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

[Bricormortis]

42 minutes ago, dnb24 said:

https://www.ons.gov.uk/aboutus/transparencyandgovernance/freedomofinformationfoi/covid19deathsandautopsiesfeb2020todec2021

Wow that looks less than 5000.

[MrXxxx]

22 hours ago, Joncrete Cungle said:

While inflation is painfully reducing cash purchasing power in terms of investing would it be better to view it as an opportunity cost? Keep some powder dry and inflation eats away at it. But the powder is there when a good buying opportunity presents itself?

Short term yes, but this is assuming the BK will be 'sooner rather than later' [or at all!].

[DurhamBorn]

25 minutes ago, MrXxxx said:

GOG the new Macbeth?

https://www.business-live.co.uk/enterprise/transport-group-go-ahead-delays-22849014

So it now looks like the end of Feb for FY results...unless of course they delay it for a FOURTH time!?

I can see this going one of two ways, either bombing big time [on negative] or surging up [on good news]. If the latter I think there will be a 'rush for the door' in retail investors so the surge will be short lived.

The transports show why you can be 100% right on the roadmap but lose money and should always be diverse.With fuel costs shooting up for cars and their 3 year hedges they would be now entering a sweet spot and the shares done very well.However due to the government deciding to pay its workers to do nothing and work from home etc they were stuffed.However those very reasons saw Royal Mail quadruple etc.I bought loads of GOG in the March sell off and National Express,but sold them when they both rebounded hard including my original stake.I still own some Stagecoach though down 38% before a few divs.

[MrXxxx]

19 hours ago, DurhamBorn said:

They are connected,state loans from printing allowed unis to be money sinks.

The university 'revolution' was just a way to substitute high youth unemployment/payments for middle age debt. The difference between the two is that with the former the unemployment payments find their way back into the system via essential purchasing i.e. food, whereas with the latter as well as being spent on essentials also a)creates employment/ pays salaries [that are taxable so provides returns], b) some [a small amount] are paid back, c) increases employee work/salary level [supposedly] so higher tax returns, and d) creates overseas income via international education business.

[sleepwello'nights]

1 hour ago, Bricormortis said:

I was a bit shocked to read this re the ONS covid death issue. Haveing downloaded 2 spreadsheets from the ONS re this,  it seems their website is opaque on the issue, no surprise there, I have done a quick further search to corroborate this statistic and have not succeeded. If anyone can corroborate with a link I would be much obliged.

There's also another report that gives an analysis of deaths prepared by the NHS. 

https://view.officeapps.live.com/op/view.aspx?src=https%3A%2F%2Fwww.england.nhs.uk%2Fstatistics%2Fwp-content%2Fuploads%2Fsites%2F2%2F2022%2F01%2FCOVID-19-total-announced-deaths-20-January-2022-weekly-file.xlsx&wdOrigin=BROWSELINK

[MrXxxx]

12 hours ago, wherebee said:

I'd counter that by saying that if inflation is running at 5% (conservative), if you sit waiting for a year to invest to get that perfect price, you have lost 5% immediately AND you might never see the perfect target.

Another counter, if the market drops 20% in a BK; this would be conservative, you could 'afford' to wait for four years to buy and you wouldn't be [bar any divis] worse off!

[Bricormortis]

13 minutes ago, sleepwello'nights said:

There's also another report that gives an analysis of deaths prepared by the NHS. 

https://view.officeapps.live.com/op/view.aspx?src=https%3A%2F%2Fwww.england.nhs.uk%2Fstatistics%2Fwp-content%2Fuploads%2Fsites%2F2%2F2022%2F01%2FCOVID-19-total-announced-deaths-20-January-2022-weekly-file.xlsx&wdOrigin=BROWSELINK

Well I had a look at the death by gender group in the above link which is 103,885 so thats presumably death with covid. So not corroborating the 17000 death toll. Or the 5000 death toll. Statistics eh ?

Still at variance with what the MSM quote though.

[HousePriceMania]

33 minutes ago, MrXxxx said:

Short term yes, but this is assuming the BK will be 'sooner rather than later' [or at all!].

If it takes 5 years for the BKK and the stock market falls 80%.

Are you better off buying now or then ?

It's all in he timing in my opinion, you need to be actively selling if it's collapsing.  I think the FTSE could see a 50% drop but 80% in the US is a distinct possibility right now, people have lost their minds.

[CannonFodder]

@Axeman123 bitcoin at 33k today following a week of decline, i.m reminded of your note about the ceo who bought a ton load at 32k, was it microstrategy? 

That share price will tank.

[Pip321]

2 minutes ago, CannonFodder said:

@Axeman123 bitcoin at 33k today following a week of decline, i.m reminded of your note about the ceo who bought a ton load at 32k, was it microstrategy? 

That share price will tank.

Michael Saylor (owner of Microstrategy) has said he will never sell. Easier to say when it’s other people’s money of course but that’s another debate.
Thing is if he isn’t careful then soon it might be the bankruptcy firm selling BTC on the businesses behalf. 

Never say never. Unless you are James Bond of course.😉

[BadAlchemy]

On 23/01/2022 at 10:01, DurhamBorn said:

It will be interesting to see who makes the first move in the telco sector.It will be obvious now to big capital that their free cash is undervalued in this cycle.Vod would of been a target,but the debt might mean they have a little time to merge areas themselves.I think its obvious now they are going to go down the tobacco route where there are only 3 players per market who only semi compete.If a big US telco tried to buy one it might force the hand of governments here to allow friendly mergers.Orange with Vod could be the outlier deal,but country by country deals might be more likely.

EU/British governments have a choice now.Allow mergers and accept prices drifting up or see big US companies,maybe even big tech buy up the industry.We just need the first trigger.

The debt isnt the main issue for the sector,its ROCE,that needs to be moving higher because that will show the inflation is slowly helping them.Watch for the figures in the telcos next results as it should be starting to feed in a bit now,much more next year.They can then start to de-leverage and slowly increases divs.

https://www.sharecast.com/news/news-and-announcements/vodafone-said-to-have-explored-three-uk-deal-in-talks-over-iliad-tie-up--9078864.html

"Vodafone has reportedly explored a potential acquisition of rival Three UK and been in talks about a potential merger of its Italian business with Iliad.
According to the Mail on Sunday, Vodafone has approached the Hong Kong owners of Three UK about a merger amid rumours the London-listed telecoms group itself could be a takeover target for a predator.

Vodafone held talks late last year with Asian conglomerate CK Hutchison, the owner of Three UK, about buying its rival, The Mail said.

It also said that Vodafone has entered talks with rival Iliad to strike a deal to merge their businesses in Italy, which could make a €6n (£5bn) telecoms powerhouse. According to Reuters, discussions between Vodafone and Iliad are ongoing and both parties are actively studying ways to clinch a tie-up of their respective businesses."

VOD share price moving strongly today. 

Anyone have any thoughts on the take over targets? 

Three UK, as far as I can see, has a ticker of CKHUY on Hargreaves Lansdown. Has moved up about 10 percent over last month. Could there be more upside if a takeover goes ahead or already priced in? No financials listed for them on HL. Will have to have a dig around elsewhere. Hmm...

[sleepwello'nights]

37 minutes ago, Bricormortis said:

Well I had a look at the death by gender group in the above link which is 103,885 so thats presumably death with covid. So not corroborating the 17000 death toll. Or the 5000 death toll. Statistics eh ?

Still at variance with what the MSM quote though.

On the report I referenced have a look at Tab 3 Deaths by condition. The total is 103,885  it analyses the deaths by age group and whether there is a pre existing condition. The NHS report is for those who died in hospital. So the 40k other deaths are those who died elsewhere.

Deaths with a pre existing condition Yes  99178, No 4707

		Pre existing condition
Age group		Yes	No
Total		99,178	4,707
0 - 19 yrs		73	20
20 - 39		764	160
40 - 59		7,257	898
60 - 79		38,350	1,959
80+		52,734	1,669
Unknown age		0	1

[Axeman123]

1 hour ago, HousePriceMania said:

I do like a superimposed graph

Where it gets interesting is that (as of 29/12/21) Microstrategy holds 124,391 BTC, acquired for ~$3.75 billion with an average price of $30,159 each. ~10% down from here puts them at breakeven, then every $1,000 dollars off the BTC price after that wipes out 124 million actual dollars! Even if the CEO remians insane, will his board of directors and institutional shareholders? Capitulation could be spectacular if Microstrategy starts selling. 

EDIT: @CannonFodder @Pip321 Our posts seem to have crossed paths. I assume Saylor will be removed by the BoD if selling is required, and that announcement will likely be the starting pistol for carnage. I would take his message about never selling as a sign that he is already under pressure to do so.

MSTR Futures share price 330 USD, 52 week high 1315! USD!

[Hancock]

13 hours ago, Harley said:

Regulatory capture.  Happened here, happening everywhere.

You sound like you have an awareness of what the FCA are currently being accused of?

[geordie_lurch]

Gazprom (OGZD) down 12% currently at $7.16 - I think I added more of these a little early last week

However these were bought for the cycle and their dividends so I will try and tune out of their prices for a while oh and hope nothing kicks off in Ukraine

[belfastchild]

On 23/01/2022 at 00:05, DurhamBorn said:

I should add,the Siemens story is why i banged on and on about it being crucial to own companies with very high fixed assets even if they were funded with a lot of debt to equity as long as coupons were fixed etc and depreciating at a set rate because people adding assets now will have to pay much more for the assets themselves and the debt to fund them.Bullseye.

 

Siemens saw it coming themselves.
Im up 90% in Siemens and they floated off Siemens energy since I bought them in 2020 (free shares) so thats another 10% even with the drop.
At the time, couldnt help thinking they wanted rid and ESG would lap it up.

 

On 23/01/2022 at 10:01, DurhamBorn said:

EU/British governments have a choice now.Allow mergers and accept prices drifting up or see big US companies,maybe even big tech buy up the industry.We just need the first trigger.

Big Tech may actually need to do this due to net neutrality. As you have pointed out in the past it will also provide a source of true cashflow.

 

Had a few alcohol fuelled chats with people over the weekend and the subject of the 15 quid universal credit broadband with BT and Virgin came up. After initial outrage it was mentioned that it might be a good idea by the government (although, sadly, the idea of the goverment using it properly is doubted) to solve a lot of the problems/fraud. Living alone with no parter? Broadband/phone banking/UC app logs say no. Probably too much joined up thinking for government departments.

[Yellow_Reduced_Sticker]

Fookinhell...VOD ROCKETING today AND thats in a DOWN market!

 

I was hoping to buy my last ladder at around a quid, sometimes it just does NOT pay to be a... TIGHTWAD!

 

[HousePriceMania]

52 minutes ago, CannonFodder said:

@Axeman123 bitcoin at 33k today following a week of decline, i.m reminded of your note about the ceo who bought a ton load at 32k, was it microstrategy? 

That share price will tank.

It already has!!!

 

It's down over 50% since peak

 

[DurhamBorn]

54 minutes ago, Pip321 said:

Michael Saylor (owner of Microstrategy) has said he will never sell. Easier to say when it’s other people’s money of course but that’s another debate.
Thing is if he isn’t careful then soon it might be the bankruptcy firm selling BTC on the businesses behalf. 

Never say never. Unless you are James Bond of course.😉

Obvious he is a liar then.If you never sell any of an "asset" that doesnt produce any income then you will never get any benefit from the investment.Its like all the youngsters and their doge to the moon crap.Their investment provides no income and never will so cant be priced,hence easy for conmen to convince its to the moon as nothing to price it off.Most of crypto is going down 99.99999999%.None of it is investing,its gambling and thats fine if you know its gambling.The young crypto investors are the modern version of my uncle who used to have a bet every day.He simply picked four horses and hoped for the best,that chance.

 

[AWW]

2 minutes ago, DurhamBorn said:

Their investment provides no income and never will so cant be priced

Some cryptos support something called "staking", which is akin to depositing cash in an interest-bearing account and does provide yield - usually far higher than interest rates.

I still don't see a use case for cryptos that's not better-served by other asset classes though.  As currencies and stores of value, they're absolutely terrible.  They're purely a speculative vehicle and this, for me, this is why they will eventually be worth zero.

[DurhamBorn]

26 minutes ago, Yellow_Reduced_Sticker said:

Fookinhell...VOD ROCKETING today AND thats in a DOWN market!

 

I was hoping to buy my last ladder at around a quid, sometimes it just does NOT pay to be a... TIGHTWAD!

 

I noticed my portfolio was well up today,2.2% outperformance.It will be interesting to see if the rotation keeps going or if growth/bubble sucks people back in David Hunter style.A few month out i expect active asset managers will see inflows turn positive next as money heads to emerging markets and value.

[Bricormortis]

3 minutes ago, AWW said:

Some cryptos support something called "staking", which is akin to depositing cash in an interest-bearing account and does provide yield - usually far higher than interest rates.

I still don't see a use case for cryptos that's not better-served by other asset classes though.  As currencies and stores of value, they're absolutely terrible.  They're purely a speculative vehicle and this, for me, this is why they will eventually be worth zero.

They will likely always have a bit of value because of their utility in the 3rd world. For instance El Salvador derives a large part of its national income from money sent from the US. But to recieve it has meant relatives going on a 6 hour bus journer to the western union office, and getting taxed by gangs hanging outside, now with bitcoin, gamechanger. Similar story in Nigeria I am led to understand, if you want to buy an item from abroad its prohibitive, bitcoin no problem.

[M S E Refugee]

1 hour ago, geordie_lurch said:

Gazprom (OGZD) down 12% currently at $7.16 - I think I added more of these a little early last week

However these were bought for the cycle and their dividends so I will try and tune out of their prices for a while oh and hope nothing kicks off in Ukraine

My ishares Eastern Europe etf is taking a pounding.

[HousePriceMania]

16 minutes ago, DurhamBorn said:

I noticed my portfolio was well up today,2.2% outperformance.It will be interesting to see if the rotation keeps going or if growth/bubble sucks people back in David Hunter style.A few month out i expect active asset managers will see inflows turn positive next as money heads to emerging markets and value.

I bought 4 of them last week...and some more BP/RDSB/REPSOL

Cant win them all 

I've taken up "shorting" companies I think are massively over priced  as a bit of a hobby, not risking much money.

It has the feeling on Summer 2020 when you could buy any old crap and make £££s

Bought these last Wed.

 

Look at these gains since the financial system collapsed, it's insanity!!!

 

They could of course shoot up, but right now I'd be surprised if they do

 

[wherebee]

16 minutes ago, Bricormortis said:

They will likely always have a bit of value because of their utility in the 3rd world. For instance El Salvador derives a large part of its national income from money sent from the US. But to recieve it has meant relatives going on a 6 hour bus journer to the western union office, and getting taxed by gangs hanging outside, now with bitcoin, gamechanger. Similar story in Nigeria I am led to understand, if you want to buy an item from abroad its prohibitive, bitcoin no problem.

as western governments continue to undermine the rule of law, what is attractive about bitcoin to those '3rd world' communities will become attractive to our '1st world'./.