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


spunko

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6 hours ago, TheNickos said:

I'm balls deep in oil in the hope something comes of it.

Life is about risk after all 🤣

Me too. Missed RDSB at 10.10 today.

That was my ladder in. 

Tomorrow Lord give me 9.99. Or BP at sub 2.5.

DB. Which Natural Gas stock do you think will benefit most from the coming reflation..

PS. Powell's comments. Anything we should note?

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6 hours ago, Harley said:

So just heard the podcast and the varnish is drying.  You're right about the last 30 minutes being the most interesting (bit slow to start with).  I'm very surprised Fleck said he never thought about the societal backdrop to all this macro stuff.  It's key and it's brewing everywhere.  Yes, like the very early 1930s, even with new young brownshirts, but without the hyperinflation.  That's why I thought the Deutsches Bank trends post earlier was important if however basic.  So far I've heard few people who can stand in the "to be" and call back to us.  No surprise as everyone is anchored on something, like the current financial system here.  Humans are hard wired not to make such leaps.  Something to do with survival, which works most of the time, except when it doesn't.  Like freezing in an ambush or car headlights.  So again, this thread is like a Russian doll, sitting within a larger doll.  Watch yer back!

Yes I agree the broad content of the interview is nothing new, as you say the societal-macro link is well understood, as per 4th Turning, etc. For me though i found it striking that Ed Chancellor seemed fully on board with this, and think he could have said much more but unfortunately time constraints prevented him. He is a conservative sober type, and has nothing to sell (his next book could be 2 years away, and seemed in no particular hurry to finish it), he also appeared refreshingly self critical, so not the typical prepper type or obfuscating 'investment guru' often invited onto such podcasts... This seems a new aspect to me and will be interesting to see if this blog's macro thesis spreads wider to other sections of the commentator community in coming months. I will certainly look up the Michael Panzner character mentioned by Chancellor.

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7 minutes ago, Panda said:

Me too. Missed RDSB at 10.10 today.

That was my ladder in. 

Tomorrow Lord give me 9.99. Or BP at sub 2.5.

DB. Which Natural Gas stock do you think will benefit most from the coming reflation..

PS. Powell's comments. Anything we should note?

Oil well up (excuse the pun) this morning, that might’ve been the low for now.

The FOMC is showing no sign of advancing to further easing. Indeed, its balance sheet expansion is all but over:

467B8C9C-FF2B-48A3-A2C8-8D727B0B9192.png

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6 minutes ago, Sugarlips said:

Oil well up (excuse the pun) this morning, that might’ve been the low for now.

The FOMC is showing no sign of advancing to further easing. Indeed, its balance sheet expansion is all but over:

467B8C9C-FF2B-48A3-A2C8-8D727B0B9192.png

Cheers SL.

Notice GBP went to 1.77 today. 

Still think the floor was 1.76.

Will be watching BP tomorrow. RDSB. Aswell..

Still think there are lows yet. This virus won't go away.

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Took some more from the profits of GDJX today (making constant moves upwards at the mo despite spot price of PMs in limbo) even my smaller miners are starting to nudge upwards (Great Panther and Impact).

Whacked that in BP, RDSB and Repsol. My average buy price in BP is around the 300p mark which I’m happy with. This monthly allocation is going in SSE and Rolls Royce. They are both in my ‘buy’ zones. With the military contracts, maintenance contracts and the power systems arm I’m quite happy to start allocations with RR at the moment...

https://www.rolls-royce.com/products-and-services/power-systems.aspx

and making inroads towards hydrogen ;)

https://www.diesel-international.com/alternatives/alternative-home/rolls-royce-and-hydrogen-lab1886/

My worst performing shares are BT and stagecoach. I’ve only got a couple of k exposure there anyway, so will quite happily let dividends reinvest in a SIPP until pension age (or watch stagecoach go bust ;)) but am well up in a sea of blue with in pretty much everything else. Who’d have thought Royal Mail would have been the star performer in the portfolio in the reflation stocks.

But to those fretting about being a couple of k down, at least the chosen sectors will rebound. Think of all those poor boomer sods blissfully unaware that their pensions, heavily weighted bonds and passive trackers will mean they won’t be retiring anywhere near when they thought in the forthcoming years.

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Just to add above, RR are in the black too despite the headwinds (pun intended)

https://www.powerengineeringint.com/decentralized-energy/rolls-royce-power-systems-stays-in-black-despite-wider-pandemic-slump/

And who doesn’t want to own a stake in supersonic/hypersonic and hybrid electric aviation engines B|

https://www.theengineer.co.uk/reaction-engines-rolls-royce-supersonic-and-hypersonic/

Have I convinced you all yet?

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3 hours ago, Sideysid said:

Just to add above, RR are in the black too despite the headwinds (pun intended)

https://www.powerengineeringint.com/decentralized-energy/rolls-royce-power-systems-stays-in-black-despite-wider-pandemic-slump/

And who doesn’t want to own a stake in supersonic/hypersonic and hybrid electric aviation engines B|

https://www.theengineer.co.uk/reaction-engines-rolls-royce-supersonic-and-hypersonic/

Have I convinced you all yet?

No need to convince me. Power systems is a lovely business, well diversified and perfectly positioned to do well if/when a military-industrial reflation really gets going (especially when Governments realise they're in an EROEI race).

Aero, not so sure. Recovery in civil aviation is hard to predict. We may never again return to previous levels of international travel because - like WFH - Covid has merely accelerated change that was already underway.

What I really want to know: what would be fair value for RR if you zeroed out the civil aero business?

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4 hours ago, Sideysid said:

Just to add above, RR are in the black too despite the headwinds (pun intended)

https://www.powerengineeringint.com/decentralized-energy/rolls-royce-power-systems-stays-in-black-despite-wider-pandemic-slump/

And who doesn’t want to own a stake in supersonic/hypersonic and hybrid electric aviation engines B|

https://www.theengineer.co.uk/reaction-engines-rolls-royce-supersonic-and-hypersonic/

Have I convinced you all yet?

But if you already own RR is it the right time to buy more with  a rights issue on the horizon, or are you just better waiting to buy your matched holding at market SP minus 20% holders discount?

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8 hours ago, Panda said:

PS. Powell's comments. Anything we should note?

only that he's a 2 faced lying cunt, the FED did a uturn since Trump but pressure on Powell

re praying to the Lord, study the tea leaves....i mean the graphs xD

Talking of graphs, what happened to that bloke who said he was making a packet with his graphs?

'graph bloke' where are you???

8 hours ago, Sugarlips said:

Indeed, its balance sheet expansion is all but over

Says who? Just cos they've taken their foot off the accelerator doesn't mean they ain't gonna reapply it when some shite starts hitting the fan again.....aka the money men throw another tantrum :P

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7 hours ago, Panda said:

Notice GBP went to 1.77 today. 

Still think the floor was 1.76.

1.77 against what? None of the majors.....

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3 hours ago, Heart's Ease said:

 

Many thanks for this.  A very good interview (cannily asked all the right questions!).  Both guys did well.  A very clear roadmap was presented (at last!).  I prepared notes (indeed a one page slide annotated with my investing strategy) but think it best and fair to listen to work through the interview.  However, one key point mentioned was he warns against betting now on the 2022+ scenario as we have to navigate 2021 first!

 

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7 minutes ago, Harley said:

Many thanks for this.  A very good interview (cannily asked all the right questions!).  Both guys did well.  A very clear roadmap was presented (at last!).  I prepared notes (indeed a one page slide annotated with my investing strategy) but think it best and fair to listen to work through the interview.  However, one key point mentioned was he warns against betting now on the 2022+ scenario as we have to navigate 2021 first!

 

As far as I'm concerned, DB has always made it clear that major players will go to the wall according to his roadmap, even in reflation sectors. That's the part I (personally) find hardest - having enough time/energy to do the research I need to do to achieve sufficient diversification in each sector. Not happy on that score, yet.

Or @Harley, by "navigate 2021", are you referring to system survival (vs collapse)?

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12 minutes ago, Harley said:

A very clear roadmap was presented (at last!).

the goldbugs have been predicting $10k gold since 2008.......is it magic mushroom season again??? :P

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11 minutes ago, Harley said:

Many thanks for this.  A very good interview (cannily asked all the right questions!).  Both guys did well.  A very clear roadmap was presented (at last!).  I prepared notes (indeed a one page slide annotated with my investing strategy) but think it best and fair to listen to work through the interview.  However, one key point mentioned was he warns against betting now on the 2022+ scenario as we have to navigate 2021 first!

 

Thanks for that @Harley - up in the night with the young pup and couldn't sleep afterwards so caught it on my twitter feed. You have whetted my appetite for the listen .  USA twitter in real time is a whirl ATM.

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22 minutes ago, jamtomorrow said:

As far as I'm concerned, DB has always made it clear that major players will go to the wall according to his roadmap, even in reflation sectors. That's the part I (personally) find hardest - having enough time/energy to do the research I need to do to achieve sufficient diversification in each sector. Not happy on that score, yet.

Or @Harley, by "navigate 2021", are you referring to system survival (vs collapse)?

He's presumably saying be careful investing in the right sectors, etc for 2022 onwards right now as you could get stung in 2021.  That is, wait until the 2021 lows.  Best to watch the video.

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4 hours ago, Heart's Ease said:

 

One reason to love this thread and all you beauties is getting leads to good sources of commentary.  I've looked into 29 year old Jake and like it.  Got a good attitude and gives a new dimension to my subscription base (which replaces my TV licence!).  He's able to pull in a good range of commentators presumably (in part) because they see him as a gatekeeper to a younger cohort.  

As an aside, just watched his Robert Kiyosaki interview.  He's said it before but worth a recharge, the problems are within you.  Easy to forget these days.  Yep, he's defo an ex-Marine!  But I've also met grunge travellers with the same mindset.  That's the point.  Headfake.

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18 hours ago, Harley said:

Historic, as in has happened throughout history!  First they will try and take all your money to shore up their world giving bread to the masses, and only then collapse.  Maximum pain all round.  Such is stupidity and the blindness afforded by troughing.  Ed touched on this in his interview with Grant (ref @JMD).  Talking about the Oxbridge elite, etc.  Wasn't expecting that from him and started to listen more closely!

you've intriuged m there H.Listening now.

https://ttmygh.podbean.com/

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10 minutes ago, sancho panza said:

 

you've intriuged m there H.Listening now.

https://ttmygh.podbean.com/

Alas he only touched on it.  And it only really gets going towards the end.  But such historians are are great listen right now.

PS:  I think I'm at peak podcast as I see Grant has also just done an interview with TC which I thought was done a while ago but guess this is a podcast about the podcast with Harl Hansen that actually I listened to instead!  Or was that the interview between George Gammon and TC about the same!  Oh dear!

PPS:  I get all these podcasts automatically on my phone using AntennaPod.  Makes life very easy, and good for playback while working (that last bit is probably not such a good idea for you!).

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5 minutes ago, Harley said:

Alas he only touched on it.  And it only really gets going towards the end.  But such historians are are great listen right now.

yeah,as someone who lived through the tech bubble and sold before the top because of the madness I was seeing,I really appreciate the historical context.

interesting that he cites tight moeny as the root cause of bubbles popping.I've felt for soemtime,this BK will hit when the Fed can no longer print for whatever reason.

I'm not sure it'll take rising rates if increasing default rates restrcit credit creation.

 

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15 hours ago, Shamone said:

Fucking A. Totally brutal. I have nothing but contempt for the entire system. Most people are still asleep to how screwed they are.

Your comment made me think of reading Bernar dGrays beginner guide back when I was 22/23.I remember reaing how in the 1970's private individuals owned 60% of stocks on the UK stock market iirc.Now that figure would be way lower.

The powers that be have herded msot punters to get heir stock market exposure via pension funds and ETF's where the charges are applied before the dividednd.

The bulk of growth in asset values over the centruy come from reinvesting divi's.So the city take 50% of the average persons compund growth....

You literally couldn't make it up.

12 hours ago, JMD said:

Yes I agree the broad content of the interview is nothing new, as you say the societal-macro link is well understood, as per 4th Turning, etc. For me though i found it striking that Ed Chancellor seemed fully on board with this, and think he could have said much more but unfortunately time constraints prevented him. He is a conservative sober type, and has nothing to sell (his next book could be 2 years away, and seemed in no particular hurry to finish it), he also appeared refreshingly self critical, so not the typical prepper type or obfuscating 'investment guru' often invited onto such podcasts... This seems a new aspect to me and will be interesting to see if this blog's macro thesis spreads wider to other sections of the commentator community in coming months. I will certainly look up the Michael Panzner character mentioned by Chancellor.

Panzner was an uber bear back when Karl Denninger was at his peak output.Got things badly worng-as a lot of us did- at the time.

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