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

[Innkeeper]

9 minutes ago, Animal Spirits said:

Saxo Bank Outrageous Predictions
2022: Revolution

https://www.home.saxo/insights/news-and-research/thought-leadership/outrageous-predictions

If the last one comes true, the planet is well and truly stuffed 

[Castlevania]

2 hours ago, DurhamBorn said:

I remember when KFC used to do buy on get one free on the back of parking tickets.An older guy i worked with worked out the way the wind blew down a certain car park and the bush all the discarded tickets used to fly into ,he used to send his wife into the bush to collect them,she was 20 years younger than him and gorgeous,yet he had her crawling around bushes for those tickets.

My old flatmate dated a girl who worked at KFC head office. She gave both of us a KFC Chicken cheque book each. The cheques are blank, and can be used as payment (with no max value) at KFC. Long after they’d split up, we’d go to KFC hungover and order the entire menu and have it all for free. 

I haven’t had a KFC since.

[Chewing Grass]

1 minute ago, Castlevania said:

My old flatmate dated a girl who worked at KFC head office. She gave both of us a KFC Chicken cheque book each. The cheques are blank, and can be used as payment (with no max value) at KFC. Long after they’d split up, we’d go to KFC hungover and order the entire menu and have it all for free. 

I haven’t had a KFC since.

Finger Lickin' Good.

[Castlevania]

41 minutes ago, RWJ said:

Cheers.  I must seek out one of these.  Not eating carbs I go through a hell of a lot of meats so I'm always on the look out for reductions.

23rd/24th Dec tends to be a good time to scan the supermarkets for vastly reduced meats and cheeses as they're clearing out ahead of the holidays.

After Christmas too. Those cheese selection boxes can usually be picked up for a fraction of the original price.

If you have a Waitrose near by they sell a block of sausage meat (they actually sell it year round) and always have loads massively reduced after Christmas. It’s amazing.

[ThoughtCriminal]

“Even the most circumspect friend of the market would concede that the volume of brokers’ loans—of loans collateraled by the securities purchased on margin—is a good index of the volume of speculation.” -John Kenneth Galbraith, The Great Crash 1929 

 

No fucking shit John. No fucking shit.

[Harley]

50 minutes ago, Animal Spirits said:

Saxo Bank Outrageous Predictions
2022: Revolution

https://www.home.saxo/insights/news-and-research/thought-leadership/outrageous-predictions

1. The plan to end fossil fuels gets a rain check
2. Facebook faceplants on youth exodus
3. The US mid-term election brings constitutional crisis
4. US inflation reaches above 15% on wage-price spiral
5. EU Superfund for climate, energy and defence announced, to be funded by private pensions
6. Women’s Reddit Army takes on the corporate patriarchy
7. India joins the Gulf Cooperation Council as a non-voting member
8. Spotify disrupted due to NFT-based digital rights platform
9. New hypersonic tech drives space race and new cold war
10. Medical breakthrough extends average life expectancy 25 years

Compared to recent times that would be a most welcomed quite year!

[Harley]

24 minutes ago, Castlevania said:

After Christmas too. Those cheese selection boxes can usually be picked up for a fraction of the original price.

If you have a Waitrose near by they sell a block of sausage meat (they actually sell it year round) and always have loads massively reduced after Christmas. It’s amazing.

I try but they all go, god knows where.  It's like easter eggs.  Go in the day after and it's like it never happened!

 

[Axeman123]

51 minutes ago, Animal Spirits said:

1. The plan to end fossil fuels gets a rain check Yes
2. Facebook faceplants on youth exodus Yes
3. The US mid-term election brings constitutional crisis Yes
4. US inflation reaches above 15% on wage-price spiral No, but only bcause BK intervenes
5. EU Superfund for climate, energy and defence announced, to be funded by private pensions Sadly seems innevitable
6. Women’s Reddit Army takes on the corporate patriarchy Who cares?
7. India joins the Gulf Cooperation Council as a non-voting member No Idea
8. Spotify disrupted due to NFT-based digital rights platform No Idea
9. New hypersonic tech drives space race and new cold war Yes
10. Medical breakthrough extends average life expectancy 25 years Hopefully, but would probably need a big war to offset

You have to give it to the man from Durham, everyone else is playing catch-up

[Errol]

19 hours ago, ThoughtCriminal said:

My word I love that film.

Love Margin Call. Probably one of my favourite films. I think in many ways it is better than the Big Short. It shows the world of business and banking in a much more realistic way, with the whole thing played out in offices and people stabbing each other in the back.

[DurhamBorn]

2 hours ago, Bobthebuilder said:

A wok is incredibly energy efficient, you can cook most things on the smallest burner on a gas hob, that's using 1KW per hour.

Carbon steel and copper pans also make a big difference energy use wise, good investments IMO.

For anyone wanting a quality Wok without breaking the bank i got this one a year ago and is superb.I got the 13ln perfect size for one or two portions.You need to spend an hour seasoning it though with quality veg oil,heat up rub oil around,keep repeating until black,best to watch a guide on Youtube to seasoning a wok.Then the knack is just use water to clean and a light brush never ever ever use washing up liquid or anything,once clean dry with kitchen towel then heat up to evaporate any water then add a drop of oil and cover whole wok while on burner,then a little more when cooled down and put away.My chinese cooking is very close to take away with this.

https://www.amazon.co.uk/gp/product/B00237VCC8/ref=ppx_yo_dt_b_asin_title_o09_s00?ie=UTF8&th=1

 

[feed]

1 hour ago, Innkeeper said:

If the last one comes true, the planet is well and truly stuffed 

Average. 

Uncle Bill and chums get 100 years, everyone else goes down. 

[Innkeeper]

4 minutes ago, feed said:

Average. 

Uncle Bill and chums get 100 years, everyone else goes down. 

A few oligarchs getting to a ton wouldn’t change the average.

That’s  only possible if the entire western world and half the Asians get a bump of 30 years plus, with Africans and South Americans hanging behind..

[feed]

8 minutes ago, Innkeeper said:

A few oligarchs getting to a ton wouldn’t change the average.

That’s  only possible if the entire western world and half the Asians get a bump of 30 years plus, with Africans and South Americans hanging behind..

i was sort of joking, point being it isn't going to be an even increase.  Wealth will mean it's asymmetric. Outside of those countries that are playing catch up with 21st century basics. 

 

[jamtomorrow]

1 hour ago, Innkeeper said:

If the last one comes true, the planet is well and truly stuffed 

F***ing hell. Somebody really needs to get a grip on this life-extension crap: the young are *supposed* to *replace* the old. Mess with that and you mess with everything.

We're starting to resemble this poor fellow ...

[Hancock]

5 hours ago, DurhamBorn said:

"Junk" food made at home is quite healthy,its all the crap they add during the process.I make burger,i always add an egg,minced onion,mixed italian herbs to the mix blitzed up.I usually use the cheap 20% mince when i get it reduced in Lidl for 70p though.Iv got a mincer on my food processor and iv never used it,il have to give it a go.

I got one of these last year for about £25 ... now up to £30 ... definitely worth the money,  minces the meat to perfect!

And easy to clean.

https://www.ebay.co.uk/itm/194262882069?epid=2317030600&hash=item2d3af85715:g:zkMAAOSwVPRhCo1X

[JMD]

5 hours ago, ThoughtCriminal said:

“Even the most circumspect friend of the market would concede that the volume of brokers’ loans—of loans collateraled by the securities purchased on margin—is a good index of the volume of speculation.” -John Kenneth Galbraith, The Great Crash 1929 

 

No fucking shit John. No fucking shit.

Scary chart. Reminds me of this recent George Gammon / 'Early Indicators of Banking Crises' interview.                                                          https://m.youtube.com/watch?v=Bbr_DylOgQA

[Hancock]

Fund managers have built up cash reserves in an attempt to protect themselves from a market crash as global stocks reach new record highs.

Mixed-asset portfolios, which can invest between 40pc and 85pc of their money in stocks, now hold 5pc in cash on average, compared with a 2pc average across all funds, according to data compiled by FE Fundinfo, a fund analyst. Managers who invest only in stocks have also taken money out of the market.

Higher levels of cash among mixed-asset managers suggest they are braced for a fall in the value of bonds, which have traditionally served as safe havens from volatility in the stock market. By taking profits, managers can use the cash to “buy the dip” if share prices fall.

The Ninety One Global Multi-Asset Sustainable Growth fund ranked among the highest, with 21pc in cash.

Michael Spinks, the manager, said: “Our concern is that we will see a decline in the price of both bonds and stocks when central banks withdraw support, and this is coupled with a growth shock from China.

He said holding cash “affords us flexibility to take advantage of any period of volatility”. Freed-up money could be spent on attractively priced corporate bonds and emerging market debt.

However, other investors have questioned the value of paying an active manager to hold lots of cash, which DIY investors can do themselves free of charge.

Thomas Becket of Punter Southall Wealth said it was irresponsible for fund managers to leave so much of their clients’ money in cash. “When DIY investors give you their money, they expect you to invest it,” he said. 

“If a manager thinks there are no good investment opportunities out there, they should offer that money back. That way, if DIY investors disagree with their view, they can put their money elsewhere or hold it in their own cash accounts without being charged.”

Mixed-asset funds are within their remit to make strategic decisions about how much cash to hold. But some stock market funds have also been building up high cash positions.

The Gresham House UK Multi Cap Income fund had around 14pc of its assets in cash. Ken Wotton, the co-manager, said this was because the fund was preparing to take advantage of a fall in the London stock market.

“Concerns over inflation, supply chain disruption and the new Covid variant have driven volatility,” he said. 

Mr Wotton added that the cash would be used to buy stocks with robust, long-term qualities overlooked by the market – at low prices. The fund’s has also had an inflow of cash from new investors, he said.

The Sanford DeLand Free Spirit fund, which also invests in British stocks, held 18pc in cash at the end of October, although the figure fell to 12pc this week. Eric Burns of Sanford DeLand said the fund had begun to accumulate investors’ cash in the summer. 

“We stood back in July and August and let the cash build. In recent weeks a number of shares have become attractive and we have used dips to top up existing holdings,” he said. “As a result, the cash position has reduced from a peak of around 18pc to 12pc at the end of November.”

Rob Burgeman of wealth manager Brewin Dolphin warned DIY investors not to take their cue from fund managers by taking profits and waiting for a dip.

“For regular investors to sell stocks and move into cash, they need to think that the news is going to get much worse than it is now. We do not think that will be the case,” he said. “Markets have been choppy this week. Some of the sharpest fallers were travel companies, yet shares in easyJet rose by 5pc between Monday and Thursday. We do not think we will have a big disaster again.”

Laith Khalaf of broker AJ Bell said DIY investors should consider selling bonds if they expected a crash when interest rates rose.

“But as omicron has demonstrated, safe havens such as bonds can still shine if fears over global growth appear,” he said. “Investors may want to consider selling long-dated government bonds and buying ‘strategic bond’ and corporate bond funds, which would be less badly affected by rate rises.”

Mr Khalaf named the Artemis Strat­egic Bond and Fidelity Strategic Bond funds, which have returned 22pc and 19pc respectively in five years.

“The downside is that these options won’t provide as much protection if there is an economic slowdown,” he added.

[sancho panza]

@Cattle Prod also anyone else with a view ive had a couple people asking me about shell pulling out of cambo.

I've offered the possibility that 

1) North Sea fields deteriorating in profitability

2) shell flexing it's muscles after delisting proposal ref Holland.part of me wonders if they're warning govts worldwide that if you keep trying to curtail their activities then govts hadbetter be careful what they wish for .

 

Particularly ref point 2 I did wonder how and when. The pull out from Holland looks like an economic disaster in the offing.

I've been adding a few rockhopper on the basis that since oil explorer cos might rocket in five years time as it looks  like the world will be short of prospects.

Sorry if this has been asked I'm on break at work and can't remember seeing it.

[sancho panza]

Got the following text from a pal earlier. Seems apt

'One crisp winter morning in Sweden, a cute little girl named Greta woke up to a perfect world, one where there were no petroleum products ruining the earth. She tossed aside her cotton sheet and wool blanket and stepped out onto a dirt floor covered with willow bark that had been pulverised with rocks. “What’s this?” she asked.

“Pulverised willow bark,” replied her fairy godmother.

“What happened to the carpet?” she asked.

“The carpet was nylon, which is made from butadiene and hydrogen cyanide, both made from petroleum,” came the response.

Greta smiled, acknowledging that adjustments are necessary to save the planet, and moved to the sink to brush her teeth where instead of a toothbrush, she found a willow, mangled on one end to expose wood fibre bristles.

“Your old toothbrush?” noted her godmother, “Also nylon.”

“Where’s the water?” asked Greta.

“Down the road in the canal,” replied her godmother, ‘Just make sure you avoid water with cholera in it”

“Why’s there no running water?” Greta asked, becoming a little peevish.

“Well,” said her godmother, who happened to teach engineering at MIT, “Where do we begin?” There followed a long monologue about how sink valves need elastomer seats and how copper pipes contain copper, which has to be mined and how it’s impossible to make all-electric earth-moving equipment with no gear lubrication or tires and how ore has to be smelted to a make metal, and that’s tough to do with only electricity as a source of heat, and even if you use only electricity, the wires need insulation, which is petroleum-based, and though most of Sweden’s energy is produced in an environmentally friendly way because of hydro and nuclear, if you do a mass and energy balance around the whole system, you still need lots of petroleum products like lubricants and nylon and rubber for tires and asphalt for filling potholes and wax and iPhone plastic and elastic to hold your underwear up while operating a copper smelting furnace and . . .

“What’s for breakfast?” interjected Greta, whose head was hurting.

"Fresh, range-fed chicken eggs,” replied her godmother. “Raw.”

“How so, raw?” inquired Greta.

“Well, . . .” And once again, Greta was told about the need for petroleum products like transformer oil and scores of petroleum products essential for producing metals for frying pans and in the end was educated about how you can’t have a petroleum-free world and then cook eggs. Unless you rip your front fence up and start a fire and carefully cook your egg in an orange peel like you do in Boy Scouts. Not that you can find oranges in Sweden anymore.

“But I want poached eggs like my Aunt Tilda makes,” lamented Greta.

“Tilda died this morning,” the godmother explained. “Bacterial pneumonia.”

“What?!” interjected Greta. “No one dies of bacterial pneumonia! We have penicillin.”

“Not anymore,” explained godmother “The production of penicillin requires chemical extraction using isobutyl acetate, which, if you know your organic chemistry, is petroleum-based. Lots of people are dying, which is problematic because there’s not any easy way of disposing of the bodies since backhoes need hydraulic oil and crematoriums can’t really burn many bodies using as fuel Swedish fences and furniture, which are rapidly disappearing - being used on the black market for roasting eggs and staying warm.”

This represents only a fraction of Greta’s day, a day without microphones to exclaim into and a day without much food, and a day without carbon-fibre boats to sail in, but a day that will save the planet.

Tune in tomorrow when Greta needs a root canal and learns how Novocain is synthesised.'

[leonardratso]

they will shoot themselves in the foot, of that i have no doubt, meanwhile id best turn the gas heating up, getting cold in here.

[Loki]

3 hours ago, leonardratso said:

they will shoot themselves in the foot, of that i have no doubt, meanwhile id best turn the gas heating up, getting cold in here.

They're shooting us in the foot you mean, and saying it's for our own good.  The real architects of this nonsense are always insulated(!) from the consequences of their fantastic 5 year plans.

[planit]

9 hours ago, sancho panza said:

@Cattle Prod also anyone else with a view ive had a couple people asking me about shell pulling out of cambo.

I've offered the possibility that 

1) North Sea fields deteriorating in profitability

2) shell flexing it's muscles after delisting proposal ref Holland.part of me wonders if they're warning govts worldwide that if you keep trying to curtail their activities then govts hadbetter be careful what they wish for .

 

Particularly ref point 2 I did wonder how and when. The pull out from Holland looks like an economic disaster in the offing.

I've been adding a few rockhopper on the basis that since oil explorer cos might rocket in five years time as it looks  like the world will be short of prospects.

Sorry if this has been asked I'm on break at work and can't remember seeing it.

My reaction was 'meh'. Shell is a global company and they probably just looked up the hassle factor and thought they couldn't be bothered with the green pressure.

Weigh up risk/reward, not enough money involved to end up on front page of newspapers. Just another example of actions causing high energy prices in the future.

 

Was thinking about Biden and OPEC again, all this is affected by timescales

long term view - OPEC, this thread, Oil companies

short term view - Biden/politicians, stockmarket

 

The short-termers are like kids, they want icecream now even if they get all their teeth pulled out later. Stupid.

 

I am thinking oil will go to sleep for a month now, there are not going to be any supply or inventory concerns until next year. I am glad I sold down some more on Friday AM.

Risk to the downside next couple of weeks, I still think US hasn't priced in a delta wave of cases which will now be compounded by Omicron.

The forth peak will be much higher than the others -

 

It is confirmed now that Omicron infects people who have already had Covid which is not good for the above graph.

(not trying to have a Covid debate here, I am only interested in what the market has or has not priced in. I get Omicron might only give mild symptoms )

 

[JMD]

13 hours ago, sancho panza said:

@Cattle Prod also anyone else with a view ive had a couple people asking me about shell pulling out of cambo.

I've offered the possibility that 

1) North Sea fields deteriorating in profitability

2) shell flexing it's muscles after delisting proposal ref Holland.part of me wonders if they're warning govts worldwide that if you keep trying to curtail their activities then govts hadbetter be careful what they wish for .

 

Particularly ref point 2 I did wonder how and when. The pull out from Holland looks like an economic disaster in the offing.

I've been adding a few rockhopper on the basis that since oil explorer cos might rocket in five years time as it looks  like the world will be short of prospects.

Sorry if this has been asked I'm on break at work and can't remember seeing it.

SP, I've owned Rockhopper since 2009, I do like it so am tempted to buy some more at these prices, it would at least bring my average loss down!!                                                                                                                               I'm also looking at Harbour Energy. SP do you have a view on Harbour? It was formed after merger, happened March 2021, between the old Premier Oil and Chrysaor. Premier itself had many energy interests around the world including a 60% licensing deal with Rockhopper. Harbour has better financials than the old Premier, and now holds many oil/gas prospects across the globe.                                                                                                                                      @Cattle Prodo  @Cattle Prod hope you don't mind me asking, but do you know of Harbour Energy (premier/chrysaor)? I know you don't like to comment on the small companies as they are far riskier and in the main probably not worth the hassle of owing, however this is now the largest UK independent so any info on its management/strategy or maybe even it's potential reserves that you are at liberty to share would be great to hear.

[DurhamBorn]

The thing with oilies is that due to idiot western politicians their now massive free cash is going on buybacks instead of projects etc.This is the part in the cycle where they would start to invest,but instead they are investing in their own stock.

For us shareholders its great because prices will explode and likely 30% less stock to share it,but society will suffer hugely.

Renewables have big upfront costs,then lower operating,so debts are big and rising rates will cause big problems.

Highly likely later in the cycle that wars start over it.Shells moves are what a huge strong player should do.They have told the Dutch bye bye,and just told the UK we will invest capital somewhere else.I just wish we could get shot of Scotland.

[MrXxxx]

On 03/12/2021 at 19:01, harp said:

David Hunter is saying this is it for PM’s. 
Then says a couple of tweets down that he’s a strategist and doesn’t make timing calls. 
This guy is still a fucking utter COCK!!

 

Brilliant, the day I bought some more PM miners!....am I the new @Yellow_Reduced_Sticker?