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


spunko

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4 minutes ago, Democorruptcy said:

A cat on the keyboard

just doing some hedging trades, hold on1153209009_download(5).thumb.jpeg.2d020e0c2c59221cc8ffea13525366cf.jpeg

I remember the drunken oil trader who moved the markets overnight....

https://www.telegraph.co.uk/finance/newsbysector/energy/oilandgas/7862246/How-a-broker-spent-520m-in-a-drunken-stupor-and-moved-the-global-oil-price.html

 

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5 minutes ago, AWW said:

Be interesting see exactly how PayPal BTC payments work out, given that the network only supports 7 txn/s.

I'd expect PayPal to hold some amount of BTC in custody and keep it's own ledger, with no transactions actually taking place on the chain unless there's deposit/withdrawal. Basically another exchange.

 

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ah that was a good day on the BTC, shoved 600 squid in friday, pulled 900 out today, thats me kebabs for a fornight

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Clueless Imbecile

I recently saw mention of the NEST pension on here.

By coincidence I've recently been offered a NEST pension at work. I'm not 100 percent certain but it looks like the deal would be that I would have to contribute 5 percent of my salary in order to get a 3 percent contribution from my employer.

Considering the available fund choices within NEST, I am seriously thinking about opting out.

Normally I would think it was a no-brainer to make the employee contribution in order to get the employer contribution. However, since I'm not sure I like any of the fund choices, I'm not sure I really want to put 5 percent of my salary into an investment I'm not keen on just to get a 3 percent contribution from my employer.

Maybe it would be possible to accept the NEST pension offer from my employer and then transfer the money from there into a different pension plan in future, but I imagine it would be a real ball-ache to do (I have some experience of transferring a pension) and not sure it's worth the hassle, on top of the investment risk of investing in funds I'm not keen on.

I'm currently thinking I might rather keep my 5 percent and maybe put it into my ISA or put it into my stakeholder pension (which is invested in a FTSE All-Share equity index tracker fund).

Cheers,
Clueless Imbecile

Disclaimer: I am not an expert. Anything I post here is just my opinions, which may not be factually correct. My posts are intended purely for the purpose of debate and are not to be taken as advice. If you act on any of the above then you do so entirely at your own risk. I do not accept any liability.

 

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UnconventionalWisdom
1 minute ago, Clueless Imbecile said:

Maybe it would be possible to accept the NEST pension offer from my employer and then transfer the money from there into a different pension plan in future, but I imagine it would be a real ball-ache to do (I have some experience of transferring a pension) and not sure it's worth the hassle, on top of the investment risk of investing in funds I'm not keen on.

I was with them so i could get the employer contribution- wasn't happy but thought it was worth it(also thought i would transfer out once i leave). Last straw was when i was buying oilies and they were selling. I have just transferred and it was simple- started a SIPP with HL and they had a form (was meant to be done on their site but it wouldn't accept). All they need is your nest account num, name of the provider and their add. They then request the transfer and Nest get on with selling the funds to get the money over. Really not difficult. HL reckons 10 days but nest reckon about 20. Hopefully it'll go smoothly but transferring is a relatively easy option.

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2 hours ago, kibuc said:

I'd expect PayPal to hold some amount of BTC in custody and keep it's own ledger, with no transactions actually taking place on the chain unless there's deposit/withdrawal. Basically another exchange.

 

Exactly this. CEX used to accept and give out BTC for exchanged phones/games/devices bet they wished they kept the receiving part. They are literally pooling just like the pension funds on a something they all know is the ultimate hedge against inflation. I’m sure they’ll be more than willing to make it very simple for the user to pay in fiat whilst holding a reserve of BTC.
Remember only 800k wallets hold more than 1 BTC and I’m one of them 

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7 minutes ago, Clueless Imbecile said:

I recently saw mention of the NEST pension on here.

By coincidence I've recently been offered a NEST pension at work. I'm not 100 percent certain but it looks like the deal would be that I would have to contribute 5 percent of my salary in order to get a 3 percent contribution from my employer.

Considering the available fund choices within NEST, I am seriously thinking about opting out.

Normally I would think it was a no-brainer to make the employee contribution in order to get the employer contribution. However, since I'm not sure I like any of the fund choices, I'm not sure I really want to put 5 percent of my salary into an investment I'm not keen on just to get a 3 percent contribution from my employer.

Maybe it would be possible to accept the NEST pension offer from my employer and then transfer the money from there into a different pension plan in future, but I imagine it would be a real ball-ache to do (I have some experience of transferring a pension) and not sure it's worth the hassle, on top of the investment risk of investing in funds I'm not keen on.

I'm currently thinking I might rather keep my 5 percent and maybe put it into my ISA or put it into my stakeholder pension (which is invested in a FTSE All-Share equity index tracker fund).

Cheers,
Clueless Imbecile

Disclaimer: I am not an expert. Anything I post here is just my opinions, which may not be factually correct. My posts are intended purely for the purpose of debate and are not to be taken as advice. If you act on any of the above then you do so entirely at your own risk. I do not accept any liability.

 

If you leave you can transfer it into a SIPP with HL by pressing about three buttons.Id still take it with the employers contributions.Most workplace pension choices are terrible.Mine is laughable so im simply taking a UK tracker until i leave again and transfer to my SIPP

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So I set an order last night to buy some XOM on a silly price and went to sleep.  Woke up to find it filled at 33.17 and is now at 34.96.

Goodness me.  Up almost 5% in a day.  Is that the bottom in?

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2 minutes ago, wherebee said:

So I set an order last night to buy some XOM on a silly price and went to sleep.  Woke up to find it filled at 33.17 and is now at 34.96.

Goodness me.  Up almost 5% in a day.  Is that the bottom in?

nice

esp if it is.

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6 minutes ago, leonardratso said:

nice

esp if it is.

I hope so, purely because it's all getting very boring now.  I want some action.  (I know markets can't be rushed and I'm just screaming into the void, but what else is there to do?)

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50 minutes ago, wherebee said:

So I set an order last night to buy some XOM on a silly price and went to sleep.  Woke up to find it filled at 33.17 and is now at 34.96.

Goodness me.  Up almost 5% in a day.  Is that the bottom in?

Strange really,WTI is up 1cent at $40.64..........and the response

image.png.8bfd61bf4f0edda59647deea82b9d872.png

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12 hours ago, Cattle Prod said:

Yeah I was happy to see Market Ear pick that up, good to see this story gets outside oil nerd channels. I think it's about 65% of US production, could be more. Hard to compare the lagging EIA figures. Yes, the inventory is steadily drawing down, and the graph doesn't look so bad. Recall why the WTI price went negative: people thought that 'tank tops will overflow'. Totally ludicrous for people who were supposed to be insiders, a good lesson for me in the madness of crowds. I don't think it'll unwind in a month though, it all happens along a curve, and I think it'll be about three months to get back to the average. Then people will say 'that average is skewed because of 2020' etc. so I don't expect a sudden sentiment change then either.

The shale industry was at full activity in February (if in slow decline), so wells put on production since then have been going through their initial spurts over the last 6 months. I think the lack of drilling and completion since April will become visible in production toward the end of the year and into Q1, when it could drop very sharply, and inventories could way undershoot the 5 year average. Then comes the 'wtf'.

This is part of the OPEC strategy: they have reduced exports to the US to drain inventories, as they know the best data is there and the market prices WTI off US inventories. It's harder to gauge what inventories are doing in the rest of the world, but I don't see them building. The WTI-Brent spread is currently very low, about $2, I'll be watching this closely. If the rest of the world inventories are not being drawn down like the US, it may even switch in favour of WTI.

I'm looking for ways to quantify what I have talked about on here a bit, beyond my own qualitative theories, and one thing I'm thinking about is the WTI-Brent spread:

image.thumb.png.45d7f9e28363fcb1ff7e737ace9c433a.png

The blue vertical line is roughly where shale production took off in the US, and WTI was therefore plentiful locally. So Brent, along with all the usual geopolitical dramas, blew out to a big premium over WTI. Interestingly, that has been decreasing linearly since about 2011. Before the blue line, US production was in long term decline, and you had to pay a dollar or two extra for the local stuff.

We are now at 4 year highs on the spread, which I haven't heard commented on anywhere. But to my simple mind, that is signalling increased scarcity of supply in the local US market. When it crosses, you might see people sit up and take notice. It is this scarce supply in the near future that Conoco has doubled down on: they expect much higher prices for their shale oil, and I have no problem with shale oil at higher prices either. It should only have ever been drilled economically, instead of wrecking the industry for everyone!

You can see it tended to hover around 2$ above Brent pre shale boom. That is really just the transport cost for importing Brent, so the market was even then. This is what OPEC is playing for I think, they can then safely export to the US market without tanking prices. In this situation, if WTI is scarce locally, it doesn't matter if you sell your oil at a $2 discount to the local stuff, because you can do so at an overall higher prices as the market allows.

I msut say I'm a fan of these comparisons that offer to shed light on the moves coming.Very much following the leads and lags style road mapping of DB.The lgoic of your Q1 call for US shale supply drop to comethoruhg to mr market is comepelling.Makes perfect sense.

I hadn't thought of the WTI/Brent spread and as you say,it looks fascinating especialwith the market pricing off US inventoriesly .As you know I've been wathcing industrial metals and they're sneding out buy signals for everything else.

Hard because some people I repsect eg Kaplan are urging harbouring cash/selling but a lot of other useful signals are saying buy certain things.I sjtu don't see how copper/aluminium/zinc/tin can go on the run it has without oil eventually showing signs of life.

Loving this oil discussion at the minute.Learning every day.

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Talking Monkey
1 hour ago, sancho panza said:

Strange really,WTI is up 1cent at $40.64..........and the response

image.png.8bfd61bf4f0edda59647deea82b9d872.png

We can't be far off the smart money from institutions/hedge funds etc start coming in at size as they reach the conclusion the next cycle is a reflation one. 

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22 minutes ago, Talking Monkey said:

We can't be far off the smart money from institutions/hedge funds etc start coming in at size as they reach the conclusion the next cycle is a reflation one. 

It's close but there may be a second wave corona crash imminent. Once fear hits, the dead cat bounce would turn into catch a falling knife. Personally I'm waiting for a 2nd wave crash, and stuff is sold at fires sale prices 😁

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Talking Monkey
51 minutes ago, Green Devil said:

It's close but there may be a second wave corona crash imminent. Once fear hits, the dead cat bounce would turn into catch a falling knife. Personally I'm waiting for a 2nd wave crash, and stuff is sold at fires sale prices 😁

True, but even under that scenario I reckon further downside would be limited to maybe 20%, I just can't see BP halving from here

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1 hour ago, Green Devil said:

It's close but there may be a second wave corona crash imminent. Once fear hits, the dead cat bounce would turn into catch a falling knife. Personally I'm waiting for a 2nd wave crash, and stuff is sold at fires sale prices 😁

bastard.  Go buy exxon today and help me feel smug.:Jumping:

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Bricks & Mortar
8 hours ago, UnconventionalWisdom said:

I was with them so i could get the employer contribution- wasn't happy but thought it was worth it(also thought i would transfer out once i leave). Last straw was when i was buying oilies and they were selling. I have just transferred and it was simple- started a SIPP with HL and they had a form (was meant to be done on their site but it wouldn't accept). All they need is your nest account num, name of the provider and their add. They then request the transfer and Nest get on with selling the funds to get the money over. Really not difficult. HL reckons 10 days but nest reckon about 20. Hopefully it'll go smoothly but transferring is a relatively easy option.

 

8 hours ago, DurhamBorn said:

If you leave you can transfer it into a SIPP with HL by pressing about three buttons.Id still take it with the employers contributions.Most workplace pension choices are terrible.Mine is laughable so im simply taking a UK tracker until i leave again and transfer to my SIPP

I had a go at this last night.  HL do indeed offer a very simple transfer process.  Wasn't quite just 3 buttons, you had to input the policy number, name of the pension plan, and a couple other details...
But, like Unconventional Wisdom, I got a 'computer says no' message.  So I had to download and print a form, helpfully pre-printed with the details I'd already inputed, sign and date it, and mail it to a FREEPOST address.

Fingers crossed the oilies remain as attractively priced another 10 or 20 days...  Good old Joe, promising to transition away from oil in tonights debate.  

P.S - the transfer option only becomes visible on NEST after you hit "Stop Contributions."  I delayed for several months wondering how onerous it would be.  Finally hit the button this morning, and appear to have dealt with everything thereafter in about 15 minutes last night.

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7 hours ago, sancho panza said:

Strange really,WTI is up 1cent at $40.64..........and the response

image.png.8bfd61bf4f0edda59647deea82b9d872.png

The whole market is about stimulus at the moment. The above is stimulus optimism.

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UnconventionalWisdom
59 minutes ago, Bricks & Mortar said:

Fingers crossed the oilies remain as attractively priced another 10 or 20 days...  Good old Joe, promising to transition away from oil in tonights debate.  

I'm hoping for the same. 

This is what's great about this thread, it has helped people make big decisions on their future, take control of their finances, and not rely on the system which usually goes against the masses. 

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