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


spunko

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2 hours ago, mattydread said:

Are you ripping the piss? I've just spent the last 15mins watching it & he's not got it yet..

I was about to stop and then my dog came in and distracted me.  Out of the corner of my eye I saw something change...

very funny.  I could have missed it if it wasn't for the hound.

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6 hours ago, Talking Monkey said:

On K&S DB, are they still at risk in a BK of going under, I might be wrong but I recall some chat

No,only a small chance,they flogged the salt business in the US so the balance sheet is much better,or will be when they get the cash.

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5 hours ago, AWW said:

They're not going to reduce PCR cycles, they're going to move testing over to lateral flow tests.

Lateral flow tests are currently getting a kicking in the more Marxist media outlets because they are "not as good" as PCR tests - they "miss lots of cases".  In reality, LF is simply more accurate, as it doesn't pick up dead bits of that cold you had last year, like a 45 cycle PCR test does.

Moving to LF tests should reduce "cases" by 60-70% on its own.

Indeed and with outstretched arms claim the lockdowns have worked and everyone is saved.The public will swallow it as truth,just glad to be able to watch Man Utd in the pub on SKY again.The money supply will of gone through the roof,meaning inflation arrives to help wash away debts.Those people wont be so happy when the government has a massive structural deficit and the BOE has to taper fast.

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Talking Monkey
51 minutes ago, DurhamBorn said:

No,only a small chance,they flogged the salt business in the US so the balance sheet is much better,or will be when they get the cash.

Thank you DB

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Heads up - my 'bellweather' stocks in Australia which have been good indicators of sentiment all took a downturn at end of day today here. Variety of sectors.

I keep small amounts in them (one is only 50 bucks now after I sold everything but that off to take profits) so I can have an easy indicator of where they are going.  

Might indicate a bit of a flap once UK and US markets open.....
 

?

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5 hours ago, JMD said:

Looks good, plus Horizon Kinetics are imo great fund managers. They specialise in finding value stocks with assets, growing cash flow, inflation protected companies of the type discussed here. Had a quick look and the new fund you mention is very globally diversified and contains a number of this threads favourites. I also like how HK are critical of much of the investment industry, particularly etf's. Having said all that I can't find where to that fund in the UK!?!

I’m surprised by the number of financial exchanges they own. It’s like a who’s who. CME; ICE; Euronext; Deutsche Borse; Singapore Exchange.

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14 minutes ago, Castlevania said:

I’m surprised by the number of financial exchanges they own. It’s like a who’s who. CME; ICE; Euronext; Deutsche Borse; Singapore Exchange.

Somewhat inclined to give it a miss based on that *but* is there an argument that "bourse" fits DB's oilie template of "encumbent player in declining sector with pricing power".

Or put another way: if financial services shrinks back as a consequence of decomplexification, who in their right mind will be investing in new bourse "capacity"? Hence the pricing power for the encumbents.

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On 10/01/2021 at 11:17, DurhamBorn said:

@Vendetta i think GSK fits in nicely with the thesis in my post as well and iv been buying anytime they went under £13.50,of course i worked for them for 10 years and i sold all of my shares in them when they went over £20 when i left the company 20 years ago.

Other companies are timber companies etc,but they have already ran up hard.I also think the new industry of factory farming will be massive and likely some 100 baggers there,but i havent done any research yet.

Gas pipeline companies will also be big winners,Enbridge being the building block for that sector.

I must admit if i was younger id be doing a lot more work in finding companies that fit the bill with the chance of bigger capital gains,however given im already at the level i need to be able to retire i focus my work on meeting inflation minimum first so not everyone on the thread will have the same goals.

 

@DurhamBorn

I did some research on Enbridge and bought a tranche for each of the kids ISA’s - it looks like a very good oil and infrastructure play - also it is in Canadian dollars so additional ‘hedging’.

The kids were not happy about it - but I went ahead and bought the boy some BAT and the girl some IMB ! My daughter thinks smoking is terrible and my investment is ‘immoral’. She’s also into all the Greta climate change bollocks so I didn’t go into detail about what Enbridge does ! 
 

I have £3 and £3k left to allocate before April 6th.

Buy Glaxo or hedge my bets and wait for a potential downturn in the markets and buy a miner? 
 

What to do ..., what to do? Any advice welcome. 
 

 

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Democorruptcy
8 hours ago, sancho panza said:

We went the other way and overloaded on the oilies.Mainly for the divis to be fair.

I've reflected on this year and not getting a proper allocation in potash was one of my biggest regrets

Having said that,oilies are beginning to run at last.XOM at $48,I can hardly believe it.

I swapped my MOS for BP. I was thinking divis and partly that the US markets looked a lot higher than the UK.

I had a real brain fart though, doing to both transactions on the same day. I'd decided to do it but at the time wasn't sure the bottom was in for oil. If I'd just sold MOS and waited a bit I could have got BP a little cheaper.

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10 minutes ago, Vendetta said:

@DurhamBorn

 

The kids were not happy about it - but I went ahead and bought the boy some BAT and the girl some IMB ! My daughter thinks smoking is terrible and my investment is ‘immoral’. She’s also into all the Greta climate change bollocks so I didn’t go into detail about what Enbridge does ! 
 

 

You could always say she is right, and as your investments are 70% unethical and 30% ethical, you are going to adjust your will so she get none of the unethical wealth.

 

See how long she stays happy with that.

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1 minute ago, wherebee said:

You could always say she is right, and as your investments are 70% unethical and 30% ethical, you are going to adjust your will so she get none of the unethical wealth.

 

See how long she stays happy with that.

Brilliant! 

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5 minutes ago, Democorruptcy said:

I swapped my MOS for BP. I was thinking divis and partly that the US markets looked a lot higher than the UK.

I had a real brain fart though, doing to both transactions on the same day. I'd decided to do it but at the time wasn't sure the bottom was in for oil. If I'd just sold MOS and waited a bit I could have got BP a little cheaper.

You are me. I did exactly the same thing. Got into MOS at $10 ! and then had ‘liquidity problems’ and sold out at 60% profit and bought more BP and Shell. 
 

Really annoyed with myself. 
 

However I think I waited a few days : weeks and ended up getting BP at 224p and Shell at 980p. But I’ll keep them for at least 10 years - for the dividends- certainly long term unless the BK is inevitable! 

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Democorruptcy
2 minutes ago, Vendetta said:

You are me. I did exactly the same thing. Got into MOS at $10 ! and then had ‘liquidity problems’ and sold out at 60% profit and bought more BP and Shell. 
 

Really annoyed with myself. 
 

However I think I waited a few days : weeks and ended up getting BP at 224p and Shell at 980p. But I’ll keep them for at least 10 years - for the dividends- certainly long term unless the BK is inevitable! 

Good point. I think it was liquidity behind it but I'd forgotten.

At the start of year I had no shares at all. After spending all the cash, the day I did that swap I was down to £100 cash. If I'd had more cash I'd have probably just left the MOS proceeds there. It was just wanting to put more into oil but I was "skint".

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1 hour ago, jamtomorrow said:

Somewhat inclined to give it a miss based on that *but* is there an argument that "bourse" fits DB's oilie template of "encumbent player in declining sector with pricing power".

Or put another way: if financial services shrinks back as a consequence of decomplexification, who in their right mind will be investing in new bourse "capacity"? Hence the pricing power for the encumbents.

They all consolidated in the 2000’s. They’ve run up a lot over the past 10-15 years. Look at the LSE’s share chart. They’ve all moved into clearing and data analytics. The big banks trade through them and then they sell that data back to the banks. 

There’s not much competition and the costs/barriers to entry are such that I can’t see any new entrants.

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3 minutes ago, Democorruptcy said:

Good point. I think it was liquidity behind it but I'd forgotten.

At the start of year I had no shares at all. After spending all the cash, the day I did that swap I was down to £100 cash. If I'd had more cash I'd have probably just left the MOS proceeds there. It was just wanting to put more into oil but I was "skint".

You are definitely me! I bought my first share (in 20 years) at end of March and used up a small bit of my allocation and bought some more over spring and summer maxing out the 20-21 ISA’s.

Ive had a really good run and can’t complain - but if I’d been set up a bit better on H&L and more organised and had read this thread in January 20’ ...... hindsight eh? 
 

I must say I’ve learnt so much on this thread and really gained from it.

@DurhamBornan absolute legend! 🍺🍻

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geordie_lurch

I'm similar to others it seems in that I felt I needed to learn to top slice to free up some of my limited investment cash to spread my risk around a bit instead of being able to sit on some of the big movers that I had done well on. It was only this thread that gave me the confidence to get into all this back in May 2020 so I missed some of the Little Kahuna bargains but am still up around 15% overall so far so thanks again all and of course @DurhamBorn :Beer:

Telefonica is even doing well today so if that goes up another 4% I'm back in the black on that :D

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Just now, Castlevania said:

They all consolidated in the 2000’s. They’ve run up a lot over the past 10-15 years. Look at the LSE’s share chart. They’ve all moved into clearing and data analytics. The big banks trade through them and then they sell that data back to the banks. 

There’s not much competition and the costs/barriers to entry are such that I can’t see any new entrants.

Makes sense. I do wonder whether the allocation/weighting in the ETF is a little overweight (especially as it's exactly the kind of cognitive bias you'd expect from a financial services product), but I might have a nibble anyway. If anything it's a useful counter to my own bias against financial services.

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ThoughtCriminal
42 minutes ago, Vendetta said:

@DurhamBorn

I did some research on Enbridge and bought a tranche for each of the kids ISA’s - it looks like a very good oil and infrastructure play - also it is in Canadian dollars so additional ‘hedging’.

The kids were not happy about it - but I went ahead and bought the boy some BAT and the girl some IMB ! My daughter thinks smoking is terrible and my investment is ‘immoral’. She’s also into all the Greta climate change bollocks so I didn’t go into detail about what Enbridge does ! 
 

I have £3 and £3k left to allocate before April 6th.

Buy Glaxo or hedge my bets and wait for a potential downturn in the markets and buy a miner? 
 

What to do ..., what to do? Any advice welcome. 
 

 

Turns 18:

"I will take your wages of sin father. But I shall tell all what a blood soaked monster raised me into this vile predicament.

 

Now, where's my 100k divi cheque from BAT and Shell?" 

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Democorruptcy
6 minutes ago, Vendetta said:

You are definitely me! I bought my first share (in 20 years) at end of March and used up a small bit of my allocation and bought some more over spring and summer maxing out the 20-21 ISA’s.

Ive had a really good run and can’t complain - but if I’d been set up a bit better on H&L and more organised and had read this thread in January 20’ ...... hindsight eh? 
 

I must say I’ve learnt so much on this thread and really gained from it.

@DurhamBornan absolute legend! 🍺🍻

One of DB's good tactics has also been to go back to work, not because he needed to but just to top the SIPP up. As I don't work and have no income, I only get tax relief on £2,880 topped up to £3,600. If I'd put up with working for a bit, the hourly rate would have been a lot higher and more worth it. The pay would have got tax relief when piling it all into a SIPP, loaded me up with cash to spend for the capital appreciation and dividends to come.

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1 hour ago, Vendetta said:

@DurhamBorn

I did some research on Enbridge and bought a tranche for each of the kids ISA’s - it looks like a very good oil and infrastructure play - also it is in Canadian dollars so additional ‘hedging’.

The kids were not happy about it - but I went ahead and bought the boy some BAT and the girl some IMB ! My daughter thinks smoking is terrible and my investment is ‘immoral’. She’s also into all the Greta climate change bollocks so I didn’t go into detail about what Enbridge does ! 

 

We set our two daughters up with isas summer 2020. Put a £1,000 in each and bought them Shell and Sibanye. They looked a bit aghast, especially with the oil choice. Both quite happy though as they are up about 75%! They've just had some money from their grandparents and will be investing that in the isa. However it appears I am their IFA for the time being so it's up to me. It's another £1,000 and I'll probably suggest a small holding in Horizonte, a solid silver miner and maybe potash or more oil.

If we can keep topping them up they should be in a good place later in this decade when they are looking to buy their first homes.

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Democorruptcy
2 minutes ago, Barnsey said:

Here we go...

 

I said from the beginning it would become permanent because Boris was talking about doing it summer 2019 anyway, well before covid. If I were the enemy I wouldn't make it permanent now, I'd extend now to the end of 2021. That keeps the FOMO up all this year. Then in the Autumn statement they can extend again it until April 2022. Then March 2022 it becomes officially permanent because by then it's just the norm.

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5 minutes ago, Democorruptcy said:

I said from the beginning it would become permanent because Boris was talking about doing it summer 2019 anyway, well before covid. If I were the enemy I wouldn't make it permanent now, I'd extend now to the end of 2021. That keeps the FOMO up all this year. Then in the Autumn statement they can extend again it until April 2022. Then March 2022 it becomes officially permanent because by then it's just the norm.

And I can only keep my fingers crossed that it happens, because Stamp Duty is pure theft. There's no basis for it other than that's easy money for the taxman so why not grab it. It's a tax on market activity.

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Talking Monkey
9 minutes ago, Democorruptcy said:

I said from the beginning it would become permanent because Boris was talking about doing it summer 2019 anyway, well before covid. If I were the enemy I wouldn't make it permanent now, I'd extend now to the end of 2021. That keeps the FOMO up all this year. Then in the Autumn statement they can extend again it until April 2022. Then March 2022 it becomes officially permanent because by then it's just the norm.

But that's a chunk of revenue they miss out on, can they afford to do that 

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