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

[Mapper]

52 minutes ago, Majorpain said:

the only real way to create dollars is Fed prints them and gives them to banks/govt to spend

This is not true.

Plenty of dollars created outside the US in the eurodollar market.

I don't know what the percentage of total "us dollars" it is, but it is a lot.

[DoINeedOne]

23 minutes ago, DurhamBorn said:

Kids used them and they were great.Very easy.Long supply chains as you say.When i was 17 my first proper job was with Electrolux in Spennymoor,cooker plant.It was huge and they had a washing machine plant and fridge/freezers.All closed during the Blair disaster and new build housing now.

However it wont be long before we are making all those things again over here.Ebac are already doing it in Newton Aycliffe,and CELLO are making TVs in Bishop Auckland.When i was importing from China  my contact over there used to say "you crazy in west,you pay to ship fresh air around world"

She meant bulky goods who had a lot of the volume empty space.

Yeah i have used them a few times nothing but great service

But since around march last year it certainly had a good run  to me just shows how fucked everything is

[HousePriceMania]

if I had known I could pay £35K and spend half an hour with Sunak and a cricket bat I'd have been up for that.

 

 

[leonardratso]

1 hour ago, DurhamBorn said:

Kids used them and they were great.Very easy.Long supply chains as you say.When i was 17 my first proper job was with Electrolux in Spennymoor,cooker plant.It was huge and they had a washing machine plant and fridge/freezers.All closed during the Blair disaster and new build housing now.

However it wont be long before we are making all those things again over here.Ebac are already doing it in Newton Aycliffe,and CELLO are making TVs in Bishop Auckland.When i was importing from China  my contact over there used to say "you crazy in west,you pay to ship fresh air around world"

She meant bulky goods who had a lot of the volume empty space.

clazy flesh air

[jamtomorrow]

1 hour ago, Majorpain said:

Turkey is small fry, after a bit more thought high commodity prices are going to be doing much more damage.

That makes a lot of sense up to this point.

But I do wonder if the speed of this Turkey collapse might change things. USDTRY now 12.45, which means it's fallen another 10% in the last 24h alone.

And there's a material chance Erdogan actively refuses IMF help this time - current chair is Bulgarian 

[Yadda yadda yadda]

1 hour ago, HousePriceMania said:

if I had known I could pay £35K and spend half an hour with Sunak and a cricket bat I'd have been up for that.

 

 

Do they mention who gets half an hour with the chancellor for £35k? They surely want a good return on that investment. They're spending time, sanity and testing their self-restraint as well as the money.

[MrXxxx]

1 hour ago, HousePriceMania said:

if I had known I could pay £35K and spend half an hour with Sunak and a cricket bat I'd have been up for that.

 

 

It always amazes me that they can do things like this to get campaign fees and promote 'good news' stories, but whenever they are asked to be accountable they are never 'available for comment'!

[ThoughtCriminal]

Smell that fear and desperation 😂🤦

 

So they've demonised oil for years and now suddenly they want lower prices and higher supply.

 

Clown world doesn't even begin to describe where we live.

 

 

[Majorpain]

1 hour ago, Mapper said:

This is not true.

Plenty of dollars created outside the US in the eurodollar market.

I don't know what the percentage of total "us dollars" it is, but it is a lot.

Whilst I am happy to be corrected, I'm fairly sure that the "dollars" in Eurodollar market are US origin.  It would be a strange system if "foreigners" could print your currency at will.  Even if im wrong it doesn't change anything with regards to the rest, the US share of world GDP is not big enough for the amount of currency needed to circulate, if anything it would make it worse as Dollars would be "printed" by every bank that could.

38 minutes ago, jamtomorrow said:

That makes a lot of sense up to this point.

But I do wonder if the speed of this Turkey collapse might change things. USDTRY now 12.45, which means it's fallen another 10% in the last 24h alone.

And there's a material chance Erdogan actively refuses IMF help this time - current chair is Bulgarian 

Total Dollars in worldwide circulation is about $40T, Turkey GDP (PPP) is 11th in world is currently about $720bn.  External USD denominated debt is about $453.2bn, so whilst it will put a dent in total assets its only a small fraction in reality.

The fear is it derivative chain reacts the banks, BBVA, Unicredit, BNP and ING are exposed, so all the EU favorites bar the Germans.  ECB will be in a position to bail them out if worst comes to worst i suspect.

[Majorpain]

6 minutes ago, ThoughtCriminal said:

Smell that fear and desperation 😂🤦

Market agrees with you, price spiked up! 

[DurhamBorn]

2 minutes ago, ThoughtCriminal said:

Smell that fear and desperation 😂🤦

Hugely bullish for the oil price.They say in the statement its ok because the market and they think oil prices will be much lower in the future  .They will be inflation adjusted around 2050,but the next decade not really a chance apart from the usual quick swings to shake out holders.They expect here that higher prices will spur production,but they have been telling the big oilies no point investing in new supply we are going green.My worry is that they blame the oil companies though and tax them more.

The UKs reserve?,where is that ,a lock up in Hull?

[Axeman123]

1 hour ago, HousePriceMania said:

if I had known I could pay £35K and spend half an hour with Sunak and a cricket bat I'd have been up for that.

 

 

Someone should email and ask "how much for *n*l with Priti?", since this is basically the same thing...

[ThoughtCriminal]

1 minute ago, DurhamBorn said:

Hugely bullish for the oil price.They say in the statement its ok because the market and they think oil prices will be much lower in the future  .They will be inflation adjusted around 2050,but the next decade not really a chance apart from the usual quick swings to shake out holders.They expect here that higher prices will spur production,but they have been telling the big oilies no point investing in new supply we are going green.My worry is that they blame the oil companies though and tax them more.

The UKs reserve?,where is that ,a lock up in Hull?

Yeah, there are hundreds on twitter saying "after reading this I'm buying July 22 oil calls like my life depends on it" 😂

[Harley]

3 hours ago, DoINeedOne said:

Whilst I don’t hold it shows from what I assumed to be a reasonably decent business who are struggling with shipping costs, availability of products and costs etc… caused by all the shit that’s going on now

I was browsing there website last week as was thinking getting a new fridge half the products were out of stock  

seems a common thing with even a lot clothes websites hardly any stock

AO is down nearly 78% over the past year 

Today didn’t help

 

 

We were heavy users in our prepping in Feb20.  Even then stock was an issue.  It defo has got worse.  They have been great for us.  Our first point of call.

[Castlevania]

9 minutes ago, DurhamBorn said:

My worry is that they blame the oil companies though and tax them more.

How would that work? You the big bad big oil company are undersupplying the market, so let’s tax you more so that you’re even less likely to invest to increase supply?

[Harley]

14 hours ago, Noallegiance said:

 

Top guy.  Seldom dissapoints.  I agreed with it all.  Really helps to hear it said.

[Underwhelmed]

17 minutes ago, Axeman123 said:

Someone should email and ask "how much for *n*l with Priti?", since this is basically the same thing...

think she would be pegging you as that's what the govt is doing to us all

[Mapper]

41 minutes ago, Majorpain said:

Whilst I am happy to be corrected, I'm fairly sure that the "dollars" in Eurodollar market are US origin.  It would be a strange system if "foreigners" could print your currency at will.  Even if im wrong it doesn't change anything with regards to the rest, the US share of world GDP is not big enough for the amount of currency needed to circulate, if anything it would make it worse as Dollars would be "printed" by every bank that could.

Total Dollars in worldwide circulation is about $40T, Turkey GDP (PPP) is 11th in world is currently about $720bn.  External USD denominated debt is about $453.2bn, so whilst it will put a dent in total assets its only a small fraction in reality.

The fear is it derivative chain reacts the banks, BBVA, Unicredit, BNP and ING are exposed, so all the EU favorites bar the Germans.  ECB will be in a position to bail them out if worst comes to worst i suspect.

They don't "print" at will.

The offshore US dollars are produced in the same way that the majority of any domestic supply of currency is produced - By creating loans.

Banks all over the world create loans demoninated in US dollars. These dollars don't exist as federal reserve notes, they exist on bank balances sheets. Again in the same way as most onshore US dollars exist.

They circulate as freely as dollars created by commercial banks in the US. They are spent, borrowed, used as collateral for more lending.

This is the essense of the current global monetary system. The federal reserve has no control over it.

[MrXxxx]

46 minutes ago, ThoughtCriminal said:

Smell that fear and desperation 😂🤦

 

So they've demonised oil for years and now suddenly they want lower prices and higher supply.

 

Clown world doesn't even begin to describe where we live.

 

 

So much for `Free market` economics!

[Yadda yadda yadda]

42 minutes ago, DurhamBorn said:

Hugely bullish for the oil price.They say in the statement its ok because the market and they think oil prices will be much lower in the future  .They will be inflation adjusted around 2050,but the next decade not really a chance apart from the usual quick swings to shake out holders.They expect here that higher prices will spur production,but they have been telling the big oilies no point investing in new supply we are going green.My worry is that they blame the oil companies though and tax them more.

The UKs reserve?,where is that ,a lock up in Hull?

Probably a dosbodders garage. If it is you strengthen the locks or move it away from Government overreach.

Our Government will probably just 'print' it on a screen and pretend to have acted.

[Hancock]

1 hour ago, ThoughtCriminal said:

Smell that fear and desperation 😂🤦

 

So they've demonised oil for years and now suddenly they want lower prices and higher supply.

 

Clown world doesn't even begin to describe where we live.

 

 

Why the panic inflation is just transitory.

Edit and they managed to put oil price up by $2 a barrel in a matter of minutes.

The elite aren't looking very elite right now.

[DoINeedOne]

Was thinking about the house i grew up in today, parents sold it in 2002 after getting divorced for £200,000 roughly today that house is going for around £600,000

Then i wondered as i have seen charts with gold to home prices ratios type charts - so i took the average price houses sold in the road over the years and gold prices roughly around mid year to see

So if you have 900 oz's of gold in 2002 (alot i know) the average price of a home lets say in Britannia's to avoid CGT today you would be able to buy 2 of that same house or 1 and have around £600,000

Where i grew up in South London it takes less than half the oz's gold to buy a home today than it did lets say before 2008

 

Just a random thought prices were averaged

At least i think its correct 

Obviously i know you would need somewhere to live during this time

 

[Sidd]

Is Dave Hunters DXY call one of his worst yet or will it reverse back down..

[DurhamBorn]

1 hour ago, Castlevania said:

How would that work? You the big bad big oil company are undersupplying the market, so let’s tax you more so that you’re even less likely to invest to increase supply?

Exactly,but we are talking about the Biden government here.They always need to blame others.

[Ma2]

Taking some carpet up at my mum's at the weekend and found this cartoon in a paper, note the date!