Credit deflation and the reflation cycle to come (part 5)

[desertorchid]

4 minutes ago, afly said:

Customer service is very good

 

Wouldn't agree there, I waited for 45 mins to get through, then transferred 3 times. Looking at Trustpilot this is quite common.

[afly]

1 minute ago, desertorchid said:

Wouldn't agree there, I waited for 45 mins to get through, then transferred 3 times. Looking at Trustpilot this is quite common.

How weird, I tried about 2 weeks ago and was really impressed. 

[HousePriceMania]

 

[Calcutta]

Doctor's are the gatekeepers, thanks to them that unproductive, non voting, complaint consumer base of fat Shaz and the ADHD boys get their meds on time and don't bother getting a job.

All part of the plan.

Edited March 14, 2023 by Calcutta
I have my reasons.

[Bobthebuilder]

24 minutes ago, Bilbo said:

Sorry to be a pain but nobody has recommended HL. I thought most of you used them? 

I was going to open an account today for wife and another for me. I noticed that they did cash ISA as well because wife won't do anything else.

 

I like H&L, fees are capped at £17 a month, so once over £50k you don't pay anymore. 

[PaulParanoia]

I'm looking at these bonds as protection against inflation ... https://www.hl.co.uk/shares/shares-search-results/s/santander-uk-plc-10-16-exch-cap-sec

Apart from the obvious risks ... price of the bonds falling or Santander needing a Bond Holder bail-in ... what are the other possible downsides to holding these for a decade?

[RWJ]

I went with Interactive Brokers in the end.  I had ruled them out as I was under the impression they didn't do ISAs but it turns out they do.  Fees seem fair and the tech looks like proper trading software.  I won't use half of it but it looks the part.

[desertorchid]

2 minutes ago, RWJ said:

I went with Interactive Brokers in the end.  I had ruled them out as I was under the impression they didn't do ISAs but it turns out they do.  Fees seem fair and the tech looks like proper trading software.  I won't use half of it but it looks the part.

On fees they piss over all the competitors. On customer services they can be abysmal. They are huge though, won't be disappearing in a puff of smoke.

[Libspero]

2 hours ago, M S E Refugee said:

Nevertheless, if this financial chaos was happening in Russia like it was supposed to, you would be sporting a raging hard-on.

We should probably keep petty Russia/Ukraine point scoring off this thread.  Do you agree?

[feed]

 

[honkydonkey]

Anyone looking at buying IBZL (iShares MSCI Brazil UCITS ETF USD (Dist) (GBP) )

I found HBRL (HSBC MSCI Brazil UCITS ETF (GBP))

to be the same but 0.5% fee instead of 0.76%

[JMD]

3 hours ago, marceau said:

It's all hypothetical for me as I think UK gov is well past the point of no return, but it still suprises me that they aren't capable of considering the whole system when making these sorts of decisions. The plans are always so narrowly focused, with second order effects not even considered.

They don't need to be machiavellian geniuses to stop doing obviously stupid things. The problem is that the system works on policy and all of the policy for decades has been slanted one way. The Conservatives should have been creating alternate policy foundations, but were too lazy/dishonest/stupid to do it.

I think UK gov is more fucked than even most on here would believe.

Lazy/dishonest/stupid people have, throughout history, always been attracted into politics (true leaders are very rare). But somehow the system has managed to work (well muddle through) for hundreds of years. The problem as I see it, is that today our Western politicians have accumulated far too much influence and power (mostly because the state itself, its responsibilities and spending have expanded; hell, the remit now even includes directing human virtue and morality!). However that concentration of political power has attracted big corporate lobbying - and I think corruption has been the result - not only personal monetary corruption, but also of political thought. The well of ideas has been truly poisoned!

I saw an interesting documentary (on Netflix, but it's title escapes me) where American lobbying stats for Washington were presented and discussed. In the 1950s there was a real diversity of lobbying groups, farmers to business people, including small regional players to trade bodies. And the lobby funds received by senators/congress for example (yes they had those figures!) was small and evenly distributed. However things began to change in the 90s with the advent of professional lobbying groups and lawyers. Today the 'political funding' has exploded and the diary time of senators/congress is dominated by PR companies, charitable groups and campaigning activists, and whos agenda is by definition very narrow and self-serving. I mention this trend because i think there is an identifiable/measurable causality happening there.

I'm not seeking excuses for our lazy/dishonest/stupid politicians (my example was of the US but think similar happens here), but the nature and noise of modern politics has changed dramatically and our political class are simply not up to the (impossible?) job - crucially I rather think no one could be. I agree with you about things being beyond point of no return. The political system we've built is irredeemably broken. Small government is i think the answer, but unfortunately we shan't get that. Instead i fear and think the future will be ever bigger government and even more social controls. 

Edited March 14, 2023 by JMD

[belfastchild]

3 hours ago, marceau said:

I think UK gov is more fucked than even most on here would believe.

Just had something happen that said its worse than that.

Just spent an hour in the car trying to get the last mile home. RTA on the main intersection so cops closed the road (fucking 8am this morning). Cops posted on the 3 roads leading to the RTA turning traffic away.
One had female cops yarning to lorry drivers and blocking the roads more rather than telling them to move the fuck on and use their sat navs.

Absolute fucking chaos. Every other road blocked, people pulling in to the side and parking up and walking into the town. No cops to be seen. HGVs being diverted down roads that dont suit then blocking the remaining intersections on the other main roads. Add in the roadworks and a complete fucking shitshow, proper one, only cars moving are those doing u-turns and like me trying to find another way past only to find that blocked.

Kept thinking to myself why the hell havent they put more cops on all the other roads, direct traffic, do some shouting at people? Even with the roads blocked its a few hundred yards for them to walk...

..then it hit me, there are no more cops.

[JMD]

5 hours ago, DurhamBorn said:

Yep looks like a double wave inflation more and more.I expect now inflation will fall,it might even get down close to 2%,then turn back up to around 5% and sit there.Rates ended up at 3.5% longer term.I think they need to inflate away at around 2% to cover deficits to stop collapse.So rates to average 2% to 3% less than inflation over the cycle.

DB, what could be the possible time frame for that happening? ...I'm thinking the polos could use that (artificially engineered) low interest rate environment to provide low/fixed type mortgage products to help support/'save' the housing market?!?

Edited March 14, 2023 by JMD

[belfastchild]

2 hours ago, Calcutta said:

Doctor's are the gatekeepers,

Consultants are the ones who keep the NHS waiting lists stats from getting worse.
Thats the reason they are being mentioned so often, they are the only ones who directly influence figures the government can be held to account on. Throwing money at them isnt going to work, particularly when you dont want to do it any more, are fed up of fighting administrators and have enough to live on from now to eternity.

My friends going down to 3 days a week means thats 2 days a weeks worth of patients whose waiting list just got longer. The waiting lists for those who have to take the work on just got longer as well.
They arent producing consultants with 20 years plus experience (other than imports) to fill the gaps.

[Yellow_Reduced_Sticker]

5 hours ago, MrXxxx said:

Can't believe you marked this as informative @Yellow_Reduced_Sticker! ...hope you don't think it's a tip?! :-)))

Ha-ha! I knew YOU would BITE!

Me 'ol mucker if anyone you should know my sarcastic, oddball/warped sense of HUMOR !

 

[Axeman123]

On the question of why Doctors are such an obsession for politicians, I think there is a symbolic element to it. Eg: "Indian Doctors all wanting to come here", "Cuban Doctors all wanting to flee", "we have lots of Doctors" are all part of the idea (IMO) that he who has the most Doctors wins and that any country losing all its' own ones is obviously a failure. It probably also ties into the idea of Doctors as the priests of science.

Obviously much more practical reasons also apply, but as with the recent bank runs confidence is an element of economics and a lack of doctors hits confidence in a country hard.

[marceau]

8 minutes ago, Axeman123 said:

On the question of why Doctors are such an obsession for politicians, I think there is a symbolic element to it. Eg: "Indian Doctors all wanting to come here", "Cuban Doctors all wanting to flee", "we have lots of Doctors" are all part of the idea (IMO) that he who has the most Doctors wins and that any country losing all its' own ones is obviously a failure. It probably also ties into the idea of Doctors as the priests of science.

Obviously much more practical reasons also apply, but as with the recent bank runs confidence is an element of economics and a lack of doctors hits confidence in a country hard.

Symbols, rituals and status. Something is missing - what could it be?

 

[AlfredTheLittle]

28 minutes ago, belfastchild said:

Just had something happen that said its worse than that.

Just spent an hour in the car trying to get the last mile home. RTA on the main intersection so cops closed the road (fucking 8am this morning). Cops posted on the 3 roads leading to the RTA turning traffic away.
One had female cops yarning to lorry drivers and blocking the roads more rather than telling them to move the fuck on and use their sat navs.

Absolute fucking chaos. Every other road blocked, people pulling in to the side and parking up and walking into the town. No cops to be seen. HGVs being diverted down roads that dont suit then blocking the remaining intersections on the other main roads. Add in the roadworks and a complete fucking shitshow, proper one, only cars moving are those doing u-turns and like me trying to find another way past only to find that blocked.

Kept thinking to myself why the hell havent they put more cops on all the other roads, direct traffic, do some shouting at people? Even with the roads blocked its a few hundred yards for them to walk...

..then it hit me, there are no more cops.

There are plenty of cops, it's more what are they doing? The government introduce endless laws and very rarely repeal any. Can't really blame the few competent cops for being completely disillusioned and whiling away their 35 years working from home, everything they do is completely pointless, and the small bits that aren't pointless will come up against an extremely broken criminal justice system.

 

[JMD]

4 hours ago, marceau said:

They're fixated on the the most visible things, most likely due to lobbying but it's impossible to be sure.

Obviously will have to wait for tomorrow for the details, but this LTA boost (if it's not part of a bigger package) is like trying to fix a failing haulage firm by working on the boss's Merc and forgetting about the trucks. I mean - it's all vehicles, right? Most expensive one must be the most important......

Funny you should mention 'lobbying'. I have just replied to one of your earlier posts in which I suggest those 'lobby louts' are responsible for poisoning the village well !!... our political fountainhead of ideas.

Edited March 14, 2023 by JMD

[marceau]

37 minutes ago, JMD said:

I'm not seeking excuses for our lazy/dishonest/stupid politicians (my example was of the US but think similar happens here), but the nature and noise of modern politics has changed dramatically and our political class are simply not up to the (impossible?) job - crucially I rather think no one could be. I agree with you about things being beyond point of no return. The political system we've built is irredeemably broken. Small government is i think the answer, but unfortunately we shan't get that. Instead i fear and think the future will be ever bigger government and even more social controls. 

Small govt does nothing - you need effective power for effective govt. Size isn't really relevant. Same deal with localism, devolution etc. The tories never understood 'big tent' politics, Cameron throught it was some 'making friends with your enemies' collegiate nonsense. Falling for UK foreign policy myths and applying them inside his own nation. Complete cretin.

Blair and Brown knew the truth, it was cover for power. The 'big tent' only ever contained the PLU - People Like Us. The PLU were in all in line with the objectives of the vanguard, and if they weren't in line they were not in the tent, even if they thought they were. The aim was to protect the PLU, grow the PLU, and maintain the power of the PLU. In that regard it was overwhelmingly successful. Shame about the nation, but that was never really the point.

15 years ago UK would have needed real headcrackers to form a counter-movement. Now not even that would suffice. Now it would need a killer, and I really do mean that literally. It's not going to get one.

[sancho panza]

23 hours ago, Majorpain said:

Seems Banks gorging on bonds has gone rather badly when those same bonds face interest rates at a more "realistic" level.  By the look of things this isn't one bank making terribly bad lending decisions as previous, and all banks are going to have the same mark to market loss problem.

Any opinion on Fed having to pump bond prices or this sucker is going down?

I think this is a really salient point.To varying degrees all banks that hold UST's as assets will be facing the same problem hence fighting inflation and QTIng are effectively mutually exclusive ie you can't do both without causing a significant consequence that might be an even bigger problem than the Fed's chunky balance sheet or CPI running 6% +.

As per the discssuion ref the Signature bank failure,US banking system much more fragmented than ours with specialist lenders/niche businesses,hence some are much more expsoed than otehrs if their total assets take a hit at the same time as they suffer a rising default profile

18 hours ago, stockton said:

On a serious note at what price would the hive mind consider buying some banks in the bloodbath?

WHen the clear survivors are obvious and the equity raisings have been done,I'd be a buyer of some but mainly thiose with EM's business eg HSBC and Standard.ALso African/Lat Am banks

18 hours ago, Democorruptcy said:

I remember US Regional banks getting a good word in here, this time last year.

iirc Steve Kaplan ran a trade on KRE(US regional banks) we discussed it but I don't remember anyone dipping a toe in.I ran the Dowd Buckner and the banks in that ETF were running at 10/1-30/1,so signifcantly less leveraged than Barclays etc.Still didn't stop them getting walloped.

I haven't touched a banking share since selling HSBC/LLoyds/A&L and RBS etc psot Northern Rock .No regrets.

Our banking system is probably in an even worse state than the US's .

I can't wait for the westmisnter elite and their 'noone could have foreseen the problems at Coventry BS '  etc etc

[JMD]

2 hours ago, Calcutta said:

Doctor's are the gatekeepers, thanks to them that unproductive, non voting, complaint consumer base of fat Shaz and the ADHD boys get their meds on time and don't bother getting a job.

All part of the plan.

I agree. They also helpfully administer jabs-in-arms (peculiar phrase?), all with a comforting and smiling bedside (deathbed?, if believe some on here!) manner!!

[reformed nice guy]

31 minutes ago, AlfredTheLittle said:

There are plenty of cops, it's more what are they doing? The government introduce endless laws and very rarely repeal any. Can't really blame the few competent cops for being completely disillusioned and whiling away their 35 years working from home, everything they do is completely pointless, and the small bits that aren't pointless will come up against an extremely broken criminal justice system.

 

Thats about a 15% fall per capita using the official population figures, so its probably a 20%+ real fall when the extra population is included

[sancho panza]

6 hours ago, Boon said:

What worries me is that inflation might simply be swept under the carpet either by fiddling with the measures, or just tolerating it. Of course it looks like coming down sharply because very high figures now drop out of the 12m, but then how it remains at 2% is beyond me.

Obviously the bond markets are screaming for cuts but I don't see why Powell should listen to that. Credibility would be improved if he just raised and kept it there until inflation was done. Once credibility is lost it isn't easy to get that back.

Somehow it seems rather mad to me, if you just look at the interest rate reflecting the time cost of money and also counterparty risk. If the central bank is not suppressing it via QE the natural rate is not going to be 1% or 2%. 

Powell has a dual mandate unlike the BoE so inflation and josb(think there's a 3rd as well.If he keeps rates heading higher then no end of other banks go to the wall.It's pick you poison time and death by deflation doesnt look like a front runner.

I agree,there's loads of room to fiddle the figures.Now would be the time to bring hosue prices into CPI....imagine what could be achieved?

5 hours ago, Majorpain said:

Going to be interesting to see how financial system copes with this one, things are definitely worse in most metrics than 2008 and its not too long before people start worrying about return of their money rather than return on.  Latest UK review specifically says that multipolar world is emerging faster than expected, would 2008 crisis have gone as smoothly if Russia/China and friends start trying to throw spanner in the works, because that's the global situation US has managed to create today.

This in bold, in spades, in terms of the banking system.The 08 bail outs took a banking crisis and turned it into a sovereign debt/currency crisis.

UK banks are in much worse shape thna 08.Either 6% mortgage rates for a year or two and/or 20% down in nominal hosue prices and they're deep in the hole.

Edited March 14, 2023 by sancho panza