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

[Lightscribe]

10 minutes ago, Calcutta said:

BK incoming yet? I know the numbers work but as far as I can see the biggest losers now would be Amazon, Google etc and they've just had their candidate win the US election. Surely that's their insurance plan? All these years of what is basically propaganda so that when shtf they can call in favours. 

I went to all cash at 6700 in the work pension from the FTSE passive tracker this week. We may get the melt up yet, but I don’t think the FTSE is the place to make the most of that. Longer term however I think it’s  one of the better undervalued  places to put into if your limited to index funds in a pension.

Like most on here I’ll keep the ISA as it is and average down in any lows. Obviously gambling with a pension is certainly not financial advice but what the heck. Increased goalpost moving/tax grabbing means I may never see it anyway. 

[Loki]

27 minutes ago, BadAlchemy said:

Big pullback in K&S (SDF) shareprice today. Down about 13% from yesterday when it touched €10. Something to do with their accounts being investigated by German watchdog...

https://www.stockopedia.com/share-prices/ks-ag-ETR:SDF/news/buzz-ks-drops-as-german-watchdog-examines-its-accounts-urn:newsml:reuters.com:20210218:nL8N2KO2HO/

(Naturally, I topped up on them a few days before this happened!)

Just seen the drop before i saw this post.  For fucks sake.

[Yadda yadda yadda]

2 minutes ago, Lightscribe said:

I went to all cash at 6700 in the work pension from the FTSE passive tracker this week. We may get the melt up yet, but I don’t think the FTSE is the place to make the most of that. Longer term however I think it’s  one of the better undervalued  places to put into if your limited to index funds in a pension.

Like most on here I’ll keep the ISA as it is and average down in any lows. Obviously gambling with a pension is certainly not financial advice but what the heck. Increased goalpost moving/tax grabbing means I may never see it anyway. 

In the work pension I've gone about 66% divided between two different global equity funds, a UK fund and a Japan fund. Most of the rest cash and a little in a bond fund. Reduced from 85% equities and 15% cash last week. If the S&P goes above 4,150ish I'll move more to cash, up to 50-50. I'll also look at the FTSE and if it gets much above 7,200 that could also be a trigger to move further to cash.

I did similar at the end of 2019 and beginning of 2020 and it worked out very well. Although knowing when to buy back in is harder as I didn't hit all of my ladders.

The aim with the work pension is just to avoid the worst crashes to some extent.

The SIPP is invested in our reflation areas and will remain invested. As will the ISA, although that contains a couple of gambles too. At some point the gambles will be reinvested more sensibly.

[harp]

31 minutes ago, BadAlchemy said:

Naturally, I topped up on them a few days before this happened!)

Probably bought them from a member of the German Watchdog 😂

[Barnsey]

Biden and the Fed Leave 1970s Inflation Fears Behind

https://www.nytimes.com/2021/02/15/business/economy/biden-fed-inflation-covid.html

WASHINGTON — Presidents who find themselves digging out of recessions have long heeded the warnings of inflation-obsessed economists, who fear that acting aggressively to stimulate a struggling economy will bring a return of the monstrous price increases that plagued the nation in the 1970s.

Now, as President Biden presses ahead with plans for a $1.9 trillion stimulus package, he and his top economic advisers are brushing those warnings aside, as is the Federal Reserve under Chair Jerome H. Powell.

After years of dire inflation predictions that failed to pan out, the people who run fiscal and monetary policy in Washington have decided the risk of “overheating” the economy is much lower than the risk of failing to heat it up enough.

[CVG]

35 minutes ago, Loki said:

Just seen the drop before i saw this post.  For fucks sake.

I was caught too. This is why I diversify rather than trusting to any one company.

[Loki]

7 minutes ago, Cattle Prod said:

Things are running too quickly

I don't understand things to the level of most on this thread, but this thought has crossed my mind a lot recently about everything that is going on

[Jesus Wept]

https://mobile.reuters.com/article/amp/idUSL1N2KN2CC

Dropped a massive 13.5 %

 

[Jesus Wept]

1 hour ago, BadAlchemy said:

Big pullback in K&S (SDF) shareprice today. Down about 13% from yesterday when it touched €10. Something to do with their accounts being investigated by German watchdog...

https://www.stockopedia.com/share-prices/ks-ag-ETR:SDF/news/buzz-ks-drops-as-german-watchdog-examines-its-accounts-urn:newsml:reuters.com:20210218:nL8N2KO2HO/

(Naturally, I topped up on them a few days before this happened!)

Just seen...

[geordie_lurch]

I'm still up on K&S thankfully from where I bought in and top sliced but there's a lot of red showing in my account today

[DurhamBorn]

47 minutes ago, Cattle Prod said:

I said last year that we'd see the supply crunch narrative hitting the MSM in the new year, but I didn't expect AEP to be laying it out almost verbatim by February:

https://www.telegraph.co.uk/business/2021/02/17/peak-oil-demand-coming-first-brace-almighty-supply-crunch/

Things long discussed here are highlighted:

As a contrarian, this makes me distinctly uncomfortable. Things are running too quickly. A price spike now would be bad for the bullish thesis, as the crash would knock out sentiment again. That said, I think we'd still have a steady rise through the 2020s due to the fundamentals. I've asterisk'd the quote about Saudi spare capacity: yesterday I pointed out that (voluntary cuts aside) they are only exporting .75mbpd less than the pre Coronoa average, while the market thinks 3mbpd are off the market. I don't think Saudi spare capacity exists, other than a spurt for a couple of months as a show of power. I wrote this in my first post on this forum, and is the second main plank of the oil bull thesis, (along with the problems in shale now in the MSM as above). I'm pleased that the Saudi plank is not in the price yet, as all hell will break loose when people realise it. It won't be visible for at least another year, perhaps when people notice that 7mbpd hasn't been returned to the market, so that could well be a post BK phase 2.

 

I sold all my BHP as commods are running far too hot and 130% was a cracking profit.I think the market has been buying the big miners rather than energy as the inflation play.The other area of course to rocket, potash, where it must be shrewd money as its not been public or talked about much.K+S looks like a none cash matter and are still up 80%.

Repsol had good results today and still look like a coiled spring,i expect them to double again from here for starters.

I think the bullish buying has been from small players,the big funds have been sellers for woke reasons and it could of been a lot of shares.I think its likely that is over now,or very close.

My main problem with the companies is they should be doing buybacks now,not in a year or so.Its not the stage in the cycle to pay down debt,they should be buying up shares.However to be fair i think a lot of it is they are having to use capital to position options into renewables.

 

 

 

[The Idiocrat]

2 hours ago, BadAlchemy said:

Big pullback in K&S (SDF) shareprice today. Down about 13% from yesterday when it touched €10. Something to do with their accounts being investigated by German watchdog...

https://www.stockopedia.com/share-prices/ks-ag-ETR:SDF/news/buzz-ks-drops-as-german-watchdog-examines-its-accounts-urn:newsml:reuters.com:20210218:nL8N2KO2HO/

(Naturally, I topped up on them a few days before this happened!)

Thanks for posting this earlier. It’s never a good sign so I got out at -8% on the day. I was up 40% and so no biggie, plenty of other opportunities.

[Yadda yadda yadda]

5 minutes ago, DurhamBorn said:

I sold all my BHP as commods are running far too hot and 130% was a cracking profit.I think the market has been buying the big miners rather than energy as the inflation play.The other area of course to rocket, potash, where it must be shrewd money as its not been public or talked about much.K+S looks like a none cash matter and are still up 80%.

Repsol had good results today and still look like a coiled spring,i expect them to double again from here for starters.

I think the bullish buying has been from small players,the big funds have been sellers for woke reasons and it could of been a lot of shares.I think its likely that is over now,or very close.

My main problem with the companies is they should be doing buybacks now,not in a year or so.Its not the stage in the cycle to pay down debt,they should be buying up shares.However to be fair i think a lot of it is they are having to use capital to position options into renewables.

 

 

 

DB, any view on steel? Some are seeing that as a commodity play due to expected increased construction. Do you see the miners (iron ore, coking coal, although possibly already priced in) plus energy as the true play there? Would the steel producers have pricing power as there are substantial barriers to entry? I'm not sure on the spare capacity in the industry currently. If there is a lot then profit could be made on increased utilisation. If not then pricing power increases profits.

[nirvana]

I was feeling bored so dumped a load of RDSB at 1371 

Had a clear out of other 'boring shite' too and bought a shitload o Silver instead....

some bloke on the internet says it's about to rocket........And errrr, me um talk with um horses....

On a more serious note I think crude has had a good run and needs a pullback

GO SILVER GO!!!! 

 

 

[DurhamBorn]

27 minutes ago, Yadda yadda yadda said:

DB, any view on steel? Some are seeing that as a commodity play due to expected increased construction. Do you see the miners (iron ore, coking coal, although possibly already priced in) plus energy as the true play there? Would the steel producers have pricing power as there are substantial barriers to entry? I'm not sure on the spare capacity in the industry currently. If there is a lot then profit could be made on increased utilisation. If not then pricing power increases profits.

I own some SSAB Svenskt Stal steel i bought during the crash last March and they have done ok,up around 50% and im going to hold them,its not a big holding.Its a difficult sector to invest in really.I much prefer energy as the play.People need to remember though im not chasing big profits or looking to get multi baggers.Im at the stage of life where iv packed in work,and have enough capital and income from it.My main aim it to sustain it until i die.Of course i hope to grow my capital as well,and the last year has been fantastic,but thats not my primary aim.

[sancho panza]

4 hours ago, Popuplights said:

Fully agree. I have driven up into central London a couple of times in the last few weeks for my medical appointment, and it is exactly as you described, 28 days later style. Shuttered shops and deserted streets. The only bright spot is that rents will have to fall to fill these spaces, and the bankruptcy of commercial landlords does not actually destroy the properties, so they can come back into use at a much more affordable price point.

With reference to the banking sector in the UK,I honestly don't know how they're going to manage these CRE related losses that are coming.Most basement dwellers are walking around their localities thinking the same thing as you,where as the public and media are walking around thinking everything will return back to normal.Mathematically,it can't.

As Jim The Realtor used to say back in 09, 'price fixes everything'.These shops/offices will come back into use,just servicing lower interest costs and business rates.

1 hour ago, Cattle Prod said:

I said last year that we'd see the supply crunch narrative hitting the MSM in the new year, but I didn't expect AEP to be laying it out almost verbatim by February:

https://www.telegraph.co.uk/business/2021/02/17/peak-oil-demand-coming-first-brace-almighty-supply-crunch/

Things long discussed here are highlighted:

As a contrarian, this makes me distinctly uncomfortable. Things are running too quickly. A price spike now would be bad for the bullish thesis, as the crash would knock out sentiment again. That said, I think we'd still have a steady rise through the 2020s due to the fundamentals. I've asterisk'd the quote about Saudi spare capacity: yesterday I pointed out that (voluntary cuts aside) they are only exporting .75mbpd less than the pre Coronoa average, while the market thinks 3mbpd are off the market. I don't think Saudi spare capacity exists, other than a spurt for a couple of months as a show of power. I wrote this in my first post on this forum, and is the second main plank of the oil bull thesis, (along with the problems in shale now in the MSM as above). I'm pleased that the Saudi plank is not in the price yet, as all hell will break loose when people realise it. It won't be visible for at least another year, perhaps when people notice that 7mbpd hasn't been returned to the market, so that could well be a post BK phase 2.

 

It's amazing to read AEP.Looks like he's been studying your thesis and writings over the last year CP.

Looking at the oil chart,there's just something unnatural in the Brent chart.It hasn't had a 5% pull back on teh dailies since the Oct 30 bottom.Doesn't mean I'm going to sell anything but some options trades are going to get delayed.

Ref the post BK phase 2,there is historical precedent,especially now we know the Fed/CB playbook back to front.

For me,the thing that really strikes me about amost of the MSM output on oil,is that they always jsut seem to assume Chinese/Indian demand as a constant and the US driving season as the variable in the demand equation.Going forward things are going to change.

[Jesus Wept]

1 hour ago, Vendetta said:

https://mobile.reuters.com/article/amp/idUSL1N2KN2CC

Dropped a massive 13.5 %

 

I had about 6% of my portfolio in SDF (K+S). 
 

It was up about 30% since purchase.

Took a big hit this morning and I cleared it right out. Still made a fair profit.

Its one thing riding out a cyclical downturn and not crystallising a loss .... a completely different matter when the auditors smell dodgy accountancy practices. 

These things never end well.

Not for me - I’ve taken my original investment and profits and ran.

Theyll be bigger and better companies to invest in. I’m thinking more telecoms.

(I also now know I can use it in my ISA and haven’t wasted my allowance... 😂). This will change my whole take on investing ! 

Anyone else continuing to hold this stock? Or even buying more at -15% to yesterday’s price?  What’s your thinking? 

 

[Yadda yadda yadda]

12 minutes ago, DurhamBorn said:

I own some SSAB Svenskt Stal steel i bought during the crash last March and they have done ok,up around 50% and im going to hold them,its not a big holding.Its a difficult sector to invest in really.I much prefer energy as the play.People need to remember though im not chasing big profits or looking to get multi baggers.Im at the stage of life where iv packed in work,and have enough capital and income from it.My main aim it to sustain it until i die.Of course i hope to grow my capital as well,and the last year has been fantastic,but thats not my primary aim.

Thanks DB. I've got a higher risk appetite than you but I think I'm going to continue to concentrate on oil and mining. Also telecoms. I've recently taken small positions in Deltic Energy and EnQuest. If oil gets whacked down I'll increase these. Perhaps names for others looking for more upside potential to consider. I think they could respond very well to 80 dollar plus oil. Could also be taken over. Of course could easily go the other way too...

I'm wary of taking on too much diversity to keep a proper eye on.

[Loki]

5 minutes ago, Vendetta said:

Anyone else continuing to hold this stock? Or even buying more at -15% to yesterday’s price?  What’s your thinking? 

 

Still holding. I don't know what to do. Still in blue for now

[Loki]

1 minute ago, Cattle Prod said:

I'm still holding too. It is a much smaller % of my portfolio than Vendetta, so I'm willing to take the risk for a bit longer. DB always said one or two companies wouldn't make it, and I'm mentally prepared for that. Benefit to having a range of companies and sectors.

Thanks for that mate.  Hopefully they get through. I guess no auditors or regulators get hauled over the coals for letting it get to this stage. Makes me question how much we really know about what we are investing in.

[nirvana]

k.....I has been doing some Cable analysis cos methinks it's getting overvalued again 

i am happy to buy a Silver ETF denominated in USD when I can get 1.39 to the shitty quid 

Capital Economics reckons the £ might go to 1.45 vs $....also they 'forecast oil prices back up to $70/barrel by the end of the year'

Apparently the £ strength is to do with a faster rollout of Covid vaccines than the rest of clown world.....

Sooo I'm getting my cable shorts warmed up too ......actually looking at the charts 1.43 might be a ceiling but I think 1.40 is a psychological barrier 

Disclaimer: all economists are lying bastards in my world and I haven't got a clue who Capital Economics are 

[sancho panza]

19 minutes ago, Loki said:

Thanks for that mate.  Hopefully they get through. I guess no auditors or regulators get hauled over the coals for letting it get to this stage. Makes me question how much we really know about what we are investing in.

That's why it's always good to 'spray n pray'.The accounts are only as good as the data put in and the people doing the calcs.

In teh potash world there's not many places to put your cash..Even our top ladders are well in the money.If they drop back to E6,I'll reassess and probably get more if there's nothing untowrd going on.

[leonardratso]

i have full trust in those kraut bastards, after my wirecard adventures, it will turn out good.

Im buying some more right now on this dip, a whole 50 great british pounds for rebuilding the 3rd reich there.

[sancho panza]

European oilies lower but RDSB/BP ex divi,so that's another couple of certificates in the psot.

Price of Brent jsut not giving up.COuld it be on the verge of an exponential move?

Chart for share prices since Brent last $64

Will BP XOM catch up with EQNR?

[nirvana]

here's a cheat sheet for holders of scottish and german shares 

think of it as a modern take on when you had to sit through those shitty corporate presentations