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

[Mapper]

Been doing some maths. I am calling it the Future Equation.

CBDC=(SU)(AI)+SC-P

Where:
CBDC = Central bank digital currency
SU = The Soviet Union
AI = Artificial intelligence
SC = Social credit
P = Privacy

Surely needs tweaking, but it's looking correct unfortunately.

[Majorpain]

Quote

For some months I’ve been hearing friends wail about their trouble finding a nanny. Or keeping the nanny if they have a good one. According to one mole, the nanny for a very successful businessman recently declared she wanted a pay-rise or she was off. The businessman, who negotiates large pharmaceutical contracts for a living, “folded within 32 seconds of the conversation and gave her what she wanted, which was £64,000”.

This isn’t as unfortunate, however, as the family who returned home from the Gulf for the summer and brought their Filipina “helper” with them. She took to meeting up with other helpers and nannies in Holland Park on her day off and soon did a bunk, having discovered how much more she could earn if she found a permanent job in the UK. “My nanny’s run away!” the mother was heard shrieking in the aisles of the Kensington High Street Waitrose.

https://www.telegraph.co.uk/women/life/nanny-theft-disappearing-butlers-rich-people-problems/

First world problems!  £64,000 for looking after some kids anyone?

[Harley]

10 hours ago, Castlevania said:

Not sure if the below letter is real, but if so we at least have one MP living in the real world.

 

Always follow the money.  It's behind every facade.  The age of debt fuelled "growth" is over.  This, and others, are the new engines of "growth".  Normally we would have had a major war by now.  A clearing event.  We still may but for now this is the "war".

I posted the wrong picture up thread.  It should have been this:

[DurhamBorn]

2 hours ago, Castlevania said:

Looks like there could be a rival bid for Playtech

https://www.msn.com/en-gb/money/other/gopher-explores-c2-a33bn-counterbid-for-gambling-software-group-playtech/ar-AAQqdRO?ocid=BingNewsSearch

Me and my dad have made a lot of money from the sector,a lot of money and we got a lot of Playtech at the bottom.However we are pissed off really because the industry has been sold off too cheaply,we trebled mostly across them all,but could of ten bagged some of them over the cycle i think.

This is an industry the UK was easily world leader,and one with huge growth potential into gaming etc.Our politicians instead chose to attack the industry over and over instead of working with them to deal with the few problem gamblers.

Now the UK has lost most of the industry.It was one of the sectors i highlighted to ladder into back in the thread so a lot on here should of made good money,but its a sector removed from us to invest in now,one of the warnings @Harley keeps warning about where there is less and less to invest in for the plebs.Constant battle.

[Castlevania]

10 minutes ago, DurhamBorn said:

Me and my dad have made a lot of money from the sector,a lot of money and we got a lot of Playtech at the bottom.However we are pissed off really because the industry has been sold off too cheaply,we trebled mostly across them all,but could of ten bagged some of them over the cycle i think.

This is an industry the UK was easily world leader,and one with huge growth potential into gaming etc.Our politicians instead chose to attack the industry over and over instead of working with them to deal with the few problem gamblers.

Now the UK has lost most of the industry.It was one of the sectors i highlighted to ladder into back in the thread so a lot on here should of made good money,but its a sector removed from us to invest in now,one of the warnings @Harley keeps warning about where there is less and less to invest in for the plebs.Constant battle.

Agreed. I’m eyeing up a small stake in Flutter once the dust settles on Playtech. If we do have a BK I would look to buy some Penn for Dave Portnoy (he’s a divisive figure but someone who gets the power of social media) and Barstool.

[JMD]

1 hour ago, Harley said:

Always follow the money.  It's behind every facade.  The age of debt fuelled "growth" is over.  This, and others, are the new engines of "growth".  Normally we would have had a major war by now.  A clearing event.  We still may but for now this is the "war".

I posted the wrong picture up thread.  It should have been this:

Yes, derangely 'tilting at windmills', but fortunately for this thread we have our very own @sancho panza to help keep us sane!     ...as for 'war', Its looking more and more that the false imaginary 'beast' will be climate and covid?

[Loki]

10 minutes ago, JMD said:

the false imaginary 'beast' will be climate and covid?

And inequality.  

[geordie_lurch]

1 minute ago, JMD said:

Yes, derangely 'tilting at windmills', but fortunately for this thread we have our very own @sancho panza to help keep us sane!     ...as for 'war', Its looking more and more that the false imaginary 'beast' will be climate and covid?

I think more and more people will realise we have already been at war for the last 18 months over this Covid crap at the same time as we probably had an almost full collapse of the banking system hence the bailouts under the guise of Covid. Whether all this was started via the USA in China (spreading Covid via the military games in Wuhan) or China on their own (but still doing gain of function research funded by Faucia and USA in Wuhan) as the beginnings of WW3 I still don't know What I do know though is the old 'normal' aint coming back without a revolution from the ground up and the next 6 -12 months will be far worse for most of us proles than in our lifetimes. TPTB have told us via their Build Back Better / WEF crap we will own nothing and be happy and this will be enforced via 'climate' crap etc. Happy Monday all

[Festival]

I find Brian Reynolds very interesting. He puts the bull case for stocks. He says that the money that is moving the market is that which flows from govt tax receipts flows into pension funds in US which in turn need to make 7.5% annually (mainly public sector pensions defined benefit schemes) and tend to invest in credit investments particularly junk credit to chase that return. This credit that is lent to companies then flows into higher share prices via buybacks. Institutional investors and until recently retail investors don't like stocks because of high P/Es but none the less the money flows from pensions keep driving the market higher. His main concern is that when the yield curve inverts then after a lag the pension funds take a break from investing the tax receipts in anticipation of a fall in stocks and then you get very fast falls in the stock market and also in the very illiquid credit market. The Fed then steps in to get the system going again and faster. It's an interesting take and if you agree with it comes with the warning that the yield curve inversion will give you time to reduce risk before a correction or crash. He sees 4-10 years of the latest bull market that started in 2020 and sees the retail participation in stocks since summer 2020 as sign of early cycle rather than late cycle investing. Worth a listen IMO.

[JMD]

1 hour ago, geordie_lurch said:

I think more and more people will realise we have already been at war for the last 18 months over this Covid crap at the same time as we probably had an almost full collapse of the banking system hence the bailouts under the guise of Covid. Whether all this was started via the USA in China (spreading Covid via the military games in Wuhan) or China on their own (but still doing gain of function research funded by Faucia and USA in Wuhan) as the beginnings of WW3 I still don't know What I do know though is the old 'normal' aint coming back without a revolution from the ground up and the next 6 -12 months will be far worse for most of us proles than in our lifetimes. TPTB have told us via their Build Back Better / WEF crap we will own nothing and be happy and this will be enforced via 'climate' crap etc. Happy Monday all

Agreed. Although i don't do conspiracies (well that's what I like to tell myself!) - so this is a genuine question - in terms of 'the panick moment' for TPTB (which may/may not have subsequently triggered the covid crap, etc) do you think the repo-market near collapse in Sept 2019 was the financial final-straw moment?                                                         Only, I read more commentators mentioning this repo thing being the catalyst.. I wonder is there a good site explaining this, because I am fascinated by this theory. 

[RJT1979]

https://www.telegraph.co.uk/women/life/nanny-theft-disappearing-butlers-rich-people-problems/

Nanny crisis 

[geordie_lurch]

17 minutes ago, JMD said:

Agreed. Although i don't do conspiracies (well that's what I like to tell myself!) - so this is a genuine question - in terms of 'the panick moment' for TPTB (which may/may not have subsequently triggered the covid crap, etc) do you think the repo-market near collapse in Sept 2019 was the financial final-straw moment?                                                                                                                                                                     Only, I read more commentators mentioning this repo thing being the catalyst.. I wonder is there a good site explaining this, because I am fascinated by this theory. 

From what I've read around all of this, I think the repo market near collapse in Sept 2019 took them by surprise but I think Covid was already and waiting and Event 201 was very 'curious' in October 2019 . I have no idea if Covid was a deliberate release via Chinese / USA / elites (above national level) but TPTB have been desperate to use something like this as the new bogey man to replace ISIS / Al-Qaeda in order to keep us all in our places. They nearly pulled a similar thing off via swine flu just over 10 years ago but the technology wasn't quite ready IMO but if anyone still thinks any of this is about our health and well being 18 months then

 

[DoINeedOne]

On 05/11/2021 at 09:25, Chewing Grass said:

and there is more

Marina Purkiss on Twitter: "Here’s a picture of the corruption we’re dealing with: - Owen Paterson paid £500ph to advise for Randox - Randox wins £133m contract for Covid testing without any other firms getting chance to bid - Govt makes Randox tests mandatory for travel - Randox reports £218m revenue (+85%)" / Twitter

 

I thought i recognised the name today a podcast i normally i listen too had her on whilst i don't agree with her views on brexit she talks about how shit the governments are 

 

 

 

Also one part of the Podcast i found quite interesting was Tim said there was a piece on Bloomberg about i think the 9th consecutive year outflows from the FTSE meaning international investors are selling UK stocks

 

Apparently 

Time Stamped Here

 

[HousePriceMania]

43 minutes ago, geordie_lurch said:

From what I've read around all of this, I think the repo market near collapse in Sept 2019 took them by surprise but I think Covid was already and waiting and Event 201 was very 'curious' in October 2019 . I have no idea if Covid was a deliberate release via Chinese / USA / elites (above national level) but TPTB have been desperate to use something like this as the new bogey man to replace ISIS / Al-Qaeda in order to keep us all in our places.

 

You'd hope this was not possible.

Given the coincidental timing of all of this, I think I'm going full on conspiracy nut and think it was.

It's all too good to be true, for them.  $10tn+ stolen by the banking system under the guide of QE, refusal to raise IRs even 0.15% and asset prices going through the roof say there is more to this.

[DurhamBorn]

12 minutes ago, HousePriceMania said:

You'd hope this was not possible.

Given the coincidental timing of all of this, I think I'm going full on conspiracy nut and think it was.

It's all too good to be true, for them.  $10tn+ stolen by the banking system under the guide of QE, refusal to raise IRs even 0.15% and asset prices going through the roof say there is more to this.

Remember though this cycle was going to be and is about bailing governments out,not banks.The government is handing out around £200 billion in benefits its not raising tax for.If it increases tax on workers to pay it nobody will work.They are instead taking it from peoples assets through inflation.Inheritance tax and personal allowance frozen for 5 years with rampant inflation.We need a citizens income instead of welfare,but they wont do it yet.

Big government is the enemy to my kids and grandkids.I can navigate it,but when im gone im not sure they will be able to.

[Hancock]

27 minutes ago, DurhamBorn said:

Remember though this cycle was going to be and is about bailing governments out,not banks.The government is handing out around £200 billion in benefits its not raising tax for.If it increases tax on workers to pay it nobody will work.They are instead taking it from peoples assets through inflation.Inheritance tax and personal allowance frozen for 5 years with rampant inflation.We need a citizens income instead of welfare,but they wont do it yet.

Big government is the enemy to my kids and grandkids.I can navigate it,but when im gone im not sure they will be able to.

Does seem as if we are the last generation of workers who were able to avoid govt having absolute control of their money. Technology and govts love of spending other peoples money has got future workers by the balls.

Several companies who i worked for are now saying the only way i can work for them is via PAYE, when i only need to do 1 rotation offshore for them every few years!

At one time we could work in mainland Europe and invoice via limited company, and claim epic amounts in hotel/expenses back, that route has now closed.

Future looks bleak, though in truth the last 25 years have been bleak for most workers.

 

 

[HousePriceMania]

Clearly DBs assertion that the government is going to spend big on infrastructure is going to happen.

Does anyone have any thoughts on:

1. Kier

2. Balfour Beatty plc

3.  Mitie Group PLC

4. Keller Group

5. SkanSka

6. HOCHTIEF

7. Vinci

8 Saipem

9. Strabag

10. ACS

Is there any of them that should definitely be ignored ?

Some 4% ish dividends in there. 

[HousePriceMania]

Rates abandoning the sinking ship ?

 

 

[JMD]

4 hours ago, DoINeedOne said:

I thought i recognised the name today a podcast i normally i listen too had her on whilst i don't agree with her views on brexit she talks about how shit the governments are 

 

 

 

Also one part of the Podcast i found quite interesting was Tim said there was a piece on Bloomberg about i think the 9th consecutive year outflows from the FTSE meaning international investors are selling UK stocks

 

Apparently 

Time Stamped Here

 

I also listen to this podcast because the radical, ie sensible views of the hosts, is refreshing to hear especially as it's from the perspective of a couple of British city finance types, and so has an obvious overlap with this thread.                                                       I know you disagree with the guest's Brexit stance. But must say the tin eared arrogance of this latest apparent 'Twitter star' was something to behold! Although saying she had, since Brexit, immersed herself in the issues and had became very politically aware, and also despite wanting Brexit reversed - all I really heard, when her views were ever challenged - was her dismissively saying im unfortunately not conversant with this or that... how very convenient!... Anyway, I think it demonstrates how important proper physical/podcast debate is, and always has been. It really does cut down to size these would-be Twitter luminaries, who really only specialise in sloganeering, never a good political look. Social media really has an awful lot to answer for!

[Chewing Grass]

Just checked my pension pots and was very surprised that one of them has jumped up 2% over the weekend up 5.56% over the trailing month - must be inflation.

[Hancock]

On 06/11/2021 at 09:10, Boon said:

Notably, the stock market reaction was good though, a 3bn loss sounds bad but with cash of over double that, it isn't going to go bust any time soon.

However, barriers to entry are a bit different in this business. Some of the middle eastern airlines undercut and offer a better product, but if you cannot get any of the prime slots, how will they get into the market? That means flying indirect, which only works for some destinations. 

Not joining an alliance brings on other costs such as lounges and reduces value to customers by selling connections.... but if they do join it then cut-throat competition isn't going to be allowed.

If you were to open an airline from scratch to try and out-compete IAG/KLM/Air France then they would quickly accrue pretty much the same debt or worse - that was Norwegian. 

OK to have cash if travel comes back to pre covid levels ... which means business class flights returning to what they were.

If this goes on for a couple more years, many more will inevitably go bust, and give up their prime slots.

Here is a list of airlines that have gone bust since covid. Alitalia is the standout one (though they were crap)
https://en.wikipedia.org/wiki/List_of_airlines_impacted_by_the_COVID-19_pandemic

[Hancock]

1 minute ago, Chewing Grass said:

Just checked my pension pots and was very surprised that one of them has jumped up 2% over the weekend up 5.56% over the trailing month - must be inflation.

The FOMO is strong out there at the moment, i just bought 4 grands worth of BAT, AUY and Saipem on the basis its better to be riding this gravy train than watching it ride off into the distance!

Bad news for the economy, is good news for the stock market and there seems like shit loads of bad news for the economy at the moment!

[Castlevania]

3 hours ago, HousePriceMania said:

Clearly DBs assertion that the government is going to spend big on infrastructure is going to happen.

Does anyone have any thoughts on:

1. Kier

2. Balfour Beatty plc

3.  Mitie Group PLC

4. Keller Group

5. SkanSka

6. HOCHTIEF

7. Vinci

8 Saipem

9. Strabag

10. ACS

Is there any of them that should definitely be ignored ?

Some 4% ish dividends in there. 

I don’t like the likes of Balfour etc because their margins are tiny. What happens if they’ve agreed to build something for x, but their input costs have increased by more than their predicted profit margin? Can they pass on those costs?

[DurhamBorn]

3 minutes ago, Castlevania said:

I don’t like the likes of Balfour etc because their margins are tiny. What happens if they’ve agreed to build something for x, but their input costs have increased by more than their predicted profit margin? Can they pass on those costs?

Thats why i never invest in those type of companies.Get one right after its smashed you can make good money,but seems they take on huge risks for tiny margins.They always strike me as companies who make good money for their staff and directors,but not for shareholders.Its an industry where they all know the game as well and if a company goes down they just join another one.

[leonardratso]

lifestyle companies - lifestyle for the management that is, not the grunts or shareholders.