Credit deflation and the reflation cycle to come (part 3)

[Loki]

My own personal reaction (perhaps my constitution is weaker after 18 months of the world wide gaslighting) is that if the announcements on the back of COP-VID (even just those from the last 2 pages of this single thread!) don't scare the shit out of you, you haven't joined all the dots yet.

Might be time for a 'stiff drink' as GG says...

Hope I'm wrong.

[Lightscribe]

32 minutes ago, Bobthebuilder said:

Spot on and, let's face it this is already happening.

I recall quite a few posters on this forum saying convid restrictions would lead us straight into carbon restrictions. Bloody obvious now ain't it?

yup.

[DurhamBorn]

[Axeman123]

I can totally see the appeal of "net zero" for BJ: a political legacy that isn't "problematic" like Brexit, A cushy unelected job for life after number 10, pockets stuffed with gold by corporations for speaches on climate change original sin, lots of First class travel on some other mugs dime, red carpets and motorcades, the chance to come back and haunt his sucessor from a position of power etc.

[Loki]

2 minutes ago, Axeman123 said:

I can totally see the appeal of "net zero" for BJ: a political legacy that isn't "problematic"

Because most of the population are fucking imbeciles 

[HousePriceMania]

25 minutes ago, DurhamBorn said:

Unfortunately I bought some VIV last week 

[Animal Spirits]

Oil giant Shell says it needs oil output to fund green shift

Ben van Beurden dismissed splitting its legacy oil and gas business from its renewables investment, a move urged by activist shareholder Third Point.

Talking exclusively to the BBC, he said the company's plans for greener energy could only be funded by oil and gas.

https://www.bbc.co.uk/news/business-59154930

[Hancock]

2 hours ago, Lightscribe said:

On Tuesday, Mr Johnson defended his net zero target, saying he believed the “great wisdom” of the British people meant they appreciated the importance of acting.

 

Yes the British people used their great wisdom to vote for Caroline stupid cow from the Green Party in 2019, well at least it seems as if they did.

41 minutes ago, HousePriceMania said:

Unfortunately I bought some VIV last week 

Wouldnt let me buy any on Monday, fucken AJ bell shite.

[sancho panza]

9 hours ago, DurhamBorn said:

Some of the Brasil stocks are getting into nice areas to open positions for anyone who wants exposure and who can live with the volatile nature.Not for widows etc etc DYOR.

AGRO,CIG,VIV,TIMB iv been adding to or set more ladders at 4% drops.

Iv sold out of Alcoa Corp pretty much 4x on that,though didnt buy a vey big holding, and iv moved 1/2 into TEF Germany this morning and im going to get a few Verizon later.

 

I see you've already  highlighted VIV n TIMB but you're obviously more widely read than we realsied.

4 hours ago, kibuc said:

Interesting news from Poland.

They've already had a rates increase in Oct from 0.1% to 0.5%, and today there was another one, this time all the way to 1.25%.

October inflation was measured at 6.8% yoy.

K will this incentivizeBritish based Poles to return home before things get more expensive?

Is there a nascent PEXIT movement in Poland or is it still a happy member of teh EU? What's the general mood like there,does it feel like the economy's running well?

[Hancock]

20 hours ago, sancho panza said:

 

A deflationary BK event looks highly likely,stock market drop will follow imho.Retail sales are an indicator but stock markets may get driven higher by commodity prices.Still lots of bulls out there and others believing the Fed has this under control

For me junk bond yields running negative in real terms and the US govt interest bill being 111% of tax receipts only ends one way.It's jsut the timing.For now I remain long the oils/telecoms/potash/goldies etc but reserve the right to be worng

But this is the thing, a BK is seemingly reliant on inflation continuing to run at current levels, so they have to raise interest rates and end printy printy.

But another recession on the horizon is surely deflationary, and just what the central banks want .... as it then enables them to keep interest rates on the floor and print some more.

I know sooner or later this all implodes on them ... but if a recession happens in 2022, then its what the market wants ... as it enables the status quo to continue ... for a while longer! 

If i'm missing a part of the puzzle, i'm happy to be shown where!

[sancho panza]

1 hour ago, Hancock said:

But this is the thing, a BK is seemingly reliant on inflation continuing to run at current levels, so they have to raise interest rates and end printy printy.

But another recession on the horizon is surely deflationary, and just what the central banks want .... as it then enables them to keep interest rates on the floor and print some more.

I know sooner or later this all implodes on them ... but if a recession happens in 2022, then its what the market wants ... as it enables the status quo to continue ... for a while longer! 

If i'm missing a part of the puzzle, i'm happy to be shown where!

BK(my defintion is a deflationary wave of defaults in the banking sector/corp bond markets).The secondary effects of that deflationary wave will be stock market drops.

For  a BK/credit deflation to occur we don't need price inflation to keep running but if it does,it will make the BK an even more powerful wave.

Recessions are by their nature deflationary but here I think it's worth noting the importance of separating price inflation/deflation from credit deflation/inflation.

CB's playbooks are very nuch based on QE/Zirp but the reality is that rampaging price inflation will restrict their room for manouvre.Hyperinflation is always and everywhere a political choice.I don't see it in the West.

I think 2022 will see the beginnings of the unwind in junk bonds.......then the fun will begin.

[Lightscribe]

3 hours ago, Loki said:

My own personal reaction (perhaps my constitution is weaker after 18 months of the world wide gaslighting) is that if the announcements on the back of COP-VID (even just those from the last 2 pages of this single thread!) don't scare the shit out of you, you haven't joined all the dots yet.

Might be time for a 'stiff drink' as GG says...

Hope I'm wrong.

Gym bro had it all sewn up in 2020

 

[BWW]

5 hours ago, Axeman123 said:

Yeah, cos he knows it would be 90:10 against this rubbish. Was this even hidden away in his manifesto, or is he just assuming the right to remake our economy and civil liberties without debate? Net zero is going to mean rationing of travel, energy consumption, and many types of food just for a start.

Well there will be a GE within 3 years and seems there's a huge opportunity for a new party given the awfulness of SirK+co.

Looks like it should be called the freedom party and can simply abolish any undemocratic nonsense Boris has imposed. But what public figure could lead such a party?

[Barnsey]

Short term not looking too great...

 

[Bricormortis]

8 hours ago, BWW said:

Well there will be a GE within 3 years and seems there's a huge opportunity for a new party given the awfulness of SirK+co.

Looks like it should be called the freedom party and can simply abolish any undemocratic nonsense Boris has imposed. But what public figure could lead such a party?

 

 

[Harley]

12 hours ago, Axeman123 said:

It honestly feels like the EU all over again. Somehow we are joining something that will trump national politics without any meaningful debate or mandate, and on which both parties will form a united front at election time anyway going forward. Innevitably the scope will creep massively, and be almost unrecognisable within a decade with it's tentacles in every corner of our lives. None of the people running it will be elected and none of it's policies will ever be debated, instead just presented as a fait acompli.

It even has many of the same ghouls previously associated with the EU. Just as the EU was a gravy train for failed national politicians, will the church of climate be the next level beyond that for failed EU ones?

I always thought the real battle would be after Brexit.  So it is and we're losing because most don't even realise.

[Harley]

8 hours ago, BWW said:

Well there will be a GE within 3 years and seems there's a huge opportunity for a new party given the awfulness of SirK+co.

Looks like it should be called the freedom party and can simply abolish any undemocratic nonsense Boris has imposed. But what public figure could lead such a party?

They're acting like there won't be another GE, or it'll be irrelevant, or fixed.

[Hancock]

38 minutes ago, Harley said:

They're acting like there won't be another GE, or it'll be irrelevant, or fixed.

Seems since 1997 (Brexit aside) they have become irrelevant, have to remember the Tories supported all Labours spending and bailout ... and since they've been in charge have then gone on to copy all Labours manifestos pledges on spending ... apart from since 2019 where they've obviously spent hundreds of billions more than Corbyn could have ever dreamed.

[headrow]

BT dividend is back

Telecoms giant BT reported a fall in profit in the first half of the year as higher finance expenses and a weakness in its enterprise and global business weighed on performance. 

for the half year to 30 September 2021, pre-tax profit fell 5% to £1,009 million, while revenue fell 3% to £10,305 million

The fall in revenue was driven by a decline in its enterprise and global, and flat growth in its consumer business. 

An interim dividend of 2.31p per share was declared, 

'Openreach has now rolled out full fibre broadband to almost 6m premises and continues to lower its build cost,' the company said.

Looking ahead, the company confirmed its financial outlook for FY22 and FY23, and brought forward its savings target. 

'We have hit our £1bn cost savings target 18 months early, which allows us to bring forward our FY25 target for £2bn of savings to FY24,' the company said.

[kibuc]

For both of you that are still holding, the greatest and pantherest of all miners reported, erm, negative profit of $18mil for the quarter, with revenues more than halved due to "operationally challenging" Q3 and with Q4 also expected to be a "challenging quarter". Fookin' hell, that a depressing quarterly report if I ever saw one.

[headrow]

Just need Carnival , Go Ahead and  Stagecoach to resume payments now. I really should dump them 3 dogs , along with Vodafone easily the biggest drag on my portfolio. Wish i'd never invested in any of them! New River Reit has cost me a fortune too.

Them 5 shares are 20k in the red , might take the loss and offset it for my tax return. Can't see any of them ever getting back to what i paid for them.

[jamtomorrow]

54 minutes ago, Harley said:

I always thought the real battle would be after Brexit.  So it is and we're losing because most don't even realise.

The Culture War is bread and circuses for the politically aware, designed to keep distracted those who would otherwise be dangerous to the interests of the establishment factions that fan its flames.

The never-ending "battles" are a feature, not a bug. You will be presented with "battle" after "battle" until you realise the only winning move is not to fight.

[Heart's Ease]

12 minutes ago, headrow said:

BT dividend is back

Telecoms giant BT reported a fall in profit in the first half of the year as higher finance expenses and a weakness in its enterprise and global business weighed on performance. 

for the half year to 30 September 2021, pre-tax profit fell 5% to £1,009 million, while revenue fell 3% to £10,305 million

The fall in revenue was driven by a decline in its enterprise and global, and flat growth in its consumer business. 

An interim dividend of 2.31p per share was declared, 

'Openreach has now rolled out full fibre broadband to almost 6m premises and continues to lower its build cost,' the company said.

Looking ahead, the company confirmed its financial outlook for FY22 and FY23, and brought forward its savings target. 

'We have hit our £1bn cost savings target 18 months early, which allows us to bring forward our FY25 target for £2bn of savings to FY24,' the company said.

Ta for posting. Ex div 30 Dec, payment 7 Feb 22. Our last bt div payment was around that date in 2020.

[Majorpain]

15 minutes ago, kibuc said:

For both of you that are still holding, the greatest and pantherest of all miners reported, erm, negative profit of $18mil for the quarter, with revenues more than halved due to "operationally challenging" Q3 and with Q4 also expected to be a "challenging quarter". Fookin' hell, that a depressing quarterly report if I ever saw one.

The Mighty Panther (Pantherus Nonminus) has just gone critically endangered.  For just £100 a month you can help keep the Directors living in the manner to which they are accustomed.

[M S E Refugee]

28 minutes ago, kibuc said:

For both of you that are still holding, the greatest and pantherest of all miners reported, erm, negative profit of $18mil for the quarter, with revenues more than halved due to "operationally challenging" Q3 and with Q4 also expected to be a "challenging quarter". Fookin' hell, that a depressing quarterly report if I ever saw one.

This came up in subscriptions yesterday.