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

[TheCountOfNowhere]

3 hours ago, TheNickos said:

I don't think my Shell fill up cost has changed in several months.

Tesco petrol was up at 1 38, niw 1.20 with a voucher, 1.25 without 

Bought 2k of shell shares today. Expect further falls but big profit in the future. Intend to buy more

[BoSon]

Rate cuts to stimulate the economy? Is a fraction of 1% going to make any real difference? They don't have much room to cut more unless they go negative. Some places are already in effect negative when considering inflation.

Maybe they'll pay the mortgages for us. 

Though if all the CEOs and their lackies are off hiding on Branson's island or somewhere, there will be a lot of empty mansions for squatters property watchers to get for free, and that's before all the oldies cark it freeing up thousands of houses and bungalows, and the properly built ones at that not the newbuild crap they are throwing up on floodplains.

Lots of positives if one managed to avoid the negatives.

[Majorpain]

46 minutes ago, Heart's Ease said:

 

Absolutely not to detail this thread as we have a Q thread - whatever your thoughts on Q it's helpful to be aware of Resignation Anon's Twitter feed. He/she has been tracking resignations for two years (something Q asked be done after Trump signed an "Executive Order Blocking the Property of Persons Involved in Serious Human Rights Abuse or Corruption" in December 2017).  No matter why they are resigning, it's one heck of a clear out.

Whilst i don't want to slag off the US Military's Q-Anon operation, every recession is always preceded by executives seeing the raw numbers and pulling the ejection handle.  This cycle will not be any different IMO.

[TheCountOfNowhere]

9 minutes ago, BoSon said:

Rate cuts to stimulate the economy? Is a fraction of 1% going to make any real difference? They don't have much room to cut more unless they go negative. Some places are already in effect negative when considering inflation.

Maybe they'll pay the mortgages for us. 

Though if all the CEOs and their lackies are off hiding on Branson's island or somewhere, there will be a lot of empty mansions for squatters property watchers to get for free, and that's before all the oldies cark it freeing up thousands of houses and bungalows, and the properly built ones at that not the newbuild crap they are throwing up on floodplains.

Lots of positives if one managed to avoid the negatives.

Rates curs werent to stimulate the ecomomy.... They were to protext the rich. 

 

Theyll all be off now with pickets full of free cash to necker island to live 

[Heart's Ease]

2 minutes ago, Majorpain said:

Whilst i don't want to slag off the US Military's Q-Anon operation, every recession is always preceded by executives seeing the raw numbers and pulling the ejection handle.  This cycle will not be any different IMO.

Yup, same in 2008 (and every cycle beforehand as you say).  I'm glad someone is pulling a list together - helps with the mood music.

[JMD]

59 minutes ago, Democorruptcy said:

It was Saville Town Dewsbury, near where the 7/7 bomber was based.

I didn't see anything in the papers but I was only buying the Racing Post! Pre-mobile phone and I didn't have a camera on me.

In terms of location I notice I wasn't completely wrong, Dewsbury being in, shall we say, the 'Bradford/Rotherham corridor'.

But actually the reason I commented was because the story you told kinda reminded me of an 'opposing' BBC TV news report - from I think the same time as those petrol shortages you mention - but the one I recall was a very positive story, where Asian petrol-station owners argued and chased off people who were demanding to be served petrol. 

 

Mass uncontrolled immigration/multiculturalism is a tragic political experiment (even Merkel ironically enough has already stated it's failed). Individuals (whatever their race) are all the same, but cultures are very different - and I think that our so called 'identity politics' - which is so regularly spoken about - is just the precursor to a very heated and prolonged, but hopefully pretty low-level, clash of cultural identity and values.

...I know this is not the space for this particular discussion. But I am beginning to fear how nasty things could get if there was a future economic/monetary collapse (maybe i'm reading/comprehending? this blog too much!), and made far worse in societies that are not cohesive. 

[Democorruptcy]

36 minutes ago, BoSon said:

Rate cuts to stimulate the economy? Is a fraction of 1% going to make any real difference? They don't have much room to cut more unless they go negative. Some places are already in effect negative when considering inflation.

Maybe they'll pay the mortgages for us. 

Though if all the CEOs and their lackies are off hiding on Branson's island or somewhere, there will be a lot of empty mansions for squatters property watchers to get for free, and that's before all the oldies cark it freeing up thousands of houses and bungalows, and the properly built ones at that not the newbuild crap they are throwing up on floodplains.

Lots of positives if one managed to avoid the negatives.

Like Denmark's -0.5% 10 year fix, launched last August?

https://www.theguardian.com/money/2019/aug/13/danish-bank-launches-worlds-first-negative-interest-rate-mortgage

[CVG]

1 hour ago, Democorruptcy said:

I was only buying the Racing Post!

Misread as Racist Post!

[BadAlchemy]

On 25/02/2020 at 23:09, Thorn said:

They seem to have changed over to new ticker/ check out SSW.JO

And the Sibanye 'ADR' stock , on Hargreaves Lansdown, appears to be changing to SBSW. Still saying "Market Data Not Available" though so not quite there yet...

[DurhamBorn]

Ok oil is now crossing into my $43 bottom target range.This is not advice,but if i was setting ladders against my road map on the oil companies id be buying 1/3 now,1/3 oil at $45.50 and last third at $43.50.Id also be very tempted to split the bottom ladder among the other two and accept some downside due to the rubber band being very stretched.

Remember when almost everyone in the MSM etc was saying oil was a strong buy at $60? Middle east tension etc.?.Downside then was very clear in the macro picture.

There is a small risk the paper market undershoots ,but it will come back quickly.For reference,not trading advice my road map went from and goes $60-$43-$71-$18-$290.

 

 

 

[TheCountOfNowhere]

4 minutes ago, DurhamBorn said:

Ok oil is now crossing into my $43 bottom target range.This is not advice,but if i was setting ladders against my road map on the oil companies id be buying 1/3 now,1/3 oil at $45.50 and last third at $43.50.Id also be very tempted to split the bottom ladder among the other two and accept some downside due to the rubber band being very stretched.

Remember when almost everyone in the MSM etc was saying oil was a strong buy at $60? Middle east tension etc.?.Downside then was very clear in the macro picture.

There is a small risk the paper market undershoots ,but it will come back quickly.For reference,not trading advice my road map went from and goes $60-$43-$71-$18-$290.

 

 

 

What oil stocks are you buying? 

[DurhamBorn]

The stimulus will come from the Fed and all other CBs funding massive government deficits.This isnt about the consumer anymore.The consumer cycle is over.This is all about production,the backbone of an economy.Money will go direct into the economy.House and interest rates will take a back seat.Until half way through the cycle when they will really move.3% by 2024/25 9%+ 2028

[DurhamBorn]

1 minute ago, TheCountOfNowhere said:

What oil sticks are you buying? 

Bp,Shell B,Repsol first line,next line Equinor,Imperial Oil, Schlumberger,next line Oxidental ,Plains American,last line (very small amounts Vermillion,Gaslog,DCP Midstream

[Elbrus]

23 minutes ago, DurhamBorn said:

Bp,Shell B,Repsol first line,next line Equinor,Imperial Oil, Schlumberger,next line Oxidental ,Plains American,last line (very small amounts Vermillion,Gaslog,DCP Midstream

is there a reason for no exxon? just wanted to check,  a complete amateur me....

[dgul]

2 hours ago, BoSon said:

Rate cuts to stimulate the economy? Is a fraction of 1% going to make any real difference? They don't have much room to cut more unless they go negative. Some places are already in effect negative when considering inflation.

Maybe they'll pay the mortgages for us. 

Though if all the CEOs and their lackies are off hiding on Branson's island or somewhere, there will be a lot of empty mansions for squatters property watchers to get for free, and that's before all the oldies cark it freeing up thousands of houses and bungalows, and the properly built ones at that not the newbuild crap they are throwing up on floodplains.

Lots of positives if one managed to avoid the negatives.

First we'll have son-of-MIRAS (for all debt, not just mortgage).

[steppensheep]

During the brexit phoney war, carney claimed interest rates would be raised in the event of a no deal, as it would be a supply shock that would lead to inflation if demand wasnt supressed. Man was a serial liar with respect to forward guidance, but presumably a similar argument could apply to current situation. 

[Barnsey]

WTI $46 

[Transistor Man]

45 minutes ago, steppensheep said:

During the brexit phoney war, carney claimed interest rates would be raised in the event of a no deal, as it would be a supply shock that would lead to inflation if demand wasnt supressed. Man was a serial liar with respect to forward guidance, but presumably a similar argument could apply to current situation. 

He did.

Actually he said both. Lowered and raised.

......."The governor had previously seemed to suggest that a no-deal Brexit could result in a rate cut to support the economy by making borrowing cheaper, as occurred after the Brexit referendum in 2016."

........"But according to reports of a briefing that Mr Carney gave to the cabinet on Thursday, he fears that such a rupture with the EU could represent a severe “contraction of supply” capacity in the UK economy. This could mean that inflation would be in danger of getting out of hand without early rate rises, particularly if sterling plummeted again, pushing up domestic import prices."

He should have said he didn't have a clue.

 

 

[DoINeedOne]

Well this virus is certainly having an effect me wondering if i should buy or wait 

 

 

 

[Solzhenitsyn]

1 hour ago, DurhamBorn said:

Ok oil is now crossing into my $43 bottom target range.This is not advice,but if i was setting ladders against my road map on the oil companies id be buying 1/3 now,1/3 oil at $45.50 and last third at $43.50.Id also be very tempted to split the bottom ladder among the other two and accept some downside due to the rubber band being very stretched.

Remember when almost everyone in the MSM etc was saying oil was a strong buy at $60? Middle east tension etc.?.Downside then was very clear in the macro picture.

There is a small risk the paper market undershoots ,but it will come back quickly.For reference,not trading advice my road map went from and goes $60-$43-$71-$18-$290.

 

 

 

Hi DB,

 

Presumably if we are at/around your bottom target in oil, then you must expect the bottom in stock markets is in or close? Surely the two would closely correspond to each other in time? No matter how much it goes down now, I can't see oil not going down in a major debt deflation event...

Also, the gold/silver peak for the cycle must be close before it all goes down together?

[Barnsey]

 

[kibuc]

WTF did just happen to the miners???

[reformed nice guy]

4 minutes ago, kibuc said:

WTF did just happen to the miners???

I assume no China means crashing sales of commodities?

More ladders for me!

[kibuc]

6 minutes ago, reformed nice guy said:

I assume no China means crashing sales of commodities?

More ladders for me!

The thing is, I can see a wall of red while gold is up strong and silver up marginally. I was thinking perhaps a "sell now, sell everything attitude" but that would include the underlying metals too?

Impact and Alexco started brightly only to find themselves at the wrong end of a 10% swing in a matter of half an hour, and they are not the only ones.

[reformed nice guy]

2 minutes ago, kibuc said:

The thing is, I can see a wall of red while gold is up strong and silver up marginally. I was thinking perhaps a "sell now, sell everything attitude" but that would include the underlying metals too?

Impact and Alexco started brightly only to find themselves at the wrong end of a 10% swing in a matter of half an hour, and they are not the only ones.

I have had the jitters as well but I am planning on holding my shares long term (10+ years, probably longer). I have just been sticking to ladders, using 10+% drops for each rung and taking "the law of round numbers" into account when setting each step. 

I run this alongside another portfolio of cheap non-UK index trackers (Japan, Asia, USA, Europe, India, misc), topping up each month.

In case anyone is interested, here are my current next ladders. I dont have current positions in them all and some require big(ger) drops to get to them. Prices are in pence when no currency is stated

 

name	type	prices
######################	#########	######
Angloamerican	mining	1700
Basf SE	chem	€55
BHP group	mining	1300
BP	oil	385
British American Tobacco	tobacco	2500
CARGOTEC	transport	€25
Centrica	energy	67.5
Chevron	oil	$94
Drax	energy	215
Equinor	oil	135NOK
Evonik	chems	€22
EVRAZ PLC	steel	225
Exxon	oil	$50
Glencore	mining	180
Kaz	mining	300
K & S AG	chem	€6
Mosaic		$16
Nutrien	potash	$50
PJSC Gazprom	oil	$6
Repsol	oil	€10
Rio Tinto	mining	2750
RoyalMail	logistics	120
SSE	energy	1000
Shell	oil	1600
Siemens		€90
Solvay	chems	€85
StageCoach	transport	100
Telefonica	telecoms	€5
Telia	telecoms	35SEK
Vodafone	telecoms	110
Wood group	oil	295
Yara	chems	300nok