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

[Harley]

12 minutes ago, harp said:

My postie thinks I’m a genius. He was pissed off when their share price went down just before they were able to sell them. I told him to buy when they got to 200. He thought I was mad. But he did and they fell more! I just said keep buying! Well he’s chuffed now. Tells me it’s still like Christmas time and post offices are rammed. I guess once things go back to “normal” this will tail off and the share price might reflect that? But I think it’s still got room to run higher. Time will tell. 

And I suggested to mine he held, but he's still being a miserable bogger!  Only himself to blame if he sold without a good enough reason with all those parcels in front of him.  I wonder if they may continue to do well even if this "madness of crowds" (influenza+, there said it, lock me up) ever ends.  

[DoINeedOne]

Congratulations to everyone who held or still does hold RoyalMail

Like a little bitch i sold months ago

[harp]

9 minutes ago, sancho panza said:

I don't want to offend any BTC fans this is more genreal discussion.I'm neutral personally.Don't own any as I struggle with the concept but accep0t digital will likely arrive.

I think it was @Democorruptcyposted this jeremy Grantham interview.He's long scpeticism in terms of bubbles and the wider marekt,long gold,long renewables(bit too much imho).This is a great interview.His views on BTC were quite forthright.

Some pearls in there

 

 

 

I think there's a decent chance of a spike in oil as freedom returns and people take all the trips they haven't for the last year.

I have a good source at the Dept of education saying schools been told they will return on march 8th-not mega high up so we could see the 'workers of the world' manage another few weeks ducking the aerosols in classrooms.

Word is that there's increasing concern about kids mental health(about bloody time),Bozza getting nervous to return at the same pace as the USA no matter what the case rate(as they'll manage the emssaging).Bozza keen to get his Chruchil moment in the Total War on Covid at the same moment as Sleepy Joe.

 

The statement below sums up what best I've learned from you over the last ten months as it's really the key to the price action over the next year ie that demand is easier to bring back online than production

'All the while in the background the money is not being spent on replacing the natural decline of production. Tick tock, tick tock...'

 

Personally I don’t understand crypto. But I have crypto. It’s the only thing that’s done well for me. £50k now £350k. Taken my original stake out plus another £50k and stuck that in HL ready to invest if we get a BK. The rest can do what it likes, I’ll let it run for shits and giggles. 

[Yadda yadda yadda]

52 minutes ago, Lightscribe said:

You didn’t. Cafe corner hasn’t been in production since 2011.

You may of seen any of these but they weren’t £60.

https://www.lego.com/en-gb/categories/modular-buildings

The marketing there is brilliant. All those buildings to collect and slot together. If they were clever, and they probably were, they would have kept back a number of each design to sell on the secondary market later.

As a kid the fun of Lego was making my own designs later. All my Lego was kept in my Dad's old tool box (he needed a bigger box). These buildings are clearly big boys toys.

[arrow]

The WSJ and IEA are reluctantly admitting that crude oil demand will outsrip supply in the 2nd half of this year. They do aknowledge rapid drawdown of iventories, as predicted by Cattle Prod and Berman, and "resilient" demand from India and China. They write that " the efforts of OPEC-plus to hold back supply, the rollout of coronavirus vaccination programs, and the prospect of weaker travel restrictions" are causing the crude oil price to rise. Not so sure about that. Probably more that the world, excluding the west, is back to normal and increasing demand and the supply isn't there anymore.

They write that Opec plus increasing production and "fresh Covid-19 variants and lockdown restrictions" may cause the crude oil price to fall. Not so sure about that either, as Cattle Prod has said, the Saudis can't produce much more, and now that Trump has gone, unlikely that these political lockdowns will continue in the US. Once, the US changes, Europe is bound to follow, eventually.

"Drilling and well completion rates in the Permian Basin have steadily risen in recent months and, while U.S. oil companies are under pressure to reward shareholders and retain financial discipline, current oil prices mean “there is clearly potential for some producers to respect those engagements and modestly increase their capital expenditures,” the report added.

I don't know what they mean by this. Do they want shale producers to produce more oil?

From WSJ,

The global supply and demand of crude oil are on course to continue rebalancing this year after the turmoil brought by the pandemic in 2020, the International Energy Agency said Thursday.

Despite increasing its estimates for oil output in 2021, the IEA said in its monthly market report that a recovery in demand would outstrip production in the second half of the year, prompting “a rapid stock draw” of the glut of crude that has built up since the pandemic began.

The agency significantly increased its forecast for producing nations outside of the pact between the Organization of the Petroleum Exporting Countries and allies such as Russia, raising its projections for non-OPEC supply growth by 290,000 barrels a day to an increase of 830,000 barrels a day this year.

At the same time, the IEA trimmed its forecast for global oil demand by 200,000 barrels a day to 96.4 million barrels—around 3% less than in 2019—but said part of that was because of a change to historic data.

Even so, with much of the developed world grappling with fresh Covid-19 variants and lockdown restrictions, a brightening economic outlook and strict supply discipline from OPEC-plus are hastening the drawdown in global oil inventories, the IEA said. It added that “the prospect of tighter markets ahead” has been responsible for a rally in oil prices in recent weeks.

Crude prices slipped early Thursday, giving up a fraction of their recent gains. Brent crude, the global benchmark, was down 0.6% at $61.13 a barrel after climbing for nine straight sessions to notch gains of 11% so far in February and break through the $60-a-barrel level for the first time in a year. West Texas Intermediate futures, the U.S. benchmark, fell 0.6% to $58.31 a barrel.

At the beginning of February, Saudi Arabia—one of the world’s largest producers—unilaterally cut an additional one million barrels of crude a day, a move that surprised the world when it was announced a month earlier.

Along with resilient demand in developing-world powerhouses, such as China and India, as well as hopes of a large U.S. stimulus bill and volatile trading in broader financial markets, Riyadh’s move has fueled a recovery in oil prices.

The so-far successful efforts of OPEC-plus to hold back supply, the rollout of coronavirus vaccination programs, and the prospect of weaker travel restrictions remain the basis for cautious forecasts of an oil-market recovery, the IEA said.

In that context, the production of non-OPEC producers will be in focus in the coming months. Those countries, particularly the U.S. and Canada, are responding to those higher prices, “albeit cautiously and from a low level,” the IEA said.

Drilling and well completion rates in the Permian Basin have steadily risen in recent months and, while U.S. oil companies are under pressure to reward shareholders and retain financial discipline, current oil prices mean “there is clearly potential for some producers to respect those engagements and modestly increase their capital expenditures,” the report added.

Canada, meanwhile, is now pumping at record rates, having restored nearly all the production shut during the collapse of the global oil market last year.

If balances continue to tighten and non-OPEC producers increase production, that could fray the cohesion of OPEC-plus cuts, the IEA said. That might have consequences for the oil-price rally."
 

[working woman]

Lots of talk here about "money in the pipes" and where the Govt. should spend it. 

One way they should be spending it is obvious to me.  Sort the flipping cladding issue out. It is a huge problem.

For those who don't know, following the Grenfell fire, the Govt. changed the building regulations and flats with wooden panelling, balconies and cladding panels may be unsafe and have to be inspected and pass a test (EWS1) otherwise building societies won't lend on them or allow remortgaging as they are giving them a Nil Valuation.

Many people are trapped in flats that are now classed as unsafe, cannot sell or remortgage and face huge bills. In my area, I have heard bills range from 10-40K.

I live in a flat and last week we passed the EWS1 test - hooray! 

Only 10% of buildings in our category pass. I have no idea how we passed, maybe we aren't that high at 3-5 stories. It is such a relief.

Having been through the worry the last few months of having the test done and awaiting the results, I know how other people are feeling. I feel so sorry for them. They bought flats that were classed as safe at the time of purchase, and then understandably, the Govt. changed the regulations.

A couple of days ago the Govt announced more financial help, which is a start, together with loans on low level buildings with repayments capped at £50 a month per resident.

I don't understand their priorities, they gave 10k out to second home / holiday home owners (not essential) in Spring last year due to Covid and have known about the cladding issue for several years following Grenfell and are slow to act on properties that are people's main homes.

Imagine having bought a flat, being young and wanting to start a family, or have a baby and can't move on, or needing to sell and move for work reasons. Or inheriting a flat, very nice thank you, but being unable to sell it or pay for the remedial works.

Until this gets sorted out, it is a disaster for the younger generation. My first home was a flat in the 1990's and I remember young families with children trapped and unable to buy a house due to negative equity. They had to wait about 5 years before prices went up, creating enough equity for a deposit on a house.

 

 

 

 

[Yadda yadda yadda]

25 minutes ago, harp said:

My postie thinks I’m a genius. He was pissed off when their share price went down just before they were able to sell them. I told him to buy when they got to 200. He thought I was mad. But he did and they fell more! I just said keep buying! Well he’s chuffed now. Tells me it’s still like Christmas time and post offices are rammed. I guess once things go back to “normal” this will tail off and the share price might reflect that? But I think it’s still got room to run higher. Time will tell. 

I wonder how many shares have been bought by posties? More insiders who can see what is happening than most businesses.

[Yadda yadda yadda]

5 minutes ago, working woman said:

Lots of talk here about "money in the pipes" and where the Govt. should spend it. 

One way they should be spending it is obvious to me.  Sort the flipping cladding issue out. It is a huge problem.

For those who don't know, following the Grenfell fire, the Govt. changed the building regulations and flats with wooden panelling, balconies and cladding panels may be unsafe and have to be inspected and pass a test (EWS1) otherwise building societies won't lend on them or allow remortgaging as they are giving them a Nil Valuation.

Many people are trapped in flats that are now classed as unsafe, cannot sell or remortgage and face huge bills. In my area, I have heard bills range from 10-40K.

I live in a flat and last week we passed the EWS1 test - hooray! 

Only 10% of buildings in our category pass. I have no idea how we passed, maybe we aren't that high at 3-5 stories. It is such a relief.

Having been through the worry the last few months of having the test done and awaiting the results, I know how other people are feeling. I feel so sorry for them. They bought flats that were classed as safe at the time of purchase, and then understandably, the Govt. changed the regulations.

A couple of days ago the Govt announced more financial help, which is a start, together with loans on low level buildings with repayments capped at £50 a month per resident.

I don't understand their priorities, they gave 10k out to second home / holiday home owners (not essential) in Spring last year due to Covid and have known about the cladding issue for several years following Grenfell and are slow to act on properties that are people's main homes.

Imagine having bought a flat, being young and wanting to start a family, or have a baby and can't move on, or needing to sell and move for work reasons. Or inheriting a flat, very nice thank you, but being unable to sell it or pay for the remedial works.

Until this gets sorted out, it is a disaster for the younger generation. My first home was a flat in the 1990's and I remember young families with children trapped and unable to buy a house due to negative equity. They had to wait about 5 years before prices went up, creating enough equity for a deposit on a house.

 

 

 

 

Yes, a failure of regulation as much as anything. The work to fix it will employ people. Get it done.

[Castlevania]

3 hours ago, Lightscribe said:

Ultimate collector series. Have I introduced Dosbods to a new asset class?

The modular building sets however are the main series when retired go for extreme prices.

https://www.amazon.co.uk/LEGO-4566081-Cafe-Corner-10182/dp/B000OTF4CQ

Surely that’s kite flying? £2.5k?

I really wanted the bank. Lack of space/the thought of having to move it whilst renting put me off.

[geordie_lurch]

Oil major Royal Dutch Shell on Thursday outlined the details of its near-term and long-term plans to transition to cleaner energy, saying its oil production and total carbon emissions have already peaked....

https://www.cnbc.com/2021/02/11/oil-giant-shell-says-carbon-emissions-and-oil-production-have-peaked.html

Is the oil bit guff and if not does it matter too those of us with their shares?

[Yellow_Reduced_Sticker]

Cor blimey i thought i'd logged into the BTC thread with all this talk back here...

 

Anyway, only posting to give @DurhamBorn another BOLLOCKING!   ;-)

 

Gotta STOP listening to his YRS Tips!

 

This time his early morning ALDI tip-off!

 

Got up at 6:30am to have breaky and get to ALDI for 8am opening, What a disaster... bloody FREEZING as well here -7  ... AND bugger they didn't even have a YRS section, I even asked/GRILLED the shelf stacker!

 

FIRST time i've got up that early in 5 years ...ALMOST felt I was going to work, heavens forbid!!!

 

AnyHOO...CAN'T GRUMBLE as just checked RMG and yeah YOU guys are correct they are ROCKETING!

I still HAVEN'T sold out...i'm holding until 2029 sell price £9.69 thank you SIR! {DB}

 

 

 

2 hours ago, MrXxxx said:

I think this is going to be my problem having started in March....and I will only realise that I am Delboy rather than Warren when I get a `spanking` :-)

 

SORRY me 'ol mucker but i couldn't resist - this is a CLASSIC Del-boy MOMENT!

 

 

 

 

 

 

 

 

 

 

[RJT1979]

22 minutes ago, working woman said:

Lots of talk here about "money in the pipes" and where the Govt. should spend it. 

One way they should be spending it is obvious to me.  Sort the flipping cladding issue out. It is a huge problem.

For those who don't know, following the Grenfell fire, the Govt. changed the building regulations and flats with wooden panelling, balconies and cladding panels may be unsafe and have to be inspected and pass a test (EWS1) otherwise building societies won't lend on them or allow remortgaging as they are giving them a Nil Valuation.

Many people are trapped in flats that are now classed as unsafe, cannot sell or remortgage and face huge bills. In my area, I have heard bills range from 10-40K.

I live in a flat and last week we passed the EWS1 test - hooray! 

Only 10% of buildings in our category pass. I have no idea how we passed, maybe we aren't that high at 3-5 stories. It is such a relief.

Having been through the worry the last few months of having the test done and awaiting the results, I know how other people are feeling. I feel so sorry for them. They bought flats that were classed as safe at the time of purchase, and then understandably, the Govt. changed the regulations.

A couple of days ago the Govt announced more financial help, which is a start, together with loans on low level buildings with repayments capped at £50 a month per resident.

I don't understand their priorities, they gave 10k out to second home / holiday home owners (not essential) in Spring last year due to Covid and have known about the cladding issue for several years following Grenfell and are slow to act on properties that are people's main homes.

Imagine having bought a flat, being young and wanting to start a family, or have a baby and can't move on, or needing to sell and move for work reasons. Or inheriting a flat, very nice thank you, but being unable to sell it or pay for the remedial works.

Until this gets sorted out, it is a disaster for the younger generation. My first home was a flat in the 1990's and I remember young families with children trapped and unable to buy a house due to negative equity. They had to wait about 5 years before prices went up, creating enough equity for a deposit on a house.

 

 

 

 

Sod that. Why should tax payers pay for it. People can deal with it themselves.  50pc of effected properties are BTL.

[Hancock]

27 minutes ago, harp said:

Personally I don’t understand crypto. But I have crypto. It’s the only thing that’s done well for me. £50k now £350k. Taken my original stake out plus another £50k and stuck that in HL ready to invest if we get a BK. The rest can do what it likes, I’ll let it run for shits and giggles. 

Fair play to you for having big bollocks to put that kind of money in and keep it there for so long.

Live changing win for being early to the ponzi.

Just now, Hancock said:

Fair play to you for having big bollocks to put that kind of money in and keep it there for so long.

Life changing win for being early to the ponzi.

 

[Harley]

39 minutes ago, DoINeedOne said:

Congratulations to everyone who held or still does hold RoyalMail

Like a little bitch i sold months ago

I topped sliced.  Its what you do, dontyaknow!

[geordie_lurch]

Nigeria and India looking to whack a mole with BTC but "Nigerian traders are now relying on a trade-by-barter system to buy and sell Bitcoin."

"Meanwhile, thousands of youths have turned to Twitter to express their displeasure about the government’s decision to ban cryptocurrencies under the hashtag #WeWantOurCryptoBack."

Note this nugget at the end...

"Beyond Nigeria, India is also seeking to ban all private cryptocurrency transactions in favor of a digital rupee, which will be issued by the Reserve Bank of India."

https://btcpeers.com/nigerians-defy-government-order-turn-to-p2p-exchanges-for-bitcoin/

[Harley]

43 minutes ago, working woman said:

For those who don't know, following the Grenfell fire, the Govt. changed the building regulations and flats

A hell of a lot more to the sorry saga than that.

[Harley]

12 minutes ago, geordie_lurch said:

Nigeria and India looking to whack a mole with BTC but "Nigerian traders are now relying on a trade-by-barter system to buy and sell Bitcoin."

"Meanwhile, thousands of youths have turned to Twitter to express their displeasure about the government’s decision to ban cryptocurrencies under the hashtag #WeWantOurCryptoBack."

Note this nugget at the end...

"Beyond Nigeria, India is also seeking to ban all private cryptocurrency transactions in favor of a digital rupee, which will be issued by the Reserve Bank of India."

https://btcpeers.com/nigerians-defy-government-order-turn-to-p2p-exchanges-for-bitcoin/

"They" like to test out such monetary things in India!

[geordie_lurch]

Just now, Harley said:

"They" like to test out such monetary things in India!

And vaccines

[geordie_lurch]

Just now, Cattle Prod said:

It didn't say that its gas production has peaked, or that by producing more gas, their total carbon emissions would go down. Shell has been increasing its gas production over oil for years. 

Ok but their oil production has peaked as per the release yes?

[Democorruptcy]

1 hour ago, sancho panza said:

I think it was @Democorruptcyposted this jeremy Grantham interview.He's long scpeticism in terms of bubbles and the wider marekt,long gold,long renewables(bit too much imho).

He said in the image I quoted that he has not had confidence for 20 years. He's been wrong for so long. I used to post his Q and Cape that implied the US markets were way overvalued a long time ago and up they go! That bloke could have sent me down to the foodbank if I'd gone short.

Maybe he needs to include "in my lifetime.." in his comments just in case he never sees it. Have I just called the top now with a disbelieving comment? El Erian calls what we have now a "Rational bubble" due to the liquidity.

[Hancock]

https://www.bloomberg.com/news/articles/2021-02-10/drax-to-abandon-plans-to-build-large-scale-u-k-gas-station?srnd=premium-europe

[geordie_lurch]

9 minutes ago, Cattle Prod said:

If they say so, I don't know any better!

Cheers - I'm not saying you should have all the answers @Cattle Prod

I do think it's prudent to think ahead for the RDSB share price and dividends knowing peak oil, at least in Shells case has already happened even if the oil price continues rising but as you say they have a lot of other income streams

[Hancock]

Never quite understood how burning wood pellets is deemed to be" Green Energy".

Unless they find a way to grow trees faster than they can burn them.

[geordie_lurch]

8 minutes ago, Cattle Prod said:

Don't just think of oil when it comes to an oil and gas company. Most of them are around half gas. Gas is viewed as an easier "sell" to agitated shareholders, so it's no big deal for Shell to say this now. I've just googled it and they said they're going to expand their gas production as I guessed. Did they say their overall production has peaked?

Another source...here

"Royal Dutch Shell Plc (LON:RDSB) told investors its oil business is past its peak, as it added detail to a strategy that aims to accelerate the fuel major’s ‘drive to net-zero emissions’.

Shell’s oil production volumes are expected to have reached a peak in 2019, the company said, meanwhile, it added total carbon emissions peaked in 2018.

The company, among the largest and most famous oil businesses in the world, said it expects a gradual reduction in crude production.

Shell’s oil production will decline by 1-2% per year each year, the company added. It highlighted that its upstream division will focus on value over volume, and, the reduction in production will be delivered by divestment and natural decline."

then near the end...

"The development of hydrogen ‘hubs’ to serve industrial and heavy-duty transport customers is also part of the plan, where Shell aims to achieve “a double-digit share of global clean hydrogen sales.”

Shell’s chemicals and products business plans a major reconfiguration, transforming and consolidating its refinery footprint – establishing six ‘high-value’ chemical and energy parks, from its current portfolio of 13 sites.

Significantly, it plans to cut production from “traditional fuels” by 55% in this decade whilst at the same time growing volumes and increasing cash generation."

Maybe we need to stop calling these companies oilies soon?

[Castlevania]

2 minutes ago, Cattle Prod said:

Don't just think of oil when it comes to an oil and gas company. Most of them are around half gas. Gas is viewed as an easier "sell" to agitated shareholders, so it's no big deal for Shell to say this now. I've just googled it and they said they're going to expand their gas production as I guessed. Did they say their overall production has peaked?

It was on the Guardian’s markets blog. Oil production peaked in 2019 and will decline at 1-2% per year.