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

[geordie_lurch]

3 minutes ago, Hardhat said:

GDX looks cheap at the moment 

All the miners are well down the last few days

[AWW]

15 hours ago, arrow said:

We have seen how fragile the global economy is to a major event ... and it brings home the reality of what a major climate event could do.”

What is even meant by "major climate event"? By definition, an event is weather, not climate.

Obviously, the climate changes. I'm completely open to the idea that mankind impacts climate - we impact a lot of natural processes. But none of the language used around climate makes any sense.

[Harley]

9 minutes ago, Hardhat said:

GDX looks cheap at the moment 

Why?  Daily?  USD or GBP version?  I'm waiting for a confirmation, especially on the monthly.  My chosen technicals are still elevated but some stiring on the monthly chart pattern front.  No individual shares have fallen into my net yet (apart from one).  Certainly one to watch though. 

[jamanda]

27 minutes ago, Yadda yadda yadda said:

Don't rush to invest your money.

The core concept is that we're at an economic changing point. For around 40 years inflation has been getting lower and lower. Not in a straight line but a trend. Interest rates have also declined to near zero. This process means borrowers have generally prospered and asset prices soared.

If it goes into reverse, which most of us are all but certain it will, then there will be a different set of winners. Commodities including oil and gas. Gold and silver. Decomplexity means the earliest stage in the process. Not manufacturing but mining. Potash for farming.

There is a lot of talk about timing. That is the next level of learning and less important. It is about squeezing an extra 5-10%. What I would emphasise is that drip feeding your money in is less risky than buying all at once. That way you are not going to buy everything at a short term peak. You won't get it all at a trough either.

One other point is that as this cycle ends after 40 years there are very few financial professionals who have experienced an inflationary environment. That means a lot of the professionals will make mistakes. I see that as our great advantage.

Good luck. I find it fascinating as well as increasing the value of my savings over time. The people on this thread are top notch.

Thank you.  I'm trying to look at oil, potash, possibly transport.  I'll keep out of metals (I do have a very few gold and silver coins for when the SHTF.  I don't have a mathematical brain however I try, but even I understand the severity of what is coming so it is time to think.

I do have premium bonds and Mr. J seems to get £25 a month.  I'm not sure if they have put my numbers in.

[Hardhat]

4 minutes ago, Harley said:

Why?  Daily?  I'm waiting for a confirmation, especially on the monthly.  My chosen technicals are still elevated but some stiring on the monthly chart pattern front.  No individual shares have fallen into my net yet (apart from one).  Certainly one to watch though. 

It's about 20% cheaper than it was 6 months ago! Haven't done any chart analysis.

 

Also - GBP version is the one I hold.

[geordie_lurch]

6 minutes ago, Harley said:

Why?  Daily?  USD or GBP version?  I'm waiting for a confirmation, especially on the monthly.  My chosen technicals are still elevated but some stiring on the monthly chart pattern front.  No individual shares have fallen into my net yet (apart from one).  Certainly one to watch though. 

Which one was that @Harley?

[Hancock]

1 minute ago, Hardhat said:

It's about 20% cheaper than it was 6 months ago! Haven't done any chart analysis.

But about 50% more expensive than 9 or 16 months ago.

[AWW]

9 hours ago, Yadda yadda yadda said:

Labour in London is completely disconnected from a lot of their supporters. They will continue winning here for a while but the party is a shambles. They represent two completely different interest groups. "Liberal" middle class people including much of the public sector and the benefits class. The private sector full time working class gets nothing from them.

Many of those private sector workers have been convinced that they should vote Labour by making them feel guilty. They don't realise how much they're already paying towards the upkeep of people who live similar or better lifestyles, but have no intention of working.

A few years ago, I did NCT classes with Mrs AWW. There was universal love for the NHS, "isn't it great that we don't have to pay hospital fees to have our babies!", lots of Brexit bashing, lots of "we're so lucky to be able to afford these classes".

Stepping outside my usual social circle completely opened my eyes to how naive and facile people can be.

[Hardhat]

7 minutes ago, Hancock said:

But about 50% more expensive than 9 or 16 months ago.

Absolutely... depends whether you are expecting a melt up in the miners...

[Hancock]

1 minute ago, Hardhat said:

Absolutely... depends whether you are expecting a melt up in the miners...

Ive got a good bit of work coming up so will have roughly 35k in cash in my SIPP by mid March, think i've decided on waiting for a correction of sorts to jump in.

[Sasquatch]

1 hour ago, jamanda said:

I'm currently trawling back through this thread.  Brain ache.

Don't forget part 1 as well.....

[working woman]

@jamanda

Re Cash and interest rates.

Mid 20's and just married, my husband and I bought our first home in 1994, when prices were rock bottom, due to previously high interest rates in the late 1980's. When we bought, a Standard Variable Interest Rate mortgage was 11%. They had been a few % higher in the previous few years. We got a fixed rate at 9% for a couple of years, then didn't bother fixing again as rates started their downward descent to where we are now. 

I remember a conversation around the time we bought, maybe with someone in the Halifax, our mortgage lender,  about fixed rate Cash ISAs and how some people had really struck lucky. When interest rates were at their highest, you could get Fixed Rate Cash ISAs, for about 5 years, that were paying definately more than 10% in interest.  I vagually recall it being 14%!!!!!.  Obviously that would have been a small window of opportunity before rates went down. Despite knowing nothing about money and investing, I did think blimey that is a good deal and was quite envious. 

As interest rates went down, mortgage rates dropped. Interest rates on savings dropped also but lagged behind. I think the same will happen going forward, if interest rates increase, mortgage interest rates will go up, savings rates will go up too but lagging behind. 

I wonder if that sort of opportunity will crop up again in 10 years time when interest rates reach a peak as predicted on this thread and you could get a Cash ISA fixed for 5 years at +10%. 

 

 

[Yadda yadda yadda]

12 minutes ago, AWW said:

Many of those private sector workers have been convinced that they should vote Labour by making them feel guilty. They don't realise how much they're already paying towards the upkeep of people who live similar or better lifestyles, but have no intention of working.

A few years ago, I did NCT classes with Mrs AWW. There was universal love for the NHS, "isn't it great that we don't have to pay hospital fees to have our babies!", lots of Brexit bashing, lots of "we're so lucky to be able to afford these classes".

Stepping outside my usual social circle completely opened my eyes to how naive and facile people can be.

Yes, for now. To paraphrase Mike Tyson, "everyone thinks that way until they get taxed in the face!"

In the future there will likely be a choice between more tax or fewer benefits. Labour will lose voters whichever they choose. Of course they can get voted into power and then do one of those before losing support. They can also do a bit of both and lose support. Potentially they can do nothing and end up banging on the IMF's door and then do a lot of both.

[Harley]

13 minutes ago, Sasquatch said:

Don't forget part 1 as well.....

And then there's the other place once that's done!  I tried reading back once but lost the will to live!

[Harley]

39 minutes ago, geordie_lurch said:

Which one was that @Harley?

Some hole in the ground in some African s-hole I never want to see again!

PS:  Oh, and down 15% since then!  Wizard of finance me!

[jamanda]

6 minutes ago, Harley said:

And then there's the other place once that's done!  I tried reading back once but lost the will to live!

I might be here for some time.  Have to keep going to do something else while let my poor addled brain have a rest.

You lot are going to think you've got a stalker!

[JMD]

4 hours ago, Barnsey said:

 

Launches in October, going to be at least 3.5% I'd imagine.

Perenna is a curiously small, non-entity type company/directors, only recently formed, to be offering such a disruptive product. Maybe its just a gimmick? But if it happens, i wouldn't be surprised if those Perenna fixed mortgage products will come with some kind of government backed insurance/guarantee (freddie mac?). 

[Bobthebuilder]

Trampolines have been mentioned on here before I seem to recall.

https://www.bbc.co.uk/news/business-55702243

[Bobthebuilder]

33 minutes ago, Harley said:

Some hole in the ground in some African s-hole I never want to see again!

PS:  Oh, and down 15% since then!  Wizard of finance me!

I think you have bought the same one as me. 1st ladder of course.

[Barnsey]

1 minute ago, Bobthebuilder said:

Trampolines have been mentioned on here before I seem to recall.

https://www.bbc.co.uk/news/business-55702243

Thank **** for that coinciding with squeezed incomes 

[JMD]

4 hours ago, Barnsey said:

Do you think this recent talk of scrapping council tax for property tax in line with current values will become a reality? I'm paying twice as much council tax in Staffordshire as I was in Wimbledon for the same size flat!

https://metro.co.uk/2021/01/17/rishi-sunak-urged-to-scrap-council-tax-and-stamp-duty-13918077/

I do think it will happen. For some time, been looking for Sunak/predecessor to do something radical with the housing market/taxes, etc, to help prop it up for the long term, however whether or not plans work or not is a different question. Anyway, think it will be a signaler that government is getting really scared of coming economic fallout from global bust, so looking to soften the blow to its trad. voters...  Its also of course a convenient start of a 'wealth tax regime'.

[geordie_lurch]

14 minutes ago, Bobthebuilder said:

Trampolines have been mentioned on here before I seem to recall.

https://www.bbc.co.uk/news/business-55702243

I know some people in the import industries and containers have gone from $3,000 to $12,000 but they are currently being quoted $14,000 which will certainly start to get inflation moving once the items in these go on sale Also worth bearing in mind that a 'second wave' of Covid has already started to shut down some of the Chinese factories according to my main contact which is for people that have already had the virus 12 months ago so factory capacities is likely to drop as well.

However also worth mentioning that several of the people I have spoken to recently reckon shipping prices should start to settle down towards the summer though as prices into Rotterdam are already coming down BUT prices into the UK due to Covid and the post Brexit import tax are what's hammering UK companies apparently.

[Nicolas Turgeon]

Steven Jon Kaplan's latest update. His latest since November!

https://truecontrarian-sjk.blogspot.com/2021/01/investing-should-be-like-watching-paint.html

I like how he discloses his current holdings at the end (he's two-thirds in cash at the momet)

[leonardratso]

i thought rishi was warned off the 'property tax' so as not to piss off the 'rich' core tory voter?

I wonder if there was ever such a tax? maybe something called a rate or some such? no, cant have been, pure fantasy.

 

[Harley]

17 minutes ago, geordie_lurch said:

I know some people in the import industries and containers have gone from $3,000 to $12,000 but they are currently being quoted $14,000 which will certainly start to get inflation moving once the items in these go on sale Also worth bearing in mind that a 'second wave' of Covid has already started to shut down some of the Chinese factories according to my main contact which is for people that have already had the virus 12 months ago so factory capacities is likely to drop as well.

However also worth mentioning that several of the people I have spoken to recently reckon shipping prices should start to settle down towards the summer though as prices into Rotterdam are already coming down BUT prices into the UK due to Covid and the post Brexit import tax are what's hammering UK companies apparently.

Still hard to find plant and machinery stocks.  Even Aldi pulling back on its special buys due to port issues, etc!  Are you saying people are being re-infected 12m after their first infection?