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

[CVG]

54 minutes ago, headrow said:

An interim dividend of 2.31p per share was declared, 

Exactly half the old interim in 2020, so perhaps the final in Sept will be 5.39?

[MrXxxx]

On 02/11/2021 at 16:04, JMD said:

Ok maybe the link below is only a minor financial podcast, but I like to imagine that this is how Grant Williams and Luke Gromen talk between themselves when they are off camera!!                                                                                                 The interesting/scary(?) thing is that these podcast guys are currently very much part of the financial establishment, partners/directors at two different finance outfits (price-value asset managers/think trading.com). Here they interview an ex Best-Invest VC guy who's 'gone sole trader' and now just invests his own money, so real skin the game... walking his own talk so to speak. Please ignore the pod-cast crypto title, it was only a small part of the content. For me it was fascinating to hear the frustrations/fears/predictions of these people, who as i say are all currently operating at relatively senior levels within our ossified financial system. It's a long podcast, but I think very refreshing to hear from people within the industry, who's thinking chimes with this thread.                                                                                                                 https://m.youtube.com/watch?v=EVKW-M4HKHk

Although quite long, well worth a listen...helped me put the 'final piece in the Covid jigsaw'...less about Crypto/finance perse, but helps with the Macro 'Big Picture'

The crux is between 45-60 minutes, where especially 'The people' are 'hanging themselves' by adopting contactless payment because its trendy; helps you understand why the government has recently been so supportive of increased maximum for contactless payment [despite fraud implications], little by little it will be nudged up until there is no maximum and all transactions are made via contactless...a cashless society then means CBDC can be applied without anyone being able to revert to the old system....'no way back'

What I didn't agree with was his insistence on Crypto becoming the 'new' gold....the Asian countries still value gold as a deposit of wealth, and have always done so, it will take decades for this to change if it ever does.

[Barnsey]

Key final point from Sam, and exactly why the BoE won't go fast with rate rises...

 

[Harley]

1 hour ago, headrow said:

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.

At least nice to hear I'm not alone, although no New River for me.  Probably about the same amount too.  No tax loss selling for me though as they're all in an ISA.  VOD is still up as it's a long term hold and is a div player.  I could have covered the losses of them all by trading the bounces but I had other things to do.  I just leave them there as a reminder that a good story isn't enough!

[Adarmo]

On 04/10/2021 at 23:35, JMD said:

Yes, it always makes me chuckle when commentators disingenuously describe Russia having similar GDP to Italy so implying the country is somehow irrelevant. The next cycle will I'm sure rank countries with commodities much higher, but it's an interesting debate as to how/where Russia 'fits'. Ie No longer a super power like USA/China, but compared to other Western nations/world powers such as UK or Germany, surely Russia is up there?

I like to think of it like a game of Poker. Each country has it's hand to play and then some other 'skills' like working out what hands others have, as well as bluffing. 

I'd say UK has a fairly strong hand and is very good at bluffing. The  Russians tend not to bluff so much but have a couple of very good cards there like natural resources, strongest army in the world (no doubt they could march to Western France if they fancied it - see Operation Unthinkable and they're even stronger now!). GDP is a fairly lame measure when you consider what that money will buy in Russia itself. You can get a nice apartment on the outskirts of Moscow (largest city in Europe by far) for $100K..... what can you buy  in some shithole in England for that?

I think I'd say that Super Power status truly is only for the USA at this time. It's defined as the ability to project power around the world and I'm not sure any other country can do so. Maybe China can soon. Maybe that term is outdated? Maybe the USA would fall behind economically and still maintain a military far beyond others as a % of GDP, a bit like USSR tried to do when it failed. 

[Mapper]

19 hours ago, DurhamBorn said:

Its the excuse to divert capital from consumption to investment.Inflation / distribution cycles always need an enemy to declare war on as the excuse to inflate to rescue bankrupt governments.Now they cant do that due to mutual assured destruction they need a global enemy.

They have a massive problem with people with brains becoming rentiers and removing themselves from work.They need to reverse that.Its why they will keep rates way below inflation.They will also find ways to kill BTL.Tax,regs etc as well.

In simple terms they want to divert ordinary peoples savings to the green agenda.They want saved accumulated labour to be used to "save" the planet so the rich can enjoy it.They would turn earth into an exclusive holiday venue if they could and stick all us underground in cities on Mars .

In simple terms they want to remove the ability of ordinary people to be able to make an income from capital.

They will of course force up the prices of everything they hate.BP will be supplying 20% of India's gas mid cycle.

Sunaks nut job idea means Tesco has to comply,Aldi and Morrisons dont.

Very very sinister.

 

 

 

This kind of post is fantastic! So to the point it's amazing.

But, how do any of you guys get this stuff across to close family etc? Do you even try these days?

I just cannot seem to get it through to people how fucked the middle is.

They don't seem to care. It makes me a bit mad and that doesn't help in trying to get my point across.

[Harley]

1 hour ago, Heart's Ease said:

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

Up 5.45% atm!  With VIV and TIMB up big yesterday, start of a run?  I'm watching telcos hoping for better technicals.  Mine could be an interesting review next week.

PS:  DYOR, not trading advice, discussion only, etc but IMO a fake buy on the daily last month, weekly now strengthening but needs more time, monthly still looking weak.  Bounced off the Jan21 high on the weekly which is good.  I might be long term fully allocated but generally I now buy my first ladder on a weekly buy confirmed by a daily buy and another on a follow through monthly buy.  I'm more interested in the other telcos though and am behind DB as I'm waiting for more technical strength (plus adversion to debt).  It'll be interesting to see how wrong I am, again!  Quite possible as things technical are very odd and more unpredictable than usual atm.

[DurhamBorn]

48 minutes ago, CVG said:

Exactly half the old interim in 2020, so perhaps the final in Sept will be 5.39?

7.7p for the year yes.

[Lightscribe]

1 hour ago, Majorpain said:

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.

The elite banking families obviously know that the Panther is a threat to the stability of the financial system when silver finally runs which is inevitable.

They’ve obviously sabotaged the mines and productivity now and get the weak hands to sell starving it of capital. JP Morgan can then swoop in to use all its lovely silver to save paper ETFs for market manipulation.

Their evil plan won’t work. Diamond hands. 💎 🙌 🐆

[headrow]

33 minutes ago, Harley said:

At least nice to hear I'm not alone, although no New River for me.  Probably about the same amount too.  No tax loss selling for me though as they're all in an ISA.  VOD is still up as it's a long term hold and is a div player.  I could have covered the losses of them all by trading the bounces but I had other things to do.  I just leave them there as a reminder that a good story isn't enough!

My portfolio sits at a record high , i retired when i was 49 , 4 years ago and i've got 125k more now than i had then. I've cut my discretional spending down as far as it will go and have reinvested  my dividends on any market weakness. I own well over 100 different shares and the loss of dividend income when covid first struck was brutal. I kept on buying though and really reduced my average prices across the board. My share account actually still managed to finance the 20k for my ISA but only just , this year it achieved that by October.

Vodafone is a huge disappointment but i'm holding on fully expecting a massive cut to the dividend.

Wynnstay Group which somebody recommended on here has been a standout performer for me.

[DurhamBorn]

28 minutes ago, Harley said:

Up 5.45% atm!  With VIV and TIMB up big yesterday, start of a run?  I'm watching telcos hoping for better technicals.  Mine could be an interesting review next week.

PS:  DYOR, not trading advice, discussion only, etc but IMO a fake buy on the daily last month, weekly now strengthening but needs more time, monthly still looking weak.  Bounced off the Jan21 high on the weekly which is good.  I might be long term fully allocated but generally I now buy my first ladder on a weekly buy confirmed by a daily buy and another on a follow through monthly buy.  I'm more interested in the other telcos though and am behind DB as I'm waiting for more technical strength (plus adversion to debt).  It'll be interesting to see how wrong I am, again!  Quite possible as things technical are very odd and more unpredictable than usual atm.

I look at the whole sector of the big companies as one in telcos.Iv got equal weight in VOD,BT,TEF,Orange then my next tier (20% to 40% capital compared to big holdings) in TEF Germany TEF Brasil,TIMB,Turkcell etc then small opening positions in Verizon,T etc.

My aim on them including divs is 65% return over the cycle,roughly 10 years,but divs are crucial for the sector.Some will turn to divi increases before others.BT for instance should increase from here.

Notice in TEFs results today their debt now averages 13 years at 3ish% from 9 years.

Balance sheets could contain bombs,they need to de-leverage,no doubt about that,but by mid cycle i expect them to be dividend machines.BT for instance might be on a 2029 free cash multiple of 3.7 here.

I think the sector will merge things like towers so they can increase prices for them all that way.

[DurhamBorn]

9 minutes ago, headrow said:

My portfolio sits at a record high , i retired when i was 49 , 4 years ago and i've got 125k more now than i had then. I've cut my discretional spending down as far as it will go and have reinvested  my dividends on any market weakness. I own well over 100 different shares and the loss of dividend income when covid first struck was brutal. I kept on buying though and really reduced my average prices across the board. My share account actually still managed to finance the 20k for my ISA but only just , this year it achieved that by October.

Vodafone is a huge disappointment but i'm holding on fully expecting a massive cut to the dividend.

Wynnstay Group which somebody recommended on here has been a standout performer for me.

Free cash increases need to come through for VOD now or the CEO is toast.The Liberty deal put too much debt on them for so far, little gain.They should be able to de-leverage euro 2.5bill a year,but they need to.CEO seems to think de-leveraging simple means increasing EBITDA,but they need outright de-leverage.Im not concerned over telcos funding coupons on debt,but i am concerned when they have that much a derivative bomb could go off and counterparties fail.

 

 

[sancho panza]

11 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?

My read says we'll have a GE sooner than 3 years.Possibly next year,berfore the economic fundamentals implode.The reason we're not in lockdown at the minute is that the tax base is suffering and the prognosis isn't good further out when any sort of bank deleveraging occurs or as rates rise to fight inflation.

The worst of all worlds for Boris and Sunak is that IR's are forced up at the same time the banks deleverage and the price of commodities moves north.Imagine the hit on consumer spending if house prices are deflating as the cost of heating them trebles.

Your average basement dweller knows how screwed we are,if my dear old Mum's(75) friends are anything to go by,the wider public is beginning to work it out with the bottom income deciles first(food and fuel rises hurt msot when you're not well off).

5 minutes ago, DurhamBorn said:

Free cash increases need to come through for VOD now or the CEO is toast.The Liberty deal put too much debt on them for so far, little gain.They should be able to de-leverage euro 2.5bill a year,but they need to.CEO seems to think de-leveraging simple means increasing EBITDA,but they need outright de-leverage.Im not concerned over telcos funding coupons on debt,but i am concerned when they have that much a derivative bomb could go off and counterparties fail.

It's interesting looking at the debts of these companies.The key thing for me is whether they're generating enough FCF to not need to issue new debt if needed a la Tesla.It's one thing to raid bond markets for 20 year 3% money it's another to be issuing 5 and 10 year at 10% +

There are some will fail,but the winners will be multibaggers

[sancho panza]

People have stopped mentioning the energy providers getting bumped......

Interesting as well that Sauid is already running the pumps faster than 2019..........where's the rest of the supply gone if demand is still sub 100mbpd?

Does this mean the US shale situation is actually worse than we realsie?

 

 

[Bricormortis]

Greg Manarino points out something quite astute. The Fed have agreed to taper zilch.

They have anounced a lower minimum target of asset purchases per month. There is no cap, no top.

Not a taper.

[Loki]

4 minutes ago, Bricormortis said:

Greg Manarino points out something quite astute. The Fed have agreed to taper zilch.

They have anounced a lower minimum target of asset purchases per month. There is no cap, no top.

Not a taper.

It must be great to be able to play horseshit word games like that 

[JMD]

2 hours ago, jamtomorrow said:

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.

Jamtomorrow, I broadly agree with your analysis, however and perhaps i am misreading you, but your conclusion seems to imply an inevitable road to serfdom? I would disagree with that as my working model is Howe's Forth Turning, with the culture wars being a kinda low-level civil war degeneration, and so in historical terms all the noisy argument is rather mild and inane really. Whether or not our childish sociatal scraps are a feature or a bug - I think the crux of it is that these things will be resolved/melt away with the arrival of strong political leadership, currently lacking of course, but when the main event crisis does hit, I think it inevitable(?!) that 'a wo/man with a plan' will step forward from stage 'left or right'! Perhaps In terms of what you posted, I am merely attempting 'to make a distinction without a difference', but it's just that for me cycle theory (like Howe's) offers a macro pathway with some hope attached... though to keep sane in these crazy times, I suppose we all need our myths to live by!

[Boon]

Interest rates unchanged.

Cunts, seriously hope the market forces them into a corner.

[Hancock]

property bubble must be protected at all costs.

[kibuc]

6 minutes ago, Hancock said:

property bubble must be protected at all costs.

The later they leave it, the harder they'll have to chase the market. I don't mind waiting a bit longer for the fireworks.

[Nomad]

I think they are only delaying the inenvitable rise, and surely the longer they leave it the worse it will get? I don't understand how they could not raise interest rates considering inflation is considerably higher than the 2% target?

[Axeman123]

10 minutes ago, Nomad said:

I think they are only delaying the inenvitable rise, and surely the longer they leave it the worse it will get? I don't understand how they could not raise interest rates considering inflation is considerably higher than the 2% target?

I am genuinely shocked they haven't raised, especially considering how well telegraphed it had been and the background of globally co-ordinated tightening. What internal data could the BoE be reacting to?

[Hancock]

13 minutes ago, Nomad said:

I think they are only delaying the inenvitable rise, and surely the longer they leave it the worse it will get? I don't understand how they could not raise interest rates considering inflation is considerably higher than the 2% target?

Its a joke isnt it.

They ought to create an algorithm to make the decision, which would save 10s of millions on wages and pensions.

[HousePriceMania]

If you never say that coming you've not been watching

These people will not raise IRs.

 

1 minute ago, Hancock said:

Its a joke isnt it.

 

Are you laughing  ?

[Hancock]

20 minutes ago, kibuc said:

The later they leave it, the harder they'll have to chase the market. I don't mind waiting a bit longer for the fireworks.

Dunno, the longer they leave it the lower the rigged inflation numbers will get ... giving them an excuse not to raise.

5 minutes ago, HousePriceMania said:

If you never say that coming you've not been watching

These people will not raise IRs.

 

Are you laughing  ?

They are.