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

[MrXxxx]

7 hours ago, Bricks & Mortar said:

I'll assume this is a declaration that you weren't trolling.  I must admit, I thought you might be.
In that case, the other part of Harley's advice should apply.  He was harsher than most of us.  But I think now,  he was being kind, and those of us who humoured you a bit were, inadvertently, potentially more unkind.  The idea of lobbing your Dad's nestegg into just 2 stocks, in the same sector, would be extremely high risk.
My advice would be find the original thread on HPC, and read that, "deflationary collapse", for the search engine.  Then find part one on this site, and of course you're in part 2.  Read them all.  It'll probably take days.  You'll find discussions of different share trading platforms.  Discussions of the likely path for the economy.  Book recommendations.  links to videos and blogs.  Shares that are likely to do well.  Pay attention to the discussion of Centrica, as it develops, for an example of what can go wrong, and why you need to spread risk around.  Take notes.  Make a list of the inestments you might like.  Check out their charts and teach yourself how to understand the financial information.

The idea of getting a cash nestegg invested is a good one.  Putting it into practice is full of pitfalls.  Best of luck to you.

Agree, the alternative (what you are currently suggesting) is going `all in on black`...on the rare occurrence that is pays off you are buying everyone drinks in the casino, but normally you end up `drowning your sorrows` at the bar with your last few coins you have left in your pocket.

[Harley]

9 hours ago, Panda said:

Be nice mate. No need to be unkind.

Joined HPC forum long before you probably broke you're duck...

Thanks for all the other responses. Very good of you all.

I'll have a rethink 

At the risk of feeding a troll, I am being nice.  Being not nice would be to respond in any other way.  Having a rethink is a good idea, either about being a troll or about learning basic accepted investing rules such as asset allocations.  End.

[TheCountOfNowhere]

1 hour ago, Castlevania said:

You should also try to understand how the company makes money. Ask yourself what  makes it unique, what are their strengths, weaknesses etc. Try and understand what headwinds the industry as a whole will face. Try and cover all the bases. Ultimately ask yourself if you’re comfortable investing in a particular company or industry.

For example transports have often come up as an area that should benefit going forward. I’m not sure about that, and haven’t been comfortable investing in the area, so haven’t. They may do very well going forward and I’ll miss out on that but I’m more comfortable investing in other areas that I do understand.

A few times in my life, I look back and think, I should have put a few quid into shares of company X because when I saw their product it was something new/innovative/different 

Here are the ones I missed and would have made a fortune from:

1) Microsoft: Windows 3.0

2) Apple (Twice): Mac then Ipod

3) Google: Their search engine was better than the rest

4) Cisco: The Internet,  well before the dot com bubble you could see the internet was going to be huge.

5) Intel: People started buying PCs en masse

6) Bit Coin: If I'd mined them at the start or bought at 10p a coin I'd have been a billionaire

There's probably a few more, like Wifi, Budget Airlines, Builders shares after HTB announced.

It's easy in retrospect but when you look at it the stuff that's made the big bucks were innovate and you looked at it and thought, "wow, this is going to change how people live".

You wont get rich buying Oil shares etc but that is more about protecting yourself.

Look about you now, what innovation do you see ?

What do you think the future holds for the world right now ?

1) Too many people, invest in stuff people need and is scarce

2) Funeral companies...there is a wave of them coming in the next 20 years

3) War/Arms...I still think this is inevitable as more and more fight over less and less

4) Biotech, as we can see right now, these people might be needed more and more in the future.

5)  Supermarkets might be a good bet, you can see how much we depend on them now !!!

6) AI....this will be big, but not for the reason people think ( e.g. cars ) it'll be big because BIG BROTHER IS WATCHING YOU.

If people have any suggestion for any investments for 1 to 6 then I'd be interested to hear them.

Does anyone else see anything in their daily life and think "WOW !!!"  ?

[Sasquatch]

WTI up a bit this morning 

 

Quote

 

[sleepwello'nights]

8 hours ago, Panda said:

Mate.

Life. Open your mouth. Ask. You get gunned down.  

I asked a question. F**k me why all the hysteria.

Just give me the answer or shut the f**k up.

Why post anything other than the answer?

 

Because society is full of odd unkind unhappy people looking for a verbal scrap f??king halfwits.

What's hard in answering a post without reading into it like its some kind of conspiracy.. Or some poor soul who ain't that bright?

F??k this.

What bullocks.

@Bricks & Mortar's post gives eminently sensible advice. Have you taken offense to it or using it to vent a bit at the earlier posts from others?

It's sound advice,  basically don't put all your eggs in one basket and do some research to gain an elementary understanding.

Having bought more Centrica when they halved to 60p what do I know 

[Harley]

8 hours ago, Panda said:

Just give me the answer or shut the f**k up.

Agreed.  Apologies.  My mistake.

[TheCountOfNowhere]

3 minutes ago, Sasquatch said:

WTI up a bit this morning 

 

 

You'd have done well, if you'd bought at -$35 

4 minutes ago, sleepwello'nights said:

@Bricks & Mortar's post gives eminently sensible advice. Have you taken offense to it or using it to vent a bit at the earlier posts from others?

It's sound advice,  basically don't put all your eggs in one basket and do some research to gain an elementary understanding.

Having bought more Centrica when they halved to 60p what do I know 

Remember....NEVER BUY CENTRICA

[Democorruptcy]

8 hours ago, Panda said:

Mate.

Life. Open your mouth. Ask. You get gunned down.  

I asked a question. F**k me why all the hysteria.

Just give me the answer or shut the f**k up.

Why post anything other than the answer?

 

Because society is full of odd unkind unhappy people looking for a verbal scrap f??king halfwits.

What's hard in answering a post without reading into it like its some kind of conspiracy.. Or some poor soul who ain't that bright?

F??k this.

What bullocks.

I was just going to say Panda is not a troll, he's one of the good guys and I've known him for years. Then you go and do one on Bricks & Mortar for what I thought was a reasonable post.

I'm putting all these troll suggestions and tensions down to the fact that the world has gone mad.

Calm people, we are in this shit together.

[sleepwello'nights]

18 minutes ago, TheCountOfNowhere said:

A few times in my life, I look back and think, I should have put a few quid into shares of company X because when I saw their product it was something new/innovative/different 

Here are the ones I missed and would have made a fortune from:

 

Does anyone else see anything in their daily life and think "WOW !!!"  ?

I always rue the day I thought about buying some shares in Next. They'd dropped to about 12p. They had a shareholder discount scheme where if you had I think it was 50 shares or it might have been 500, Say it was 500 so for £60 my wife, a professional shopper, could get one purchase a year at a big discount. That one purchase wouldn't be restricted at all so you could buy thousands of pounds worth of what they sold. 

My wife had managed one of their stores in the past so should did buy lots of their clothing and knew how they were managed. It was about the time that George Davis, who rejuvenated the retail operation of Hepworth Tailoring by turning it into Next was ousted. So there was lots of speculation that without him they would return to a non-descript existence without his flair.

So I bought some M&S shares instead. Those 12p shares soared to reach the giddy heights of £80 and their dividend return outstripped most other retailers. Hey ho, it still fucking hurts. 

[TheCountOfNowhere]

1 minute ago, Democorruptcy said:

I was just going to say Panda is not a troll, he's one of the good guys and I've known him for years. Then you go and do one on Bricks & Mortar for what I thought was a reasonable post.

I'm putting all these troll suggestions and tensions down to the fact that the world has gone mad.

Calm people, we are in this shit together.

The trolling's not so bad on here, though I have blocked 200 people so far 

I can see what both sides are saying, Panda, if you need to ask advice from Random people on the internet then you need to step back and have a think about what you are doing.  However, I can see why you are asking, this thread is priceless and DB does seem to have a very good handle on what's going on.  Though, saying that I have lost about 5K in the last 2 months, if I'd taken my own advice then I'd be starting to invest next month or so.

There are no easy answers you need to do whatever you think right to try and protect yourself.

It's a no brainer though not to risk everything on one company, no type of share, one asset class.

Seek advice from as many sources as you can, but make the decision based on what you think is right.  If it goes wrong then you only have yourself to blame.

 

 

[TheCountOfNowhere]

7 minutes ago, sleepwello'nights said:

I always rue the day I thought about buying some shares in Next. They'd dropped to about 12p. They had a shareholder discount scheme where if you had I think it was 50 shares or it might have been 500, Say it was 500 so for £60 my wife, a professional shopper, could get one purchase a year at a big discount. That one purchase wouldn't be restricted at all so you could buy thousands of pounds worth of what they sold. 

My wife had managed one of their stores in the past so should did buy lots of their clothing and knew how they were managed. It was about the time that George Davis, who rejuvenated the retail operation of Hepworth Tailoring by turning it into Next was ousted. So there was lots of speculation that without him they would return to a non-descript existence without his flair.

So I bought some M&S shares instead. Those 12p shares soared to reach the giddy heights of £80 and their dividend return outstripped most other retailers. Hey ho, it still fucking hurts. 

That's the sort of thing.  Personal experience is a great way to make a fortune, it's down to luck and judgement tho, neither of which many people have :-) 

The problem I've seen since about 2012, there's nothing much worth investing in.

Bubbles everywhere.  You're going to lose no matter what turn you take.

Best solution was to ultimately lose less than everyone else.

Not many sell out and make money, the bubbles burst and most lose out, it's a mathematical certainty.  It's better to get ready to hold the cash and pounce when you think the bubble has burst.

Looking forward to my 1960's Ferrari for a tenner soon :-) 

 

 

[sleepwello'nights]

1 minute ago, TheCountOfNowhere said:

 

Looking forward to my 1960's Ferrari for a tenner soon :-) 

 

 

Your investments are going to have to do well to be able to run it.  

[Democorruptcy]

5 minutes ago, TheCountOfNowhere said:

The trolling's not so bad on here, though I have blocked 200 people so far 

I can see what both sides are saying, Panda, if you need to ask advice from Random people on the internet then you need to step back and have a think about what you are doing.  However, I can see why you are asking, this thread is priceless and DB does seem to have a very good handle on what's going on.  Though, saying that I have lost about 5K in the last 2 months, if I'd taken my own advice then I'd be starting to invest next month or so.

There are no easy answers you need to do whatever you think right to try and protect yourself.

It's a no brainer though not to risk everything on one company, no type of share, one asset class.

Seek advice from as many sources as you can, but make the decision based on what you think is right.  If it goes wrong then you only have yourself to blame.

 

 

Panda is not a troll he is just someone with no experience of investing. I can partly understand why he would say 2 shares given the bias towards major oilies on here. I'd sell a few of my others at the prices I paid (yes I'm thinking about that one) to buy more RDSB even today.

[Castlevania]

29 minutes ago, TheCountOfNowhere said:

A few times in my life, I look back and think, I should have put a few quid into shares of company X because when I saw their product it was something new/innovative/different 

Here are the ones I missed and would have made a fortune from:

1) Microsoft: Windows 3.0

2) Apple (Twice): Mac then Ipod

3) Google: Their search engine was better than the rest

4) Cisco: The Internet,  well before the dot com bubble you could see the internet was going to be huge.

5) Intel: People started buying PCs en masse

6) Bit Coin: If I'd mined them at the start or bought at 10p a coin I'd have been a billionaire

There's probably a few more, like Wifi, Budget Airlines, Builders shares after HTB announced.

It's easy in retrospect but when you look at it the stuff that's made the big bucks were innovate and you looked at it and thought, "wow, this is going to change how people live".

You wont get rich buying Oil shares etc but that is more about protecting yourself.

Look about you now, what innovation do you see ?

What do you think the future holds for the world right now ?

1) Too many people, invest in stuff people need and is scarce

2) Funeral companies...there is a wave of them coming in the next 20 years

3) War/Arms...I still think this is inevitable as more and more fight over less and less

4) Biotech, as we can see right now, these people might be needed more and more in the future.

5)  Supermarkets might be a good bet, you can see how much we depend on them now !!!

6) AI....this will be big, but not for the reason people think ( e.g. cars ) it'll be big because BIG BROTHER IS WATCHING YOU.

If people have any suggestion for any investments for 1 to 6 then I'd be interested to hear them.

Does anyone else see anything in their daily life and think "WOW !!!"  ?

Netflix for me. I’ve been a subscriber since a month or so after Netflix launched in the U.K. (early 2012). I thought it was amazing (this was the future!) and remember telling everyone how great it was. I didn’t think to buy the shares. They were a lot cheaper back then.

[TheCountOfNowhere]

2 minutes ago, Democorruptcy said:

Panda is not a troll he is just someone with no experience of investing. I can partly understand why he would say 2 shares given the bias towards major oilies on here. I'd sell a few of my others at the prices I paid (yes I'm thinking about that one) to buy more RDSB even today.

100% agree.

When faced with the s**t hitting the fan, this thread looks like the only sanity on the internet.  

1 minute ago, Castlevania said:

Netflix for me. I’ve been a subscriber since a month or so after Netflix launched in the U.K. (early 2012). I thought it was amazing (this was the future!) and remember telling everyone how great it was. I didn’t think to buy the shares. They were a lot cheaper back then.

Just had a look, about  400x higher :-) 

[sancho panza]

@DurhamBorn @Cattle Prod @MvRor anyone else.Learned something this morning and that's some futures are physically settled......I can see why I was confused as it appears roughly only 2% of futures get physically settled and there are varying oil contracts that are iether cash/physcial delivery based upon where the contract is issued.

I'm genuinely interested in what's going to happen ref physical oil getting delivered.I know nothing about the retender process and whether some of these traders who've got caught will be able to.

Wolf St yesterday is saying physical delivery will happen.Whcih is confirmed by the link below as we're talking Nymex(I was totally unaware of this difference).

As one of my expereinced  colleagues says 'Every day's a learning day.Day you stop learning is the day you shoudl give up' etc etc.

https://wolfstreet.com/2020/04/20/holy-wtf-moly-wti-crude-oil-may-contracts-collapse-to-negative-35/

It’s not often that we’re served up a WTF moment like this. Just about a couple of hours ago, I published my article about US crude-oil benchmark grade West Texas Intermediate (WTI) and how the May futures contract for it collapsed by 45% to $10 a barrel — US Crude Oil Gets Annihilated Under Targeted Saudi Attack — and I pointed at some of the dynamics. But WTI kept plunging.

It seems some oil trading firms and hedge funds were caught on the wrong side of heavily leveraged bets, and couldn’t roll over their contracts due to a liquidity crunch and horrible market conditions in that space. But if they can’t sell the contracts by tomorrow, they’ll have to take delivery of the physical oil at the delivery point for NYMEX futures, namely in Cushing, Oklahoma.

The delivery time is in May. But storage in Cushing for May seems to have been spoken for, and now these traders see that they have no place to go with this oil that they might have to take delivery of in May.

https://www.danielstrading.com/2014/01/03/physical-delivery-vs-cash-settlement

Popular cash settled contracts at the CME Group are the Emini S&P 500, Emini NASDAQ, Emini DOW, Lean Hogs and Feeder Cattle. Popular cash settled contracts at the ICE exchange are the Mini Russell 2000, WTI Crude Oil and Natural Gas. Brent Crude Oil is physical delivered but it has an option to cash settle.

At the end of the contract the holder of the position will either have to deliver the physical commodity if short or take delivery if long. It is estimated that only 2% of all futures contracts are actually delivered. All Physically Delivered contracts have both a First Notice Day and a Last Trading Day. Most brokers, if not all, will notify traders if they are in a contract and First Notice Day is approaching.

If a trader wants to deliver or take delivery of a commodity, they will coordinate with their broker, the clearing firm and the exchange in order to do so. If the trader does not want to take delivery, they can “retender.”

Popular Physical Delivery futures contracts include (but are not limited to) CME Currencies (Euro, JPY, & GPB), CBOT Treasuries (2 yr, 5yr, 10 yr, & 30 yr), NYMEX Energies (Crude Oil, Natural Gas, RBOB Gasoline, & Heating Oil), CME Live Cattle, CBOT Grains (Corn, Wheat, Soybeans, Soybean Meal, Soybean Oil, Rice, and Oats), COMEX Metals (Gold, Silver, & Copper), and ICE Softs (Sugar, Cotton, Cocoa, Coffee and OJ).

[Dave Bloke]

2 hours ago, Castlevania said:

You should also try to understand how the company makes money.

Reminds me of a friend who piled into Sun  just before the dot bomb with his life savings because Sun, unlike the .coms made real stuff not just bullshit websites. I pointed out they made servers used by the .coms and the banks that financed them. He lost his shirt. They were throwing sun servers in the garbage because no-one wanted them and they were already out of date by 2001.

Same thing for the place I work. A multinational telco. Their share price has bounced right back this week because everyone is going to be remote working, innit. But our commercial director said a lot of firms and individuals/S.E. were cancelling mobile contracts and looking to make savings which will hit us.

[sancho panza]

5 hours ago, leonardratso said:

https://www.barchart.com/futures/quotes/CL*0/futures-prices

 

Absolutely fascinating.So glad I'm not involved iether side of that.

[sancho panza]

2 hours ago, Castlevania said:

You should also try to understand how the company makes money. Ask yourself what  makes it unique, what are their strengths, weaknesses etc. Try and understand what headwinds the industry as a whole will face. Try and cover all the bases. Ultimately ask yourself if you’re comfortable investing in a particular company or industry.

For example transports have often come up as an area that should benefit going forward. I’m not sure about that, and haven’t been comfortable investing in the area, so haven’t. They may do very well going forward and I’ll miss out on that but I’m more comfortable investing in other areas that I do understand.

I took the decomplex trade there and jsut bought more oil.I think picking between the potential winners and losers needs a lot of studying, is really hard and my previous efforts haven't instilled much confidence in me.

Trying to dodge the value traps is hard,see my various efforts at plunging myself deeper into the mire on the share that shan't be named.

I look at telecoms.Compelling in many ways,but this side of a debt deflation I'm a little nervous at some of the debt to equity ratios.I was looking at my old planned portfolio from 2018 the other day and it had 25% Telecoms pencilled in,8% oil.We're currently about 45% big oil&gas and 0.4% Vodafone.Go figure.

[sancho panza]

48 minutes ago, TheCountOfNowhere said:

You'd have done well, if you'd bought at -$35 

Remember....NEVER BUY CENTRICA

you keep breaking the first rule of fight club.

[TheCountOfNowhere]

15 minutes ago, Dave Bloke said:

Reminds me of a friend who piled into Sun  just before the dot bomb with his life savings because Sun, unlike the .coms made real stuff not just bullshit websites. I pointed out they made servers used by the .coms and the banks that financed them. He lost his shirt. They were throwing sun servers in the garbage because no-one wanted them and they were already out of date by 2001.

Same thing for the place I work. A multinational telco. Their share price has bounced right back this week because everyone is going to be remote working, innit. But our commercial director said a lot of firms and individuals/S.E. were cancelling mobile contracts and looking to make savings which will hit us.

Oracle bought out sun....have you see the Oracle share price !!!!

1 minute ago, sancho panza said:

you keep breaking the first rule of fight club.

Trying to make sure people stop getting punched in the face

[sancho panza]

57 minutes ago, sleepwello'nights said:

 

Having bought more Centrica when they halved to 60p what do I know 

I remember averaging in at £1-60, £1-40, £1.20..feels like a different decade....................................worst trade for us since Northern Rock.

[DurhamBorn]

The thing to remember mostly though is this thread is a macro strategy thread.Its about reading the longer term cycles and roughly where we are in them.

A macro road map at no point says "buy xyz".It doesnt in any way say if a company is cheap,expensive etc.Investing styles and allocations are endless.Even all things being equal where someone invests ages 25 compared to me at 48 makes a big difference.For myself im not really interested in increasing wealth,im more interested in keeping it where it is inflation adjusted and gaining an income that lets me live my pretty simple life.

Im very happy though to be able to buy companies i think the cycle will help at prices down 50% to 80% from their highs.Then its a case of sit back and let the cycle play out.

My oil road map said oil was going down to $40 from $60 and maybe $15 .It didnt tell me the price Shell would go to.It did mean though i got an average price of £12.35 on the stock.It doesnt tell me if Shell will go to £5,or even bust.It did allow me to buy over 50% down from its highs.My road map says oil over $200 in 28.If thats right,or even just the direction Shell should be £40+.Im actually confident if it survives (always an if on anything) it will hit that price.I have no idea if next week it will be £15 or £10.In macro strategy longer terms calls are much easier than short term ones.Thats why its difficult on an open forum and thread,because human nature is to want answers to tomorrow,loss hurts,and emotions take over where contrarian macro investing is all about letting things play out over a longer timeframe,a full cycle.

 

 

[MvR]

21 minutes ago, sancho panza said:

@DurhamBorn @Cattle Prod @MvRor anyone else.Learned something this morning and that's some futures are physically settled......I can see why I was confused as it appears roughly only 2% of futures get physically settled and there are varying oil contracts that are iether cash/physcial delivery based upon where the contract is issued.

Apparently there were over 100k contracts still outstanding for the front month contract yesterday afternoon, and everyone was getting margin calls. 100k contracts, at 1000 barrels per contract = 100m barrels of oil that in theory someone needs to collect in May and find storage for.   God knows how it'll all play out..

[RickyBacker]

1 hour ago, TheCountOfNowhere said:

A few times in my life, I look back and think, I should have put a few quid into shares of company X because when I saw their product it was something new/innovative/different 

Here are the ones I missed and would have made a fortune from:

1) Microsoft: Windows 3.0

2) Apple (Twice): Mac then Ipod

3) Google: Their search engine was better than the rest

4) Cisco: The Internet,  well before the dot com bubble you could see the internet was going to be huge.

5) Intel: People started buying PCs en masse

6) Bit Coin: If I'd mined them at the start or bought at 10p a coin I'd have been a billionaire

There's probably a few more, like Wifi, Budget Airlines, Builders shares after HTB announced.

It's easy in retrospect but when you look at it the stuff that's made the big bucks were innovate and you looked at it and thought, "wow, this is going to change how people live".

You wont get rich buying Oil shares etc but that is more about protecting yourself.

Look about you now, what innovation do you see ?

What do you think the future holds for the world right now ?

1) Too many people, invest in stuff people need and is scarce

2) Funeral companies...there is a wave of them coming in the next 20 years

3) War/Arms...I still think this is inevitable as more and more fight over less and less

4) Biotech, as we can see right now, these people might be needed more and more in the future.

5)  Supermarkets might be a good bet, you can see how much we depend on them now !!!

6) AI....this will be big, but not for the reason people think ( e.g. cars ) it'll be big because BIG BROTHER IS WATCHING YOU.

If people have any suggestion for any investments for 1 to 6 then I'd be interested to hear them.

Does anyone else see anything in their daily life and think "WOW !!!"  ?

Only to reiterate my earlier 'graphene' call.
I also notice there is a piece on the BBC about a 'hydrogen sponge' that ties in well with DB's call on that possibility.