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

[Hardhat]

15 minutes ago, BurntBread said:

I like the idea that this thread (especially the leading posters) has essentially re-built the capabilities of the old Fidelity Investments department (at least if @nirvana eases off on the drugs).

From what I hear from friends in city banks we probably aren't doing enough drugs...

[MrXxxx]

2 hours ago, HousePriceMania said:

Thats the excuse scumbag money grabbing ****s at "charities" give for paying six figure salaries. What a horrible bunch of ****s the people at the top in the UK are.

....and don't forget VCs at universities!

[Animal Spirits]

3 hours ago, kibuc said:

Unemployment only counts people in the market for work. Participation rate is low (and lower than previous reading), so it's mostly people not being arsed about looking for a job.

Yes, I mentioned this in the Furlough thread:

The BLS have various data series of employment and unemployment, one of which removes people not looking for work entirely even though they could work or count as a potential worker. Some of its collected by survey.

A few considerations:

• Lower employement prospects post 2008
• Offshoring and automation
• Retirement
• Stimmy cheques
• Cash only informal/gig work

 

[Bobthebuilder]

My PM miners are starting to look a little bit better, early days yet I know, but hold the front page......CNA at 60p?

Been thinking of adding more BATS recently, saw others here doing this today so, doubled my holding.

Oilles are very nice, Repsol 60%+ and Shell not so far behind.

Rolls-Royce up 30%.

Guinness global energy doing nicely as well.

Think I will treat myself to a kebab and a Lidl Perlenbacher lager or two tonight.

Thanks all, you are amazing.

[Noallegiance]

 

[Castlevania]

39 minutes ago, Bobthebuilder said:

Think I will treat myself to a kebab and a Lidl Perlenbacher lager or two tonight

[Castlevania]

@Bobthebuilder living the dream  

[Noallegiance]

What's a good $ exposure in a SIPP?

[Castlevania]

15 minutes ago, Noallegiance said:

What's a good $ exposure in a SIPP?

Buying dollars. There are money market funds out there.

[JimmyTheBruce]

10 hours ago, Castlevania said:

Sibanye have union wage negotiations for their South African gold mining operations coming up. The South African mining unions are notoriously militant, and have seemingly set aside their differences (they used to hate each other) to negotiate as one. The last round of negotiations three years ago wasn’t exactly harmonious. Harmony agreed a 20% rise over three years a few weeks ago. Would expect Sibanye to have to pay something similar or risk strikes.

Also, Sibanye’s stock price due to their huge platinum operations, tends to oscillate wildly with times when it acts as a cyclical industrial stock and others where it follows other gold miners. It’s a tough one to trade.

Thanks CV.  Hope you don't mind me asking, but where do you get hold of this level of detail?  Do you trawl through the quarterly reports or have you got a secret source?

[Castlevania]

10 minutes ago, JimmyTheBruce said:

Thanks CV.  Hope you don't mind me asking, but where do you get hold of this level of detail?  Do you trawl through the quarterly reports or have you got a secret source?

I was trying to find out why Harmony’s stock dropped by ~10% a month or so ago when other gold miners didn’t take a hit and found an article that explained it well. I just regurgitated what I remembered in my earlier post. Will have a look if I can find it.

I’m also friends with the daughter of one of the union negotiators for a certain platinum mining company. He sleeps with a gun beneath his pillow. The South African mining unions make Scargill’s lot look like amateurs.

[DurhamBorn]

3 hours ago, Bobthebuilder said:

My PM miners are starting to look a little bit better, early days yet I know, but hold the front page......CNA at 60p?

Been thinking of adding more BATS recently, saw others here doing this today so, doubled my holding.

Oilles are very nice, Repsol 60%+ and Shell not so far behind.

Rolls-Royce up 30%.

Guinness global energy doing nicely as well.

Think I will treat myself to a kebab and a Lidl Perlenbacher lager or two tonight.

Thanks all, you are amazing.

Funny enough i bought some BAT today but it was a straight sell of some Imperial moved to BAT.In capital terms i was up 10% on Imperial level on BAT,but my Imperial holding was nearly as big as BAT and although im happy to hold both here iv always had IMPs at 60% of my BAT holdings so juggled them a bit.

I also sold a few of the Scottish Play,id bought a large amount at 49p a few weeks ago so sold them down a bit and moved that into Orange SA.Holding the rest,they getting close to a breakeven  .

I had to go to Morrisons though,the Pizza Express Passata is on offer 50p thats an incredible price.It wasnt on shelf though,only on top of the shelf,so i went and got one of those ladder things they use and climbed up and got it all.Could be they only selling to online customers,but it went through the till fine at 50p,anyone near Morrisons get stocked up,2 year date on it,so 2 year and 6 months be fine.

https://groceries.morrisons.com/products/pizza-express-passata-566315011

The course semolina flour is on offer in Sainsbury's as well so stocked up.Perfect for dusting the bottom of the pizza bases with and mixing a small amount into the dough,as someone said on here makes the bases taste like Dominoes but we get 10 for what 1 costs there.

https://www.sainsburys.co.uk/gol-ui/product/bigger-packs-208331-44/natco-semolina-coarse-15kg

[Don Coglione]

6 minutes ago, DurhamBorn said:

Funny enough i bought some BAT today but it was a straight sell of some Imperial moved to BAT.In capital terms i was up 10% on Imperial level on BAT,but my Imperial holding was nearly as big as BAT and although im happy to hold both here iv always had IMPs at 60% of my BAT holdings so juggled them a bit.

I also sold a few of the Scottish Play,id bought a large amount at 49p a few weeks ago so sold them down a bit and moved that into Orange SA.Holding the rest,they getting close to a breakeven  .

I had to go to Morrisons though,the Pizza Express Passata is on offer 50p thats an incredible price.It wasnt on shelf though,only on top of the shelf,so i went and got one of those ladder things they use and climbed up and got it all.Could be they only selling to online customers,but it went through the till fine at 50p,anyone near Morrisons get stocked up,2 year date on it,so 2 year and 6 months be fine.

https://groceries.morrisons.com/products/pizza-express-passata-566315011

The course semolina flour is on offer in Sainsbury's as well so stocked up.Perfect for dusting the bottom of the pizza bases with and mixing a small amount into the dought,as someone said on here makes the bases taste like Dominoes but we get 10 for what 1 costs there.

https://www.sainsburys.co.uk/gol-ui/product/bigger-packs-208331-44/natco-semolina-coarse-15kg

DB, 

If you hadn't shagged 100+ women, I would be seriously worried about you at this point; as it is, for the sake of the (many) incels/virgins on this site, make clear that frugality and celibacy and successful investing are not mutually exclusive!

[Hancock]

3 hours ago, Bobthebuilder said:

Think I will treat myself to a kebab and a Lidl Perlenbacher lager or two tonight.

Which i could afford such luxuries. But i've had a bad week, 2 punctures in 3 days = £200, done my back in at the gym which = £50 for Osteopath  and other £50 in 2 weeks .. bought some dreadful noodles from Wok2go for me and the kid costing £15 that went in the bin and then gave me the trots.

But on the plus side my SIPP might be crashing according to the BOE as interest rates could spike!

https://www.telegraph.co.uk/business/2021/10/08/bank-warns-market-shock-higher-rates-inflation/

Stock markets are at risk of crashing around the world if an investor panic takes hold over stagnation and higher interest rates as prices jump, the Bank of England has warned.

Officials at Threadneedle Street said there is a danger that share prices will "correct sharply" in coming months following a spate of risky bets by investors.

It comes amid fears of an inflationary spiral as labour shortages and a surge in energy costs push up the price of everything from toys to steel. There are signs that increases are becoming embedded in the labour market, with starting salaries rising at their fastest rates in 24 years according to a survey released on Friday by the Recruitment and Employment Federation.

A report by the Bank's Financial Policy Committee (FPC) said that a rally which has pushed share prices to record highs “partly reflects the improved economic outlook, but may also reflect a ‘search for yield’ and higher risk‐taking in a low interest rate environment".

It added: “Asset valuations could correct sharply if, for example, market participants re‐evaluate the prospects for growth, inflation or interest rates.”

Fears are growing that the West will be plunged into a bout of so-called stagflation, where prices rise but economic growth remains sluggish. This risks sparking a cost of living crisis and destroying the value of assets, forcing central banks to combat the increases by raising interest rates.

The US stock market sagged last month, stumbling from record highs amid worries high inflation will prove stronger and longer-lasting than had been expected.

In Britain, households are facing particular pressure as energy prices surge and driver shortages exacerbate supply problems.

On Thursday, the Bank of England’s new chief economist, Huw Pill, warned the duration and scale of price increases was “proving greater than expected”.

Further data released by the Bank and the Financial Conduct Authority showed that a fifth of UK mortgage holders would be exposed to a rise in the interest rate.

More than 21pc of outstanding residential mortgages had variable rates at the end of June which could climb if the benchmark is lifted, piling further cost-of-living pressures on 1.9m households. Collectively, vulnerable households are sitting on home loans worth more than £300bn.

Money markets are pricing in the first rate increase by the end of the year, lifting it off its current all-time low of 0.1pc.

Further increases are expected by September next year, taking the rate to  0.75pc.

UK bond yields hit their highest level relative to German bunds since 2016 on Friday, a signal that traders expect inflation in Britain to outstrip Europe’s top economy over the coming decade.

The Bank added that there are signs that investment banks are beginning to take on more debt, though officials stressed the UK’s financial system is sufficiently resilient to potential shocks.

Its report also warned of a potential spillover from the crisis at Evergrande, one of China‘s biggest property developers, which is facing a default on its debts.

Officials said the company’s troubles “could pose risks to the wider property sector in China with potential spillovers internationally”.

The Bank also warned over a debt time-bomb threatening Britain’s small businesses, saying they have been borrowing at a significantly faster rate than larger companies.

Huge numbers of small companies took on extra debt to weather the pandemic, much of it through government-backed schemes. Their debt levels have jumped by a quarter during the pandemic, versus a rise of just 2pc for large firms, the Bank said.

Companies built up about £80bn in loans overall, some of which they are now beginning to repay.

The FPC said: “Significantly more [small companies] now have debt to service, and while the majority of new debt was relatively cheap due to government loan schemes, this will add to pressure on weaker [businesses]."

It comes amid signs of increasing pessimism over the British economy.

Bank of America’s gauge of UK consumer confidence has continued to slip in the past two weeks, falling to its lowest level since April in a move analysts said was driven by tax hikes, [the] energy crisis, Covid cases, shortages and inflation.

The figures come ahead of new GDP data next week, which economists believe are likely to show that August was a last hurrah for post-lockdown growth before inflation and economic disorder began to bite.

Sanjay Raja from Deutsche Bank predicted monthly growth of 0.3pc, an acceleration from a narrow gain in July.

He said: “We don't think that the pick up in growth will last very long, however – at least not while supply side constraints continue to hamper demand.

“With supply frictions rising, inflation biting, and confidence falling, we expect the rest of the year to see a more notable slowdown in activity.”

[Loki]

6 minutes ago, Hancock said:

there is a danger that share prices will "correct sharply" in coming months

Before or after a "parabolic blow off top" though? That's the question...if taken at face value, will the officials be right? Are they ever right? 

[Castlevania]

3 minutes ago, Loki said:

Before or after a "parabolic blow off top" though? That's the question...if taken at face value, will the officials be right? Are they ever right? 

Rarely

[Loki]

3 minutes ago, Castlevania said:

Rarely

It's a brilliant statement though

Quote

Officials at Threadneedle Street said there is a danger that share prices will "correct sharply" in coming months following a spate of risky bets by investors.

 

Yes it's those pesky investors

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

[Hancock]

7 minutes ago, Loki said:

Before or after a "parabolic blow off top" though? That's the question...if taken at face value, will the officials be right? Are they ever right? 

I don't think anyone knows what's going on anymore, whether its the stock market or just life.

The new normal isn't normal/

[Loki]

4 minutes ago, Hancock said:

 

The new normal isn't normal/

１ ｃａｒｂｏｎｃｏｉｎ ｈａｓ ｂｅｅｎ ｄｅｄｕｃｔｅｄ

ｆｒｏｍ ｙｏｕｒ ａｃｃｏｕｎt．

[Bobthebuilder]

59 minutes ago, Hancock said:

Which i could afford such luxuries. But i've had a bad week, 2 punctures in 3 days = £200, done my back in at the gym which = £50 for Osteopath  and other £50 in 2 weeks .. bought some dreadful noodles from Wok2go for me and the kid costing £15 that went in the bin and then gave me the trots.

But on the plus side my SIPP might be crashing according to the BOE as interest rates could spike!

https://www.telegraph.co.uk/business/2021/10/08/bank-warns-market-shock-higher-rates-inflation/

Stock markets are at risk of crashing around the world if an investor panic takes hold over stagnation and higher interest rates as prices jump, the Bank of England has warned.

Officials at Threadneedle Street said there is a danger that share prices will "correct sharply" in coming months following a spate of risky bets by investors.

It comes amid fears of an inflationary spiral as labour shortages and a surge in energy costs push up the price of everything from toys to steel. There are signs that increases are becoming embedded in the labour market, with starting salaries rising at their fastest rates in 24 years according to a survey released on Friday by the Recruitment and Employment Federation.

A report by the Bank's Financial Policy Committee (FPC) said that a rally which has pushed share prices to record highs “partly reflects the improved economic outlook, but may also reflect a ‘search for yield’ and higher risk‐taking in a low interest rate environment".

It added: “Asset valuations could correct sharply if, for example, market participants re‐evaluate the prospects for growth, inflation or interest rates.”

Fears are growing that the West will be plunged into a bout of so-called stagflation, where prices rise but economic growth remains sluggish. This risks sparking a cost of living crisis and destroying the value of assets, forcing central banks to combat the increases by raising interest rates.

The US stock market sagged last month, stumbling from record highs amid worries high inflation will prove stronger and longer-lasting than had been expected.

In Britain, households are facing particular pressure as energy prices surge and driver shortages exacerbate supply problems.

On Thursday, the Bank of England’s new chief economist, Huw Pill, warned the duration and scale of price increases was “proving greater than expected”.

Further data released by the Bank and the Financial Conduct Authority showed that a fifth of UK mortgage holders would be exposed to a rise in the interest rate.

More than 21pc of outstanding residential mortgages had variable rates at the end of June which could climb if the benchmark is lifted, piling further cost-of-living pressures on 1.9m households. Collectively, vulnerable households are sitting on home loans worth more than £300bn.

Money markets are pricing in the first rate increase by the end of the year, lifting it off its current all-time low of 0.1pc.

Further increases are expected by September next year, taking the rate to  0.75pc.

UK bond yields hit their highest level relative to German bunds since 2016 on Friday, a signal that traders expect inflation in Britain to outstrip Europe’s top economy over the coming decade.

The Bank added that there are signs that investment banks are beginning to take on more debt, though officials stressed the UK’s financial system is sufficiently resilient to potential shocks.

Its report also warned of a potential spillover from the crisis at Evergrande, one of China‘s biggest property developers, which is facing a default on its debts.

Officials said the company’s troubles “could pose risks to the wider property sector in China with potential spillovers internationally”.

The Bank also warned over a debt time-bomb threatening Britain’s small businesses, saying they have been borrowing at a significantly faster rate than larger companies.

Huge numbers of small companies took on extra debt to weather the pandemic, much of it through government-backed schemes. Their debt levels have jumped by a quarter during the pandemic, versus a rise of just 2pc for large firms, the Bank said.

Companies built up about £80bn in loans overall, some of which they are now beginning to repay.

The FPC said: “Significantly more [small companies] now have debt to service, and while the majority of new debt was relatively cheap due to government loan schemes, this will add to pressure on weaker [businesses]."

It comes amid signs of increasing pessimism over the British economy.

Bank of America’s gauge of UK consumer confidence has continued to slip in the past two weeks, falling to its lowest level since April in a move analysts said was driven by tax hikes, [the] energy crisis, Covid cases, shortages and inflation.

The figures come ahead of new GDP data next week, which economists believe are likely to show that August was a last hurrah for post-lockdown growth before inflation and economic disorder began to bite.

Sanjay Raja from Deutsche Bank predicted monthly growth of 0.3pc, an acceleration from a narrow gain in July.

He said: “We don't think that the pick up in growth will last very long, however – at least not while supply side constraints continue to hamper demand.

“With supply frictions rising, inflation biting, and confidence falling, we expect the rest of the year to see a more notable slowdown in activity.”

Crikey, @Hancock I haven't even finished my kebab yet.

[Bobthebuilder]

1 hour ago, DurhamBorn said:

The course semolina flour is on offer in Sainsbury's as well so stocked up.Perfect for dusting the bottom of the pizza bases with and mixing a small amount into the dough,as someone said on here makes the bases taste like Dominoes but we get 10 for what 1 costs there.

I could talk for hours about cooking, my Ma died when I was 16, so I had to learn to fend for myself. Ended up at a young age working in hotel kitchens, learnt to cook and more importantly, learnt how to make money from raw ingredients. I am lucky in the fact I have lots of Turkish supermarkets near me in London, trust me those Turks know their food, bargains to be had I tell thee.

My old man died 4 years ago last month, I found your thread because I ended up with a large inheritance and did not know what to do with it.

Thank you for everything so far, I really appreciate it.

Bob.

[ThoughtCriminal]

Says it all really. 

 

Also, love the fact someone has set up a twitter account to publicise and continually update scumbag Pelosis's insider trading portfolio 😂

[JMD]

6 hours ago, Castlevania said:

No, you are exposed to the price of silver in GBP regardless. You buy one ounce of silver - it doesn’t matter what currency you pay because what you own is one ounce of silver.

Thanks again Castelvania, and i think I do understand what your saying in terms of the commodity price value of the silver within the fund. However when it came to actually selling, and if the pound for example had risen against the dollar, wouldn't I then get correspondingly 'fewer' pounds if I took settlement in pounds?                                                                                                                                                                                      Isn't this the main reason why investors buy or hold assets in a foreign currency, in order to hedge against the risk of their own currency falling against that other currency? ...Excuse my myopic question, but I had a specific idea in mind (not hedging btw, but merely 'cashing in' the silver fund in future and to exchange for physical gold, after gsr favors that swop) and I'd hate to think my planning was ill conceived, or just plain wrong! Not asking for advice of course, just enquiring about the mechanics of this.

[goldbug9999]

1 hour ago, Hancock said:

Which i could afford such luxuries. But i've had a bad week, 2 punctures in 3 days = £200, done my back in at the gym which = £50 for Osteopath  and other £50 in 2 weeks .. bought some dreadful noodles from Wok2go for me and the kid costing £15 that went in the bin and then gave me the trots.

But on the plus side my SIPP might be crashing according to the BOE as interest rates could spike!

https://www.telegraph.co.uk/business/2021/10/08/bank-warns-market-shock-higher-rates-inflation/

Stock markets are at risk of crashing around the world if an investor panic takes hold over stagnation and higher interest rates as prices jump, the Bank of England has warned.

Officials at Threadneedle Street said there is a danger that share prices will "correct sharply" in coming months following a spate of risky bets by investors.

It comes amid fears of an inflationary spiral as labour shortages and a surge in energy costs push up the price of everything from toys to steel. There are signs that increases are becoming embedded in the labour market, with starting salaries rising at their fastest rates in 24 years according to a survey released on Friday by the Recruitment and Employment Federation.

A report by the Bank's Financial Policy Committee (FPC) said that a rally which has pushed share prices to record highs “partly reflects the improved economic outlook, but may also reflect a ‘search for yield’ and higher risk‐taking in a low interest rate environment".

It added: “Asset valuations could correct sharply if, for example, market participants re‐evaluate the prospects for growth, inflation or interest rates.”

Fears are growing that the West will be plunged into a bout of so-called stagflation, where prices rise but economic growth remains sluggish. This risks sparking a cost of living crisis and destroying the value of assets, forcing central banks to combat the increases by raising interest rates.

The US stock market sagged last month, stumbling from record highs amid worries high inflation will prove stronger and longer-lasting than had been expected.

In Britain, households are facing particular pressure as energy prices surge and driver shortages exacerbate supply problems.

On Thursday, the Bank of England’s new chief economist, Huw Pill, warned the duration and scale of price increases was “proving greater than expected”.

Further data released by the Bank and the Financial Conduct Authority showed that a fifth of UK mortgage holders would be exposed to a rise in the interest rate.

More than 21pc of outstanding residential mortgages had variable rates at the end of June which could climb if the benchmark is lifted, piling further cost-of-living pressures on 1.9m households. Collectively, vulnerable households are sitting on home loans worth more than £300bn.

Money markets are pricing in the first rate increase by the end of the year, lifting it off its current all-time low of 0.1pc.

Further increases are expected by September next year, taking the rate to  0.75pc.

UK bond yields hit their highest level relative to German bunds since 2016 on Friday, a signal that traders expect inflation in Britain to outstrip Europe’s top economy over the coming decade.

The Bank added that there are signs that investment banks are beginning to take on more debt, though officials stressed the UK’s financial system is sufficiently resilient to potential shocks.

Its report also warned of a potential spillover from the crisis at Evergrande, one of China‘s biggest property developers, which is facing a default on its debts.

Officials said the company’s troubles “could pose risks to the wider property sector in China with potential spillovers internationally”.

The Bank also warned over a debt time-bomb threatening Britain’s small businesses, saying they have been borrowing at a significantly faster rate than larger companies.

Huge numbers of small companies took on extra debt to weather the pandemic, much of it through government-backed schemes. Their debt levels have jumped by a quarter during the pandemic, versus a rise of just 2pc for large firms, the Bank said.

Companies built up about £80bn in loans overall, some of which they are now beginning to repay.

The FPC said: “Significantly more [small companies] now have debt to service, and while the majority of new debt was relatively cheap due to government loan schemes, this will add to pressure on weaker [businesses]."

It comes amid signs of increasing pessimism over the British economy.

Bank of America’s gauge of UK consumer confidence has continued to slip in the past two weeks, falling to its lowest level since April in a move analysts said was driven by tax hikes, [the] energy crisis, Covid cases, shortages and inflation.

The figures come ahead of new GDP data next week, which economists believe are likely to show that August was a last hurrah for post-lockdown growth before inflation and economic disorder began to bite.

Sanjay Raja from Deutsche Bank predicted monthly growth of 0.3pc, an acceleration from a narrow gain in July.

He said: “We don't think that the pick up in growth will last very long, however – at least not while supply side constraints continue to hamper demand.

“With supply frictions rising, inflation biting, and confidence falling, we expect the rest of the year to see a more notable slowdown in activity.”

TLDR: Bank of england in hand over fist money printing causes inflation shocker.

[DurhamBorn]

2 hours ago, Don Coglione said:

DB, 

If you hadn't shagged 100+ women, I would be seriously worried about you at this point; as it is, for the sake of the (many) incels/virgins on this site, make clear that frugality and celibacy and successful investing are not mutually exclusive!

Its closer to 150  ,and given i dumped someone who played hockey for England once and a bikini model because they were high maintenance and i knew i needed to find myself a nurse to make sure i could avoid nursing home fees and protect capital in my dotage i dont think i can split them im afraid.Remember ,during a reflation cycle, being able to cook lovely, healthy, cheap food will be a 100% certain way to see women using their knickers to keep their ankles warm in your presence ,the roadmap is everything,leads and lags