charge in a battery (electrode paste, electrolyte, and separator). However, lithium ion batteries remain energetically preferable when considering the operation of the system, as well as its manufacture, due to their higher round-trip efficiency (90%). This is reflected in the overall energy efficiencies of the two storage technologies: the overall energy efficiency of a typical lithium ion battery system is 0.83, compared to 0.30 for the reference case RHFC system. This highlights that in spite of its relatively efficient use of manufacturing energy inputs, the round-trip efficiency of a RHFC system must increase before it can provide the same total energy benefit as other storage technologies. Higher RHFC round-trip efficiency relies on improved electrolyzer and fuel cell performance.

When storing overgeneration from wind turbines, energy storage in hydrogen provides an energy return similar to batteries, in spite of its lower round-trip efficiency. The aggregate EROI of wind generation augmented with RHFC storage is equal to that of the same wind facility augmented with lithium ion battery storage, when up to 25% of the electricity output passes through the storage system. For spilled power from solar photovoltaics, storage in hydrogen provides an EROI that is slightly higher than curtailment, though lower than batteries. As with other storage technologies, energy storage in hydrogen coupled to wind generation provides an overall EROI that is well above the EROI of fossil electricity generation.

Energy 'storage' is still a problem. Although energy is I think no longer just dumped, and if it can't be used to do something productive like say hydrogen manufacture, it's used to power bitcoin mining. Apparently 0.25% of world's power production, and rising, goes toward solving those bitcoin riddle-me-rees... unintended consequences and moral hazards eh!?

[sancho panza]

14 hours ago, jamtomorrow said:

Chanced upon this EROI/ESOI analysis of powergrid storage options from 2015, it's quite long (but readable and interesting) so I'll just paste an interesting tidbit that caught my attention, and the conclusions: https://pubs.rsc.org/en/content/articlelanding/2015/ee/c4ee04041d#!divAbstract

JT thanks for psoting this.Very informative .thank you.

[sancho panza]

9 hours ago, Cattle Prod said:

Another mention of capital controls, and this one is a cannonball across the bows. I was just nodding off reading a Moneyweek article on the IMF snd World Bank, and the last paragraph made me sit up: 

Can anyone verify this policy reversal? Huge if true.

I think theyve always allowed capital controls,it may be a change in who theyll let use them.

I know from expereince that SA has them and is stil able to borrow off IMF

https://www.ft.com/content/e07b70bd-71ae-4b8a-9855-09665330fed9

South Africa unveils $26bn stimulus and taps IMF for first time ...

 

https://www.investopedia.com/terms/e/exchangecontrol.asp

Not every nation may employ the measures, at least legitimately; the 14th article of the International Monetary Fund's Articles of Agreement allows only countries with so-called transitional economies to employ exchange controls.

[sancho panza]

4 hours ago, DurhamBorn said:

Has anyone bought Nutrien on HL and got the US version instead of the CAD one?,im just being quoted the CAD one.

they do thst with a raft of shares whoich have dual lsitings CAN/US

[jamtomorrow]

8 hours ago, sancho panza said:

JT thanks for psoting this.Very informative .thank you.

Pleasure. Although I'm currently finding EROI/EROEI fascinating and infuriating in equal measure.

As as an engineer, energy economics seems to me to be self-evidently a useful and important perspective for energy policy - it's just a pity the methodologies aren't similarly self-evident and therefore consistent. Example: the study I linked implies an upper EROI of 86 for wind, but I've also seen single-digit values mentioned elsewhere - that doesn't even qualify as a Fermi estimate, never mind allowing different technologies to be compared reliably.

Luis de Sousa sums it up nicely to Euan Mearns here: https://euanmearns.com/eroei-for-beginners/

"On the grand scheme of things: PV ERoEI estimates range from 30 down to 0.8. Before asking the IEA (or whomever) to start using ERoEI, the community producing these estimates must come down to a common, accepted methodology for its assessment. As it stands now, EROEI is not far from useless to energy policy."

Same link also discusses the "net energy cliff" (i.e. "why we *should* care about EROI"):

If only the analyst community could convince us they knew how to estimate/measure EROI!!

[Transistor Man]

On 27/06/2020 at 09:17, jamtomorrow said:

 

Conclusion: wind's a tough gig for storage, in terms of energy economics:

 

I thought the idea of Alex Slocum from a few years back was an interesting one.

A pump storage scheme, upside down. 

 

[jamtomorrow]

32 minutes ago, Transistor Man said:

I thought the idea of Alex Slocum from a few years back was an interesting one.

A pump storage scheme, upside down. 

 

That ought to fall under CAES, but from what I can tell the original study they reference assumed geological storage rather than pressure vessel: https://pubs.rsc.org/en/content/articlehtml/2013/ee/c3ee41973h

Still, with PHS and CAES sharing a lot of the same underlying physics, it wouldn't be surprising if a pressure vessel solution showed similar promise.

[DurhamBorn]

20 hours ago, leonardratso said:

hmm dunno about HL but lloyds quotes me last NYSE price;

Last closing price 33.03 (USD)
Listed on Market: NYS

fact i cant even get the TSE one. ill have a play.

HL seem to always quote on Canadian when dual listing.Not sure if the tax situation is different on the divis,15% on Canadian i think,might be tax free if in a SIPP on the US ones.

[JMD]

9 hours ago, jamtomorrow said:

Pleasure. Although I'm currently finding EROI/EROEI fascinating and infuriating in equal measure.

As as an engineer, energy economics seems to me to be self-evidently a useful and important perspective for energy policy - it's just a pity the methodologies aren't similarly self-evident and therefore consistent. Example: the study I linked implies an upper EROI of 86 for wind, but I've also seen single-digit values mentioned elsewhere - that doesn't even qualify as a Fermi estimate, never mind allowing different technologies to be compared reliably.

Luis de Sousa sums it up nicely to Euan Mearns here: https://euanmearns.com/eroei-for-beginners/

"On the grand scheme of things: PV ERoEI estimates range from 30 down to 0.8. Before asking the IEA (or whomever) to start using ERoEI, the community producing these estimates must come down to a common, accepted methodology for its assessment. As it stands now, EROEI is not far from useless to energy policy."

Same link also discusses the "net energy cliff" (i.e. "why we *should* care about EROI"):

If only the analyst community could convince us they knew how to estimate/measure EROI!!

JamTomorrow, in terms of developing more green energy, isn't the economics really driven by whether the green energy produced can be stored efficiently? Isn't it true that storage technology lags way behind the production technology? Ie in terms of overnight supply to the UK national grid there is no solution at present. It seems to me that large scale battery storage isn't anywhere near where it needs to be, with 'oldy-worldy' kinetic/potential energy schemes not really able to be supply industrial demand for example.                                                                                                I ask because these types of issues do make me think that hydrogen will be used to replace most current gas use including much (haulage) transport, and nuclear will replace substantial current electricity use, with green doing the remainder - perhaps an equal 3-way split for next 30 years. This information also informs investment strategy, so crucial to know, or if can't be certain at least have a macro view. Be interested to know your thoughts, and those of TransistorMan perhaps, as I am no expert but think this topic very interesting and also probability some decent returns (jam!) to be had if a decent inv. strategy can be taken.

[Castlevania]

19 minutes ago, DurhamBorn said:

HL seem to always quote on Canadian when dual listing.Not sure if the tax situation is different on the divis,15% on Canadian i think,might be tax free if in a SIPP on the US ones.

With regards to tax, it’s the country of incorporation that’s important not where the shares are traded.

[TheCountOfNowhere]

Has this been posted

 

https://www.theguardian.com/politics/2020/jun/28/boris-johnson-to-launch-spending-drive-to-build-uk-back-to-health

 

DB is right.

PM promises new schools, hospitals and infrastructure, amid unemployment warnings

 

Classic thieve your way out of a liquidity trap, Carney said as much a year ago

https://www.investopedia.com/terms/l/liquiditytrap.asp

 

• Some ways to get out of a liquidity trap include raising interest rates, hoping the situation will regulate itself as prices fall to attractive levels, or increased government spending.

 

Anything other than raise rates and let their own asset prices fall.  What a bunch of self serving c**ts run the world.

There is no way they will increase rates until a fill blown monetary collapse happens.

[nirvana]

hey @TheCountOfNowhere have you watched 'The Spiders Web' yet? It's right up your street 

edit, this one to save you searching

At the twilight of the British Empire, bankers, lawyers and accountants from the City of London set up a spider's web of offshore secrecy jurisdictions that captured wealth from across the globe and funnelled it to London

makes one proud to be a British tax payer