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

[Noallegiance]

2 hours ago, Loki said:

Very poor form to pass your thoughts off as their own if true. Sadly it was only a matter of time.

 

How many thoughts are our own?

Think long enough and the realisation is that the answer may be very close to none!

[Harley]

18 hours ago, Harley said:

Er, Mr AJ, the US markets do not close at 6pm, you just lock out your customers then!

https://market24hclock.com/#_

 

My bad, the US market does close early today, but I think I previously read on their website that they don't normally provide access the full hours but I may be wrong about that too (anyways, their website says only CDIs)!

[DurhamBorn]

Repsol's strategic plan for the next five years was pretty much as expected.Divi cut to 60c about what id of expected.Increasing to 75c by 2025,anyone buying at 7.5 euro or less should be happy with that,share buy backs to kick in in 2022 and including divi to be over 1euro a share in 2025,all based on an average Brent of $50 and henry hub of $2.50.

One worry is there was mention of cashflow over target would go into more renewables.That could mean capital destruction instead of boosted payouts.However one interesting nugget,and where i think Repsol is leading and others will follow is hints the renewable business will end up split and floated off on the market with an initial small minority stake,then i expect shareholders handed the equity.That would then mean the oil and gas side would be run for cash and dividends.That could prove lucrative is we see a green bubble.Shareholders could reap from both sides.

The interesting thing with BP and Repsol is they have almost locked themselves in payouts though id expect they would have to increase when cash flow explodes.

[Loki]

52 minutes ago, Noallegiance said:

How many thoughts are our own?

Think long enough and the realisation is that the answer may be very close to none!

I already thought of that

[Democorruptcy]

2 hours ago, DurhamBorn said:

Repsol's strategic plan for the next five years was pretty much as expected.Divi cut to 60c about what id of expected.Increasing to 75c by 2025,anyone buying at 7.5 euro or less should be happy with that,share buy backs to kick in in 2022 and including divi to be over 1euro a share in 2025,all based on an average Brent of $50 and henry hub of $2.50.

60c dividend = 48.6c after 19% Spanish withholding tax.

Not as bad as Germany 26.375%, France 28%, Sweden 30%, etc

https://topforeignstocks.com/2020/02/03/dividend-withholding-tax-rates-by-country-for-2020/

 

[harp]

11 hours ago, Cattle Prod said:

I hope they haven't told their IT dept about the refresh-esc trick you mentioned, saved me a subscription 

It doesnt work for me... probably doing something wrong

[harp]

Just now, harp said:

It doesnt work for me... probably doing something wrong

I kid you not! It just did! Cheers mate.

[DurhamBorn]

1 hour ago, Democorruptcy said:

60c dividend = 48.6c after 19% Spanish withholding tax.

Not as bad as Germany 26.375%, France 28%, Sweden 30%, etc

https://topforeignstocks.com/2020/02/03/dividend-withholding-tax-rates-by-country-for-2020/

 

Yes,no tax this year as its scrip if you want,simply sell scrip shares if income is wanted.Witholding tax is a pain and is a reason US shares are so tempting given zero tax in a SIPP

[MrXxxx]

5 hours ago, Noallegiance said:

How many thoughts are our own?

Think long enough and the realisation is that the answer may be very close to none!

The good/successful ones are always mine...for the bad ones I usually find someone else to blame :-)

[Castlevania]

2 hours ago, Democorruptcy said:

60c dividend = 48.6c after 19% Spanish withholding tax.

Not as bad as Germany 26.375%, France 28%, Sweden 30%, etc

https://topforeignstocks.com/2020/02/03/dividend-withholding-tax-rates-by-country-for-2020/

 

They have a “Flexible Dividend Program”. So you can take as shares and then sell if you need the cash.

[DurhamBorn]

9 minutes ago, Castlevania said:

They have a “Flexible Dividend Program”. So you can take as shares and then sell if you need the cash.

Yes i use that one to avoid the with holding tax but im not sure they are going to use it next year and simply pay out as cash.I think it has something to do with having to have some many treasury shares or something.Hopefully they keep the flexible dividend as its perfect for large holdings as a small dealing charge gets you the cash tax free,though anything under 10 euros il be taking the shares as most of my Repsol is in my SIPP.

[Harley]

Another bummer to WHT for international shares is most broker conversion fees, mandatory in a GBP only ISA, where I was stung for £20 today on a £2k EUR CDI purchase.

[DurhamBorn]

1 minute ago, Harley said:

Another bummer to WHT for international shares is most broker conversion fees, mandatory in a GBP only ISA, where I was stung for £20 today on a £2k EUR CDI purchase.

Yeah i hate those charges Harley,but my shares that suffer it tend to be ones i intend to hold for a long time.Its also better than paying an IFA £10k a year to give you an hour meeting once a year and a load of waffle when really you are just in a 60/40 Vanguard scheme,a bond fund and a high growth ie 6 tech stocks mostly fund.

[UnconventionalWisdom]

23 hours ago, DurhamBorn said:

 

If you have a renewable energy development, say an offshore wind farm, then you know what that revenue is pretty much going to be over the next 20 to 30 years. 

The exact thing BP are developing. These woke idiots should do a bit of googling.

[Harley]

With the potential CGT changes, currency conversion fees in most SiPP/ISA brokers, and the ability to claim UK tax relief for WHT, I'm probably going to hold most international div stocks outside a tax wrapper, save for North American stocks in a SIPP.

[Bricormortis]

Harry Dent screaming deflation. 13 minute video.

Contrary to the views expressed here of course, I found it interesting, talks bout gold a lot

[Castlevania]

23 minutes ago, DurhamBorn said:

Yes i use that one to avoid the with holding tax but im not sure they are going to use it next year and simply pay out as cash.I think it has something to do with having to have some many treasury shares or something.Hopefully they keep the flexible dividend as its perfect for large holdings as a small dealing charge gets you the cash tax free,though anything under 10 euros il be taking the shares as most of my Repsol is in my SIPP.

They’ve had it for a while, but yes they do seem to have to have enough retained earnings to go down that route.

https://www.repsol.com/en/shareholders-and-investors/repsol-on-the-stock-exchange/flexible-dividend-program/index.cshtml

[Castlevania]

23 hours ago, DurhamBorn said:

 

If you have a renewable energy development, say an offshore wind farm, then you know what that revenue is pretty much going to be over the next 20 to 30 years. 

Yes and no. I know of Spanish solar power companies that essentially borrowed to invest in Solar power back in the 2000’s before solar panel costs plummeted. The Spanish government offered a guaranteed price per unit of energy produced, so the companies borrowed, entered into interest rate swaps to fix the coupon on the borrowings and safe in the knowledge that the energy price was guaranteed sat back to collect the margin between the two. Then the financial crisis happened, the Spanish government being cash strapped and faced with some difficult decisions instead of cutting the subsidies they give to households cut the so called guaranteed price. It didn’t end well for the solar power companies.

[DurhamBorn]

22 minutes ago, Bricormortis said:

Harry Dent screaming deflation. 13 minute video.

Contrary to the views expressed here of course, I found it interesting, talks bout gold a lot

There is a very real risk still of deflation,but it will be very short lived i think.The explosion it would/will cause in derivative markets would see printing expand by a huge amount.Cycle turn slowly,even with massive fiscal injections,but this one has its rudder hard astern.

Dent said the dollar was going up at 100 when we said it was heading to 88,drifting slowly lower.

https://www.marketwatch.com/investing/index/dxy

I quite like Harry,his work on demographics is very interesting,and iv used some of his forecasts on that on road maps before,especially investing into India etc.

 

[sancho panza]

 

14 hours ago, Cattle Prod said:

I hope they haven't told their IT dept about the refresh-esc trick you mentioned, saved me a subscription 

WHat refresh-escape trick????

 

 

1 hour ago, Bricormortis said:

Harry Dent screaming deflation. 13 minute video.

Contrary to the views expressed here of course, I found it interesting, talks bout gold a lot

Harry Dent has been screaming deflation for as long as I can remember.A very lucid and engaging speaker but someone who needs to take on board that liquidity can undermine the most logical of thoughts.

The banking system is set up for a deflationary event,msot likely in corporate bond/money markets but also possibly car loans /revolving credit.But it has been set up for a deflationary event since 08.

This one will kick in once the infaltion is runnign and the Fed can't push liquidty like it's done over the last decade..

This BK could see the end of banks as we've known them.

[sancho panza]

1 hour ago, DurhamBorn said:

There is a very real risk still of deflation,but it will be very short lived i think.The explosion it would/will cause in derivative markets would see printing expand by a huge amount.Cycle turn slowly,even with massive fiscal injections,but this one has its rudder hard astern.

Dent said the dollar was going up at 100 when we said it was heading to 88,drifting slowly lower.

https://www.marketwatch.com/investing/index/dxy

I quite like Harry,his work on demographics is very interesting,and iv used some of his forecasts on that on road maps before,especially investing into India etc.

 

He's one of thsoe guys with some thought provoking things to say,but timing off him has been a danger.

You could go to a good few psoters on here incl your good self and develop a balanced plan for the future,for free.That's what undoes Harry,he needs to sell books.

I agree on his demogrphaic ideas.ALong side Paul Hodges,one of the few people to discuss them that I've read/heard.

 

[sancho panza]

Rosie on Macro voices.

I listne to this for Erik and Patrick as much as hte guests these days.

https://www.podbean.com/ew/pb-g3k9y-f35204

https://www.macrovoices.com/

[CVG]

4 hours ago, sancho panza said:

WHat refresh-escape trick????

Keep your finger on the ESC key while refreshing the page that says sign up required.

[AlfredTheLittle]

58 minutes ago, CVG said:

Keep your finger on the ESC key while refreshing the page that says sign up required.

The paywall loads just after the article, so you just press escape after the article has loaded but before the paywall comes up, and you can read whatever you like for free

[Lightscribe]

17 hours ago, CVG said:

I think that it relates to the false sense of security arising from the perceived favourable election result and continuing vaccine news. No need for safe havens!

This pretty much. The markets dislike uncertainty. They think that Biden is in, the vaccine is here and normal service resumes but with ever more QE stimulus coming.

Why would you need something like gold, when there’s stocks like Tesla (that isn’t based on anything silly like production/profit/dividends etc) will continue to go up and up forever?

If by some 4D chess move Trump manages to overturn it, the markets will tank and PMs will shoot back up. 

Other than that PMs will slowly decline from here until either the economic realisation causes the big kahuna next year or the masses start to realise that inflation is rapidly taking hold.