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


spunko

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sleepwello'nights
28 minutes ago, Democorruptcy said:

Housebuilders filled 4 out of the 5 FTSE shares with double digit daily gains.

 

risers.jpg

I don't follow the reason why they have made such gains. If Boris introduces a points based immigration system then it will be because he sees political capital in reducing the flow of immigrants. Wouldn't that reduce the demand for housing?

 

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10 minutes ago, sleepwello'nights said:

I don't follow the reason why they have made such gains. If Boris introduces a points based immigration system then it will be because he sees political capital in reducing the flow of immigrants. Wouldn't that reduce the demand for housing?

 

Maybe they know who’s in line to take over at the BoE from Carney?

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1 hour ago, Tdog said:

It doesnt cost much to build a house, a supermarket trolley pusher should be able to afford a brand new 70m2 house.

If the nation is accepts that the corporations are to house us then it's going to be far worse than i already think under this anti-capitalist Conservative party.

Seems to work well in places like Germany.  This is to complement buying, to tidy up the current scummy rental sector, and accepts the increasing UK population.  The big pension funds build and professionally rent out on long term lease, earning income to pay pensions (better than government bonds!).  And as they are long term holders they look for good build quality and maintenance.  Also easier to regulate than a series of mum and pops.  But my focus on this thread was not the politics but the naughty idea that these big funds get involved and screw over the house-builders on price and quality!

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1 hour ago, sleepwello'nights said:

I don't follow the reason why they have made such gains. If Boris introduces a points based immigration system then it will be because he sees political capital in reducing the flow of immigrants. Wouldn't that reduce the demand for housing?

I think the answer lies in your question!  Boris and trust is something to be watched!

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6 hours ago, Harley said:

 

Capture.thumb.JPG.06df2579c637a6f109ff5f6401889a59.JPG

A rewrite:  Bunched a bit to show the important historic support levels.  One interpretation of several: a broadening wedge/megaphone (mauve) from Mar '17 until Dec '18, working down and up a series of lower parallel support lines.  May be in a bullish symmetrical triangle pattern (orange) since at least Aug '18.  But would any bull move just be a New Year Brexit relief rally or something with legs given the relative under-performance of the FTSE to date?  Or I'm mad!

I don't pay too much attention to chart patterns apart from bull/bear flags, KOBO ( kick off, blow off ) patterns, rounded bottoms, and adam-and-eve bottoms, but looking at that chart it does look rather like a bearish topping diamond pattern to me. 

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1 hour ago, Loki said:

So as the day draws to a close...does anyone have their eye on any other big future events that would relate to this thread?

Some form of banking crisis involving the usual suspects and maybe an outlier.  Liquidity issues, bail ins, etc.

A nasty budget early on in the 5 year term (i.e. next year).  For example, hitting pensions (e.g. restricting draw down, etc).

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1 minute ago, Harley said:

Some form of banking crisis involving the usual suspects and maybe an outlier.  Liquidity issues, bail ins, etc.

A nasty budget early on in the 5 year term (i.e. next year).  For example, hitting pensions (e.g. restricting draw down, etc).

Good point I hadn't thought about pensions, only 'right here right now' things like, as you say, a banking crisis.  

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Democorruptcy
2 hours ago, sleepwello'nights said:

I don't follow the reason why they have made such gains. If Boris introduces a points based immigration system then it will be because he sees political capital in reducing the flow of immigrants. Wouldn't that reduce the demand for housing?

 

I believe their manifesto had Help to Buy being extended from 2021 to 2023. Plus I assume with them being the party that introduced Help to Buy and on the hook for any potential losses from house price falls using the scheme, it's expected other props might be introduced. Also if you believe people hold off buying houses due to political uncertainty, a majority governbankment might release some pent up demand.

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9 hours ago, DurhamBorn said:

Iv got 88 on the dollar,shorter term target 94.5,but i have only been running liquidity and sentiment filters,no cross market work.Il be doing full work on it after xmas.I see oil down still though so im not sure on the interaction on the two yet as havent done the work.

 

Any chance we'll hit 70 before the big kahuna?

6 hours ago, Harley said:

"May be in a bullish symmetrical triangle pattern (orange) since at least Aug '19".

Also interesting how the EFT tracker and actual FTSE chart patterns differ!  The FTSE trackers (e.g. VUKE) fell much harder in October 2019 (over 2% difference) to give a downward channel rather than a symmetrical triangle.  Indeed quite a few differences at the peaks and troughs between the two, even more so recently.  Stock mix variance?

I'm no expert but I think the portfolios are rebalanced monthly

3 hours ago, Tdog said:

And why wouldn't they, market knows its a good bet that the Tory party will be diverting tens of billions of pounds of taxpayers money directly to their shareholders and directors over the coming 5 years. 

Persimmons share price since they came to power.

All the salivating on this website about Boris and the Tories today seems to have forgotten they're similar to Corbyn when it comes to socialism, just they've a more affluent client base, who somehow get to claim its capitalism.

image.png.7999326e2be825a75d061caaaad00e2e.png

I know we dont really do politvs on this thread but I have to agree with you.It's important to remembwer as @Harleyalludes ,waht you see isnt  necessarilywhat you get with Boris

1 hour ago, Harley said:

I think the answer lies in your question!  Boris and trust is something to be watched!

 

50 minutes ago, Democorruptcy said:

I believe their manifesto had Help to Buy being extended from 2021 to 2023. Plus I assume with them being the party that introduced Help to Buy and on the hook for any potential losses from house price falls using the scheme, it's expected other props might be introduced. Also if you believe people hold off buying houses due to political uncertainty, a majority governbankment might release some pent up demand.

I think it's safe to say they'll be trying to keep the wolves from the hosuebilders door as it'll keep the plates spinning.Be interesting to see how well they succeed

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8 minutes ago, sancho panza said:

No idea.Good question though.He posted this gaph as well,but the lines are very arbitrary

image.thumb.png.595762a6e81076a7daccd6c4a0b35634.png

 

On a similar vein,gold silver ration heading higher again

https://www.bullionbypost.co.uk/price-ratio/gold-silver-ratio-chart/

Cheers! I'd better think about getting an order in.  

With everything else we talk about here being electronic, I feel it can't hurt to concentrate on physical metals rather than ETFs.  (That is not to say I wouldn't buy more shares in miners. Only NGD at the moment)

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1 minute ago, Loki said:

Cheers! I'd better think about getting an order in.  

With everything else we talk about here being electronic, I feel it can't hurt to concentrate on physical metals rather than ETFs.

Couple of the bigger silver miners, Fres/Hoc appear oversold but dyor natch

 

Decl:long both

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4 hours ago, Harley said:

Seems to work well in places like Germany.  This is to complement buying, to tidy up the current scummy rental sector, and accepts the increasing UK population.  The big pension funds build and professionally rent out on long term lease, earning income to pay pensions (better than government bonds!).  And as they are long term holders they look for good build quality and maintenance.  Also easier to regulate than a series of mum and pops.  But my focus on this thread was not the politics but the naughty idea that these big funds get involved and screw over the house-builders on price and quality!

Thats exactly what will happen i think.These are blue collar Tories getting elected in blue collar seats.They dont want to see house prices smashed,but they also want young people to be able to buy,or rent a decent priced house.I expect the big insurers will see things move their way to get into rented housing more.Tories would love to move the rented sector away from the owning one or two terraces and the housing associations/ALMOs.Boris has a chance to finish Labour for decades,i think he will take it.Expect massive investment spending to come,lots of it simply to encourage the private sector.

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Democorruptcy
9 hours ago, Tdog said:

Hammond already extended it to 2023 as his parting handout to himself, so not too sure why they put that in.
https://www.telegraph.co.uk/money/consumer-affairs/help-buy-scheme-extended-2023-first-time-buyers/

In my more optimistic moments i do hope now they've a huge majority, they can remove props lets the bubble burst so they actually have a few more owners to seek votes from in 2024.

  When Hammond extended it he limited it to FTBs only. I wasn't sure if the manifesto pledge meant it was going to be extended in full, to include existing homeowners as it does now. Reading the actual text it says 'we have extended' so maybe it's still FTBs only?

Here's the full Tory manifesto:

Some snippets from page 29 onwards:

"And we have extended the Help to Buy scheme from 2021 to 2023 and will review new ways to support home ownership following its completion"

"We will encourage a new market in long-term fixed rate mortgages which slash the cost of deposits, opening up a secure path to home ownership for first-time buyers in all parts of the United Kingdom"

"We will maintain our commitment to a Right to Buy for all council tenants. We will also maintain the voluntary Right to Buy scheme agreed with housing associations"

"We will offer more homes to local families, enabling councils to use developers’ contributions via the planning process to discount homes in perpetuity by a third for local people who cannot otherwise afford to buy in their area. Councils could use this to prioritise key workers in their area, like police, nurses and teachers"

"Infrastructure first. We will amend planning rules so that the infrastructure – roads, schools, GP surgeries – comes before people move into new homes. And our new £10 billion Single Housing Infrastructure Fund will help deliver it faster."

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Talking Monkey
11 hours ago, sancho panza said:

 

Any chance we'll hit 70 before the big kahuna?

I'm no expert but I think the portfolios are rebalanced monthly

I know we dont really do politvs on this thread but I have to agree with you.It's important to remembwer as @Harleyalludes ,waht you see isnt  necessarilywhat you get with Boris

 

I think it's safe to say they'll be trying to keep the wolves from the hosuebilders door as it'll keep the plates spinning.Be interesting to see how well they succeed

SP when the Big Kahuna hits the house builders surely will be absolutely smashed down

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3 hours ago, Talking Monkey said:

SP when the Big Kahuna hits the house builders surely will be absolutely smashed down

Yes.  I moved into a new-build in Dec 2008 and shortly after the builers on site were talking about the share price of Barratts which was around 34p.  It was before I started buying shares plus I didn't have the cash at the time.  I think some of them did and they must have done well out of it.  Next time I will be poised and ready.

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When did we predict this would happen?.Macro cycles drive the political cycle,not the other way around.The macro dis-inflation has ended up causing massive rips in the political landscape.Iv never seen anything like it here in the North,old miners were making sure they got to the polling stations to vote Tory.Seats that they have never ever won before getting 8000 majority.

https://www.theguardian.com/politics/2019/dec/14/boris-johnson-plans-to-go-on-spending-spree-in-north

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Durham even gets a name check!  I'm smashing the overtime recently to build up my stocks and shares ISA as much as possible before things kick off.  Anything catching your eye at the moment?

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19 hours ago, DurhamBorn said:

Thats exactly what will happen i think.These are blue collar Tories getting elected in blue collar seats.They dont want to see house prices smashed,but they also want young people to be able to buy,or rent a decent priced house.I expect the big insurers will see things move their way to get into rented housing more.Tories would love to move the rented sector away from the owning one or two terraces and the housing associations/ALMOs.Boris has a chance to finish Labour for decades,i think he will take it.Expect massive investment spending to come,lots of it simply to encourage the private sector.

Ever wondered what they will do with all that student accommodation that they have/are building but won't be able to fill?...some students will go to uni, stay in the halls/uni accommodation, and stay there for the rest of their working lives.

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12 hours ago, Talking Monkey said:

SP when the Big Kahuna hits the house builders surely will be absolutely smashed down

They're a leveraged play on the credit cycle...they will.

2 hours ago, Loki said:

Durham even gets a name check!  I'm smashing the overtime recently to build up my stocks and shares ISA as much as possible before things kick off.  Anything catching your eye at the moment?

Was about to say Big Oil till I read Cattle Prods post.I'm a speculator with a nose for value.CP post and contents are well worth reading/lsitening.I've been buying Exxon,ENI,Shell,BPEquinor since August.

DYOR natch

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5 minutes ago, sancho panza said:

Was about to say Big Oil till I read Cattle Prods post.I'm a speculator with a nose for value.CP post and contents are well worth reading/lsitening.I've been buying Exxon,ENI,Shell,BPEquinor since August.

DYOR natch

Thanks!  I haven't even started looking into oil yet (As I've seen durhamborn mention it outside the scope of his main infrastructure 'roadmap' I thought I'd focus on those sectors...only so many braincells and hours in a day)

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