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

[Loki]

7 minutes ago, DurhamBorn said:

file:///C:/Users/User/Downloads/Nest-quarterly-investment-report.pdf

file:///C:/Users/User/Downloads/underlying-holdings-Q2-2020.pdf

And Durhamborn's real name remains a secret.....

C:/Users/Warren.Buffet/disappointment.jpg

[UnconventionalWisdom]

They have pretty much gone for the biggest companies and hope the good times will continue. 

It's typical city mentality- continue with what's worked before and noone  will get upset. If things go bad, you can say it wasn't your fault as you were doing what everyone else was doing and noone could have expected anything different. It ends in tears here for millions of people who put their faith into them expexting financial gurus to put their pension to good work.

[sancho panza]

5 hours ago, DurhamBorn said:

I dont even know where to start with this,but to think the bottom half of earners have this woke nutcase in control of their pension.She is saying poor peoples pensions should be used for her social agenda even if it means a long term loss of capital.

I think it deserves to be on the thread to check back on in 2028/30.

https://www.dailymail.co.uk/money/pensions/article-8797741/How-making-pension-greener-make-money-DIANDRA-SOOBIAH-explains.html?login

Just before a massive boom in prices that will compound over the cycle we get this sage advice,the lack of understanding is breath taking.

"Resources from fossil fuels will likely become too expensive to extract from the ground, from either rising carbon taxes or a lack of consumer demand."

It's similar the way govts force pensions funds to buy 30 year govt bonds with 2% coupons in the name of solvency ratios.

First comes the excuse ,then comes the people's poverty.

28 minutes ago, Chewing Grass said:

Here fixed it for you.

https://www.nestpensions.org.uk/schemeweb/dam/nestlibrary/Nest-quarterly-investment-report.pdf

Incredible.As if the roads of Seattle and Sanf Francisco aren't clogged with cars.....

 

[sancho panza]

17 minutes ago, UnconventionalWisdom said:

They have pretty much gone for the biggest companies and hope the good times will continue. 

It's typical city mentality- continue with what's worked before and noone  will get upset. If things go bad, you can say it wasn't your fault as you were doing what everyone else was doing and noone could have expected anything different. It ends in tears here for millions of people who put their faith into them expexting financial gurus to put their pension to good work.

It's herding/momentum investing.Wonder what their average price on AAPL is? I bet it's dire.

I read CG's link but didn't get past the 1.8% charges................

average pension fund £12k.....................so basically she's charging 1.8% to the poorest people.............

[reformed nice guy]

The Nest "lower growth fund" has been returning 0.5% since launch. If average inflation was 2% then thats a big chunk gone!

 

[DurhamBorn]

6 hours ago, sancho panza said:

It's herding/momentum investing.Wonder what their average price on AAPL is? I bet it's dire.

I read CG's link but didn't get past the 1.8% charges................

average pension fund £12k.....................so basically she's charging 1.8% to the poorest people.............

I think the 1.8% is only as the money goes in,then its 0.3% a year,so thats very cheap.However that top holdings section is very revealing.As you say its simply momentum investing and probably as badly positioned as it could be.Luckily most people have very little in there,but its a shocking situation when low paid workers have no choice but to save into that fund.

[MrXxxx]

8 hours ago, working woman said:

Our world is changing, the changes we need to make to adapt will be hard for people, look at how people are struggling adapting to Coronavirus.

I think there is a distinct difference here, normally the former depends on someone having to make a sacrifice and this due to selfishness is someone elses to make. The resistance to change in the latter is due to the apparent contradictions and so lack of faith.

[UnconventionalWisdom]

7 hours ago, reformed nice guy said:

The Nest "lower growth fund" has been returning 0.5% since launch. If average inflation was 2% then thats a big chunk gone!

 

And then you prob have to take away the management fees and it's much worse

[MrXxxx]

8 hours ago, Knickerless Turgid said:

I fear that NEST investors will become the bridge-dwellers i ten years' time, due to this mindest.

Either them, or today's investors in BP...

The difference is the investors in BP understand diversification, those in NEST just pay monthly without any understanding at all (including myself before discovering sites like this and reading around the subject).

[Castlevania]

1 hour ago, DurhamBorn said:

I think the 1.8% is only as the money goes in,then its 0.3% a year,so thats very cheap.However that top holdings section is very revealing.As you say its simply momentum investing and probably as badly positioned as it could be.Luckily most people have very little in there,but its a shocking situation when low paid workers have no choice but to save into that fund.

You get to choose which of the six funds to put your money in. Bizarrely you have to invest in the Sharia fund if you want 100% equity exposure. Plus as a bonus you don’t get any exposure to bank stocks.

[MrXxxx]

1 hour ago, DurhamBorn said:

but its a shocking situation when low paid workers have no choice but to save into that fund

But they do DB, educate themselves financially like the rest of us have done...they all seem able to understand their latest Smartphone purchase, and the government/s are hardly going to make it part of the National Curriculum.

[jamtomorrow]

1 hour ago, DurhamBorn said:

I think the 1.8% is only as the money goes in,then its 0.3% a year,so thats very cheap.However that top holdings section is very revealing.As you say its simply momentum investing and probably as badly positioned as it could be.Luckily most people have very little in there,but its a shocking situation when low paid workers have no choice but to save into that fund.

Can't say I'm shocked by any of this - the entire system has been rigged against the little guy for as long as I remember, and you have to go *well* out of your way to somewhat escape their tentacles.

Examples: the hoops you have to jump through to put bullion in a SIPP; SDRT still charged for SIPPs, but I bet pension funds don't have to pay it; the general quality of the vast vast majority of IFAs (they're as much part of the problem as the big boys)

I don't see the point in getting worked up about it - the privileged lord it over the masses in every part of life, but the masses are just as culpable for letting the c***s do it to them over and over again through incuriosity.

You get what you aquiesce to, and not just in pensions and investing, but in life generally.

I've ended up in Nest with the latest job (it's the only option where I work), so I'll just drain it into the SIPP once a year so I can do what I want with it - nae bother.

[MrXxxx]

 This may be of interest to some here that are considering the massive Worldwide debt, inflation, demise of the US dollar, China/Russias recent gold buying spree, and the potential direction in gold price. Chapter 9 of `The Death of Money` by James Rickards [isbn 978-0-670-923700] looks at the requirements for a Worldwide adoption of a gold standard.

Too many points, but in a nutshell Banks/Rentiers being screwed via nominal debt values left unchanged, fractional reserve holding of gold meaning a price of US$9000 oz, and this to `cleanse` the system of 40 years of financial abuse to ensure an inflation reset.

[Chewing Grass]

7 minutes ago, MrXxxx said:

US$9000 oz

Would see the boundaries of the Snowdonia National Park redrawn, Parys Mountain on Anglesey dug up along with Wanlock Head and Camborne in Cornwall.

[DoINeedOne]

10 hours ago, DurhamBorn said:

Can anyone get hold of the portfolio NEST holds?,it would be interesting to see how they change it etc.

Scheme annual report and accounts 

Nest’s comprehensive report on our mission, financial performance and activities throughout the last year.

https://www.nestpensions.org.uk/schemeweb/dam/nestlibrary/Nest-SARA-2019-20.pdf

[Harley]

15 minutes ago, DoINeedOne said:

Scheme annual report and accounts 

Nest’s comprehensive report on our mission, financial performance and activities throughout the last year.

https://www.nestpensions.org.uk/schemeweb/dam/nestlibrary/Nest-SARA-2019-20.pdf

Ta.  So almost as much in some industrial estate in Dunstable as in XOM!  Kidding aside, so be it.  The key is being told their investment approach otherwise just a list of companies, and industrial estates!

PS:  There are no "long arms" of any length in UK Finance PLC!

[DoINeedOne]

So the top 100 percentages add up to around 26% 

[Harley]

Just now, DoINeedOne said:

So the top 100 percentages add up to around 26% 

More of a shotgun than a rifle then!

[DoINeedOne]

https://www.nestpensions.org.uk/schemeweb/dam/nestlibrary/underlying-holdings-Q1-2020.pdf

Anyway time for some coffee

[jamtomorrow]

Been thinking more about the BTC/XAU ratio.

I really do think it's the one to watch if you're interested in crypto, because the fixed "stock" on both sides of the ratio anchor the "meaning" very solidly indeed.

The big uncertainty is therefore global gold stocks. I've seen "above ground" estimates range from 150kt to 2000kt, so I'm tracking 3 BTC/XAU price points of interest corresponding to the lower, upper and geometric mean, and based on notional parity of valuation of overall stock.

Lower: 7.5kg per BTC

Middle: 28kg per BTC

Upper: 100kg per BTC

For perspective, ratio today is ~ 0.2kg per BTC.

NB: not saying BTC will ever get to parity with gold, but I *am* saying it's useful to have a metric to understand where we are on that scale.

[Harley]

If I was a politician I would be insisting we use NEST to promote a fairer and more sustainable society.  Just as with positive discrimination and the clear benefits that has brought to the workplace, this windfall should be used to the benefit of our society as a whole.  To empower people to feel they can contribute to a better future for themselves and their children.  To prevent inter-generational, housing and racial and gender inequality.  To tackle the tremendous damage caused by this Covid plague that has so brutally ravaged our society and economy.  Indeed I am so excited by this opportuniy gifted to us that we should encourage, by all possible means, everyone to abandon their current, and quite frankly dangerous schemes, and be opted into NEST.  After all, it's only right we should all be "entitled" to take stock, reset, and join this crusade to a new dawn.

PS:  Eight months ago you would also have laughed at lockdowns and Covid marshals.  Enjoy our new regulated world.

[Heart's Ease]

15 hours ago, Knickerless Turgid said:

This was the most terrifying comment from that article:

"Coronavirus has provided an opportunity to reset the economy for a more sustainable future".

I wonder who told her to say that?

Absolutely not here to derail but it's such a red flag to me.

 @Harley (didn't mean to tag you can't delete it!)

Tucker Carlson covered it a couple of nights ago:

“The World Health Organization says that finding a vaccine is not the goal; reordering society is the goal. Quote, ‘We will not, we cannot go back to the way things were.’ That’s a direct quote from the leader of the World Health Organization, Dr. Tedros, who by the way it is not really a doctor.”

Carlson said Dr. Tedros Adhanom Ghebreyesus does not ultimately see the coronavirus as just “a public health crisis really or even a mere virus. COVID-19 … is really about global warming. As he puts it, quote, ‘The COVID-19 pandemic has given new impetus to the need to accelerate efforts to respond to climate change.’”

The Fox News host also pointed to comments from billionaire Bill Gates, who argued that the coronavirus pandemic is really a lesson in learning how to “sacrifice even more to save the Earth from warming.” In 2015, Gates predicted an influenza pandemic that would kill millions of people.

“Now, for people who are not billionaire global influencers, this is all pretty confusing. Quick, what does the coronavirus have to do with climate change? Well, for one thing, China caused both of them.”

But Carlson said that this not the point for either Tedros or Gates.

“No. For Dr. Tedrose and Bill Gates, pandemic and climate change share a very different connection. Both are useful pretexts for mass social control. Both are essentially unsolvable crises they can harness to bypass democracy and force powerless populations to obey their commands.”

https://dailycaller.com/2020/08/25/tucker-carlson-world-health-organization-linking-coronavirus-climate-change/

[sancho panza]

3 hours ago, DurhamBorn said:

I think the 1.8% is only as the money goes in,then its 0.3% a year,so thats very cheap.However that top holdings section is very revealing.As you say its simply momentum investing and probably as badly positioned as it could be.Luckily most people have very little in there,but its a shocking situation when low paid workers have no choice but to save into that fund.

Thanks for pointing that out DB,I msut have got the headers confussed.Looking at the holdings,these things are going to get reamed longer term

The thing I like is how all they appear to do to derisk different funds is change the allocation to MSFT and AAPL.....and I love how the ethical fund is chock full of candidates for anti trust investigation in the US.Too posh to push oil,but ok with monpolitic practitioners driving small businesses under with dubious practices

And then there's the ethical fund with it's 9.9% in UK property,presuming they'll turn down BP as a tenant....

Nest 2040 fund

Nest Ethical Fund

Global higher risk fund

 

 

2 hours ago, jamtomorrow said:

I don't see the point in getting worked up about it - the privileged lord it over the masses in every part of life, but the masses are just as culpable for letting the c***s do it to them over and over again through incuriosity.

You get what you aquiesce to, and not just in pensions and investing, but in life generally.

Great quote JT.Like you say,the system is geared up so that the overlords in parliament can get a nice little one day a week board membership when they retire (eg Alistair Darling at Morgan Stanley).

The govt has it set up so that everyone has to have a pension no matter how crap the pension is and they intorduce the right solvency ratio's that inadvertently leave pension funds holding the baby in terms of low return Gilts when inflation runs

The IFA's then steer the punters into the crap investments and between them and the manager the return gets swallowed in wages for the parasites.

1 hour ago, MrXxxx said:

 This may be of interest to some here that are considering the massive Worldwide debt, inflation, demise of the US dollar, China/Russias recent gold buying spree, and the potential direction in gold price. Chapter 9 of `The Death of Money` by James Rickards [isbn 978-0-670-923700] looks at the requirements for a Worldwide adoption of a gold standard.

Too many points, but in a nutshell Banks/Rentiers being screwed via nominal debt values left unchanged, fractional reserve holding of gold meaning a price of US$9000 oz, and this to `cleanse` the system of 40 years of financial abuse to ensure an inflation reset.

I think it was CP posting some stuff on possible gold backed Yuan that could really challenge the global hegemony of the $.

The challenges to fiat currency are looming larger and larger by the day.

20 minutes ago, jamtomorrow said:

Been thinking more about the BTC/XAU ratio.

I really do think it's the one to watch if you're interested in crypto, because the fixed "stock" on both sides of the ratio anchor the "meaning" very solidly indeed.

The big uncertainty is therefore global gold stocks. I've seen "above ground" estimates range from 150kt to 2000kt, so I'm tracking 3 BTC/XAU price points of interest corresponding to the lower, upper and geometric mean, and based on notional parity of valuation of overall stock.

Lower: 7.5kg per BTC

Middle: 28kg per BTC

Upper: 100kg per BTC

For perspective, ratio today is ~ 0.2kg per BTC.

NB: not saying BTC will ever get to parity with gold, but I *am* saying it's useful to have a metric to understand where we are on that scale.

I'm intrigues with using raio's for timing.GS ratio looks like a rare but exceelent timer for selling gold strangely enough.

VEry interested in your thoughts on this BTC/Gold ratio.Problem is that anything with Gold needs a long history as gold moves over years not weeks.

I'm averse to buying BTC because I'm an old fogie but am open to the possibility that it may become common among younger/more savvy technical people

 

 

[sancho panza]

57 minutes ago, DoINeedOne said:

https://www.nestpensions.org.uk/schemeweb/dam/nestlibrary/underlying-holdings-Q1-2020.pdf

Anyway time for some coffee

wtf are they doing hedging Sing $ versus USD$?

especially as they're sat on a pile of stocks that sell globally....

[sancho panza]

@jamtomorrow some interesting long term perspectives re BTC gold.

Silver does look filthy cheap hsitorically

Looking at this you'd think property was cheap  and not about to get even cheaper.But Land Sec says it is.

Miners look reasonable value versus the underlying

No comment. I've been wrong since 0.05.