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

[M S E Refugee]

11 minutes ago, Option5 said:

Because they know they can do it better.

Because they know they're smarter and better than anyone else.

They are like degenerate gamblers you see in the Bookies who think that they will eventually come up with a system that works.

[Yadda yadda yadda]

1 hour ago, Bricormortis said:

" For the poorest members of society " thats the bit that gets my goat. Make everybody else pay the bill.

They cannot accurately target the poorest in any case. They can give to those on benefits but many of those are in the middle. Low wage workers without children under 18 are the poorest in society. Exceptions apply as always - something they cannot cater for.

Any attempt to subsidise food and energy destroys price signals for those affected. As well as impoverishing those who do not receive the boost. Removing price signals increases demand and therefore overall prices. Knock on effects for poorer nations are hunger, cold or excessive heat and death. Completely immoral for a global organisation to suggest this.

[Pip321]

2 hours ago, DurhamBorn said:

I think its the key moment of the cycle here in the UK.If the government put bennies up with inflation from September then the roadmap moves to even higher inflation and much higher risk of systemic collapse.However i see nothing yet to think they wont,no pushback,not one mention of the fact high bennies are one of the main problems.The left own the narrative at the moment due to the media etc.Employment wont collapse,but the margins will move and continue in one direction.Since Blair they had mass migration and monetising debt to mask it,now they dont.It could be the government is demonizing the BOE so that printing isnt available.My friends daughter and her boyfriend have 6 kids between them,he has just got a 4 bed house,she a 3,between them they get £3900 a month in bennies.She sublets her house of course and lives with him.My friend hates what she is doing,but like he says Browns bennies have corrupted them all.Funny enough he has retired at 52 and gone on sickness bennies,sick of working to pay bennies,even though his daughter takes a massive amount.

I don’t disagree. Indeed I would encourage reporting of subletting if it is stealing my taxes. 

But at what stage do you stop referring to a specific previous government? The last three governments since must have some accountability to those who have been in power since or do you think Browns influence was as is so massive that no one was able to can change it?

Whenever Brown/Blair are specifically named it sounds like is an apology for the current governments since ie the last 12 years their hands were tied. If it’s always the other guys fault what’s the point of changing the leader. 

Biden now blaming Trump.…Trump blames Obama…..he blames Bush.

So I am not pro Brown but rather think for the past 30 years we have a mush of liberalism and political self interest. I wouldn’t pin my mast on anyone’s colours nor specifically blame a person because it alleviates some blame from others. They are all shite and corrupt. 

My bet is benefits go up with inflation and ‘people’ blame Blair/Brown/Putin/Biden/Thatcher/Simon Cowell….oh, I hope I am wrong. 

 

[Virgil Caine]

11 minutes ago, Yadda yadda yadda said:

They cannot accurately target the poorest in any case. They can give to those on benefits but many of those are in the middle. Low wage workers without children under 18 are the poorest in society. Exceptions apply as always - something they cannot cater for.

Any attempt to subsidise food and energy destroys price signals for those affected. As well as impoverishing those who do not receive the boost. Removing price signals increases demand and therefore overall prices. Knock on effects for poorer nations are hunger, cold or excessive heat and death. Completely immoral for a global organisation to suggest this.

All subsidies in whatever form distort markets as U.K. house prices confirm. Given the poor in Western nations have generally higher benefits then they will simply outbid the poor elsewhere on the planet for food and energy.  If they want equality of outcome they will need to impose rationing on a global scale. I can’t see that happening. 

[reformed nice guy]

1 hour ago, Errol said:

It will have to be for everyone. No means testing  - so universal.

Exactly.

My typical rant: do billionaires get it? If not, its not universal.

Do disabled people get the same as a normal person?

Do you get the same amount in a small mining village as you would in central London, even for housing? If not its not basic.

If they retort "but you get housing, so its the same wherever you are". In that case, can I get a free house in the poshest part of London? Its therefore not universal or basic if they will spend £300/m in one place but £1300/m in another.

Would you get the same allocation for heating in the south east as the chilliest part of Wales or Scotland?

The only correct word in UBI is income.

Its just a fancy name for "more means tested benefits doled out by the government"

[Virgil Caine]

12 minutes ago, Pip321 said:

I don’t disagree. Indeed I would encourage reporting of subletting if it is stealing my taxes. 

But at what stage do you stop referring to a specific previous government? The last three governments since must have some accountability to those who have been in power since or do you think Browns influence was as is so massive that no one was able to can change it?

Whenever Brown/Blair are specifically named it sounds like is an apology for the current governments since ie the last 12 years their hands were tied. If it’s always the other guys fault what’s the point of changing the leader. 

Biden now blaming Trump.…Trump blames Obama…..he blames Bush.

So I am not pro Brown but rather think for the past 30 years we have a mush of liberalism and political self interest. I wouldn’t pin my mast on anyone’s colours nor specifically blame a person because it alleviates some blame from others. They are all shite and corrupt. 

My bet is benefits go up with inflation and ‘people’ blame Blair/Brown/Putin/Biden/Thatcher/Simon Cowell….oh, I hope I am wrong. 

 

I would generally agree but I still feel that Blair/Brown were dealt a better hand when they came to power than most of the subsequent administrations.  All of the governments since the mid 1990s have essentially followed Blairite policies in some form as that is what has won elections. Given winning their seat or getting into government is the ONLY thing politicians really care about I don’t think it will change until that magic trick no longer works.

[Joncrete Cungle]

1 hour ago, M S E Refugee said:

It is sad that despite it's 100% failure rate people still believe Communism is a viable system.

I talk to people at work who lived under Ceausescu and Communism. They 100% think Communism is terrible and don't want anything to do with it at all.

1 hour ago, feed said:

When the only tool you have is a printer. 

Use the UBI to buy gold / silver or stocks?

[Loki]

1 hour ago, M S E Refugee said:

It is sad that despite it's 100% failure rate people still believe Communism is a viable system.

"That wasn't real communism"

[Democorruptcy]

3 hours ago, DurhamBorn said:

My friends daughter and her boyfriend have 6 kids between them,he has just got a 4 bed house,she a 3,between them they get £3900 a month in bennies.She sublets her house of course and lives with him.My friend hates what she is doing,but like he says Browns bennies have corrupted them all.Funny enough he has retired at 52 and gone on sickness bennies,sick of working to pay bennies,even though his daughter takes a massive amount.

Good guest speaker potential for the Durham summit.

[Errol]

38 minutes ago, Joncrete Cungle said:

Use the UBI to buy gold / silver or stocks?

Absolutely.

27 minutes ago, Democorruptcy said:

Good guest speaker potential for the Durham summit.

I will bring the rotten fruit and veg.

[Democorruptcy]

1 minute ago, Errol said:

I will bring the rotten fruit and veg.

That's not nice, we might need to know how to play the system one day.

[DurhamBorn]

3 hours ago, Axeman123 said:

Warehouse space could be about to become very over supplied! Will any be converted to residential I wonder?

A real sign of the times.

Its funny isnt it this macro game.A few years ago looking at things i thought to myself one of the worst investments in the world during a distribution cycle would be Amazon.Everything in a dis-inflation is in their favour,everything in a reflation is against them.Delivering a small widget one at a time is a ludicrous business model,yet such is the drugging affect of dis-inflation they were seen as unbeatable.I expect an 85% fall inflation adjusted in them.

Another lesson new investors will learn.Owning a bubble stock that pays no divi goes down 50% there is nothing clawing that back,just inflation eating away at whats left of your capital.

[DurhamBorn]

3 hours ago, Axeman123 said:

Another anecdotal about the fall of Amazon:

In the past falling retail sales or high-street footfall could always be hand-waved as being signs of the switch to online shopping. If Amazon is struggling it looks like a real hard rain will fall soon...

The operational leverage in reverse will be epic.Their delivery vans for instance will lose a fortune with a third less deliveries and much higher costs.

[Axeman123]

2 minutes ago, DurhamBorn said:

The operational leverage in reverse will be epic.Their delivery vans for instance will lose a fortune with a third less deliveries and much higher costs.

It is incredible to think how perfectly aligned their business model was to profit from the disinflation, and how 180 degrees to that they are for inflation. They turned pretty much a whole golf course (Wavendon) near me into fulfillment centres, by the looks of it from the road. Only a year or two ago investing in land with potential for fulfillment centres was being touted as the new hotness.

A thing I read the other day on twitter was something along the lines of "what if the whole start-up and venture capital business model was just a disguised interest rate short?". I actually spent a good five minutes processing that; how many people have unwittingly just been shorting interest rates, while convincing themselves they were succeeding at something far more complex through skill? George Gammon said something similar around the same time on a youtube videa, real estate is just an interest rate play unless you have skills to value add.

[BWW]

4 hours ago, M S E Refugee said:

I can't see how UBI can work if the currency becomes worthless.

I'm no financial expert but I just can't see how it can work. 

UBI **should** be introduced anyway at a rate of 2.5k per year. At the same time the zero rate tax allowance can be scrapped and UC/JSA/state pension etc. reduced  by the same amount .. those working will see no change in net income.

Next add 1k and get rid of the zero rated NI tranche.

The latter will increase tax take since rich pensioners will pay extra as they should. Was in a stunning old building of a pub in an affluent Devon village last nite. Packed with pensioners eating from a menu I turned my nose up at mainly because it reminded me of Brit school dinners at 25 a main so probably 50 quid ++ a head spend with wine at 20-40 a bottle.

The idea they anywhere near paid for what they now get needs to be thouroughly debunked by the meedja.

3 hours ago, Yadda yadda yadda said:

They cannot accurately target the poorest in any case. They can give to those on benefits but many of those are in the middle. Low wage workers without children under 18 are the poorest in society. Exceptions apply as always - something they cannot cater for.

Any attempt to subsidise food and energy destroys price signals for those affected. As well as impoverishing those who do not receive the boost. Removing price signals increases demand and therefore overall prices. Knock on effects for poorer nations are hunger, cold or excessive heat and death. Completely immoral for a global organisation to suggest this.

The problem with the above is having done the transfer from allowances to UBI they will come with this targeting crap and means test it which lets the cheaters profit again. GIVE IT TO THE BILLIONAIRES TOO, it's cheaper and fairer !

[BWW]

3 hours ago, Pip321 said:

I don’t disagree. Indeed I would encourage reporting of subletting if it is stealing my taxes. 

...

LOL at you thinking it's YOUR taxes. It's THEIR taxes and when YOU want anything like a non-emergency op on the NHS you are going to discover your taxes have bought you a place on a very long waiting list for treatment so rushed [because the managers have stolen all the dosh and there's a limited amount for staff doing real jobs] that you'll be lucky if they don't kill you.

My advice: do something to pay less tax so you have the dosh available to pay for decent services when you need them.

[Nomad]

Productivity is a real issue, way too many bennies expecting/almost demanding inflation rises. Maybe get a job? I'm fed up subsidising their lifestyle. Also way too much support for this from the msm, i have lost count of the number of times there have been articles about people not affording meals, generally I don't believe them, they need to budget and cut their cloth accordingly. We have ended up in a culture where people feel entitled and not prepared to graft.

Govt needs to be strong and stand up to them, not convinced they will

[snaga]

2 minutes ago, Nomad said:

Productivity is a real issue, way too many bennies expecting/almost demanding inflation rises. Maybe get a job? I'm fed up subsidising their lifestyle. Also way too much support for this from the msm, i have lost count of the number of times there have been articles about people not affording meals, generally I don't believe them, they need to budget and cut their cloth accordingly. We have ended up in a culture where people feel entitled and not prepared to graft.

you know these stories are BS when people claim to need to choose between eating and heating .... in MAY

[JMD]

22 hours ago, Loki said:

Spending the past couple of decades demonising oil companies so they stop/reduce exploring was a bizarre way of addressing the problem of an oil shortage

I am just trying to rationalize the political madness (before it turns me insane!)... I guess I am looking for a middle path to help explain what's going on - but ok, if forced to admit it, yes i need a myth to live by! (to help counter the religious dogma that characterizes most modern day green activism).                                                                                                        In this regard I am reminded that Patrick Moore, the co-founder of green peace, fell out with what he considered 'anti human politics' and left the organisation many years ago. Anyway he is still very much an environmentalist but also disagrees vehemently that renewable tech is a viable global energy solution - however he does think it very sensible to ration oil because the commodity will very much be needed for plastics, fertilisers, etc, long into our futures; and that our future energy needs can only be provided for by nuclear fusion/fission. 

[spygirl]

1 hour ago, DurhamBorn said:

The operational leverage in reverse will be epic.Their delivery vans for instance will lose a fortune with a third less deliveries and much higher costs.

I was having my dinner time walk and watched about 3-4 delivery cans, pass, stopping at vaious houses.

Every town has deveral largre, empty shop.

Turn one into  local pickup point - poof! Most of the vans go.

 

 

[Pip321]

42 minutes ago, BWW said:

UBI **should** be introduced anyway at a rate of 2.5k per year. At the same time the zero rate tax allowance can be scrapped and UC/JSA/state pension etc. reduced  by the same amount .. those working will see no change in net income.

Next add 1k and get rid of the zero rated NI tranche.

The latter will increase tax take since rich pensioners will pay extra as they should. Was in a stunning old building of a pub in an affluent Devon village last nite. Packed with pensioners eating from a menu I turned my nose up at mainly because it reminded me of Brit school dinners at 25 a main so probably 50 quid ++ a head spend with wine at 20-40 a bottle.

The idea they anywhere near paid for what they now get needs to be thouroughly debunked by the meedja.

The problem with the above is having done the transfer from allowances to UBI they will come with this targeting crap and means test it which lets the cheaters profit again. GIVE IT TO THE BILLIONAIRES TOO, it's cheaper and fairer !

I like the concept of UBI and your suggestion looks a really interesting start that I hadn’t heard before.

I would like to see the cost of our current systems v a simple UBI. Ie how is is paid out (and all the admin) per capita of the UK. 

All the staff, the systems, the means testing etc must cost a fortune. I wonder if the current system costs more to administer than it gives out. 

When I say a simple system I mean simple ie £xk a year for qualifying citizen (criteria to avoid UBI tourists)….and if you need more, work. If you have 6 kids work harder. If your rent is £1400 pcm then move…

It should always pay to work. 

Disabled given free services to compensate (eg ramp, handrail, medicine, care, travel etc) but not extra money.

Politically unachievable and I sense the anger from some on here who actually see ‘benefit manipulation’ eg DB himself see’s. I admit I don’t see in my little town bubble. Those closer to it will be in a better place to make suggestions.

[JMD]

22 hours ago, Bobthebuilder said:

I do not think you are being tin foil hat at all, so much stuff happening right now that just looks under hand to me.

I am starting to notice a few Ukraine license plates around London, mostly vans nice ones too maybe £30k worth, now they might be delivering aid, but they looked like they were doing multi drops to me. Also, friends nearby have told me they are seeing an increase in Polish and Romanian vehicles in their council flat car parks. Seems like freedom of movement again under a different banner.

Mr Durham Born often warns about the possibility of systemic collapse, I am starting to think it may be written in as it were, everything is starting to smell of bullshit.

Yes freedom of movement on the rise. Plus the pandemic border control measures seemed to disappear overnight once we had offered sanctuary to Ukrainian refugees. Average vax rate in Ukraine is only at 25%, but were any refugees tested before allowed into UK? I don't think they were. In fact I believe all countries merely relaxed their controls which is fair enough - but where was the media debate on this issue? Instead the whole COVID health emergency was quickly and rather conveniently forgotten about, replaced by a new - and this time a 'morally evil' pox - called uncle Vlad!? As you say none of this smells right.

[JMD]

21 hours ago, The Bear of Doom said:

Any relation to Dimitry Orlov? 

On an investment note, the Ad Agency that came up with that concept must have made a fortune!

 I wonder if the ad agency has any undisclosed links with Russia?... No doubt a soon to be revealed FSB umbrella operation?!

[JMD]

20 hours ago, DurhamBorn said:

This ^ .Its very likely thats why.I dont see many trees going up on all the grouse moors.I think the whole thing is about getting the plebs to consume less oil and gas so it lasts longer for the rich.They also know they need 40 to 50 years for renewables.If they want to save the planet they could start by planting trees etc into all these huge areas of council owned grass,yet very little happens.

My starting point is that IF there was any such thing as a  'climate emergcy' the West would have rapidly ramped up and bought online a nuclear fleet, regardless of what other Asian countries, etc, did. Plus something ignored every year the CCC climate report is produced is that their 2050 targets are very much the ideal - however the same report also contains 2100 targets which are kinda indistinguishable in terms of impact and risk. In reality the science is far from settled, we all know that, but even the CCC have their own caveats, etc, however these issues are suspiciously never discussed. 

[Harley]

7 hours ago, DurhamBorn said:

I think its the key moment of the cycle here in the UK.If the government put bennies up with inflation from September then the roadmap moves to even higher inflation and much higher risk of systemic collapse.However i see nothing yet to think they wont,no pushback,not one mention of the fact high bennies are one of the main problems.The left own the narrative at the moment due to the media etc.Employment wont collapse,but the margins will move and continue in one direction.Since Blair they had mass migration and monetising debt to mask it,now they dont.It could be the government is demonizing the BOE so that printing isnt available.My friends daughter and her boyfriend have 6 kids between them,he has just got a 4 bed house,she a 3,between them they get £3900 a month in bennies.She sublets her house of course and lives with him.My friend hates what she is doing,but like he says Browns bennies have corrupted them all.Funny enough he has retired at 52 and gone on sickness bennies,sick of working to pay bennies,even though his daughter takes a massive amount.

Well less than inflation if they want a meaningful gap to fill with their intentions:  UBI, rationing, digital ids, CBDCs, etc.  Be interesting how Labour positions itself.  Could be the give away given they (polos) may all be in it together.