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

spunko

By spunko
in Property Prices & Economy

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Castlevania

Castlevania

Posted
Posted
2 hours ago, planit said:

Government doubling down on it's plans. There is going to be such a shortage of electricity in the future people won't be able to afford heating. I predict the country will be voting in a pro-fossil fuels government in 4 years time.

 

image.png.3565c414feb4367e92b605e3e2cc097f.png

Sorry, I have posted too much this morning but everything seems to be going crazy.

What if you use heating oil?

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janch

janch

Posted
Posted
1 hour ago, Harley said:

eff the fundamentals (like most out there beyond here)

Yes I think a lot of it has been going on.  I made a bit on the likes of INRG over the summer and sold in time to make a profit.  Everyone is now running to the oilies and gas.......so much for green investment.

The madness is as it must have been in 2000 but I wasn't partaking then.  Now it's in everything not just the stockmarket.  This is the time for a very cool head and to stick to the thesis of the thread.  If there is a BK I have some more to invest but the stocks I have now I will be holding.  I'm looking at a few I should have bought eg RR/BAB which I've left too late but will buy if there's a BK.  Same with YCA/GCL.

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Yadda yadda yadda

Yadda yadda yadda

Posted
Posted
16 minutes ago, planit said:

Completely agree except my brain automatically added a 'fucking' due to the level of incompetence:

 

 

I try not to swear too much on here but it is appropriate when discussing almost all Government initiatives.

The other thing that will happen is that those with the facility will burn more wood for heating. Unintended consequences are to be expected when you play tax whack-a-mole.

Wood is clearly sustainable and carbon neutral so long as new trees are planted. However, it does have an effect on air quality. Especially in urban areas. This is a generalisation but the average person with a wood burning stove has more money than the average person who relies on gas.

Go long stove manufacturers and especially woodland. Anyone got some investable names in those sectors?

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Barnsey

Barnsey

Posted
Posted

Quick fixed mortgage update, had another look at the market to sniff out what lenders think the future will hold. A reminder, I fixed 15 years at 2.59% earlier this year (75% LTV), all but one lender stopped offering 15 Yr fixes in the Spring leaving Virgin Money at 3.79%. Now it's 4.39%.

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HousePriceMania

HousePriceMania

Posted
Posted
52 minutes ago, Barnsey said:

Quick fixed mortgage update, had another look at the market to sniff out what lenders think the future will hold. A reminder, I fixed 15 years at 2.59% earlier this year (75% LTV), all but one lender stopped offering 15 Yr fixes in the Spring leaving Virgin Money at 3.79%. Now it's 4.39%.

That's very interesting.  I noted elsewhere that the Term Funding sub prime lending scheme scam might be ending soon or be ended, I'm not clear which.

Since it was responsible for fueling the housing bubble re-inflation by suppressing mortgage rates , providing funds to banks to lend and ensuring normally prudent savers would take their money out the bank to onvest in riskier asset classes, if it is gone/going it would account for rises in mortgage rates and of course savings rates, which I believe are rising also.

 

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Majorpain

Majorpain

Posted
Posted

https://www.zerohedge.com/commodities/china-orders-top-energy-firms-secure-supplies-all-costs-oil-surges

Quote

Bloomberg reports that China’s central government officials "ordered the country’s top state-owned energy companies to secure supplies for this winter at all costs."

Which simply means that the supply chain bottlenecks are about to get even worse since China will muscle in even more aggressively for what little coal and LNG supply there is. It is unclear if it also means that Beijing is about to give up on its laughable pursuit of decarbonization.

Most of the problem with gas isn't Vlad turning the taps off, its China hoovering up as much Middle Eastern gas as it can get its hands on.  Since they are going to subsidise Elec/Gas to keep the population from revolting, its going to keep getting worse for the rest of the world.

My bet is UK Gas/Electric will still be price capped, but you only get a limited number of hours a day to use it like the good old Soviet Union!

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JimmyTheBruce

JimmyTheBruce

Posted
Posted
20 hours ago, Loki said:

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

Same.  Got some at £1.96 🥳 but got a lot more at £4 plus, literally days before the SHTF 😭.  I'm a little bit up now, and a bit more if you throw the divs in too.

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Loki

Loki

Posted
Posted
2 minutes ago, JimmyTheBruce said:

Same.  Got some at £1.96 🥳 but got a lot more at £4 plus, literally days before the SHTF 😭.  I'm a little bit up now, and a bit more if you throw the divs in too.

It's just nice to see this thread vindicated after sitting back and watching GME, AMC and Dogecoin go ballistic :D

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Gin

Gin

Posted
Posted

Talking about inflation. I transported the luggage for a Chinese student today and he told me he is visiting his folks in China , the area where there are power cuts , but thats another story.

He had to fly home after four years here studying , to sign a legal document in person .

He asked me to guess the cost of his air fare . I replied £1k.

Cost of a one way ticket there , economy ....£3,200  , gulp. O.o

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Hancock

Hancock

Posted
Posted
29 minutes ago, Majorpain said:

Most of the problem with gas isn't Vlad turning the taps off, its ...

... the fault of successive British govts not taking advantage of the fact we're sitting on more than enough oil/gas/coal to make us self reliant for 100s of years.

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invalid

invalid

Posted
Posted
5 hours ago, planit said:

Government doubling down on it's plans. There is going to be such a shortage of electricity in the future people won't be able to afford heating. I predict the country will be voting in a pro-fossil fuels government in 4 years time.

 

image.png.3565c414feb4367e92b605e3e2cc097f.png

Sorry, I have posted too much this morning but everything seems to be going crazy.

 

 

Crazy indeed. A couple of graphs below for wholesale prices and nat gas futures (up 11% today) to put some context on the increases in cost.

 

 

Screenshot 2021-09-30 at 17-27-24 Natural gas - BBC News.png

Screenshot 2021-09-30 at 17-25-58 Wholesale Energy Prices for Oil, Gas and Electricity - Interactive Charts.png

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Lightscribe

Lightscribe

Posted
Posted

As a bit of anecdotal, I’ve been monitoring prices on my 2015 24k mile Peugeot 308 I bought at the beginning of the year. Similar models/specs are now asking 20-25% more.

Now has a second hand run-of-the-mill average family car actually gone up in value in a year and performing better than some of my shares?

Or is it that money has been devaluing at a far more rapid rate than the actual inflation rates suggest?

I’m thinking the latter.

 

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JimmyTheBruce

JimmyTheBruce

Posted
Posted
1 hour ago, Loki said:

Does anyone have any thoughts on SSE? We heard about the takeover mutterings a while back, price has been very subdued considering the energy situation

I've got a reasonable chunk of SSE, but haven't been buying since it went past £14.  If it goes down again I'd get more, I like the divs.

Same question for NG, anyone buying?  I'm in the red on it but, again, I like the divs and I'm struggling to see how somebody new turns up and competes with them.

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JimmyTheBruce

JimmyTheBruce

Posted
Posted
6 hours ago, JMD said:

I would be interested in others opinion and answers to your question.

My take is that you are probably correct about choosing the pm miners (i believe $1-5bn cap is the current sweet spot?), along with their leverage etc, they should give the better return compared to the physical underlying precious metal. However it is higher risk (which miners to select?), and more work (when do you sell, etc?). 

So being just an amateur, i decided to split investment 50/50 between the miners and the physical.  

It was a difficult conundrum for me, started to hurt my head, so I sprayed and prayed on 12 miners, dumped some in bullionvault, and ordered some physical online.  Sorted.

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Loki

Loki

Posted
Posted
2 minutes ago, JimmyTheBruce said:

I've got a reasonable chunk of SSE, but haven't been buying since it went past £14.  If it goes down again I'd get more, I like the divs.

Same question for NG, anyone buying?  I'm in the red on it but, again, I like the divs and I'm struggling to see how somebody new turns up and competes with them.

Sold my NG due to its overall lacklustre performance, but only in comparison some of my other stocks.  I never sell anything at a loss, but the mediocre performance of NG meant I chopped it in (For Gazprom, I think).  Sorry I can't remember exact dates, and the HL portfolio history tool is useless.  This wasn't based on any numerical analysis at all.

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Yadda yadda yadda

Yadda yadda yadda

Posted
Posted
8 minutes ago, ThoughtCriminal said:

French Prime Minister apparently just announced he's going to make gas and electric price rises illegal. 

 

Genius. 🤡🤡🤡

Does EdF have a monopoly within France? I expect the gas business is a state owned monopoly too. They'll just have to push taxes up instead.

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