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

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3 minutes ago, M S E Refugee said:

I think the NMW is £9.50.

Anyhow nothing will be saving people in places like Carlisle, loads of new estates have been built recently and most 4 bedroom detached houses start at 250k and most households won't be earning more than 50k.

And most of these people will have two new Cars on the drive, basically they are screwed.

50

 

year

 

mortgages

 

 

[M S E Refugee]

Just now, feed said:

50

 

year

 

mortgages

 

 

50 year or 100 hundred year mortgages make no difference when your utility bills have doubled,you have Car loans and massive credit card debt.

And also your job could go in the next 6 months.

We are in the end game.

[Axeman123]

5 minutes ago, feed said:

50

 

year

 

mortgages

Funded by selling 50 year bonds to pension funds. What rate would they want to commit for that length of time? I predict the whole thing will fizzle, perhaps after selling some shares and making the founder rich.

[sancho panza]

14 hours ago, Axeman123 said:

On the other hand...

Place your bets...

Yeah, I think you gotta decide your own risk parameters,as @geordie_lurch points out below,he was in a lot of stuff your average basement dweller wouldn't go near.

With inflation moving at a decent clip near double digit,then moving to cash has ramifications it didn't with 3% CPIH.

We're still long oilies,goldies,comms,baccy.Not feeling the urge to cash up yet.

13 hours ago, geordie_lurch said:

Given what he was holding I would say he was actually late to sell most "long positions on 11 companies during the second quarter" but seems like he got out of nearly all equities before May like myself and a few others in the thread

The current share price rises seems like a classic bear market rally to me and maybe some will be able to time things will enough to get out of the burning building when it all finally comes crashing down but I'm happy keeping my recent profits in cash for a little while longer

Really good point Geordie.The time to bail on those was Dec last year.

As I've said before,going back to 2000,it was the lower high that was the thing to short.Shorting in a bull run up is a mad game(been there got the t shirt).Fed,reins back a bit and we get a weak dollar pahse,then equities might scoot higher,most likely led by value stocks rather than tech.

dyor natch

 

[feed]

7 minutes ago, M S E Refugee said:

50 year or 100 hundred year mortgages make no difference when your utility bills have doubled,you have Car loans and massive credit card debt.

And also your job could go in the next 6 months.

We are in the end game.

State price caps on utilities and car ownership is going away.  
Mortgages payments will be the last to go and every trick in the book will be employed to extend them.  

 

[sancho panza]

4 minutes ago, M S E Refugee said:

50 year or 100 hundred year mortgages make no difference when your utility bills have doubled,you have Car loans and massive credit card debt.

And also your job could go in the next 6 months.

We are in the end game.

to the bank a 100 year mortgage defautl is the same as a 25 yr default.Thye still have to recover capital.

reality is that there are a lot of people looking at the worker bees with plansa for the taxes they pay-bennie recipients,defence dept,heatlh dept,pensions industry,councils,banks etc etc.

if that pot of income drops,the taxpayers have hard choices to make but so do the people relying on the flows from their workstream.period.

as we've dsicussed,people will pay their food bill first,then their fuel,with whats' left the groups above can haggle over what they get.

reality is hard times are coming particualrly for some like councils who've been living off the fat of the land for years.

[sancho panza]

2 hours ago, geordie_lurch said:

Story is from Guardian here: https://www.theguardian.com/politics/2022/aug/15/ministers-planning-to-cut-civil-servant-redundancy-pay-at-same-time-as-91k-jobs

"Ministers are planning to reduce redundancy pay for civil servants while cutting 91,000 Whitehall jobs, setting up a bitter confrontation that unions warned may lead to legal and industrial action.

 

Big thing I find with stiking is that it really helps if people notice you're not at work.

[M S E Refugee]

1 minute ago, feed said:

State price caps on utilities and car ownership is going away.  
Mortgages payments will be the last to go and every trick in the book will be employed to extend them.  

 

I have no doubt they will try and subsidise Utility bills but it won't work and will just make things worse.

[DurhamBorn]

1 hour ago, Yadda yadda yadda said:

Nailed on. I also think that utilities and council tax will have a major impact on people retiring on small to average pensions. If those bills end up at £5k+ for a small home and £7k+ for an average house that will squeeze a lot of people into poverty. Knock on impact on the housing market as people downsize.

I think this is key.Its going to be horrific for single people now of any age living alone.The 25% discount on Council Tax is already a joke,it should be 50%.Most people will of priced £2.5k for the two.This thread said ages ago big houses would be a huge liability and thats coming to pass.

Just been in Lidl,two obvious new immigrants,you could tell by their top of the range phones and only English words a few yes,no etc,trolley load of food,all being consumed from English taxpayers.Lass behind with 3 kids obvious southern bennie scrounger moved up here because her bennies will cover the rent.Lots of food is now up 50%.The government has no answers to this,they are useless.More and more consuming resources we have to import with sterling when we are running massive current account deficits.Iv input some of this into my roadmap.It assumes every new immigrant consumes,but doesnt add any exportable production.Roadmap says collapse certain 100%.I though still do think collapse for the UK is avoidable,but it really is looking like a 50/50 now.Its so bad and my roadmap is usually pretty close to the money i should move all assets out of the UK.However usually when at extremes on my roadmap like this political moves lower the dial.The only moves now have to be massive  inflation adjusted spending cuts and massive tax cuts on work and business.

[feed]

8 minutes ago, M S E Refugee said:

I have no doubt they will try and subsidise Utility bills but it won't work and will just make things worse.

No doubt.  But look at the props they've employed since the GFC just to keep house prices level with inflation.  Financial repression all day long, but a nominal fall in house prices whilst they are being eroded by real inflation gives the game away.

Stealing from old people slowly.  

Property will be the last to go.  

[geordie_lurch]

26 minutes ago, sancho panza said:

Yeah, I think you gotta decide your own risk parameters,as @geordie_lurch points out below,he was in a lot of stuff your average basement dweller wouldn't go near.

Just for the record @sancho panza I think the only stock I haven't bought that the average basement dweller hasn't is my £50 punt at BBBY last week and similar small punts on meme stocks last time to try and fight the system However my own personal circumstances of needing a large sum of cash before the end of the year made me hyper focussed on preserving as much of the 25% or so I made on oilies, baccy and potash since the 2020 lows and there were enough warnings in March and April for me to move to mostly cash then. I'm also aware sitting mostly in cash isn't going to get me as much in dividends and is not standard practice in these inflationary times but I can live with that 'cost' given that I would have lost at least 5% of that 25% since I sold up so far according to my watchlist price tracker of the stocks I sold which I simply couldn't afford to take on the chin at the moment due to my personal circumstances.

[Starsend]

7 minutes ago, DurhamBorn said:

I think this is key.Its going to be horrific for single people now of any age living alone.The 25% discount on Council Tax is already a joke,it should be 50%.Most people will of priced £2.5k for the two.This thread said ages ago big houses would be a huge liability and thats coming to pass.

Just been in Lidl,two obvious new immigrants,you could tell by their top of the range phones and only English words a few yes,no etc,trolley load of food,all being consumed from English taxpayers.Lass behind with 3 kids obvious southern bennie scrounger moved up here because her bennies will cover the rent.Lots of food is now up 50%.The government has no answers to this,they are useless.More and more consuming resources we have to import with sterling when we are running massive current account deficits.Iv input some of this into my roadmap.It assumes every new immigrant consumes,but doesnt add any exportable production.Roadmap says collapse certain 100%.I though do still do think collapse for the UK is avoidable,but it really is looking like a 50/50 now.Its so bad and my roadmap is usually pretty close to the money i should move all assets out of the UK.However usually when at extremes on my roadmap like this political moves lower the dial.The only moves now have to be massive cuts and massive tax cuts on work and business.

Baked in far as I'm concerned but we'll know by Christmas, Truss will have had a few months so we'll have had long enough to see if she's another clueless cretin or not.

We've just seen a pretty typical response to the problem in the form of 50 year mortgages - let's try and milk the productive few left even harder, they don't seem to know how to do anything else.

[wherebee]

2 minutes ago, Starsend said:

Baked in far as I'm concerned but we'll know by Christmas, Truss will have had a few months so we'll have had long enough to see if she's another clueless cretin or not.

We've just seen a pretty typical response to the problem in the form of 50 year mortgages - let's try and milk the productive few left even harder, they don't seem to know how to do anything else.

Indeed.  Every turn of the screw on the productive results in more of them withdrawing their labour and doing minimum effort to get by.  Eventually the reality will whipsaw back and then everything crashes.  I'd suggest we're already seeing that in terms of inflation - which is just a currency losing value.  Giving out free money to people just results in the people selling actual stuff into the country (food/goods) demanding more of this shit currency.

It's going to end in hyperinflation, isn't it.

[HousePriceMania]

23 minutes ago, M S E Refugee said:

I have no doubt they will try and subsidise Utility bills but it won't work and will just make things worse.

No doubt at all.

 

 

 

They want the inflation, or they are thick.

[HousePriceMania]

14 minutes ago, feed said:

No doubt.  But look at the props they've employed since the GFC just to keep house prices level with inflation.  Financial repression all day long, but a nominal fall in house prices whilst they are being eroded by real inflation gives the game away.

Stealing from old people slowly.  

Property will be IS ALREADY the last to go.  

 

[AlfredTheLittle]

10 minutes ago, geordie_lurch said:

Just for the record @sancho panza I think the only stock I haven't bought that the average basement dweller hasn't is my £50 punt at BBBY last week and similar small punts on meme stocks last time to try and fight the system However my own personal circumstances of needing a large sum of cash before the end of the year made me hyper focussed on preserving as much of the 25% or so I made on oilies, baccy and potash since the 2020 lows and there were enough warnings in March and April for me to move to mostly cash then. I'm also aware sitting mostly in cash isn't going to get me as much in dividends and is not standard practice in these inflationary times but I can live with that 'cost' given that I would have lost at least 5% of that 25% since I sold up so far according to my watchlist price tracker of the stocks I sold which I simply couldn't afford to take on the chin at the moment due to my personal circumstances.

I think he means Michael Burry was in risky stocks (tech etc), not you! 

[A_P]

21 hours ago, Option5 said:

Are they reducing credit card limits as well?

It doesn't appear so from my singular perspective. But then I utlise my CC's, put as much cashflow as I can through them and pay off in full. I have had no issues during any applications either and am trying to get as many CC's as I can with as big as credit limits as they'll give.

Separately regarding OD's. My experience (limited) is they have been reducing them for a long time. FD removed their free £500 OD yonks ago.

CC's are giving out money transfers at 2.9% fee, interest free for 24+ months on some of my existing cards. Still plenty of cheap accessible money if you need it. But there lies the problem...those that need it can't get it....well cheaply.

[Starsend]

7 minutes ago, wherebee said:

Indeed.  Every turn of the screw on the productive results in more of them withdrawing their labour and doing minimum effort to get by.  Eventually the reality will whipsaw back and then everything crashes.  I'd suggest we're already seeing that in terms of inflation - which is just a currency losing value.  Giving out free money to people just results in the people selling actual stuff into the country (food/goods) demanding more of this shit currency.

It's going to end in hyperinflation, isn't it.

If they don't allow the system to restore itself to a natural equilibrium, i.e. enormous mofo of a crash then I think it has to eventually as they'll have to print ever increasing sums of money to keep it all propped up.

The only other possibility I can see is to grow yourself out of it - but this isn't really a possibility anymore because it requires cheap energy and highly competent leaders.

It's going to be a shitstorm of some description for sure.

[King Penda]

2 hours ago, DurhamBorn said:

You do if you have more than £6k in savings.

16 for uc

[King Penda]

32 minutes ago, DurhamBorn said:

I think this is key.Its going to be horrific for single people now of any age living alone.The 25% discount on Council Tax is already a joke,it should be 50%.Most people will of priced £2.5k for the two.This thread said ages ago big houses would be a huge liability and thats coming to pass.

Just been in Lidl,two obvious new immigrants,you could tell by their top of the range phones and only English words a few yes,no etc,trolley load of food,all being consumed from English taxpayers.Lass behind with 3 kids obvious southern bennie scrounger moved up here because her bennies will cover the rent.Lots of food is now up 50%.The government has no answers to this,they are useless.More and more consuming resources we have to import with sterling when we are running massive current account deficits.Iv input some of this into my roadmap.It assumes every new immigrant consumes,but doesnt add any exportable production.Roadmap says collapse certain 100%.I though do still do think collapse for the UK is avoidable,but it really is looking like a 50/50 now.Its so bad and my roadmap is usually pretty close to the money i should move all assets out of the UK.However usually when at extremes on my roadmap like this political moves lower the dial.The only moves now have to be massive  inflation adjusted spending cuts and massive tax cuts on work and business.

Yes a big house can be a liability going foward if your on your own but it depends how you use it .you can have lodgers you can foster your going to also

need off road parking .terraces and many small homes have no off road parking.in a big house you could have a winter room (they will become a thing trust me ).in a winter room it’s got 9 inches of insulation and it’s geared up like a bedsit the best will cost peanuts to heat for 3 months . Ps does anyone know if the domain name winteroom.com is available to buy ?

[M S E Refugee]

https://cumbriacrack.com/2022/08/15/police-called-after-men-spotted-on-roof-of-carlisle-hotel/

I have drive past these scrounging Cunts every day when I'm on my rounds.

[feed]

17 minutes ago, HousePriceMania said:

 

https://www.pensionsage.com/pa/UK-pension-wealth-almost-1trn-more-than-property-wealth.php

Britons have nearly £1trn more wealth in pensions than they do in property, according to figures from the Office of National Statistics (ONS).

The statistics showed that, in 2018-2020, occupational and private pension wealth was estimated at £6.45trn, whilst property wealth in the UK was estimated at £5.46trn.

[Yadda yadda yadda]

39 minutes ago, DurhamBorn said:

I think this is key.Its going to be horrific for single people now of any age living alone.The 25% discount on Council Tax is already a joke,it should be 50%.Most people will of priced £2.5k for the two.This thread said ages ago big houses would be a huge liability and thats coming to pass.

Just been in Lidl,two obvious new immigrants,you could tell by their top of the range phones and only English words a few yes,no etc,trolley load of food,all being consumed from English taxpayers.Lass behind with 3 kids obvious southern bennie scrounger moved up here because her bennies will cover the rent.Lots of food is now up 50%.The government has no answers to this,they are useless.More and more consuming resources we have to import with sterling when we are running massive current account deficits.Iv input some of this into my roadmap.It assumes every new immigrant consumes,but doesnt add any exportable production.Roadmap says collapse certain 100%.I though do still do think collapse for the UK is avoidable,but it really is looking like a 50/50 now.Its so bad and my roadmap is usually pretty close to the money i should move all assets out of the UK.However usually when at extremes on my roadmap like this political moves lower the dial.The only moves now have to be massive  inflation adjusted spending cuts and massive tax cuts on work and business.

Work must pay. It is as simple as that. At the moment it doesn't pay to work, other than part time to maximise benefits, for half the population.

Further to that an increased focus should be on export industries. The free lunch is over. We're net importers of essentials. We have to provide goods that others want in order to import those essentials of energy and food.

Imagine how much more efficient our industry would be if working age benefits didn't distort price signals. I'm talking about service industry here rather than production. If we move people to an expanded production sector with improved relative wages then services will have to invest in efficiency. The so called productivity gap is no mystery. It is the consequence of cheap labour. When I was in Brazil some restaurants had twice as many staff as customers. The consequence of labour being worth very little.

Less tax and lower benefits are the future. The only question is how long the can is kicked?

[DurhamBorn]

1 minute ago, M S E Refugee said:

https://cumbriacrack.com/2022/08/15/police-called-after-men-spotted-on-roof-of-carlisle-hotel/

I have drive past these scrounging Cunts every day when I'm on my rounds.

Do you have the address of the wokesperson below,its just next time im in Cumbria id like to beat them to death,

A Cumbria County Council spokesman said: “We are aware of the peaceful protest at a property in the London Road area of Carlisle.

“We are working with SERCO, district council partners and local third sector organisations to support refugees and asylum seekers in Cumbria and ensure any concerns they have are listened to.”

[Plan-b]

12 minutes ago, wherebee said:

It's going to end in hyperinflation, isn't it.

Higher inflation will happen If civil service Pensions are not dealt with, If bennies are not dealt with, if energy security for the future and some quick energy responses are not dealt with, if immigration is not dealt with, if affordable housing is not dealt with.

Of course None of the above will happen.

The route of least resistance will continue.

What will happen is more civil service pension increases, bennies increases, subsidies for energy price increases, Bennies & Free housing for immigrants, No chance for mass affordable housing.

All highly inflationary so UK Hyperinflation is a possibility, together with sterling collapse.

So its persistent High or Higher inflation or Hyperinflation.