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

[Chewing Grass]

12 minutes ago, Yadda yadda yadda said:

Doing some of the easier percentages, below. Plus some speculation.

£19k = 10%. That is good but they'll need it. Private sector doing similar at that level of wage.

£25k = 7.6%. This might be the sort of wage that bin men are on. Could be other better paid opportunities coming up for people in this bracket.

£38k = 5%. A good wage. Very good in Durham. Few local government workers on that money would move on even if they got nothing.

£50k = 3.8%. People on this money will think they're important. They're going to get taxed at 40% on all the increase and will be pissed off. Might look for another job but unlikely to find anything in the private sector. Maybe some of the older ones will retire early. Even at this level it is more than a lot in the private sector will be getting.

Will the top bosses be making do with £1,900 or will they have a separate deal?

We have said that wage differentials will decrease and this is a clear sign of it. Still far too much of a raise at the higher levels.

Union chap at work was pissing himself at the Industrial staff refusing promotions to management as it is a pay cut, they would be expected to do unpaid overtime and the government steals an extra 20%.

Staying on 'the tools' means overtime, shift pay, disturbance and hot work allowance.

Its the Government, HMRC and large monopoly employers who have primarily fucked this country.

[feed]

8 minutes ago, Chewing Grass said:

Union chap at work was pissing himself at the Industrial staff refusing promotions to management as it is a pay cut, they would be expected to do unpaid overtime and the government steals an extra 20%.

Staying on 'the tools' means overtime, shift pay, disturbance and hot work allowance.

Its the Government, HMRC and large monopoly employers who have primarily fucked this country.

Been like that at our place for a decade.  I've been refusing to apply for one since 2016.  People only take promotions if they think they'll get another one after that or as a stepping stone to something outside the company.

Expect it'll get worse as hourly and general salary grades pay is union negotiated, management isn't .    

[sancho panza]

3 hours ago, M S E Refugee said:

Russian gas transit to EU via Nord Stream to be halted  – Gazprom https://www.rt.com/business/561178-nord-stream-pipeline-shutdown/

Gazprom are closing it for a few days for repairs.

Very safety conscious those Russians.

MSE,you've been following the Ukraine thing closely.From what I'm seeing in the media-ie less hero worship Zelensky,less moeny for arms,less arms,,less MSM coverage-looks like the germans are buttering up for a surrender soon as per the telegraph article posted earlier.

Cost of living crisis,plus Germany being needed to support the Euro/EU means they need german industry back on track asap to get the bills paid and to keep the Italians and greeks in the eurozone.

Is it jsut me,or has the mood music changed-also putting it out there for the hive mind.

If it is the case then european industrials like Thyssenkrupp could be a leveraged play on it?BASF are worth a nudge at these levels if we get a peace deal,surely?

[sancho panza]

Talking of mood music

Interesting to see them using income deciles for comparison.......a point often made down in htis here basement........nice to see it.

Anecdotally,I was talking to a friend last night close to the motor trade who confirmed the heads up @ThoughtCriminal gave us ref things being very quiet.Lot of people putting of purchases,keeping what they got

https://www.telegraph.co.uk/business/2022/08/19/record-breaking-gloom-grips-britain-ahead-nightmare-winter/?li_source=LI&li_medium=liftigniter-onward-journey

Record-breaking gloom grips Britain ahead of 'nightmare' winter

Consumer confidence slumps to lowest ever level as businesses and households brace for further surge in prices

A record-breaking economic gloom is gripping Britain as households brace for a “nightmare” winter of soaring costs.

Consumer confidence has plummeted to its lowest ever level as the Bank of England increases interest rates to counter rocketing inflation, according to a closely watched survey from the data company GfK.

Meanwhile, separate data showed that a host of industries are in contraction in a sign the country is teetering on the brink of recession.

GfK blamed acute concerns over the cost of living for a drop in its confidence index to -44, the lowest it has been since launching in 1974.

The outlook darkened on every one of GfK's measures, with Britons feeling increasingly pessimistic about their own finances and the general economy both at present and over the next year.

The bleak outlook is unlikely to be enough to prevent the Bank of England from a spate of further interest rate rises to control inflation, which reached a new 40-year high of 10.1pc in July.

At -60, the sub-gauge for how Britons see the economy performing a year from now was also a record low.

Mortgage holders are facing painful cost increases as the Bank of England rapidly raises interest rates to slow demand and try to ease the rate of inflation.

Prices are expected to surge even further in the coming months as a significant increase in the Ofgem energy price cap kicks in from October. Analysts say the cap could rise by 82pc or more amid elevated natural gas prices.

 

Nine of out 14 major business sectors saw their output contract during July, according to the Lloyds Bank UK Sector Tracker – the most in 18 months.

Small companies are giving up hope, with the majority expecting zero or negative growth in the coming year.

 

[Lightscribe]

2 hours ago, Loki said:

Or they just want less of us so rammed the system into a wall at 100mph?

Unless their Big Brain thinking really did only come up with the genius plan of "Less is better" 

No of course not 

 

[M S E Refugee]

8 minutes ago, sancho panza said:

MSE,you've been following the Ukraine thing closely.From what I'm seeing in the media-ie less hero worship Zelensky,less moeny for arms,less arms,,less MSM coverage-looks like the germans are buttering up for a surrender soon as per the telegraph article posted earlier.

Cost of living crisis,plus Germany being needed to support the Euro/EU means they need german industry back on track asap to get the bills paid and to keep the Italians and greeks in the eurozone.

Is it jsut me,or has the mood music changed-also putting it out there for the hive mind.

If it is the case then european industrials like Thyssenkrupp could be a leveraged play on it?BASF are worth a nudge at these levels if we get a peace deal,surely?

I think the Germans arrogance and pig-headedness will be their downfall and the Greens in the German Government seem very committed to their aim of destroying German Industry.

Also there can be no peace unless the Americans give their blessing so I'm not sure that the Germans would stand up to the Americans.

[Starsend]

Occidental up 10% today as Buffet is given the go ahead to buy up to 50% of the company,

Juicy, one of my biggest holdings.

[onlyme]

8 minutes ago, M S E Refugee said:

I think the Germans arrogance and pig-headedness will be their downfall and the Greens in the German Government seem very committed to their aim of destroying German Industry.

Also there can be no peace unless the Americans give their blessing so I'm not sure that the Germans would stand up to the Americans.

Years of getting their own way with all the countries in the EU.

[ONC]

1 hour ago, sancho panza said:

MSE,you've been following the Ukraine thing closely.From what I'm seeing in the media-ie less hero worship Zelensky,less moeny for arms,less arms,,less MSM coverage-looks like the germans are buttering up for a surrender soon as per the telegraph article posted earlier.

Cost of living crisis,plus Germany being needed to support the Euro/EU means they need german industry back on track asap to get the bills paid and to keep the Italians and greeks in the eurozone.

Is it jsut me,or has the mood music changed-also putting it out there for the hive mind.

If it is the case then european industrials like Thyssenkrupp could be a leveraged play on it?BASF are worth a nudge at these levels if we get a peace deal,surely?

I think this is real @sancho panza, I notice that Polymetal has been moving up recently, just as gold generally is moving down. See chart of polymetal vs GDX below diverging, 

 

 

 

[Axeman123]

24 minutes ago, ONC said:

I notice that Polymetal has been moving up recently, just as gold generally is moving down. See chart of polymetal vs GDX below diverging,

I have had my eye on similar. As a counterpoint though, Poly is basically flat since the big drop. Getting above ~340 would be the start of a move IMO.

[Axeman123]

16 minutes ago, Rollseyes said:

You would think Turkey would be cheap with their currency on the floor, but their hotel sector in Istanbul isn't. 

Might that not just be Russian's having fewer destinations to choose from, and filling the hotels?

Lots of Russian Superyachts in Turkey now I think, so plenty of rooms needed for associated camp-followers and sex-workers too.

[Ash4781b]

1 hour ago, sancho panza said:

Talking of mood music

Interesting to see them using income deciles for comparison.......a point often made down in htis here basement........nice to see it.

Anecdotally,I was talking to a friend last night close to the motor trade who confirmed the heads up @ThoughtCriminal gave us ref things being very quiet.Lot of people putting of purchases,keeping what they got

https://www.telegraph.co.uk/business/2022/08/19/record-breaking-gloom-grips-britain-ahead-nightmare-winter/?li_source=LI&li_medium=liftigniter-onward-journey

Record-breaking gloom grips Britain ahead of 'nightmare' winter

Consumer confidence slumps to lowest ever level as businesses and households brace for further surge in prices

A record-breaking economic gloom is gripping Britain as households brace for a “nightmare” winter of soaring costs.

Consumer confidence has plummeted to its lowest ever level as the Bank of England increases interest rates to counter rocketing inflation, according to a closely watched survey from the data company GfK.

Meanwhile, separate data showed that a host of industries are in contraction in a sign the country is teetering on the brink of recession.

GfK blamed acute concerns over the cost of living for a drop in its confidence index to -44, the lowest it has been since launching in 1974.

The outlook darkened on every one of GfK's measures, with Britons feeling increasingly pessimistic about their own finances and the general economy both at present and over the next year.

The bleak outlook is unlikely to be enough to prevent the Bank of England from a spate of further interest rate rises to control inflation, which reached a new 40-year high of 10.1pc in July.

At -60, the sub-gauge for how Britons see the economy performing a year from now was also a record low.

Mortgage holders are facing painful cost increases as the Bank of England rapidly raises interest rates to slow demand and try to ease the rate of inflation.

Prices are expected to surge even further in the coming months as a significant increase in the Ofgem energy price cap kicks in from October. Analysts say the cap could rise by 82pc or more amid elevated natural gas prices.

 

Nine of out 14 major business sectors saw their output contract during July, according to the Lloyds Bank UK Sector Tracker – the most in 18 months.

Small companies are giving up hope, with the majority expecting zero or negative growth in the coming year.

 

Dreadful reading there. And getting worse. £5k a year energy bills aren’t great for confidence. House prices still rising and if they start falling that reading will go to new records

[CannonFodder]

regards poly and jrs - some are viewing risk of more western sanctions as low imho. West also seems to have stopped narrative of siezing russian assets.

I dont see why russia would end the war before winter to be honest - thats their best fun and games window.

[sarahbell]

On 18/08/2022 at 12:56, Barnsey said:

Wouldn't be surprised about Morrisons going under given it's more expensive than not only Aldi and Lidl, but also Tesco and Sainsburys. Most of their supermarkets feel dingy as fook.

They don't need the big supermarkets anymore. Warehouse does home delivery 

[sancho panza]

2 hours ago, ONC said:

I think this is real @sancho panza, I notice that Polymetal has been moving up recently, just as gold generally is moving down. See chart of polymetal vs GDX below diverging, 

 

 

 

You msut be psychic.I was literally having that conversation with my Mum this afternoon.I follow my watchlists all day every day when I'm not at wrok in between running around after the kids and doing my research.

I was saying to her today that Poly had been steadily building little up moves the last week sometimes against the run of play.Hence I asked her to have a sift in the MSM for stuff about a Russia/Ukraine peace deal.She was the one who sent me the links I posted earlier.I think he points @M S E Refugee rasied earlier are probably more in line with where we are than the 'dirty deal' getting done.

Having said that,I picked up on Poly not moving with the market but I didn't think to run a comparison with GDX.Good spot.

We'll watch here.Could be a real tell.

 

1 hour ago, Ash4781b said:

Dreadful reading there. And getting worse. £5k a year energy bills aren’t great for confidence. House prices still rising and if they start falling that reading will go to new records

Couldn't agree more Ash,I think we're possibly on the verge of some uncharted terrotiry for a lot of people under 40.

British consumer confidence-pardon the pun- is built on hosuing the same way the USA stock market moves things there.

DOn't know how they're going to refloat this time if there's a buyers strike.

[Axeman123]

9 hours ago, CannonFodder said:

I dont see why russia would end the war before winter to be honest - thats their best fun and games window.

Mud frozen solid and leaves all fallen off the trees = absolute walkover for Russia IMO. The deliberate goading of Russia to invade in spring tells you who benefits from a long war IMO.

From my previous link about Germans calling for opening NS2:

"Kubicki, a member of Finance Minister Christian Lindner’s Free Democrats (FDP), called for activating the pipeline 'as soon as possible' to fill gas storages ahead of winter."

I think he is dreaming, Putin will want zero in storage to maximise his leverage once the cold weather comes.

[M S E Refugee]

18 minutes ago, Axeman123 said:

Mud frozen solid and leaves all fallen off the trees = absolute walkover for Russia IMO. The deliberate goading of Russia to invade in spring tells you who benefits from a long war IMO.

From my previous link about Germans calling for opening NS2:

"Kubicki, a member of Finance Minister Christian Lindner’s Free Democrats (FDP), called for activating the pipeline 'as soon as possible' to fill gas storages ahead of winter."

I think he is dreaming, Putin will want zero in storage to maximise his leverage once the cold weather comes.

This shows you the psychopathic zealotry of the German Greens.

 

Noting the increase in heating costs was not as problematic for people of his income bracket, Kretschmann did admit that some Germans could not make ends meet without government aid. However, he argued that the Covid-19 pandemic has shown the German government will be there for people hit the hardest by the crisis.  

This time there would be some “loss in terms of prosperity,” Kretschmann said. “We all have to adjust to that.”

[ONC]

Interesting letter in the FT today.  Recognising the past Lack of investment in oil/gas, and need for more drilling.  

https://www.ft.com/content/25451156-434a-4c36-96ef-774d99c89688

The last paragraph is great. Translated to plain English, ‘Screw the Ukraine we want a shower!”

[Errol]

34 minutes ago, ONC said:

Interesting letter in the FT today.  Recognising the past Lack of investment in oil/gas, and need for more drilling.  

https://www.ft.com/content/25451156-434a-4c36-96ef-774d99c89688

The last paragraph is great. Translated to plain English, ‘Screw the Ukraine we want a shower!”

They are still all assuming that Russia will supply them with Gas.

I think this is quite unlikely. At best, Putin will say - 'Yes, we will think about starting supply again - but our thinking will take about a year'.

[M S E Refugee]

9 minutes ago, Errol said:

They are still all assuming that Russia will supply them with Gas.

I think this is quite unlikely. At best, Putin will say - 'Yes, we will think about starting supply again - but our thinking will take about a year'.

Hopefully he will do this and it may inspire the Europeans to depose all of the WEF shills that are in charge at the moment.

[ThoughtCriminal]

"You're all going to freeze to death, but the political and media class wont."

 

Fuck me, people voted for this shit.

 

 

[Axeman123]

20 minutes ago, Errol said:

They are still all assuming that Russia will supply them with Gas.

I think this is quite unlikely. At best, Putin will say - 'Yes, we will think about starting supply again - but our thinking will take about a year'.

I think different. Gas is a double edged sword: it can cause tremendous pain when temporarily withheld from the addict, but an easy and cheap supply is the best way to keep the victim hooked. Think of it like Heroine, where dealers have to give free samles to tempt former addicts that have completed withdrawals back into hell. As a weapon withholding gas is best used in short bursts. If I was Putin I would sell them as much gas as they could immediately burn, once NS2 was online, but not one BTU for storage. Even the will they/won't they about opening NS2 is about even greater supply of cheap gas as a Russian tool to crowd out alternative energy sources and entrench German addiction.

[Castlevania]

30 minutes ago, Errol said:

They are still all assuming that Russia will supply them with Gas.

I think this is quite unlikely. At best, Putin will say - 'Yes, we will think about starting supply again - but our thinking will take about a year'.

Yeah. Whilst I expect Ukraine to be thrown under the bus this Autumn, I think this winter is a right off and that’s assuming Russia are willing to play ball (they might be enjoying seeing Europe collapse too much). , even if there’s a settlement, prices will be high, probably not as high as people are fearing but even so it’ll be a grim winter for many. I don’t see gas ever returning to the prices of a few years ago.

[ThoughtCriminal]

Does anyone on here own natural gas etfs?

[Axeman123]

10 minutes ago, Castlevania said:

Yeah. Whilst I expect Ukraine to be thrown under the bus this Autumn, I think this winter is a right off and that’s assuming Russia are willing to play ball (they might be enjoying seeing Europe collapse too much). , even if there’s a settlement, prices will be high, probably not as high as people are fearing but even so it’ll be a grim winter for many. I don’t see gas ever returning to the prices of a few years ago.

I expect Putin would not want a collapsing and desperate nuclear-armed neighbour.

High gas prices make aternatives like SMR fleets seem cheap, a bit like the idiom that the cure for high oil prices is high oil prices.

In terms of operant conditioning Putin has already shown that defiance = unlimited pain, now to reinforce that he needs to show that compliance = instant pleasure when gas prices go right back down. He can then train Europe like a dog, using gas as both carrot and stick. The carrot is tyically seen as a much more effective long-term training strategy, from dogs to schools and even the workplace.