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

[sancho panza]

On 30/11/2021 at 14:59, Cattle Prod said:

A very important point. People go on about low velocity, but it's just a ratio of GDP to M2. What do you expect when M2 is being pumped up like this...

Velocity is a function of GDP and M whatever.However,the key thing for me is to ascertain the psycholgy behind it.Take Zimbabwe,there came a point when people began spending moeny,not becasue they wanted to,but becasue they knew it would be woprthless if they didn't .

This brings forward demand and creates distortions economcially.We're nowhere near there,but once people begin fearing devaluation,then we'll se velocity move up and we'll see the demand pull inflation of neo classical textbooks.

As an off shoot,I've been toying with goldies calls last week after some losses in Oct/Nov.

Apologies for the advert line acorss this screenshot but don't know how to get of it.Key thing is goldies look undervalued here .this is from the monthly peak jan 08(gold is in err...gold)

and from June 03

On 30/11/2021 at 17:09, Transistor Man said:

https://news.samsung.com/us/samsung-new-advanced-semiconductor-fab-site-taylor-texas/

 

Just psoting some of thedetail there TM...interesting move....new cold war?

'Samsung Electronics Co., Ltd., a world leader in advanced semiconductor technology, today announced that it would build a new semiconductor manufacturing facility in Taylor, Texas. The estimated $17 billion investment in the United States will help boost production of advanced logic semiconductor solutions that power next-generation innovations and technologies.

The total expected investment of $17 billion, including buildings, property improvements, machinery and equipment, will mark the largest-ever investment made by Samsung in the U.S. This will also bring Samsung’s total investment in the U.S. to more than $47 billion since beginning operations in the country in 1978, where the company now has over 20,000 employees across the country.

[Eventually Right]

Hi @DurhamBorn,

I'm sure you've articulated it before-so apologies for asking, but with regards to silver, which I believe you still see as one of the likely biggest winners of this cycle-what are your reasons for that thesis?  I assume it's a mix of increased investment demand, and industrial demand (solar etc), but I wondered what you think will be the main driver?

This latest silver dip has me questioning myself, as I'm probably too overweight the sector compared to energy/telecoms etc.

I seem to repeatedly see things that I think should be bullish for precious metals-Central Banks buying gold, heavy demand for retail gold in India/China, silver coins going for way over spot price, the US Mint halting production of silver eagles for the rest of the year etc-not to mention repeated high inflation figures.  But for the last 16 months gold and silver have just consolidated/drifted down slightly, and the miners lost 30%ish.  In the same timeframe, the S&P and Nasdaq have gained over 40%.

I see debates on twitter on how manipulated the gold and silver markets are by paper gold/silver, the bullion banks/Comex etc.  The guys on both sides are far more knowledgeable than I am on the market, so I can't really have a firm opinion on it, other than to say that it seems weird to me when a market participant dumps huge amounts of paper gold/silver on the market at very illiquid times, which causes the price to tank.  Do you have a view on this at all?

I also worry that if this is how gold/silver have acted with big inflation prints, how far would they drop if inflation pulls back for a few months...

Thanks in advance!

[Lightscribe]

3 hours ago, Harley said:

  I started by looking at a Jackery, etc and suffered a bit of scope creep!  I really like the microscope.  I never knew they existed.  Very useful, and good value.  Cheers.

I mention this storage stuff here as I can see this becoming a popular area what with energy costs, smart meters, differential tariffs, grid issues, etc.  For me personally, it's an example of how I can invest depreciating or to-be-stolen fiat now to save money and/or just live better down the line.  Putting money outside of the burning building of a system.  At source!  A bit of faith on my side rather than any detailed financial analysis.  The components are going up in price atm with the supply shortages, etc so it was a bit stressy to get it all done.  But I feel great for having done something given my concerns about the future. 

You can actually get the microscopes cheaper than that, obviously adding import charges.

https://a.aliexpress.com/_mr2I0Fo

All that and a decent Fluke multimeter and your well away and can pinpoint most issues and fix. 

I prefer to use solder paste and flux syringes and decent solder wick (MG chemicals super wick) when working on the small stuff.

https://www.amazon.co.uk/RELIFE-RL-405-Lead-free-Temperature-Soldering/dp/B08YRZPBZJ/ref=mp_s_a_1_12?keywords=solder+paste&qid=1638472125&sr=8-12

 

[Harley]

8 minutes ago, Lightscribe said:

You can actually get the microscopes cheaper than that, obviously adding import charges.

https://a.aliexpress.com/_mr2I0Fo

All that and a decent Fluke multimeter and your well away and can pinpoint most issues and fix. 

I prefer to use solder paste and flux syringes when working on the small stuff.

https://www.amazon.co.uk/RELIFE-RL-405-Lead-free-Temperature-Soldering/dp/B08YRZPBZJ/ref=mp_s_a_1_21?adgrpid=56074884889&gclid=Cj0KCQiA-qGNBhD3ARIsAO_o7ykYAPbwAOddEPN_x6Kj3v0s8U6eTEPNONXzFIx5f539Lb6LZ3-cL1YaAppHEALw_wcB&hvadid=259147524197&hvdev=m&hvlocphy=20339&hvnetw=g&hvqmt=e&hvrand=18029711167348489102&hvtargid=kwd-298113167461&hydadcr=16882_1798501&keywords=solder+paste+syringe&qid=1638471795&sr=8-21

It's all changed since I was a hobby electronics lad.  Got a PIV system on me workbench to debug tomorrow.

[sancho panza]

7 hours ago, reformed nice guy said:

Noticed that Shell and Chevron have increased their share buybacks just as the seer of Durham predicted

Why wouldn't you at these prices?Big oil still looking cheap compared to the underlying.they know what's coming.

from mar 20

from jan 16

 

Decl:very long

 

[DurhamBorn]

14 minutes ago, Eventually Right said:

Hi @DurhamBorn,

I'm sure you've articulated it before-so apologies for asking, but with regards to silver, which I believe you still see as one of the likely biggest winners of this cycle-what are your reasons for that thesis?  I assume it's a mix of increased investment demand, and industrial demand (solar etc), but I wondered what you think will be the main driver?

This latest silver dip has me questioning myself, as I'm probably too overweight the sector compared to energy/telecoms etc.

I seem to repeatedly see things that I think should be bullish for precious metals-Central Banks buying gold, heavy demand for retail gold in India/China, silver coins going for way over spot price, the US Mint halting production of silver eagles for the rest of the year etc-not to mention repeated high inflation figures.  But for the last 16 months gold and silver have just consolidated/drifted down slightly, and the miners lost 30%ish.  In the same timeframe, the S&P and Nasdaq have gained over 40%.

I see debates on twitter on how manipulated the gold and silver markets are by paper gold/silver, the bullion banks/Comex etc.  The guys on both sides are far more knowledgeable than I am on the market, so I can't really have a firm opinion on it, other than to say that it seems weird to me when a market participant dumps huge amounts of paper gold/silver on the market at very illiquid times, which causes the price to tank.  Do you have a view on this at all?

I also worry that if this is how gold/silver have acted with big inflation prints, how far would they drop if inflation pulls back for a few months...

Thanks in advance!

Take a Silver Brit,or Maple in your hand,consider how much it costs today to buy one.Now imagine a system so leveraged it needs trillions and trillions printing just to fund welfare,never mind other demands.Name me something,anything you can buy today at that price that is rare, beautiful,money etc that has the potential of silver to x10,x20?

Thats the answer.Given the system and the liquidity needed to stop it rolling over to the stone age the potential is incredible.I dont even think about my silver even though its a big chunk of my worth.I get $200+ or i die holding it.Both are coming,its just what comes first.The best lesson anyone can learn in the markets is to let things go to where they are going in their own time.

As for the NASDAQ etc why care?,DRAX,RM,Mosaic and many others have 3x ,4x etc in the same months.Going to where they were going in their own time.

£50k in Tesla or £50k in silver,but you have to hold for 5 years and cant sell,what would you choose?

The miners already ran before and have simply given up some gains,never linear.

[Eventually Right]

47 minutes ago, DurhamBorn said:

Take a Silver Brit,or Maple in your hand,consider how much it costs today to buy one.Now imagine a system so leveraged it needs trillions and trillions printing just to fund welfare,never mind other demands.Name me something,anything you can buy today at that price that is rare, beautiful,money etc that has the potential of silver to x10,x20?

Thats the answer.Given the system and the liquidity needed to stop it rolling over to the stone age the potential is incredible.I dont even think about my silver even though its a big chunk of my worth.I get $200+ or i die holding it.Both are coming,its just what comes first.The best lesson anyone can learn in the markets is to let things go to where they are going in their own time.

As for the NASDAQ etc why care?,DRAX,RM,Mosaic and many others have 3x ,4x etc in the same months.Going to where they were going in their own time.

£50k in Tesla or £50k in silver,but you have to hold for 5 years and cant sell,what would you choose?

The miners already ran before and have simply given up some gains,never linear.

Thanks DB, I agree on the beauty of them-I cant see myself selling my queen’s beasts unless the price gets ridiculous.

It’s my fault for being over concentrated-great on the way up, less fun when other things are outperforming! 

I’d have the £50k in silver any day, over Tesla-I’ve tried to short that before with options, and it’ll be a  good day if Musk ever gets his comeuppance... 

[CannonFodder]

Wednesday, Uk watchdog orders an american icon facebook to sell giphey. Bit cheeky...

Two days later USA states tarriffs to stay if article 16 dropped.

Boris playing with the big boys now.

Cant see economics going better than foreign policy

[macca]

On 29/11/2021 at 10:30, HousePriceMania said:

And, just for balance...

 

 

Its lack of slave labours fault now..  Not money printing, 0% interest rates and asset stripping of the country..

Its because we cant get people to do work on the cheap,, Well there were 20 mopeds outside MacDonalds yesterday that would say that's bollocks, They are delivering for 35p an hour then pulling in the bennies,, init 

[Chewing Grass]

Tonight Martin Lewis told the plebs to do nothing when a ransom letter comes through your door from Energy McEnergyFace when your Tariff ends as then its the Governments Problem if they don't like it.

[Hancock]

3 hours ago, Boon said:

No, but pretty sure there are similar examples on this in every area.

Average income in Oxford must be more than average, although its academic as you couldn't borrow on that.

More pertinently, assuming it costs £100k to do up then it may rent for £1k a month and two people on an ordinary income could afford it, and Homes under the Hammer regulars will tell you that's a 4% yield and better than the bank account. 

The thought of earning the same through a dividend (and also have the prospect of capital appreciation) isn't gonna appeal to these people.

That is why there are buyers for these sort of things, at those sort of prices.

That'll be Blackbird Leys, Oxfords main council estate.

The average wage should get you somewhere "average", thats well below average prior to it being burnt out.

Sort of place oop North that you can just about get for 4 times average local wage.

[Hancock]

12 minutes ago, macca said:

Its lack of slave labours fault now..  Not money printing, 0% interest rates and asset stripping of the country..

Its because we cant get people to do work on the cheap,, Well there were 20 mopeds outside MacDonalds yesterday that would say that's bollocks, They are delivering for 35p an hour then pulling in the bennies,, init 

Im truly amazed at the amount of people who get Mcdonalds delivered, there must be 10s of 1000s of morbidly obese people who don't leave the house as bennies can pay for some immigrant to deliver them a heart attack and coke.

[CannonFodder]

46 minutes ago, PrincessDrac said:

Link

Anyone own Fortuna Silver Mines Inc? Just bought in my first ladder, missed the bottom of ~ $3.15 as I was out. But i got in at the close at $3.26.

I bought 400 shares. Every 15 to 20 cents drop I think i'l buy another 400 odd shares.

Any thoughts, am I catching a falling knife here? A nice silver play for the long term I hope.

 

I used to but sold them in march, one of my better decisions. There are issues operationally, stopped paying attention after sale.

I.ld say high risk , only put in what thou can lose, but could come good.I wont hold them again. DYOR

Edit to add, they have 3 big mines, one in Peru, political risk, second in mexico in trouble, environmental permit and tribal risk, the mexican one too much risk for me

[BadAlchemy]

13 minutes ago, PrincessDrac said:

Link

Anyone own Fortuna Silver Mines Inc? Just bought in my first ladder, missed the bottom of ~ $3.15 as I was out. But i got in at the close at $3.26.

I bought 400 shares. Every 15 to 20 cents drop I think i'l buy another 400 odd shares.

Any thoughts, am I catching a falling knife here? A nice silver play for the long term I hope.

 

You did well there. $3.72 for me some time last week I think. I'm holding...

Started digging out some weeds in the garden today. Anything to keep me away from the Buy button 

[Boon]

39 minutes ago, Hancock said:

Im truly amazed at the amount of people who get Mcdonalds delivered, there must be 10s of 1000s of morbidly obese people who don't leave the house as bennies can pay for some immigrant to deliver them a heart attack and coke.

This amazes me too from multiple aspects. 

Why the hell do people get junk food delivered in the first place? 

Secondly why the hell do people order off Uber Eats? The prices are about 30% more expensive than the shop, as the takeaway needs to cover the fees (Mcdonalds is an exception)

How do Uber Eats actually make money? A driver is paid £3.50 per delivery minimum. McDonalds seem to be a small loss leader for them, just a way to give their drivers regular work. 

On the rest they are basically hoping that people are idiots and pony up for the big takeaways, ie a £35 takeaway might earn Uber £10 in fees, which only £3.5 is paid to the driver. But this might be quite rare. 

Just seems to me to be one of those things which is never gonna be profitable. 

[AlfredTheLittle]

9 minutes ago, Boon said:

This amazes me too from multiple aspects. 

Why the hell do people get junk food delivered in the first place? 

Secondly why the hell do people order off Uber Eats? The prices are about 30% more expensive than the shop, as the takeaway needs to cover the fees (Mcdonalds is an exception)

How do Uber Eats actually make money? A driver is paid £3.50 per delivery minimum. McDonalds seem to be a small loss leader for them, just a way to give their drivers regular work. 

On the rest they are basically hoping that people are idiots and pony up for the big takeaways, ie a £35 takeaway might earn Uber £10 in fees, which only £3.5 is paid to the driver. But this might be quite rare. 

Just seems to me to be one of those things which is never gonna be profitable. 

I did a brief stint as an Uber eats driver, I don't know how the pricing works for the customer, but well over 90% of the work when I did it, about 3 years ago, was McDonald's, so if that's a loss leader they have no chance of making money (and in fact they have never made a profit - it's just another symptom of the fact that we're using up as many of the earth's resources as we can as quickly as we can, while talking bollox about climate change)

[AWW]

I use Uber Eats occasionally, because they spam me with voucher codes for anywhere between 35 and 50% off.

The sharing platter from my local Turkish place on Green Lanes is good value when I pick it up and pay full price, never mind when it's half price and delivered to the door.

Uber just consumes capital. They're all about growth, not profit. It's a business model that can only work in a ZIRP environment. They're fucked. Every time they try to put their prices up to turn a profit, everyone stops using them.

They've conditioned their customers to think that their service isn't worth very much.

[wherebee]

12 minutes ago, AWW said:

I use Uber Eats occasionally, because they spam me with voucher codes for anywhere between 35 and 50% off.

The sharing platter from my local Turkish place on Green Lanes is good value when I pick it up and pay full price, never mind when it's half price and delivered to the door.

Uber just consumes capital. They're all about growth, not profit. It's a business model that can only work in a ZIRP environment. They're fucked. Every time they try to put their prices up to turn a profit, everyone stops using them.

They've conditioned their customers to think that their service isn't worth very much.

Uber is useful for use when you cannot drive but need a fast pickup.  For example, son went swimming with mates down in the sea the other week, too far for me to go due to work, I ordered them all an Uber back, 40 bucks for 5 kids home safely.  That's worth it.

[ashestoashes]

On 19/11/2021 at 12:11, Talking Monkey said:

 I've seen that a few times with the Indians, it's mental. They turn into the most obnoxious bastards after a couple of promotions. 

it's worse than that

https://www.brightworkresearch.com/how-indian-it-workers-discriminate-against-non-indian-workers/

[Hancock]

59 minutes ago, Boon said:

This amazes me too from multiple aspects. 

Why the hell do people get junk food delivered in the first place? 

Secondly why the hell do people order off Uber Eats? The prices are about 30% more expensive than the shop, as the takeaway needs to cover the fees (Mcdonalds is an exception)

How do Uber Eats actually make money? A driver is paid £3.50 per delivery minimum. McDonalds seem to be a small loss leader for them, just a way to give their drivers regular work. 

On the rest they are basically hoping that people are idiots and pony up for the big takeaways, ie a £35 takeaway might earn Uber £10 in fees, which only £3.5 is paid to the driver. But this might be quite rare. 

Just seems to me to be one of those things which is never gonna be profitable. 

Yes its a mystery to me, its bad enough fresh, let alone eaten 25 minutes later and after its been thrown round a bag.

But then the whole of civilisation has become a fucken mystery to me. Irony is the people ordering that shite are probably deemed more "normal" than us lot who are bemused by it all!

I feel sorry for Mcdonalds workers though, its non stop work for £9 an hour; they have to be one of the few groups of people who genuinely put in a hard days graft these days.

 

[CannonFodder]

42 minutes ago, PrincessDrac said:

Thanks. I like a punt with a bit of risk.

But thank you for your opinion.

If you want risk, pick a silver miner with an animal or bird in its name....

There is a whole zoo including silver bull and silver bear 🐻

[Hancock]

1 minute ago, ashestoashes said:

it's worse than that

https://www.brightworkresearch.com/how-indian-it-workers-discriminate-against-non-indian-workers/

What they do in the middle east is, Indian office gets her mate to run an agency, pays her $150 for each worker, then the agency pays them $50 a day.

They hire anyone who can buy forged documents, and then treat them like absolute shit. 

I like the low level Indians they make me laugh and are pretty harmless, explained to one that if it wasn't for that Ghandi cunt they'd get treat a whole lot better than they do by us Brits.

Its probably what happens the world over, just slightly more obvious to us whiteys, maybe the main difference being middle class whitey wouldn't order working class whitey about in the same way, as they're scared of them and would be afraid of getting a hiding.

[belfastchild]

4 hours ago, Lightscribe said:

You can actually get the microscopes cheaper than that, obviously adding import charges.

https://a.aliexpress.com/_mr2I0Fo

All that and a decent Fluke multimeter and your well away and can pinpoint most issues and fix. 

I prefer to use solder paste and flux syringes and decent solder wick (MG chemicals super wick) when working on the small stuff.

https://www.amazon.co.uk/RELIFE-RL-405-Lead-free-Temperature-Soldering/dp/B08YRZPBZJ/ref=mp_s_a_1_12?keywords=solder+paste&qid=1638472125&sr=8-12

 

I went the small old laptop for the screen use and just the microscope end thing.

Judging by your posts you probably know these already but I'll throw them out there.

OWON VDS1022 - virtual oscilloscope, used one, thought thats not a bad idea for my laptop (as above), bought one and like my 3d printer has only been out of the box to set up. Ive an old 32 inch lcd tv that I replaced some of the caps on the power board but still not right yet that I need to get this on over the winter.

Bought a wee assembled digital dso150 oscilloscope as well as a small xr2206 signal generator kit. Again if I ever get the chance I'll put these together and up and running for portable use. The wee scope isnt bad for some simple waveform stuff, havent used it for anything complicated yet.

Bought a few cheap uno kits from banggood/aliexpress pre brexit and have them to play with as well at some stage.

What has this to do with the thread? Well I see the ability to fix stuff being crucial going forward and yes I did buy a hobby sewing machine as well, although wasnt up to fixing the tarp for my trailer, bought a leather stiching kit for that instead!

Saddo, I know.

[sancho panza]

2 hours ago, PrincessDrac said:

Link

Anyone own Fortuna Silver Mines Inc? Just bought in my first ladder, missed the bottom of ~ $3.15 as I was out. But i got in at the close at $3.26.

I bought 400 shares. Every 15 to 20 cents drop I think i'l buy another 400 odd shares.

Any thoughts, am I catching a falling knife here? A nice silver play for the long term I hope.

 

I'm a confirmed 'spray n prayer' when it comes to individual stocks in something like the PM miners. So not an expert on this sector by any stretch but I'd steer clear from what I've read about this individual stock(It has some serious issues that look like they won't get resolved in it's favour).It looks like a falling knife.DYOR obviously,I could be wrong.

@kibuc has probably the best working knowledge on here ref junior miners, maybe @Majorpain or @DurhamBorn have an opinion.

[Hancock]

55 minutes ago, Cattle Prod said:

Wtf? It really is end of days. It's often cold when I get it over the counter, who tf gets it delivered? 

That said I can recall about 4,000 hangovers when I'd have paid big money for a sausage and egg mcmuffin to the door. I guess I'm a hypocrite...

Aye, but i doubt your modern day fat cunt has any room left over for alcohol ... why waste precious real estate in your belly on booze when more food can go there.