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

[reformed nice guy]

https://www.dailymail.co.uk/news/article-8488947/Chancellor-Rishi-Sunak-warns-generation-young-people-risk-lost-coronavirus-pandemic.html

Good posts Sancho.

When you have people saving at a much higher rate than usual and the Chancellor saying:

"'This is a consumption-driven economy; people used to, three months ago, go out with their friends or family to go and have a meal. Or buy a car, or upgrade their house, or move house. Go camping, come up to the Yorkshire Dales and go coast-to-coast.' Mr Sunak added that it was important to get 'the next few bits right' in order to save the younger generation's jobs and lifestyles."

Insane times

[janch]

10 hours ago, The Idiocrat said:

there seemed to be a lot of emerging market funds that caught my eye on the list. 

I'm beginning to think that investing something in EMs or Japan/Singapore etc might be a good option especially if they haven't been hit so badly by CV-19 and when looking at what's going on here and in the US.  What do others think?

[Heart's Ease]

28 minutes ago, sancho panza said:

Inteersting piece on London which pretty much applies to msot of the UK.Sadly,it doesn't discuss foreign student numbers but covers a number of issues raised on here.

 

https://edition.cnn.com/2020/07/04/business/london-coronavirus-economy/index.html

The UK is reopening for business. London may never be the same

Underground journeys for the month of March tumbled 43% from the 106 million recorded in February, and plunged even further in April, during the height of lockdown, to just 5.7 million. Social distancing rules mean the Tube can only handle up to 15% of its normal traffic, according to London's mayor, Sadiq Khan.

 

The fallout from lockdown has been severe. London's economy is expected to contract nearly 17% this year, according to figures from the city government, a sharper drop than the 14% decline the Bank of England expects for the United Kingdom as a whole.

 

Companies in London are expected to shed some 460,000 jobs, or about 7% of the workforce, with manufacturing, construction, retail, and accommodation and food services the hardest hit. Employment is not expected to fully recover until 2022.

 

What happens to real estate, which accounts for 15% of London's economy, matters a great deal to the city.

The government has protected commercial tenants from eviction through August, but those measures will at some point expire. According to property management platform, Re-Leased, just 45% of commercial rents for the third quarter had been paid by early July. But that was an improvement on the previous three months and "a sign of the capital's resilience," said Re-Leased CEO, Tom Wallace.

 

Still, the penetration of online shopping during the coronavirus will mean a reduction in brick-and-mortar outlets, which could radically alter the landscape of London's vast retail space and create yet more uncertainty for the city's real estate market. "What would have happened over five years is happening over months," said Richards.

The City, reinvented

London's financial heart, referred to as the City of London, has a proven track record of reinvention.

Storied institutions like Lloyd's of London, the Bank of England and the London Stock Exchange have been around for centuries, withstanding radical social, political and economic turmoil.

 

Today, the City is home to well over 250 international banks and handles 43% of global foreign exchange trading, according to the Bank for International Settlements. Financial services contributed £65 billion ($81 billion) to the London economy in 2018, or about 15%, figures from City Hall show.

And despite four years of uncertainty over Brexit, the United Kingdom has been Europe's top location for international financial services investment over the past two decades, with London claiming the bulk of those flows.

 

There are factors working against the City, however. The UK government's handling of the coronavirus crisis has been widely criticized, and business and consumer confidence remains depressed.

 

The City of London may yet be tested. Crucially, there is currently no guarantee that UK financial firms will retain access to the European Union after this year — an export market worth £26 billion ($32.4 billion) in 2018, according to the Office for National Statistics, or 40% of the sector's total value.

 

The city is home to a large share of digital consumer businesses, Chandratillake said, including online grocer Ocado, digital banks such as Revolut and Monzo, and food delivery companies such as Deliveroo and Gousto.

 

London also boasts an outsized share of technology companies in areas such as cyber security and workforce management, now servicing armies of home workers. And the coronavirus has boosted investment into health technology, benefiting London and the United Kingdom more broadly.

 

Leisure and hospitality "really strategically matter," said Simpson. "People come from all over the world partly because London is a cool place to live."

Nearly 40% of Londoners are born outside the United Kingdom, making London one of the most cosmopolitan cities in the world. It is home to 1 million EU nationals and was the world's third most visited city in 2018, narrowly behind Paris and Bangkok, according to Mastercard.

Last year, London boasted 21.7 million overseas visitors who spent £15.7 billion ($19.6 billion) on the local economy and supported 250,000 jobs, according to the Office for National Statistics.

"That revenue keeps certain things alive in London," said UK Tourism Alliance director Kurt Janson. "The West End theaters couldn't survive if not for overseas visitors."

 

London's pubs and restaurants face an even greater threat from social distancing.

Already, Michelin-starred Texture and the upmarket Indian Accent, a Mayfair outpost of the Delhi original, have permanently closed. They are unlikely to be the only casualties.

Murat Kilic, the owner of Amber, in the hip East Aldgate neighborhood, told CNN Business that he is not confident about reopening. Amber is opening its doors on Saturday for the first time in nearly four months, but at less than half its previous capacity.

 

Whether Londoners are quick to return to bars and eateries remains to be seen. Worryingly, household income and expenditure are set to tumble by 5.5% and 12% respectively this year, and are not expected to reach 2019 levels before at least 2023, according to City Hall.

 

Thanks Sancho. It's a challenge for this northerner to separate out the bits where it refers to the city that is called London, and the City of London Corporation.  I'm hazarding a guess one of them will do better than the other! Some streets will always be paved with gold. 

[JMD]

2 hours ago, sancho panza said:

Tech crunch on the India/UK deal.I was gobsmacked we'd got a $1bn deal going through with UK govt as buyer and I had zero awareness of the players or the sector.Obviously heard of Bharti Global....but sitll.Unusally brave deal by UK govt.

Goes to shwo as well UK linking up with Commonwealth too.

Appreciate if any of our resident techies can enlighten us cave dwellers us ref the importance of this technology commerically.

 

 

'Distressed satellite constellation operator OneWeb, which had entered bankruptcy protection proceedings at the end of March, has completed a sale process, with a consortium led by the UK Government as the winner. The group, which includes funding from India’s Bharti Global – part of business magnate Sunil Mittal’s Bharti Enterprises – plan to pursue OneWeb’s plans of building out a broadband internets satellite network, while the UK would also like to potentially use the constellation for Positioning, Navigation and Timing (PNT) services in order to replace the EU’s sat-nav resource, which the UK lost access to in January as a result of Brexit.

The deal involves both Bharti Global and the UK government putting up around $500 million each, respectively, with the UK taking a 20 percent equity stake in OneWeb, and Bharti supplying the business management and commercial operations for the satellite firm.

OneWeb, which has launched a total of 74 of its planned 650 satellite constellation to date, suffered lay-offs and the subsequent bankruptcy filing after an attempt to raise additional funding to support continued launches and operations fell through. That was reportedly due in large part to majority private investor SoftBank backing out of commitments to invest additional funds.

 

The BBC reports that while OneWeb plans to essentially scale back up its existing operations, including reversing lay-offs, should the deal pass regulatory scrutiny, there’s a possibility that down the road it could relocate some of its existing manufacturing capacity to the UK. Currently, OneWeb does its spacecraft manufacturing out of Florida in a partnership with Airbus.

OneWeb is a London-based company already, and its constellation can provide access to low latency, high-speed broadband via low Earth orbit small satellites, which could potentially be a great resource for connecting UK citizens to affordable, quality connections. The PNT navigation services extension would be an extension of OneWeb’s existing mission, but theoretically, it’s a relatively inexpensive way to leverage planned in-space assets to serve a second purpose.

Also, while the UK currently lacks its own native launch capabilities, the country is working towards developing a number of spaceports for both vertical and horizontal take-off – which could enable companies like Virgin Orbit, and other newcomers like Skyrora, to establish small-sat launch capabilities from UK soil, which would make maintaining and extending in-space assets like OneWeb’s constellation much more accessible as a domestic resource.'

 

Really interesting SP, I was expecting Global Britain,, but Galactic Britain is something else!... Is an Anglo-Indian moon mission on the cards I wonder? As I have said before infrastructure spending is too slow, house building yes, but I think Freeports and big space projects will be where the 'fast and loose money printing' will be directed.

[JMD]

1 hour ago, sancho panza said:

Inteersting piece on London which pretty much applies to msot of the UK.Sadly,it doesn't discuss foreign student numbers but covers a number of issues raised on here.

 

https://edition.cnn.com/2020/07/04/business/london-coronavirus-economy/index.html

The UK is reopening for business. London may never be the same

Underground journeys for the month of March tumbled 43% from the 106 million recorded in February, and plunged even further in April, during the height of lockdown, to just 5.7 million. Social distancing rules mean the Tube can only handle up to 15% of its normal traffic, according to London's mayor, Sadiq Khan.

 

The fallout from lockdown has been severe. London's economy is expected to contract nearly 17% this year, according to figures from the city government, a sharper drop than the 14% decline the Bank of England expects for the United Kingdom as a whole.

 

Companies in London are expected to shed some 460,000 jobs, or about 7% of the workforce, with manufacturing, construction, retail, and accommodation and food services the hardest hit. Employment is not expected to fully recover until 2022.

 

What happens to real estate, which accounts for 15% of London's economy, matters a great deal to the city.

The government has protected commercial tenants from eviction through August, but those measures will at some point expire. According to property management platform, Re-Leased, just 45% of commercial rents for the third quarter had been paid by early July. But that was an improvement on the previous three months and "a sign of the capital's resilience," said Re-Leased CEO, Tom Wallace.

 

Still, the penetration of online shopping during the coronavirus will mean a reduction in brick-and-mortar outlets, which could radically alter the landscape of London's vast retail space and create yet more uncertainty for the city's real estate market. "What would have happened over five years is happening over months," said Richards.

The City, reinvented

London's financial heart, referred to as the City of London, has a proven track record of reinvention.

Storied institutions like Lloyd's of London, the Bank of England and the London Stock Exchange have been around for centuries, withstanding radical social, political and economic turmoil.

 

Today, the City is home to well over 250 international banks and handles 43% of global foreign exchange trading, according to the Bank for International Settlements. Financial services contributed £65 billion ($81 billion) to the London economy in 2018, or about 15%, figures from City Hall show.

And despite four years of uncertainty over Brexit, the United Kingdom has been Europe's top location for international financial services investment over the past two decades, with London claiming the bulk of those flows.

 

There are factors working against the City, however. The UK government's handling of the coronavirus crisis has been widely criticized, and business and consumer confidence remains depressed.

 

The City of London may yet be tested. Crucially, there is currently no guarantee that UK financial firms will retain access to the European Union after this year — an export market worth £26 billion ($32.4 billion) in 2018, according to the Office for National Statistics, or 40% of the sector's total value.

 

The city is home to a large share of digital consumer businesses, Chandratillake said, including online grocer Ocado, digital banks such as Revolut and Monzo, and food delivery companies such as Deliveroo and Gousto.

 

London also boasts an outsized share of technology companies in areas such as cyber security and workforce management, now servicing armies of home workers. And the coronavirus has boosted investment into health technology, benefiting London and the United Kingdom more broadly.

 

Leisure and hospitality "really strategically matter," said Simpson. "People come from all over the world partly because London is a cool place to live."

Nearly 40% of Londoners are born outside the United Kingdom, making London one of the most cosmopolitan cities in the world. It is home to 1 million EU nationals and was the world's third most visited city in 2018, narrowly behind Paris and Bangkok, according to Mastercard.

Last year, London boasted 21.7 million overseas visitors who spent £15.7 billion ($19.6 billion) on the local economy and supported 250,000 jobs, according to the Office for National Statistics.

"That revenue keeps certain things alive in London," said UK Tourism Alliance director Kurt Janson. "The West End theaters couldn't survive if not for overseas visitors."

 

London's pubs and restaurants face an even greater threat from social distancing.

Already, Michelin-starred Texture and the upmarket Indian Accent, a Mayfair outpost of the Delhi original, have permanently closed. They are unlikely to be the only casualties.

Murat Kilic, the owner of Amber, in the hip East Aldgate neighborhood, told CNN Business that he is not confident about reopening. Amber is opening its doors on Saturday for the first time in nearly four months, but at less than half its previous capacity.

 

Whether Londoners are quick to return to bars and eateries remains to be seen. Worryingly, household income and expenditure are set to tumble by 5.5% and 12% respectively this year, and are not expected to reach 2019 levels before at least 2023, according to City Hall.

I wrote some time back that I thought the Covid economy (whatever that is in reality?!) will be more impactful than the Green economy (whatever that really was?!). It's turning out to be depressingly true. Or am i being OTT?. ...Not being conspiitoral btw, all this is just the impetus for the required big  government spending after all.

[CVG]

3 hours ago, janch said:

I'm beginning to think that investing something in EMs or Japan/Singapore etc might be a good option especially if they haven't been hit so badly by CV-19 and when looking at what's going on here and in the US.  What do others think?

I have no idea what sectors and markets will outperform so I like to have a finger in most pies. In this case I use a couple of investment trusts to give me some exposure to Japan and EM. I prefer IT's to ETF's and Unit Trusts in this respect and pin my hopes on the IT management to make some good choices on my behalf. So far so good.

[JMD]

3 hours ago, CVG said:

I have no idea what sectors and markets will outperform so I like to have a finger in most pies. In this case I use a couple of investment trusts to give me some exposure to Japan and EM. I prefer IT's to ETF's and Unit Trusts in this respect and pin my hopes on the IT management to make some good choices on my behalf. So far so good.

CVG, I'm about to do a review of funds/ITs in those sectors. Would be interested in what ITs you use if you could share that info. Not for advise of course.

[Transistor Man]

UK consortium acquisition of OneWeb

My thoughts:

1. Connected Autonomous Vehicles

See Project Darwin on the Harwell Science Campus, Oxfordshire, a collaboration between Telefonica/ O2, European Space Agency, and UK Space Agency, Oxford + Glasgow universities.

CAVs will require highly-reliable (diverse) networks, enabling massive real-time data transfer rates and volumes. UK sees a solution based on a complimentary combination of terrestrial 5G and satellite links.

2. A platform for UK Space start-ups

The UK has already gone Space investment crazy over the past few years. There are now 1000 people working in the space cluster on the Harwell Campus, many at startups associated with the Satellite Applications Catapult centre.

OneWeb will act as a technology platform, enabling many of these R&D/ startup activities.

3. OneWeb will enable a UK Sovereign Global Navigation System, in the face of the Galileo-lockout 

After the Leave result, the UK was strongly locked out of the EU’s Galileo project to build a European rival to GPS. 

Treason May’s surrender deal would not have got us back in!

Back in 2018, the then-PM committed the UK to build its own global navigation system, at a cost of 3 billion +.

“I cannot let our armed services depend on a system we cannot be sure of. That would not be in our national interest. And as a global player with world-class engineers and steadfast allies around the world, we are not short of options.” 

And OneWeb is how we are going to do it.

Galileo follows the atomic-clocks, and precise-orbits, approach of GPS, and is expensive at 10 billion $\€.

However, there are proposals to use mass produced LEO satellite constellations (like OneWeb) to offer global navigation system at far lower cost.

It could even be better than Galileo.  

The satellites are closer, there are going to be loads of them, and things like consumer-driven microelectronics and integrated optics have advanced massively since the design of Galileo was finalised.

 

 

[CVG]

8 hours ago, JMD said:

CVG, I'm about to do a review of funds/ITs in those sectors. Would be interested in what ITs you use if you could share that info. Not for advise of course.

Sure. The two I use are:

JPMorgan Emerging Markets IT plc (JMG)  

Baillie Gifford Shin Nippon plc (BGS) (This is focused on smaller co's - so just decide if that's what you want)

[Castlevania]

8 hours ago, JMD said:

CVG, I'm about to do a review of funds/ITs in those sectors. Would be interested in what ITs you use if you could share that info. Not for advise of course.

I’ve owned the below at various times:

Blackrock Frontiers Investment Trust

Blackrock Latin American Investment Trust

Fundsmith Emerging Equities Trust

JPMorgan Brazil Investment Trust

Vietnam Enterprise Investments Limited

[jamtomorrow]

Seen a few posts this week about technology companies, especially semiconductor companies, which reminded me of another perspective on deflationary forces in the economy. Short version:

• I wonder to what extent macro policymakers have a handle on Moore's Law acting as an exogenous deflationary force. This sort of thing: https://www.vanguard.co.uk/adviser/adv/articles/research-commentary/markets-economy/gmm-deflationary-effects-moores-law.jsp
• Is Moore's Law on borrowed time? The demise of Moore's Law has been oft-predicted, but the Schiffs of semiconductors will surely be right one day. Dennard scaling is sorta kinda the EROI of semiconductors, and we're certainly dicing with the physical limits (sound familiar??). This sort of thing: https://www.nextplatform.com/2019/06/18/dennard-scaling-demise-puts-permanent-dent-in-supercomputing/
• And finally, if both of the above are true, we could be in for the mother of all planetary alignments. Imagine all of these happening at the same time: money printing finally feeds through to inflation in the "real economy"; Moore's Law deflationary pressure drops below some critical threshold; macro-level EROI drops below the prosperity threshold

All makes me wonder whether there might be a few surprises left in store as to the magnitude and timing of the Real Big Kahuna i.e. bigger/sooner than we might think.

[JMD]

9 hours ago, CVG said:

Sure. The two I use are:

JPMorgan Emerging Markets IT plc (JMG)  

Baillie Gifford Shin Nippon plc (BGS) (This is focused on smaller co's - so just decide if that's what you want)

Thanks. When I finalise my own list I will post it here... not strictly what this blog is about, but I am looking for value/reflation plays so does kinda relate, plus it is convenient (lazy?) method of buying international stocks.

[JMD]

9 hours ago, Castlevania said:

I’ve owned the below at various times:

Blackrock Frontiers Investment Trust

Blackrock Latin American Investment Trust

Fundsmith Emerging Equities Trust

JPMorgan Brazil Investment Trust

Vietnam Enterprise Investments Limited

Thanks Castlemania. 

[UnconventionalWisdom]

On 29/06/2020 at 16:00, Popuplights said:

Plus every bloke has now discovered it's a piece of piss to cut your own hair with some clippers, or at least get your missus to do it....

I was thinking the same with coffee. Surely people who were buying 2/3 quid coffee invested in kit to make it at home. But no, i head to the park to shoot hoops svery few days, always someone walking in the park with a cafe bought coffee in their hands 

[Jimmy64]

Just listened to an interesting discussion with David Rosenberg, he certainly had some interesting insights and in particular I was drawn to his comments re gold and real interest rates for the next number of years from circa 59:30 (circa 5 mins long).

Still trying to think & process the main arguments, but I thought it chimed with a lot of commentary in this thread. In summary:

Potentially years of weak productivity post COVID

More government deficits/ intervention/regulation and reduction in global supply chains & higher cost structure, which he thinks will result in a mild form of stagflation. 

Rosenberg thinks that real assets will perform well in this environment

He anticipates Gold will do well due to its correlation with real interest rates

Central banks will keep a cap on interest rates "out on the curve"

Real interest rates therefore likely to go increasingly negative for a prolonged period of time, which ties in with the research paper based upon an analysis of 15 previous pandemics from the 14th century onwards. 

Reference to paper "The longer-run economic consequences of pandemics" as mentioned in the discussion. 

https://voxeu.org/article/longer-run-economic-consequences-pandemics

[DurhamBorn]

4 minutes ago, Jimmy64 said:

Just listened to an interesting discussion with David Rosenberg, he certainly had some interesting insights and in particular I was drawn to his comments re gold and real interest rates for the next number of years from circa 59:30 (circa 5 mins long).

Still trying to think & process the main arguments, but I thought it chimed with a lot of commentary in this thread. In summary:

Potentially years of weak productivity post COVID

More government deficits/ intervention/regulation and reduction in global supply chains & higher cost structure, which he thinks will result in a mild form of stagflation. 

Rosenberg thinks that real assets will perform well in this environment

He anticipates Gold will do well due to its correlation with real interest rates

Central banks will keep a cap on interest rates "out on the curve"

Real interest rates therefore likely to go increasingly negative for a prolonged period of time, which ties in with the research paper based upon an analysis of 15 previous pandemics from the 14th century onwards. 

Reference to paper "The longer-run economic consequences of pandemics" as mentioned in the discussion. 

https://voxeu.org/article/longer-run-economic-consequences-pandemics

I think thats going to be one of the reasons we get so much printing.They will need to keep the curve down further out.Governments have a window to print and get things moving,likely a couple of years.Supply chains will contract backwards and although that will have good results in many areas,it will mean prices rising.

I was talking to a friend today who works for a big tier 1 supplier to the auto industry.They make chassis and body work etc.Employ around 2000 in their plant here.They have already laid off all temps (there were a lot) and he said they have been told 1 in 3 permanents need to go.Welfare in this country was already as economy destroying levels,and its about to explode higher.

Its going to get really interesting as inflation (already here now,prices are moving higher) grows and wages move towards minimum wage.Loads of people will want jobs,but nobody will want the jobs at the salaries on offer.Government needs to inflate the whole economy.

The economy becomes very different during inflation cycles.Some companies can see falling sales,but higher prices and so gain,others see input costs shooting higher with consumers unable to pay.

[Loki]

RRE +62%  Was not expecting to see that...not complaining 

Quote

Viaro Energy has agreed to buy RockRose Energy for almost £248m in cash.
RockRose shareholders will receive £18.50 for each of their shares. The price is 64% higher than RockRose's closing share price on 3 July and a 91% premium to the company's average share price over the past three months.

The deal values the oil and gas and infrastructure company at £247.6m and has been recommended by the company's board. The directors and senior managers, who own about a third of the company, have irrevocably agreed to support the deal.

RockRose shares rose 62% to £18.31.13 at 08:43 BST. The company was founded in 2015 and floated in January 2016 valuing its shares at 50p each and the company at £5m. Its value soared as it made a series of acquisitions and peaked at about £22 a share in early January 2020 before the coronavirus-induced oil price crash.

Andrew Austin, executive chairman of RockRose, said: "After careful reflection, the board of RockRose has concluded that accepting this offer is firmly in the best interests of our shareholders. It has been an exciting journey since RockRose was founded five years ago. However, for the benefit of all stakeholders, now is the time to move on and allow RockRose to continue to flourish with new backers."

Viaro, a privately owned energy trader and logistics company, said buying RockRose would allow it to expand in the waters around the UK known as the UK Continental Shelf. RockRose's senior management team will stay on under its new owners.

 

[Talking Monkey]

14 hours ago, DurhamBorn said:

I think thats going to be one of the reasons we get so much printing.They will need to keep the curve down further out.Governments have a window to print and get things moving,likely a couple of years.Supply chains will contract backwards and although that will have good results in many areas,it will mean prices rising.

I was talking to a friend today who works for a big tier 1 supplier to the auto industry.They make chassis and body work etc.Employ around 2000 in their plant here.They have already laid off all temps (there were a lot) and he said they have been told 1 in 3 permanents need to go.Welfare in this country was already as economy destroying levels,and its about to explode higher.

Its going to get really interesting as inflation (already here now,prices are moving higher) grows and wages move towards minimum wage.Loads of people will want jobs,but nobody will want the jobs at the salaries on offer.Government needs to inflate the whole economy.

The economy becomes very different during inflation cycles.Some companies can see falling sales,but higher prices and so gain,others see input costs shooting higher with consumers unable to pay.

With the circa 2 year window DB, looks like its all about decision making and execution, any countries that mess up this part would I guess really lag behind as the decade unfolds. I get the feel that the setup may mean an arrest in the decline of the west relative to the rest of the world through the decade and beyond

[Loki]

On 01/07/2020 at 16:18, janch said:

Here is the BBC's take on hydrogen:

https://www.bbc.co.uk/news/science-environment-53238512

This is interesting:

The website Euractiv reported that it plans to publish a hydrogen strategy soon. A leaked draft floated the idea of making the Euro the currency for international hydrogen trades, as the US Dollar is for oil.

Hmm.........

https://oilprice.com/Energy/Energy-General/Europes-Leaked-Hydrogen-Strategy-Is-Very-Ambitious.html

Another site covering it

[Bobthebuilder]

22 minutes ago, Loki said:

https://oilprice.com/Energy/Energy-General/Europes-Leaked-Hydrogen-Strategy-Is-Very-Ambitious.html

Another site covering it

Hydrogen blending all over this months gas magazine. Thats the 3rd month in a row.

[Transistor Man]

On 05/07/2020 at 12:04, jamtomorrow said:

 

• Is Moore's Law on borrowed time?. Dennard scaling.

 

No, I don’t think it’s on borrowed time.

Moore’s Law: “a doubling of transistor count every 2 years (at constant cost)”, with a tremendous effort, is still being achieved.

And for the next decade at least, I am certain every generation of semiconductor technology will continue to be significantly better (in terms of power, performance, area) than the previous one. 

Progress will come through further changes in the transistor structure and materials, not just from a scaling/ shrink. 

The abrupt ending of Dennard-scaling in 2005 is an interesting story. 

(Dennard scaling was a set of rules which told you how much you should scale all your transistor lengths and properties in the next technology generation, and how much your performance (I.e. power-consumption and clock speed) would improve).

The end result of the ending of the Dennard Scaling era, was a switch to the main driver of semiconductor technology being “mobile” — meaning phones.

Clock frequencies hit a wall, but progress didn’t.

Apple has driven the leading edge at an incredible rate.

They demand an improved fabrication process every year. (5 nm (N5) generation A14 chips will be shipped this year.)

[Harley]

2 hours ago, Cattle Prod said:

Nice bounce in Babcock this morning, chart looks interesting on the weeklys. I think @Harley and @MvR would tell me there is no buy signal yet, but there is a positive divergence on the RSI, and the March to now decline (~%52) is very similar to 2008 (52%). Might be putting in a base around the 300 level.

Why say that?  DYOR, but for me maybe I've had a buy signal on the daily and am waiting for confirmation on the weekly.  I have it in my income portfolio but they've cut the div from 30p to 7p to currently yield only 2.29%.  But I have a few like this where I need to judge if/when the div will be re-instated and I am currently underallocated due to their price fall.  Also a few where I am now overallocated, which is a nicer problem to have!

PS: Nice set of technical indicators you use there!  I add the Slow Stochastic (14,3,1) which is more volatile (more false positives) but provides an earlier signal and I then use the (14,3,3) as confirmation.  Shame TradingView does not support (14,3,1) in its screens.  On the BAB, (14,3,1) has crossed 25 already on the daily.  I've also today tried the dark view for the first time which I'm finding easier on the eye:

Babcock Debt to Equity ratio now 123% so defo not one for my value portfolio!

 

[Harley]

13 minutes ago, Cattle Prod said:

Just a guess Harley, as I'm inevitably too early when I get a tingly feeling! And I'm still learning charts.

You're all looking good from here!  IMO a nice chart set up and technical/fundamental analysis.  I was tempted to buy a few this week but resisted the urge for some.  It's hard!  But I've distracted myself by building a value portfolio in key sectors such as Energy and having a lot of fun with my fundamental screens!  This is where the action is for me right now (value picks and total returns).  The energy sector (US in particular) is insane!  I've ditched the FT and gone with Investing.com like several on here.  IMO, defo the best (even if I can't screen multiple countries at the same time, which given the results of my review of withholding taxes is not a big issue).

[Transistor Man]

1 hour ago, Cattle Prod said:

Thanks TM, very interesting. Who are Apples key chip supplier, TSMC?

Yes. They work very closely together.  

[kibuc]

Fortuna Silver had a fatal accident in their silver mine in Peru and are shutting it down for two weeks. Not the best start to what should be a rebound quarter.