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


spunko

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10 hours ago, jamtomorrow said:

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.

How do you drain it into a Sipp. I hate being in nest but thought I had to cancel being in it to transfer it out?

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4 minutes ago, Shamone said:

How do you drain it into a Sipp. I hate being in nest but thought I had to cancel being in it to transfer it out?

Ah true - I've been doing it in tranches with a pension pot from previous employer, assumed I could do the same with current Nest one too. Looks like not if you're still paying in, I'll update original post to avoid misleading anyone - thanks for pointing it out @Shamone.

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2 minutes ago, jamtomorrow said:

Ah true - I've been doing it in tranches with a pension pot from previous employer, assumed I could do the same with current Nest one too. Looks like not if you're still paying in, I'll update original post to avoid misleading anyone - thanks for pointing it out @Shamone.

Thanks for the info, buddy

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21 minutes ago, Shamone said:

How do you drain it into a Sipp. I hate being in nest but thought I had to cancel being in it to transfer it out?

I was just reading the other day that you can do a partial transfer of a DC pension, and so not lose the benefits of your employer contributions BUT it appears here that this isn't the case with NEST (https://www.nestpensions.org.uk/schemeweb/nest/my-nest-pension/transfer-your-pension-pots/transferring-your-money-out-of-nest.html)

 

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Democorruptcy
9 hours ago, Chewing Grass said:

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

Anglesey Mining! 90p a share in 2011, 2p today

Quote

 

The Parys Mountain property has zinc, copper and lead deposit with small amounts of silver and gold. The Parys Mountain property site has a head frame, a 300-meter deep production shaft and planning permission for operations.

https://www.hl.co.uk/shares/shares-search-results/a/anglesey-mining-plc-ordinary-1p-shares/share-charts

 

 

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7 hours ago, UnconventionalWisdom said:

Been thinking more about this. Are we witnessing another late 90s/ early 2000s where tech stocks are considered unstoppable. There is so much confidence in them from the lay person. I work at an SME developing new tech. I'm sure all my colleagues think Tesla would be a good buy. They would prob buy if they knew how to buy stocks, and this is what's driving Tesla gains. Could hit a 95% loss in the FAANG stocks like tech stocks in 2002 and destroy people's pensions. 

Yes i think so.I dont think we will see 90% down on the big ones,but what the cycle looks like would say 60% down and no recovery and only 1% dividends at those levels.The market thinks Tesla will control 20% of all electrice cars sold when every car sold is electric.That has no chance of happening.High end pricing doesnt work when everyone has one.

People forget its dividends that deliver the long term gains in stocks,not growth.A stock can go down 30% but give a very nice decade return with a 6% dividend compounding back in.A stock that goes down 30% with no dividend just stays down 30%.

The macro picture paints a decade where value stocks who like inflation will outperform by a massive amount so its a case of keeping a broad portfolio and re-investing the dividends for the first half of the cycle.

Governments are trashing the economy though and ordinary people are being destroyed.Government mandate removing the right to trade could wipe out every single company if it was extended more and more.

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1 hour ago, 5min OCD speculator said:

BP £2 - my pension is getting fecked :P

I was reading about Toyota's hydrogen car, the Mirai, what a loadoshite that is!

It's nearly 5 meters long, weighs over 2 tonnes with a couple of people in it, does about 300 miles range if you're lucky....

AND costs about £60k...Jesus H Christ...wtf happened to the world??? :o

PLUS the national grid was tweeting the other day that they want to get rid of gas, I was never a fan of gas but I think that's a bit far fetched too....

Anyway, carry on, just needed a bit of a whinge xD

Relax,stay calm,re-invest the lovely divis flowing and watch them all compound hugely over the cycle.I just hope things can stay down as long as possible,lots of juicy divis landing from the 11th onwards though BAT is almost tempting me to re-invest back into them,but im not,its oilies for the lot of them.

These events come along a couple of times a lifetime and the market is providing gifts.Take them and say thankyou.

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2 minutes ago, DurhamBorn said:

 

 

Relax,stay calm,re-invest the lovely divis flowing and watch them all compound hugely over the cycle.I just hope things can stay down as long as possible,lots of juicy divis landing from the 11th onwards though BAT is almost tempting me to re-invest back into them,but im not,its oilies for the lot of them.

These events come along a couple of times a lifetime and the market is providing gifts.Take them and say thankyou.

I fucking hope so DB. I'm bleeding here....

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Awaiting my pension transfer from when I worked for local government for 3 years. It's not much but when it's done all of my accrued pensions thus far will be SIPPed.

When I get it it's going straight into oil with a bit of an energy gamble with a fraction of it.

Things are so crazy right now that daily movements are worth only ignoring.

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41 minutes ago, DurhamBorn said:

Yes i think so.I dont think we will see 90% down on the big ones,but what the cycle looks like would say 60% down and no recovery and only 1% dividends at those levels.The market thinks Tesla will control 20% of all electrice cars sold when every car sold is electric.That has no chance of happening.High end pricing doesnt work when everyone has one.

People forget its dividends that deliver the long term gains in stocks,not growth.A stock can go down 30% but give a very nice decade return with a 6% dividend compounding back in.A stock that goes down 30% with no dividend just stays down 30%.

The macro picture paints a decade where value stocks who like inflation will outperform by a massive amount so its a case of keeping a broad portfolio and re-investing the dividends for the first half of the cycle.

Governments are trashing the economy though and ordinary people are being destroyed.Government mandate removing the right to trade could wipe out every single company if it was extended more and more.

Agree 100%...and the key word?...compounding, your share gain is only a gain when you sell, you dividend is in 'your hand' and compounding as soon as its paid!

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1 hour ago, MrXxxx said:

I was just reading the other day that you can do a partial transfer of a DC pension, and so not lose the benefits of your employer contributions BUT it appears here that this isn't the case with NEST (https://www.nestpensions.org.uk/schemeweb/nest/my-nest-pension/transfer-your-pension-pots/transferring-your-money-out-of-nest.html)

 

Earlier in the year, I was reviewing partner’s inactive (no further contributions being made into) pension and was told by the provider that partial transfers were not allowed and the whole amount would have to be transferred. I got cold feet into an immediate transfer because of a fear of (unknown) significant events hitting the stock market and associated volatility. Then came along the pandemic.

It seems such a risky process to transfer under such constraints.

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1 hour ago, Noallegiance said:

Awaiting my pension transfer from when I worked for local government for 3 years. It's not much but when it's done all of my accrued pensions thus far will be SIPPed.

When I get it it's going straight into oil with a bit of an energy gamble with a fraction of it.

Things are so crazy right now that daily movements are worth only ignoring.

Literally doing this now too - same scenario (But 1 year).  It's taking ages.  

Straight into XOM it will go

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1 hour ago, Liberty said:

Earlier in the year, I was reviewing partner’s inactive (no further contributions being made into) pension and was told by the provider that partial transfers were not allowed and the whole amount would have to be transferred. I got cold feet into an immediate transfer because of a fear of (unknown) significant events hitting the stock market and associated volatility. Then came along the pandemic.

It seems such a risky process to transfer under such constraints.

From reading on the web the other day partial transfers depend on the current providers policy, some will allow it, some wont.

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2 hours ago, harp said:

I fucking hope so DB. I'm bleeding here....

Patience harp,this is the critical period during a cycle turn.The last hands are being shaken out of hated sectors.The market is making sure the least people possible own the right areas as the cycle turns.Its critical at these times a contrarian faces into the storm.Remember we have many areas up 100%,200%+.Some of those can be trimmed to top up other areas.This cycle will see $200 oil and the big boys will live to see it.Ignore short term movements,markets arent linear.The amounts of liquidity being pumped ensures after a sharp deflation we will see an expansion cycle unfold.This cycle will be a distribution cycle for most assets as bonds and shares are sold to make up for lower living standards,only assets that can leverage that inflation will fly.

We are in the stage of the deflation now where governments panic.They are about to turn on the fiscal taps across the whole world aided by the central banks and the dash for real assets will begin.China is already in a full on industrial recovery that will expand quickly.They wont stop when they sniff inflation,other factors will be playing out then,political and geo-political.You will hear the term the roaring 20s before this decade is over.

The thread needs to remember the likes of Harmony Gold,Sibanye,Eldorado,even Royal Mail has doubled from the bottom,DRAX up 130%,the gambling companies trebling etc etc.We want people to throw in the towel and keep prices down while we funnel dividends in and trim and position.

BOE will print again very soon as will everyone else,watch for it being fiscal.

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9 minutes ago, Loki said:

Market will allocate the liquidity Loki once its in the system.Remember, its print,inject,allocate,purchase,produce,.All liquidity ends up in consumption then assets in the end.

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1 minute ago, DurhamBorn said:

Market will allocate the liquidity Loki once its in the system.Remember, its print,inject,allocate,purchase,produce,.All liquidity ends up in consumption then assets in the end.

I think I see what you mean - so with consumption costing more (As not a consumer led economy), it almost acts like a "Trickle Up" economy, as a return on the money is wanted, and found in oilies/industrials?

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7 hours ago, wherebee said:

after a bit more telstra I am now 40% oil, 30% gold miners (of which 60% is GDXJ), 20% telecoms, 5% Agri, 5% BAT

feel much more comfortable and set for long term wealth positioning, and thankyou to all those who have contributed to the thread.

I'm sitting on 15% cash for jumping in on any lows in long termers if a BK comes along.

roll on the election fireworks...

Probably not far from where we are.Your portfolio has a clear thesis beneath if I may say.

Although I've been pairing the PMs back with some profit taking,I can't reinvest in the sector much at these levels.

Did some basic maths on a Fres/BP trade as below.I can't see many PM miners with the loft space to double from where they are?Oilies.......telecoms.......potash....
 

 
£1000 to invest
Sept 2019
Fres =146 @£6.83
BP=194 @ £5.15
 
Fres sold for £13 yesterday
146 x £13= £1898
buys
BP £1898/BP share price today £2.02=939 shares.So a near quadrupling of the BP holding.....

 

5 hours ago, Cattle Prod said:

Been a bit busy lately, just a quick note to say distillates still drawing down hard in the US, as good sign for industrial recovery. Crude and gasoline more moderate this week, perhaps reflecting the traditional build season.

The really interesting bit in the EIA data for me is that their data is finally catching up to a few months ago, and has US production now down to 9.9m bpd. That's a 22% drop from this time last year (12.8m bbl), which is a lot for any country, and reflects the nature of shale decline and permanently lost production (and maybe some shut ins). I think my back of the fag packet was somewhere around 3m, maybe I said 3.5 I can't really remember.

It's also a lot more than consumption has dropped (10%? Who knows, need more space in the rear view). Going forward I expect EIA production numbers to pick up again as they are lagging, and then drop hard in Q1.

For reference, that 2.9m lost production is roughly equivalent to the export capacity of Libya, Iran and Venezuela (currently) put together. 

 

CP,question for you.There's been a rig count drop in shale territoy of nearly 70%.Have you any idea what proportion US prodcution is shale?

Market ear had this graph.Given the dislocations of this year,they only appear to be about 10% above average.With the cuts in US shale production,that could unwind in a month.

image.thumb.png.b54737d160462e6062c033845c69098e.png

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8 minutes ago, Loki said:

I think I see what you mean - so with consumption costing more (As not a consumer led economy), it almost acts like a "Trickle Up" economy, as a return on the money is wanted, and found in oilies/industrials?

Exactly the liquidity goes up to the basic production.China is spending massive amounts already on re-tooling,diggers,reach lifts etc.Everyone else will follow.The industrial recovery cycle is underway,but will be hidden a while and there will be false dawns,deflation bumps etc,maybe even big jumps down but the cycle is getting underway.If CBs stopped printing we would be in trouble,but there is no way thats happening.Taps are open and they are going to push until they avoid deflation.

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1 minute ago, DurhamBorn said:

Exactly the liquidity goes up to the basic production.China is spending massive amounts already on re-tooling,diggers,reach lifts etc.Everyone else will follow.The industrial recovery cycle is underway,but will be hidden a while and there will be false dawns,deflation bumps etc,maybe even big jumps down but the cycle is getting underway.If CBs stopped printing we would be in trouble,but there is no way thats happening.Taps are open and they are going to push until they avoid deflation.

Thanks for clearing that up.  Where do you think we are on your timeline?  I think it was you who mentioned David Hunter on here, do you still agree with his forecast? 

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4 hours ago, Democorruptcy said:

Anglesey Mining! 90p a share in 2011, 2p today

 

Balance sheet could be a lot worse.

image.png.627d4ef54f6bc2f1feb40e84bbb13436.png

 

3 hours ago, DurhamBorn said:

 

 

Relax,stay calm,re-invest the lovely divis flowing and watch them all compound hugely over the cycle.I just hope things can stay down as long as possible,lots of juicy divis landing from the 11th onwards though BAT is almost tempting me to re-invest back into them,but im not,its oilies for the lot of them.

These events come along a couple of times a lifetime and the market is providing gifts.Take them and say thankyou.

If I'd have known that fact when BHP/BLT was £1.30 back in the late 90's I'd have gone in more forcefully.

We've jsut had some BP scrip arrive.Very nice.

I msut admit,after syaing we'd hit our limit for oilies,I have found myself selling PM's and buying more.RDSB today....can't help myself.

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3 minutes ago, Loki said:

Thanks for clearing that up.  Where do you think we are on your timeline?  I think it was you who mentioned David Hunter on here, do you still agree with his forecast? 

I agree with his call on us being in the deflation now ending a great dis-inflation cycle.David is a superb macro strategist and was a junior member of the Fidelity team back in the 80s,but hes making short term calls for the gallery when his real skills are over a cycle.Davids real experience is on liquidity and Fed reactions.He knows the Feds actions before they do.His job would be to provide an inflation/dis-inflation road map to the stock pickers.

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