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

[DurhamBorn]

2 hours ago, Funn3r said:

OK here's where the rubber meets the road, for me at least. About three years ago I opened an HL account with 1 pound after following this thread since ToS, then totally bottled any use of it. Finally this week got sick and tired of my cash ISA getting 0.01% and arranged to have it transferred to HL as a Stocks&Shares ISA. 

I'll add in a bit more cash so let's say 50K for now. I have been saving what I thought were notable posts from this thread exactly for a time like this and got some ideas. Basically telecoms, oil companies, PMs, and maybe a little bit miners. Not expecting or accepting Advice but any general suggestions welcome on how to get started. I'm not dead yet but no spring chicken so time horizons are shall we say "limited." 

Firstly thats a lovely amount i think for a nice investment portfolio.Its actually exactly what my partner has in her ISA,the rest she piles in her SIPP.

First you need to decide if you are going to go for same sized holdings ie 10 x £5k,20 x £2.5k etc,or if your going to have different sized holdings.I myself have much bigger holdings in several then lots of smaller holdings.So maybe you might consider some £4k holdings and then £2.5k ones etc.

Id start where i have always started with every portfolio iv ran and built for everyone BAT.If they say no,i dont build it.Its a shame its now though as its ran up 10% in a few weeks,so it depends if you want to risk a pullback or not.

Telcos id buy TEF SA ,VOD,Orange in equal amounts.Id also buy BT if it pulls back a bit.

Id buy two investment trusts Henderson Asian Income Investment Trust and the one iv been buying this last couple of weeks Blackrock Latin American Investment Trust.That gets you a lot of value shares in areas that should do well from the cycle,and good divs.

PMs id not buy too many with a portfolio that size.Maybe £3k of £4k of silver.See that as insurance.

Wealth managers are out of favour but should gain from the cycle,Abrdn and M&G are most suitable for long term income portfolios.They can be volatile though in a BK event.

Energy is tricky,because we have mostly already doubled or trebled our holdings.However if we look towards later in the cycle BP and Repsol should see new highs still yet.

Id avoid smaller more speculative companies.

Id also open a SIPP and feed the divis from the ISA into you bank account then back out into your SIPP getting tax relief added on.Thats exactly what i do with my partners who is putting all her taxable income into her SIPP.

You could also do half stakes in the areas you choose and then put ladders under them all and buy the 2nd half if they fall say 8%.

Main thing is keep diversified,understand a lot of your gains will come from divis not capital growth and accept you might be under water for a long time,or not.

Dont buy Centrica at £1.80,worse dont buy your partner it at £1.50 who mentions it every time she sees her portfolio (though doesnt mention the ones that have trebled and quadrupled )

The individual names are not advice and do your own research etc,everyone is different etc and has to live by their own choices,but whatever you do good luck.

 

 

 

[sleepwello'nights]

4 hours ago, Bobthebuilder said:

Right, sh#t has just got real for me in bobs land, this is serious.

Hornby have just released their 2022 model train product line. Last year's prices for a steam train was £169.99, this year's releases £269.99. These are not new tooling, but re-releases.

Being discretionary spending, I'm shorting Hornby.

Things have got serious, folks.

I've decided to buy a pair of boots. Just had an awful shock looking at the prices of Churches shoes. They've doubled their prices!!. I recall seeing an announcement from them in 2019 IIRC, saying they were going to reposition themselves and reduce volume. 

Doubling prices will do that obviously. Question is why, unavailability of skilled labour perhaps and few wanting to train. 

Fortunately found a pair in the sales with 55% discount, so still expensive but not ludicrous.

Thing with your trains though @Bobthebuilderis secondhand the selling prices have increased over the years, and newer models are far more sophisticated than they used to be. 

[AWW]

I have started to buy all sorts of shit that is on the "I'll need that at some point" list. Even stuff I might not need for years. It won't be that long before others start to do the same, then it's game over for the transitory inflation theorists.

Except houses, obvs 

[Bobthebuilder]

19 minutes ago, sleepwello'nights said:

Thing with your trains though @Bobthebuilderis secondhand the selling prices have increased over the years, and newer models are far more sophisticated than they used to be. 

Oh, yes, I agree, the China Bachmann stuff has been exceptional for the last few years in terms of quality. Hornby are trying to add some value with DCC, real smoke, etc, but the price increases are eye watering. Reading a model railway forum about this tonight, sounds like they could be on here talking about inflation, retired fixed incomes and what gets the spending chop first.

[DurhamBorn]

11 minutes ago, AWW said:

I have started to buy all sorts of shit that is on the "I'll need that at some point" list. Even stuff I might not need for years. It won't be that long before others start to do the same, then it's game over for the transitory inflation theorists.

Except houses, obvs 

Iv been buying loads of quality clothes 2nd hand, iv even got a John Smedley jumper from Casino Royale  .All i need now is to bump into Eva Green and invite her back to mine so she can can sit on the end of my bed and repeat over and over "im the money" or maybe the scene from Goldfinger,but il paint her in oil instead of gold 

[CannonFodder]

4 minutes ago, DurhamBorn said:

Or maybe the scene from Goldfinger,but il paint her in oil instead of gold 

Potash?

Sorry i.ve been drinking

[Bobthebuilder]

21 minutes ago, AWW said:

I have started to buy all sorts of shit that is on the "I'll need that at some point" list. Even stuff I might not need for years. It won't be that long before others start to do the same, then it's game over for the transitory inflation theorists.

Except houses, obvs 

I have been like this for a while, bought a set of Zildjian cymbals cheap the other week. Well, you never know when they might come in handy.

[Yellow_Reduced_Sticker]

On 11/01/2022 at 14:21, geordie_lurch said:

Below is a link to a great documentary on Netlfix about a cameraman that goes to Cuba over 40 years of initial boom and the subsequent bust......

https://www.netflix.com/ro-en/title/80126449

 

 

Thanks for the Cuba film documentary tip on Netflix, well it goes without saying that i wouldn't have a subscription on Netflix  - so for us fellow super-tight-wads, here's a FREE place YOU can watch this film right NOW! Cuba and the Cameraman:

 

[working woman]

13 hours ago, MrXxxx said:

I think this is the issue especially in the UK where it is overpopulated, hence why I consider this idea is more viable in the rural parts of Spain, Portugal or Italy....be interesting to hear from those with experience if this is the case as I am considering it as part of my 'escape' plan.

In the right spot, I think the UK is still ok.  My Dad had a smallholding in the UK for many years. 

Theft -  can't recall anything getting pinched, probably because his sheds were surrounded by mud and crazy cows. Animals are a good deterent, attacking intruders and making noises. I was wary of his cows, geese and bees.  Access gates always locked. A public footpath ran through so dogwalkers were also a deterent. The main theft issue was the fox getting the chickens if you forget to lock them up at night.

Pros and Cons Whilst hard work, a small holding is fulfilling. If you have large animals, it is hard to go away as someone needs to look after them for you.

Alternatives - In the Med, maybe buy a rural house with a few rooms and run a B&B, plus have a small veg plot.

I have an allotment and so far,  not lost tools or food.  Someone would have to come regularly and pinch food for it to be worth their while.    

 

 

[Lightscribe]

1 hour ago, DurhamBorn said:

maybe the scene from Goldfinger,but il paint her in oil instead of gold 

I would dress her up as a silver great panther (no particular reason of course)

It would be a dominatrix type role. She could don the attire, take all my money and leave me crying in the corner at what could have been.

[WICAO]

4 hours ago, Funn3r said:

OK here's where the rubber meets the road, for me at least. About three years ago I opened an HL account with 1 pound after following this thread since ToS, then totally bottled any use of it. Finally this week got sick and tired of my cash ISA getting 0.01% and arranged to have it transferred to HL as a Stocks&Shares ISA. 

I'll add in a bit more cash so let's say 50K for now. I have been saving what I thought were notable posts from this thread exactly for a time like this and got some ideas. Basically telecoms, oil companies, PMs, and maybe a little bit miners. Not expecting or accepting Advice but any general suggestions welcome on how to get started. I'm not dead yet but no spring chicken so time horizons are shall we say "limited." 

In addition to thinking what should my portfolio look like also don't forget to think product (individual shares, funds, ETF, etc) and wrapper (a S&S ISA, SIPP, trading account is a wrapper) costs.  For example with the HL S&S ISA and just thinking annual costs (there will also be trading costs, buy/sell spreads, possibly performance fees, etc)):

• Buy funds and you'll be paying 0.45% in wrapper fees on your total investment on your first £250,000 with it starting to decrease a little on amounts above that.  There will then also be product fees.
• Buy shares which includes ETF's and it's also 0.45% but importantly capped at £45.

So for example let's say somebody has £100,000 invested:

• in the Vanguard Global Equity Income Fund - Income.  HL will take 0.45% and Vanguard will take 0.48%.  So annual fees will be £930.
• in the Vanguard FTSE Global All Cap Index Fund.  HL will take 0.45% and Vanguard will take 0.23%.  So annual fees will be £680.
• If instead they bought Vanguard FTSE All-World UCITS ETF (VWRL).  HL will take 0.45% but capped at £45 and Vanguard will take 0.22%.  So annual fees will be £265.
• if instead they bought individual shares.  HL will take 0.45% but capped at £45 and there will be no ongoing product costs.  So annual fees will be £45.

A big difference there particularly when compounded over many years or when thinking safe withdrawal rates in retirement.

As always do your own research, not a recommendation, the value of this is directly proportional to what you paid for it, etc etc

[JMD]

A few weeks back there was quite a bit of discussion about Martin Armstrong. Well looks like we have our own British version, am not being critical of either person. David Murrin, like Armstrong, has his own cycle theory, but is I think more articulate and has more interesting things to say, and its refreshing to hear a British accent for a change.                                          https://m.youtube.com/watch?v=l9-jfo-lh74.                                                Plus his website, with eye watering sub fees of 5k/month(!) for his institutional clients.    https://www.davidmurrin.co.uk/media/breaking-the-code-of-history

[Mapper]

11 hours ago, Tingles said:

Another excellent episode from Pailsade Gold, apologies if already posted.

Talking Points From This Episode

- The consequences of poor decision-making.

- Nuclear, global energy concerns, and green energy.

- Natural gas, fertilizer, and higher food prices.

- Speculation in crypto, the risks, and concerns around Tether.

 

 

This is a brilliant interview!

All energy economy related and grounded in the realities of physics. The guy (guys) actually repeatedly refers to energy as life, so even more emphatic than Dr. Tim at the SEE blog.

I don't follow them, but if anybody doesn't know Doomberg seems to be a bunch of people with experience in industry and commoditities. This interview guy must be the spokesman as he keep talking about "we think" and "our investments" etc.

Highly recommended if you need ammo to fire at people who think we can go down the current green path without disasterous consequences.

[geordie_lurch]

7 hours ago, Yellow_Reduced_Sticker said:

Thanks for the Cuba film documentary tip on Netflix, well it goes without saying that i wouldn't have a subscription on Netflix  - so for us fellow super-tight-wads, here's a FREE place YOU can watch this film right NOW! Cuba and the Cameraman:

If you have one of the fee free cards from the newer challenger banks you can sign up to Netflix anywhere in the world where it's cheapest via a VPN like I did via Turkey . This way you get to write you own virtual 'yellow reduced stickers' and get full UHD Netflix on several devices at once for 54.99 Turkish lira which cost me £2.56 last month

[BadAlchemy]

I just logged in to check the Royal Mail interim and special dividends that just came in. Holy cow! Is anyone else picking themselves up off the floor like me? Very nice!

RMG has been brilliant for me... I got an average price of 190p and now have a semi-decent (for me) holding of it as a result. The dividend is the first one for me that approaches the sort of sum I would normally spend on buying a ladder into something else, so I can see a snowball effect kicking in here.

Good luck @Funn3r. I have been, and still am, very cautious and still have a fair bit sitting in cash earning nothing and getting inflated away, but for me it's all about getting some balance to that so that's why I started buying the reflation stocks with some of it. It was not fun looking at a sea of red (minus 20 to 30% on pretty much everything I'd bought) back in March 2020. I nearly panicked and sold a load of it then, but my Mrs (who is the BEST investment I ever made!) told me not to be so daft. Bless her. I am currently 43% up on everything, but maybe we'll be looking at a sea of red again (buying opportunity!) in the future? So I stay cautious holding cash and top slice a little from the stocks from time to time to lock in and reallocate profits.

Maybe I could suggest to stay close to the shoreline to begin with while you get the hang of things but definitely get out there... you will learn fast and hopefully have fun too.. the sea is deep and the waves can be choppy but I believe that 'HMS Reflation' is a sturdy ship and will carry us all to safety

[belfastchild]

8 hours ago, AWW said:

I have started to buy all sorts of shit that is on the "I'll need that at some point" list. Even stuff I might not need for years. It won't be that long before others start to do the same, then it's game over for the transitory inflation theorists.

Except houses, obvs 

Ive been doing the same since the Brexit vote (why I was late to the stocks and shares party). Ive enough tools (cheap ones including lidl/aldi etc) to make other tools or fix the cheap tools. Lots and lots of consumables. Ordered a fair amount from aliexpress over the years, things I'll go through eventually. Put in an order early december (about 70 quids worth so not a lot but mostly small things) and all 5 items were cancelled. Said they were posted and heard nothing again, description say they made it to china internal customs then were returned to sender (if you believe that sort of thing). I was refunded most of the month (aliexpress kept a small proportion of it - wankers). Thought all of that was interesting in itself.

Over the last couple of years like DB have been buying up clothes etc. Only noticed my cheap (well 50 quid) decathlon walking boots are about 2 years old and probably have less than a year left, cant get replacements of the same version, newer ones look like they wouldnt last as long as the old ones will at this point! Good job I bought altbergs etc and others down the years, they are still going strong.

Came home from a trip over to England last night, bought 2l full milk, a batch loaf, 4 fruit scones and it was over a fiver for the first time ever. Saying that I couldnt get cherry scones at all. 4 mass produced fruit scones of better quality were 1.85, I bought 4 shite ones from morrisons for 1.35 during the week in england. Would rather pay the extra for something decent but everything used to be around a quid or 1.10 now over a fiver for the three.

Taxi from the airport was just over 25 quid, last time I took it (summer 2020) it was just under 20 quid. Taxi driver said he buys 2 year old cars, runs for 2 years and gets rid. Had this one for almost 3 years now, cant get 2 year old cars less than new price so on waiting list for a new car. No idea when he will get it, at the minute business isnt enough (airport runs) to cover the maintenance costs (new timing belts etc).

Been toying with the idea of getting rid of some of my small stock holdings (first ladder in each of 1k before they went to the moon), mosaic, drax etc. RT documentaries did a hatchet piece on mosaic possibly being associated with increased cancers in florida recently (trying to choose my words carefully). Both up 200 odd percent for me.
 

[geordie_lurch]

I think this short 8 minute video by Adam at Wealthion is a great resource to help anyone new to this thread (or share with friends & family outside of here) get up to speed on where we are inc what inflation is, why we are here and what's coming over the next few years.

 

[DurhamBorn]

8 hours ago, WICAO said:

In addition to thinking what should my portfolio look like also don't forget to think product (individual shares, funds, ETF, etc) and wrapper (a S&S ISA, SIPP, trading account is a wrapper) costs.  For example with the HL S&S ISA and just thinking annual costs (there will also be trading costs, buy/sell spreads, possibly performance fees, etc)):

• Buy funds and you'll be paying 0.45% in wrapper fees on your total investment on your first £250,000 with it starting to decrease a little on amounts above that.  There will then also be product fees.
• Buy shares which includes ETF's and it's also 0.45% but importantly capped at £45.

So for example let's say somebody has £100,000 invested:

• in the Vanguard Global Equity Income Fund - Income.  HL will take 0.45% and Vanguard will take 0.48%.  So annual fees will be £930.
• in the Vanguard FTSE Global All Cap Index Fund.  HL will take 0.45% and Vanguard will take 0.23%.  So annual fees will be £680.
• If instead they bought Vanguard FTSE All-World UCITS ETF (VWRL).  HL will take 0.45% but capped at £45 and Vanguard will take 0.22%.  So annual fees will be £265.
• if instead they bought individual shares.  HL will take 0.45% but capped at £45 and there will be no ongoing product costs.  So annual fees will be £45.

A big difference there particularly when compounded over many years or when thinking safe withdrawal rates in retirement.

As always do your own research, not a recommendation, the value of this is directly proportional to what you paid for it, etc etc

Very good advice for people,fees are a huge thing to consider.I often hear people say HL are expensive,but like you say they arent unless you own lots of unit trusts etc.I own all direct shares and investment trusts so my SIPP costs £200 a year, miniscule on the size of the SIPP.The IFA who did a pension transfer for me charged 1.8% (including all platform fees,fund fees,ongoing advice) if id left it there (he thought i was going to hence doing the transfer).They take about a third of the return of a 60/40 fund and thats pretty much the portfolio they all build,and thats in a rising market.Someone with say £200k with them is losing £3600 a year before they start.Nuts.

[Harley]

18 hours ago, janch said:

Also according to Max Keiser (sorry no link) there are many "unicorn" stocks in the US which have yet to make a profit and many of these will sink without a trace ie go bust. 

He's talking a fair bit of sense atm (bar the odd naughty!).  Nice perspectives even if you're not a crypto fan (bar the odd naughty!).

[Colliedog1]

10 hours ago, AWW said:

I have started to buy all sorts of shit that is on the "I'll need that at some point" list. Even stuff I might not need for years. It won't be that long before others start to do the same, then it's game over for the transitory inflation theorists.

Except houses, obvs 

I have enough shoes, socks , toothbrushes etc to last my lifetime. I buy bankrupt stock to resell but keep some of it.

[Democorruptcy]

9 hours ago, WICAO said:

In addition to thinking what should my portfolio look like also don't forget to think product (individual shares, funds, ETF, etc) and wrapper (a S&S ISA, SIPP, trading account is a wrapper) costs.  For example with the HL S&S ISA and just thinking annual costs (there will also be trading costs, buy/sell spreads, possibly performance fees, etc)):

• Buy funds and you'll be paying 0.45% in wrapper fees on your total investment on your first £250,000 with it starting to decrease a little on amounts above that.  There will then also be product fees.
• Buy shares which includes ETF's and it's also 0.45% but importantly capped at £45.

So for example let's say somebody has £100,000 invested:

• in the Vanguard Global Equity Income Fund - Income.  HL will take 0.45% and Vanguard will take 0.48%.  So annual fees will be £930.
• in the Vanguard FTSE Global All Cap Index Fund.  HL will take 0.45% and Vanguard will take 0.23%.  So annual fees will be £680.
• If instead they bought Vanguard FTSE All-World UCITS ETF (VWRL).  HL will take 0.45% but capped at £45 and Vanguard will take 0.22%.  So annual fees will be £265.
• if instead they bought individual shares.  HL will take 0.45% but capped at £45 and there will be no ongoing product costs.  So annual fees will be £45.

A big difference there particularly when compounded over many years or when thinking safe withdrawal rates in retirement.

As always do your own research, not a recommendation, the value of this is directly proportional to what you paid for it, etc etc

On the 'if they bought individual shares' what about the upfront £500 stamp duty, trading fee and currency fee if it's a foreign share? Compounded of course!

Re ISA/SIPP costs across different firms, the more you are playing with the more the price at transaction matters. Could a 'cheap' firm offer a slightly lower price and trouser a little bit? I suppose it's difficult to assess across firms with real time prices. I've seen stats on it for US firms but not for UK. Have you seen any?

[CannonFodder]

I.m with 3 platforms. Iweb. Ig and hargreaves. One Sipp and two isas.

Hargreaves is the best imho, customer service is superb. Iweb the cheapest. Ig has some niche features but they wasted on me. IG also pissing me off atm regarding a specific issue so thinking of transferring tbh. Lets give em a month to come good.

I pay a bit more in fees having 3 but I feel better in terms of counter party risk. Eg someone goes pop.

Thinking its time for a different isa, interactive investors seems quite rated on here? AJ Bell is another name. Anyone else that I have missed.

Edit. Ig also very cheap forex fees

My company pension is in standard life, worst of the 4 and sl fees are ridiculous

[HousePriceMania]

53 minutes ago, Colliedog1 said:

I have enough shoes, socks , toothbrushes etc to last my lifetime. I buy bankrupt stock to resell but keep some of it.

Out of interest, where do you get the bankrupt stock from or find out about them ?

[moneyscam]

I have a question. My only income streams are my dividends and some capital gains. These will never hit the £12.5K personal tax allowance limit. None of my investments are in any wrappers as I just had them transferred over from a custody account in Switzerland. Am I right in thinking there is no particular advantage in putting these into S+S ISA in my case as long as they remain below £12.5K + dividend allowance + capital gain allowance? 

I know I could look all this up for myself but I ask here also for the benefit of others that may be reading this and in the same position. Cheers for any answers 

 

[DurhamBorn]

1 hour ago, Democorruptcy said:

On the 'if they bought individual shares' what about the upfront £500 stamp duty, trading fee and currency fee if it's a foreign share? Compounded of course!

Re ISA/SIPP costs across different firms, the more you are playing with the more the price at transaction matters. Could a 'cheap' firm offer a slightly lower price and trouser a little bit? I suppose it's difficult to assess across firms with real time prices. I've seen stats on it for US firms but not for UK. Have you seen any?

Agree and thats why im usually a long term buy and hold.Its only the last three years iv really churned everything,but going forward only be odd buys and sells.I can swallow a one off (or two if selling) currency fees for long term holds.Repsol for instance has just today sent everyone a big fat divi and il be holding them another 8 years or more.

£200 fee on a HL half a mill Sipp is incredible value plus they dont charge for anyone drawing down amounts,thats a big thing to watch for anyone in drawdown.