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

[Yadda yadda yadda]

36 minutes ago, JMD said:

Yes, these times call for a 'iron chancellor' type... but instead we have Rishy-washy Sunak!

Iron would be good. As would Brave, Visionary or Principled. Wishy washy Rishi is a rabbit in the headlights.

[Starsend]

1 hour ago, DurhamBorn said:

What 99.9% of these economists miss is what a macro strategist see's.The fact the Fed WANTs higher inflation to cut the government deficit.30%ish quick increase does the job where tax goes up faster than spending.Watch the US deficit fall now very fast,thats the key.Fed will want to slow inflation,i see a quick slice off later in the year down to 8%,then a drift down to 6%,then bouncing around the 4% to 6% area for a cycle.There is a chance we go back down to 2% or less for a short period,but onshoring investment pushes it back up.

They will use rate increases but knowing the repo money is all sat to come out and be invested.US looks like the best placed economy in the world right now,but i still wouldnt buy most of its stocks.Apart from T

Do you see the dollar continuing to strengthen from here db?

[Castlevania]

1 hour ago, DurhamBorn said:

US looks like the best placed economy in the world right now,but i still wouldnt buy most of its stocks.Apart from T

Why’s that? They’re comparatively expensive or some other reason?

[DurhamBorn]

47 minutes ago, Starsend said:

Do you see the dollar continuing to strengthen from here db?

I think it will still up a while because there is a scramble for food and energy,a high dollar secures that for them,another reason the BOE is a disaster for people.Pound falling is adding to inflation,will ensure onshoring though.

[DurhamBorn]

1 hour ago, Craig said:

@DurhamBornEven more scandalous than all the inflation, wars, Government/CB duplicity etc, is that the arse has finally fallen out of my Ferrari pizza oven! Have had it for about six years, so no surprise really, but just not getting the temperatures any more. Will be going onto Amazon.it later on to buy a replacement, remarkably they still only seem to be 100 Euros.

Now if the pound could just avoid crashing in the next few hours, that would be great...

Mine blew up,but i managed to fix it,i was very upset until i did.Secure one while you can.Im using mine a lot for little garlic breads freeze the dough in small balls defrosts in a couple of hours,15p and thats with Caputo flour.

[DurhamBorn]

1 hour ago, Noallegiance said:

If we're essentially floating somewhere around peak inflation now, why would PMs perform exceptionally well in the new cycle?

Because real rates remain negative for longer.Then next crisis hits and they print even more.

 

[DurhamBorn]

24 minutes ago, Castlevania said:

Why’s that? They’re comparatively expensive or some other reason?

Expensive yes.Some are starting to come into range,but still too high for me.

[Pip321]

55 minutes ago, DurhamBorn said:

Expensive yes.Some are starting to come into range,but still too high for me.

You said you wouldn’t invest in the US  ‘except T’ ….was the ‘T’ Telecoms?

Ps noted my prediction of everyone forgetting why Vodafone shares went up in 3 weeks time (ie after the purchase by Etisalat this weekend)….seemingly was wrong. It only took 3 hours for them to dip below 120p.😆😆

I am starting to see why ‘trading’ and ‘macros’ remain mutually exclusive. One predicts the tides, the moon cycles and the lifetime of the earth…..when the other ‘predicts/guesses’ at what the weather will be like this afternoon. 

Macro guy ‘there’s a comet heading towards earth which will kill us all in 2 years time’.
I still want to know if I should wear a jumper at the beach later today, and that must be so annoying to those who study big picture macros.  🕶🌤😉👍🏻

[Transistor Man]

4 minutes ago, Pip321 said:

You said you wouldn’t invest in the US  ‘except T’ ….was the ‘T’ Telecoms?

AT&T

[geordie_lurch]

Seems like the just released China figures are going to spook the USA and other markets today and Friday was a dead cat bounce This is indeed a crazy stat

 

[ThoughtCriminal]

🙊

[feed]

23 minutes ago, geordie_lurch said:

Seems like the just released China figures are going to spook the USA and other markets today and Friday was a dead cat bounce This is indeed a crazy stat

 

Other side to it, is 

https://www.teletrader.com/shanghai-to-ease-covid-restrictions-from-june-1-vice-mayor/news/details/57884527?internal=1

Shanghai will begin reducing COVID-19 lockdown restrictions starting June 1 amid a steady decrease in registered infections, the city's vice-mayor Zong Ming stated at a press conference on Monday.

Zong noted that the city leadership "will switch to a normal virus control mode," after which everyday life and production "will return fully to normality." He also noted that certain shopping centers and restaurants that have been free of collective infections during the past 14 days will be allowed to reopen starting Monday.

On May 8, the Russian TASS News, citing familiar sources, reported that Shanghai's health authorities had decided to ease the coronavirus containment measures in the peripheral parts of the city, aiming to eradicate the virus by mid-May.

 

 

[Heart's Ease]

Thanks to whoever posted the link to this channel. Really interesting. I have fence and wall envy!

Turning to the meat of the video - from 11.30 minutes in Harry gives us four or so minutes on:

- wheat prices - a year ago Harry would have said £150 was a bit steep, today, just over £300 per metric tonne, rapeseed double the high price from a year ago

- He's growing feed wheat. 80% of cost of chicken meat/eggs is from the feed. Prices in supermarkets not rising fast enough to keep pace with feed costs, same with pig industry

- farmers weekly report shows average £58 per finished pig Jan-Mar 2022. Unsustainable. 80% of producers potentially out if business by end of the year

- arable farmers a peculiar situation as grain is global commodity. They will have a very good financial year. Not beholden to supermarket contracts unlike egg production 

- other thing he reports is all the environmental schemes are starting to appear in the fields. His neighbours have taken up Government schemes of around £600 per hectare for growing wild flowers instead of crops. That's also increasing grain prices as quite a lot of marginal land is being given over to this.  His grain merchant estimates that has reduced production by 1 million tonnes

- Harry reports DEFRA got in touch with him a few months ago to explain their view about why food security wasn't an issue (Harry's view being food security is paramount); they've now gone quiet. That said, Harry understands why his neighbours have taken up the schemes for the guaranteed income they provide.

[Democorruptcy]

2 roubles for 2 billions:

Quote

 

Renault sells Russia business and stake in Lada maker for two roubles

Renault is selling its stake in Russia’s Avtovaz, the manufacturer of the country’s best-selling Lada cars, for a symbolic sum in one of the most significant retreats by a foreign company since the invasion of Ukraine.

The French group’s exit, involving a €2.2bn writedown and sale of its businesses to a Russian state-backed body and to the City of Moscow, highlights the meagre options facing businesses trying to leave the country without huge losses on their investments.

https://12ft.io/proxy?q=https%3A%2F%2Fwww.ft.com%2Fcontent%2F515d978a-16c9-4af9-a8b8-4c5abdfd1ee7

 

 

[Democorruptcy]

McDonalds for a rouble?

Quote

 

The humanitarian crisis caused by the war in Ukraine, and the precipitating unpredictable operating environment, have led McDonald’s to conclude that continued ownership of the business in Russia is no longer tenable,” McDonald’s said in a statement.

The Chicago-based company said it expected to book a non-cash charge of $1.2bn to $1.4bn for the exit, and did not identify a possible buyer for the business.

https://12ft.io/proxy?q=https%3A%2F%2Fwww.ft.com%2Fcontent%2F21a9a482-3a87-42b4-8c70-81b3a25bbcea

 

 

[Yadda yadda yadda]

32 minutes ago, ThoughtCriminal said:

🙊

Ruble can only get stronger. Russians can't use dollars, etc, to buy western goods. Gazprombank will simply sell all the dollars they receive. Rubles get bought, dollars get sold so it is a one way price elevator. The fuel contracts are all in dollars or Euros, yes? As the Ruble strengthens there will be fewer Rubles purchased but still adding up. Perhaps some connected Russians will be able to make out like bandits buying western goods at a much lower Ruble price. The Americans might eventually decide to allow/ignore back channel trade to Russia via China or some other nation.

[JMD]

Haven't watched this podcast yet...  but Francis Hunt and Rick Rule together has got to be worth seeing! Enjoy!!...                https://m.youtube.com/watch?v=9QRT8KX-RKk

[Axeman123]

20 minutes ago, Yadda yadda yadda said:

The Americans might eventually decide to allow/ignore back channel trade to Russia via China or some other nation.

I think at some point they will have to embrace it, even if under a fig-leaf of a third country as intermediary. Roubles flowing out to buy consumer goods will be the new "sanction" to limit Rouble strength and Russian economic growth. Putin may even be the one imposing import tarriffs and quotas in future!

[BadAlchemy]

Seeing as how 20 European gas buying companies now have accounts with Gazprombank, there should be no problem with us being allowed to hold our Gazprom shares with them too, once the ADRs are cancelled. 

Unless, of course, we are being ruled by total spineless hypocrites and it's one rule for them and another rule for us....

[BadAlchemy]

1 hour ago, Heart's Ease said:

Thanks to whoever posted the link to this channel. Really interesting. I have fence and wall envy!

Turning to the meat of the video - from 11.30 minutes in Harry gives us four or so minutes on:

- wheat prices - a year ago Harry would have said £150 was a bit steep, today, just over £300 per metric tonne, rapeseed double the high price from a year ago

- He's growing feed wheat. 80% of cost of chicken meat/eggs is from the feed. Prices in supermarkets not rising fast enough to keep pace with feed costs, same with pig industry

- farmers weekly report shows average £58 per finished pig Jan-Mar 2022. Unsustainable. 80% of producers potentially out if business by end of the year

- arable farmers a peculiar situation as grain is global commodity. They will have a very good financial year. Not beholden to supermarket contracts unlike egg production 

- other thing he reports is all the environmental schemes are starting to appear in the fields. His neighbours have taken up Government schemes of around £600 per hectare for growing wild flowers instead of crops. That's also increasing grain prices as quite a lot of marginal land is being given over to this.  His grain merchant estimates that has reduced production by 1 million tonnes

- Harry reports DEFRA got in touch with him a few months ago to explain their view about why food security wasn't an issue (Harry's view being food security is paramount); they've now gone quiet. That said, Harry understands why his neighbours have taken up the schemes for the guaranteed income they provide.

And still the local councils around here are approving prime agricultural land to be used for exercising pet dogs, and 'dog daycare' (which, IMO,  is an 'end of days' misallocation of people's time, and a scandalous misuse of food growing resource at a time when people are about to begin starving around the world in growing numbers).

[Bobthebuilder]

55 minutes ago, Heart's Ease said:

Turning to the meat of the video

Thanks for posting that.

My take from it is, meat and diary products look like they might well double from where we are now.

To continue with my beer story. I have started going to Lidl for the Perlenbacher beer, buy a few items like rice, tins, pasta every visit to stock up for the same price as the becks beer from the corner shop. Should have started doing this ages ago but, hated the mask rules so stayed away from supermarkets during that time.

Also heads up to whoever it was that mentioned South African wine, got a 14% bottle of shiraz for £3.89 today.

Cheers.

[Don Coglione]

5 minutes ago, Bobthebuilder said:

Also heads up to whoever it was that mentioned South African wine, got a 14% bottle of shiraz for £3.89 today.

Christ, that is going to hurt tomorrow!

[Chewing Grass]

20 minutes ago, BadAlchemy said:

And still the local councils around here are approving prime agricultural land to be used for exercising pet dogs, and 'dog daycare' (which, IMO,  is an 'end of days' misallocation of people's time, and a scandalous misuse of food growing resource at a time when people are about to begin starving around the world in growing numbers).

It's horses round me and I can't think of a bigger waste as the daft bastards then buy knackered old Ford Cargos to cart them around in.

[Lightscribe]

46 minutes ago, Bobthebuilder said:

Thanks for posting that.

My take from it is, meat and diary products look like they might well double from where we are now.

To continue with my beer story. I have started going to Lidl for the Perlenbacher beer, buy a few items like rice, tins, pasta every visit to stock up for the same price as the becks beer from the corner shop. Should have started doing this ages ago but, hated the mask rules so stayed away from supermarkets during that time.

Also heads up to whoever it was that mentioned South African wine, got a 14% bottle of shiraz for £3.89 today.

Cheers.

If you do fancy ‘splashing out’ in Lidl the Azinhaga De Ouro Reserva Douro is very good for the price at £5.99. 

https://www.decanter.com/wine-reviews/portugal/douro-valley/lidl-azinhaga-de-ouro-reserva-douro-douro-valley-2017-36387

[Bricormortis]

 

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