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


spunko

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Just now, Bobthebuilder said:

I bought BP too early, bought a couple more chunks during 2020, but my timing was bad. I am just about evens here with them as of today. Some others here caught the bottom and will be well in the green.

Exactly the same with me, except I broke even on Monday xD:Beer:

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14 minutes ago, Loki said:

Exactly the same with me, except I broke even on Monday xD:Beer:

If in 2019 someone had said you'll get BP for 340p and have had a couple of years divis, you'd have been delighted.

So the question is why are people questioning buying in at this price! (of which i suppose there is no answer)

 

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5 minutes ago, Hancock said:

If in 2019 someone had said you'll get BP for 340p and have had a couple of years divis, you'd have been delighted.

So the question is why are people questioning buying in at this price! (of which i suppose there is no answer)

 

I started buying in December 2019, so I've caught the downward trend quite nicely really, always nice to be break even though (And HL include trading costs in that too)

Only thing stopping me buying more is a couple of posts recently that they've bought into the eco-loonery and stopped exploration

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14 hours ago, JimmyTheBruce said:

I'd have another look around now if I was you.  I was on a 10 year fix at 2.4%, and, even with the ERC, the current rates are so low that it made sense for me to switch.

I have a penalty I think to change, but I might ask my mortgage advisor if there is anything to be had..

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1 hour ago, Hancock said:

If in 2019 someone had said you'll get BP for 340p and have had a couple of years divis, you'd have been delighted.

So the question is why are people questioning buying in at this price! (of which i suppose there is no answer)

 

Agree and yes in 2018 when it was well over £5 I'd have snatched your hand off. Also see WICAO buying Shell at £26 in c.2014. If I'd had the money I'd have done that too 

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35 minutes ago, Heart's Ease said:

Agree and yes in 2018 when it was well over £5 I'd have snatched your hand off. Also see WICAO buying Shell at £26 in c.2014. If I'd had the money I'd have done that too 

What ever became of WICAO?

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I don't think think things have changed in the long term.

Still too much debt. Still a massive bubble in everything. Still most people looking the wrong way.

There will be a BK. How can there not be? In recent decades we've just lurched from one financial crisis to the next.

It'll happen and everyone on this thread will be able to load up.

hold-fast.jpg

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4 hours ago, belfastchild said:

Reduction of coal fired stations and nuclear.
Increase in renewables hasnt filled the gap.
Theres a rumour that the move to low energy lighting was to save building a power station or two!
Offshoring manufacturing helped.
Efficiencies will continue at a smaller rate, most lighting, a rated appliances.
Electric heating and electric cars on the other hand....

Thanks. Your points are valid, so the website's use of term 'efficiencies' was very misleading i think. Site is run by an avid supporter of RE so some bias going on I think, but it is interesting to see his blinkered view clouding his judgement imo. However his charts are still good I think. Anyway, takeway is that onshoring, electric cars/heating will send electricity demand up and in the opposite direction.  

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4 hours ago, Noallegiance said:

Similarly with only selling profits. Taking chips of the table but still being in the game in rising stocks is a winner.

Plus rotating those profits into other stocks means potentially compounding your returns, and which is the real investment power play to aim for. 

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Talking Monkey
4 hours ago, Hancock said:

If in 2019 someone had said you'll get BP for 340p and have had a couple of years divis, you'd have been delighted.

So the question is why are people questioning buying in at this price! (of which i suppose there is no answer)

 

I was actually thinking about this today and my view is if somebody wasn't already holding BP and  understood and agreed the thesis we have here then today's price is perfectly fine to go in for a first ladder. 

20 to 25% as a first ladder of the total amount destined for BP. 

As to why people are questioning it is because they've seem the volatility and how its gone a fair bit lower than 340 at times over the past 18 months. But if holding for the cycle and if one really buys into the thesis then any anxiety is not really warranted. One almost never gets an optimal entry and exit. 

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1 hour ago, JREWING said:

Cashed out of BP yesterday. It hurt. Held them for a year nice income. Ave 2.5. But after tax was £39.5k profit. Too much to say bye too if it drops again. If it goes higher I'm in the 20% tax band on profits. I hope it goes to £5 for you guys and girls. Me I need a deposit for a shed, well slave box. Also I'm so underwater on my miners. I'm in need of a snorkel. Hoc and Poly are in a kamikaze nosedive. 

Selfish side of me hopes BP goes down to 289p. But I've feeling its going up. Some good guys on here. Good luck all. 

 

wouldn't you then sell those, crystallise the losses to offset the profits on the BP to lower your tax burden, and then buy the miners back after the required period (I think 28 days in many countries)?

 

DYOR etc etc

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18 hours ago, JMD said:

I have a large amount invested in two silver etf's, one is denominated in dollars, the other is in pounds. I bought them couple years back, and intended to sell half (take profit) when the silver price had increased sufficently, and then will leave the remainder in for the rest of the cycle.

I am still waiting to sell 'half' when/if silver goes up, later this year hopefully. But has anyone a view on which to sell? I am thinking of simply ditching the dollar denominated silver etf in order to remove future currency risk.

I wonder, what would others do?

I don't want to derail your focus @JMD, but why do people buy silver/gold paper ETF's with not return and running costs of ~ 0.3-0.6% per annum, when they can get exposure to the same commodities through silver/gold miners and get a dividend return of ~2-3%+?

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34 minutes ago, MrXxxx said:

I don't want to derail your focus @JMD, but why do people buy silver/gold paper ETF's with not return and running costs of ~ 0.3-0.6% per annum, when they can get exposure to the same commodities through silver/gold miners and get a dividend return of ~2-3%+?

because, take GDXJ as an example, you get a bucket of small miners which spreads risk.  Small miners do go bust.  If you buy each one, you pay a fee for each purchase.  If you buy one small miner, you might lose everything.

GDXJ means that if gold goes to da moon, you profit across all of those.  I bought GDXJ years ago as a bit of an insurance, sold 70% of holdings at around 45 in 2020, from memory, and had bought at 25.  That's a nice return, and had all that insurance as well for the period.  If the collapse had come when we were out of Australia, we could have seen GDXJ up to 100 or more, in my view.  They also gave small dividends on the way.

I also hold PSLV, which is showing a loss, because they hold real silver and help with the silver squeeze on the rigged market.

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19 minutes ago, wherebee said:

because, take GDXJ as an example, you get a bucket of small miners which spreads risk.  Small miners do go bust.  If you buy each one, you pay a fee for each purchase.  If you buy one small miner, you might lose everything.

GDXJ means that if gold goes to da moon, you profit across all of those.  I bought GDXJ years ago as a bit of an insurance, sold 70% of holdings at around 45 in 2020, from memory, and had bought at 25.  That's a nice return, and had all that insurance as well for the period.  If the collapse had come when we were out of Australia, we could have seen GDXJ up to 100 or more, in my view.  They also gave small dividends on the way.

I also hold PSLV, which is showing a loss, because they hold real silver and help with the silver squeeze on the rigged market.

Fair comment regarding juniors (although there is the 'less' risky GDGB/GDX), but what about buying a few [3-5] larger miners, where you dont have the annual charge?

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HousePriceMania
12 hours ago, Hancock said:

If in 2019 someone had said you'll get BP for 340p and have had a couple of years divis, you'd have been delighted.

So the question is why are people questioning buying in at this price! (of which i suppose there is no answer)

 

I look at it 2 ways

1) relative to start of 2020 these oil shares are trading at a 30% discount.  All this green energy stuff wont happen without oll and even when it does the oil companies, the ones with vast wealth, will be buying up the successful energy companies.  There's a chance these oil shares are heading 10/20/30/40% up in a small space of time if the BKK doesn't hit.

2) From 2008 onwards, they printed and they saved the stock market/banks/housing makret, followed by the longest bull run in history ( 10 years ), I remember there was an inflationary blip which disappeared quite quickly. I did not partake of that party.

The only difference I see now is the threat of the central banker cartel ( BoE/ECB/FED ) raising IRs.  They clearly have no intention of doing so, US house prices up 20% and inflation well over 5%. Any sane man would have already acted.  

So some questions:

1) Do you see the free money ending ?

2) Do you see the IRs rising significantly ?

3) If a collapse comes which shares would you be prepared to hold long term ?

4) If you sell out and the BKK doesnt hit, when do you buy back in ?

The CBC are making the right noises, but they've been doing that since 2009, but do you see them actually doing anything ?

We gave 3 central banks totally disregarding inflation so they can keep an asset bubble gong, if they stop it collapses on their watch, I'd imagine they all lose a lot of money at that point.  

5) Would you stop ?

6) Do you see anything other than a currency collapse that will stop them ?

7) Is the BKK imminent ?

I'm hedging right now, I think the oil/gas shares have a long way up to go and when they crash I'd expect they're the ones who will rebound this time.  

 

Edited by HousePriceMania
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I'm up 30% on both BP and RDSB. I've also reinvested divis in both. A four figure profit atm. Repsol also up a similar amount.

I've been selling a lot of other stuff recently, CWR, FRES, INSG etc to de risk (and de clutter) my portfolio.

Happy to hold energy, gold and cash.

Personally think oil has longer left to run before a major pullback. The psychology of petrol shortages and rising heating prices will chip away over complacency re: oil supply, and I personally think sectors SP is mainly suppressed due to sentiment.

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8 minutes ago, HousePriceMania said:

 

So some questions:

1) Do you see the free money ending ?

Yes

2) Do you see the IRs rising significantly ?

I see them rising sooner and higher than currently predicted

3) If a collapse comes which shares would you be prepared to hold long term ?

What ive got.

4) If you sell out and the BKK doesnt hit, when do you buy back in ?

Im not selling what i have.

7) Is the BKK imminent ?

Fuck knows.

 

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