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

[DurhamBorn]

7 hours ago, sancho panza said:

Labour committed to making sure old people freeze for the sake of their council comrades final salary pension scheme.

I genuinely fear a corrupt Tory govt but Labour seem intent on committiing economci suicide by driving away the only businesses that actually pay any tax.not only that,at the same time they're driving out the only companies that give us a chance of energy security.

I find it incredulous that Labour can't see the consequnces of what they're planning.I mena if they want to windfall tax anyone tey should be windfalling Big Pharma for how much they've made during the coof,yet somehow,theyre' only taxed at 25%.Not 75% which is what the North Sea producers already pay.

https://uk.finance.yahoo.com/news/labour-calls-energy-firms-pay-213044746.html

Energy companies are making £60m in profits a day from operations in the North Sea and should be paying more in tax to fund a freeze on council tax for cash-strapped households, according to Labour.

Labour’s call comes before the latest financial updates from Shell and BP this week. The energy companies are expected to report more bumper profits to the London market due to the spike in prices caused by Russia’s invasion of Ukraine.

UK-headquartered Shell made $40bn (£32bn) in profits last year, one of the largest in British corporate history and the best performance in its 115-year history, while BP more than doubled annual profits to $28bn.

Other energy companies including Centrica, the owner of British Gas, also posted record profits last year.

Labour estimates that the largest energy companies have already booked £7bn in profits so far this year – the equivalent of about £60m a day – from North Sea operations.

Ed Miliband, the shadow climate change and net zero secretary, said: “While families face the crunch from soaring bills, these new figures confirm yet again that the Conservatives are refusing to do the fair and right thing and bring in a proper windfall tax on oil and gas giants to help freeze council tax this year.

“That’s the choice Labour would make ahead of these local elections, because we are on the side of working people.”

Prime minister Rishi Sunak originally introduced a 25% energy profits levy, more commonly known as a “windfall tax”, which was meant to run until the end of 2025 when he was chancellor. In January, the windfall tax was increased to 35% and will run until March 2028.

Harbour Energy, the North Sea’s biggest producer, has claimed that the tax “all but wiped out” its profits last year. Oil and gas firms operating in the North Sea also pay 30% corporation tax on their profits and a supplementary 10% rate on top of that. Other firms currently pay corporation tax at 25%.

Labour has criticised the windfall tax scheme because it applies to profits made from extracting UK oil and gas but not from other activities, such as refining oil and selling petrol and diesel on forecourts. It also lets firms claim tax savings worth 91p of every £1 invested in fossil fuel extraction in the UK.

Labour said the tax relief should be scrapped to implement a “proper” windfall tax.

Shell initially said it did not expect to pay any windfall tax for 2022 as its North Sea investments meant it was not considered to have made any UK profits.

However, the company subsequently announced that it would pay $134m (£108m) for 2022, and expected to pay more than $500m (£400m) for 2023. BP said it would pay $700m (£583m) in windfall tax for 2022.

Europe, which uses a different method to tax windfalls under its “solidarity contribution” scheme, raised the larger sum of $520m in EU payments last year.

The government says that tax receipts from companies operating in the North Sea will be £11bn in 2022-2023. Jeremy Hunt, the chancellor, has said that the windfall tax will raise £40bn over six years

 

This is all what im most scared of when i look at the roadmap.Iv got it at 54% direct takers now,thats simply taking almost all income from the state,its even worse if you include those and ones who gets some income from the state etc.My roadmap shows the takers speed up once it gets to this point,then slows at around 60%,but at the levels we are already where collapse is 100% certain,the only difference is when.It seems the polos are simply going for the way that takes the longest,and thats the one where they take all assets.The reason is the inflation route through QE is closed mostly due to said inflation.The general tax route will be expanded and fiscal drag will be used to take assets.

Whats causing most of the pain and our destruction here is the fact the ones making policy and the civil service etc are all inflation protected,they suffer nothing from higher prices.So you have leftie civil servants with massive inflation linked pensions who think i must leave me kids a low carbon world.Its a death spiral.They will of course double the pain on workers as they will sub the bennies as the energy bills keep increasing.

The Tories and Labour are now direct enemies of ordinary workers and savers outside of that inflation protection.

Under the surface the UK now has the same conditions as were there that started the American Civil War.

[DurhamBorn]

3 hours ago, wherebee said:

Australian Labor gvt just announced massive crackdown on Vapes, especially the unregulated ones.  The newspapers are saying it will hit big tobacco and small importers.

Me, I just see more profit for BAT as large companies can work with regulations, small players can't afford the overheads to get it right.

Big baccy will push for legislation behind the scenes to kill off the small guys like you say.Its how they have always operated.Thats why a few companies who only put together paper,filter and baccy make tens of billions profit.

Edited May 2, 2023 by DurhamBorn

[belfastchild]

5 hours ago, Harley said:

What did he do?

Dropped CGT allowance so the plan of dropping up to 10k of non-cgt silver first before touching the cgt free stuff was kicked into touch when he is dropping it to 3k.
Roughly a 3:1 ratio of non-cgt to cgt exempt before the boat accident. Hit a limit for silver then started collecting sovereigns.
Of course the CGT thing only applies in the UK. Trains to Dublin and booze cruises from Holyhead may become very popular in the future.

[ashestoashes]

BP down 4% on reduced share buyback, buying opportunity ?

[M S E Refugee]

8 minutes ago, belfastchild said:

Dropped CGT allowance so the plan of dropping up to 10k of non-cgt silver first before touching the cgt free stuff was kicked into touch when he is dropping it to 3k.
Roughly a 3:1 ratio of non-cgt to cgt exempt before the boat accident. Hit a limit for silver then started collecting sovereigns.
Of course the CGT thing only applies in the UK. Trains to Dublin and booze cruises from Holyhead may become very popular in the future.

If you use the Gold/Silver ratio you wouldn't necessarily be booking large profits on Silver.

Just slowly sell it down and buy Sovereigns or put the profits in an ISA.

I sold a fair bit over the weekend for a profit of around £550, however most of that Silver was bought when the ratio was around 90 or above, I didn't make a vast profit but I was able to buy a bit more Gold as the ratio is under 80.

Once the ratio gets under 50, I doubt selling 50 ounces of Silver to buy and ounce of Gold will show much of a paper profit for CGT purposes.

I rarely buy CGT exempt Silver as it's only useful if we have total moonshot, VAT and massive premiums make it unattractive.

 

[Loki]

1 hour ago, belfastchild said:

the plan of dropping up to 10k of non-cgt silver first before touching the cgt free stuff was kicked into touch when he is dropping it to 3k

That was exactly my plan too. I bought maple leafs

[marceau]

2 hours ago, DurhamBorn said:

This is all what im most scared of when i look at the roadmap.Iv got it at 54% direct takers now,thats simply taking almost all income from the state,its even worse if you include those and ones who gets some income from the state etc.My roadmap shows the takers speed up once it gets to this point,then slows at around 60%,but at the levels we are already where collapse is 100% certain,the only difference is when.It seems the polos are simply going for the way that takes the longest,and thats the one where they take all assets.The reason is the inflation route through QE is closed mostly due to said inflation.The general tax route will be expanded and fiscal drag will be used to take assets.

Whats causing most of the pain and our destruction here is the fact the ones making policy and the civil service etc are all inflation protected,they suffer nothing from higher prices.So you have leftie civil servants with massive inflation linked pensions who think i must leave me kids a low carbon world.Its a death spiral.They will of course double the pain on workers as they will sub the bennies as the energy bills keep increasing.

The Tories and Labour are now direct enemies of ordinary workers and savers outside of that inflation protection.

Under the surface the UK now has the same conditions as were there that started the American Civil War.

They may be inflation protected, but they aren't tax exempt. Inflation will see them losing increasingly large real-terms chunks of their newfound wealth to HMRC. I doubt that'll be enough to make them change course though - all that matters to these retards is that numbers go UP. 

Edited May 2, 2023 by marceau

[CannonFodder]

Found this though realise all charts are make believe.

should be a good proxy for sentiment

[baffledbyzirp]

10 hours ago, sancho panza said:

I was talking with a frined today with a trading background and he was saying how it lawyas surprised him hwo teh dip buyers come out and btfd,even when it's obvious that the industry is in serious turmoil.

I was one of them once.Scottish Play.Prime example.You get value trapped in and then lose for years.

Certainly it is a mug's game to systematically jump into stocks that exhibit large falls, notwithstanding the tendency of mean reversion. However, there are occasions when the market appears to over react, or fails to take account of megatrends/ macro signals.

Case in point the increase in house builders today.

Are we heading for a drop in house prices adjusted for inflation over the next couple of years? Yes.

Is the vast amount of housing stock going to be in the same ownership as it was at the end of the period? Yes.

Is demand going to exceed supply throughout the period? Yes.

Do the large house builders employ models that allow them to shutter operations and eliminate variable costs and reduce fixed costs in extremis? Yes.

Does British culture still have an unhealthy obsession with property, partly motivated by government that uses it as an instrument of control and garners enormous amounts of tax from it? Yes.

Does government have an incentive to support the housing sector in the hope of reelection? Yes.

Is the residential rental sector going to become stronger as a result of paper hands folding in the BTL sector? Yes.

I would therefore submit that housing builders were oversold and that the bounce today, based on one month's data that is not inflation adjusted, reflects irrational market activity. While I think capital values may fall marginally I do not see drops as severe as 2008-9 or the early 1990s. In addition, the level of reckless lending by banks has been curtailed in this cycle.

Another example to my thinking is the falls in commodity stocks in recent months e.g. BP, SHELL, BHP, RIO, IMB, BATS, ANTO, FRES, ANGLO etc. China has reopened and data is bullish. Demand for materials to supply the energy transition towards renewables and electrification will be enormous. Supply will be restricted due to geopolitics in the medium term. The US has weaponized the dollar while its adversaries have retaliated by weaponizing commodities. People around the world will continue to smoke and new custom in India, Africa, China and South America will compensate for reduced demand in traditional triad markets. Cold people will want heat, hot people will want refrigeration, hungry people will want food and everyone wants a home, a car, a smart phone and a flushing toilet, regardless of climate change propaganda. 

Do these companies offer relatively high dividends? Yes.

Are their PEs relatively low? Yes.

Do they have great FCFs? Yes.

Are they global and hedged against currency fluctuations? Yes.

Do they benefit from scale? Yes.

If Zoltan Posar uses the term 'commodity super cycle' who am I to question? Yet today RIO dropped below £50.

GLA there are some great opportunities out there among the risks. Like @DurhamBornsaid poetically a few weeks ago, you can look a gift horse in the mouth if you are overcautious, although I think his example was the best looking woman in the nightclub and he wasn't looking in her mouth.

[HousePriceMania]

 

 

This is genuine.  Wonder what he was banned for.

[wherebee]

14 minutes ago, HousePriceMania said:

 

 

This is genuine.  Wonder what he was banned for.

as ever with twitter, the answer will be 'the truth'

[ThoughtCriminal]

Cocksuckers.

 

End of message.

[MrXxxx]

16 hours ago, King Penda said:

Rocketing prices won’t be so much of a problem for attractive girls .

Reminds me, I must go 'long' on Pfizer:

 

 

 

 

[MrXxxx]

13 hours ago, Froggy2000 said:

Food production has already been hit hard by rules on pesticides, cost of fertiliser etc. Add in rewilding, more farmland built on for houses, renewables etc. Someone else further up the thread posted a clip from a farmer discussing finances and planting decisions. I can see a lot of farmers deciding not to plant anything and just let the land rest/collect subisidies since its not worth the financial risk at current prices. So soon we could have low supply in a market with inelastic supply and food prices explode soon after.

On the other we have all the freaks pushing a vegan diet. I would say perhaps this is all a grand conspiracy but as others have pointed out they are far too stupid for that.

Yes and No:

13 hours ago, Froggy2000 said:

Food production has already been hit hard by rules on pesticides, cost of fertiliser etc.

Food shortage not really an issue when we are currently wasting ~40% [https://lordslibrary.parliament.uk/food-waste-in-the-uk/]

13 hours ago, Froggy2000 said:

Add in rewilding, more farmland built on for houses, renewables etc

Not really an issue as 69% of UK land is farmed [https://www.gov.uk/government/statistics/agricultural-land-use-in-england/agricultural-land-use-in-england-at-1-june-2022],

and this hasn't really changed over time

[https://www.statista.com/statistics/315937/total-agricultural-land-area-in-the-united-kingdom-uk/]

13 hours ago, Froggy2000 said:

I can see a lot of farmers deciding not to plant anything and just let the land rest/collect subisidies since its not worth the financial risk at current prices.

Agree, but this has changed recently in the last few years to the Countryside Stewardship scheme; a more focussed approach towards paying to protect biological diversity/habitats than overproduction

[https://defrafarming.blog.gov.uk/2023/04/12/countryside-stewardship-delivering-for-farmers-and-the-environment/]

13 hours ago, Froggy2000 said:

On the other we have all the freaks pushing a vegan diet. I would say perhaps this is all a grand conspiracy but as others have pointed out they are far too stupid for that.

Simple 'Rule of tens' energy transfer as it goes down through the food chain, with 10% 'surviving to the next trophic level...so for of 1kg steak you need 10kg of cattle feed i.e. commonly corn or soya...hardly a) an efficient use of food, and b) a conspiracy; its basic physics [https://en.wikipedia.org/wiki/Ecological_efficiency]

Note, I am not a vegan or vegetarian AND not anti-meat, but believe meat should be eaten in moderation which it is not at the moment....the issue we have regarding food is wastage and choice, not supply.

[Bobthebuilder]

8 minutes ago, MrXxxx said:

Note, I am not a vegan or vegetarian AND not anti-meat, but believe meat should be eaten in moderation which it is not at the moment....the issue we have regarding food is wastage and choice, not supply.

Agree, I think we should all be eating less meat but of a higher quality / welfare than at present. I always buy my meat direct from the source or as close as possible. Out of all my family and friends, I am the only one who has this approach.

@King Penda, @Frank Hovis Been in Lidl today to get my lout pilsner perlenbacher, 4 cans has been reduced from £3.50 to £3.09 unfortunately the can size has also been reduced from 500ml to 450ml.

[leonardratso]

£3.50/500ml=£0.007/ml
£3.09/450ml=£0.0069/ml

winner. Buy 400 cans.

[Bobthebuilder]

1 minute ago, leonardratso said:

£3.50/500ml=£0.007/ml
£3.09/450ml=£0.0069/ml

winner. Buy 400 cans.

Sorry, I made a mistake the cans are now 440ml not 450ml.

[Funn3r]

16 hours ago, montecristo said:

https://smartsavebank.co.uk/

Here's the problem with all those kind of banks though. What if you start noticing queues of people outside their branches? Well not that they even have any branches but you know what I mean.
 

• You can’t withdraw money from your savings account prior to the end of the fixed term.

 

[Funn3r]

13 hours ago, Froggy2000 said:

On the other we have all the freaks pushing a vegan diet. I would say perhaps this is all a grand conspiracy but as others have pointed out they are far too stupid for that.

I have an very-nearly-almost-vegan diet. I am not "pushing" it though so I will give you the benefit of the doubt that you didn't include me in your characterisation of "freaks."

But now that you've definitely called me stupid as well though the gloves are off so...

 

 

[DurhamBorn]

3 hours ago, marceau said:

They may be inflation protected, but they aren't tax exempt. Inflation will see them losing increasingly large real-terms chunks of their newfound wealth to HMRC. I doubt that'll be enough to make them change course though - all that matters to these retards is that numbers go UP. 

Yes,the problem is though they are last man standing.When i do my roadmaps their real use is for direction,then you can cross market likely things happening,then you can push forward on that happening forcing something else to happen.Its why the macro has to be really tight and needs the work because i cant afford direction miss calls.I find getting the roadmap right in the first place gives me a rough 75% chance of being right two cross market affects later,the markets dont tend to be that far ahead,the Covid profits for us were so huge because we got the two steps over 75% right,but were 100% on direction,where market was almost 100% wrong.

Im not worried about keeping ahead,im worried about the fact nothing is moving the roadmap away from collapse,its saying certain even if i juggle some bits.Seeing the setup while they import millions of 3rd world scum is very worrying.It can only be the Tories want Labour to be destroyed once they get in.

[montecristo]

6 minutes ago, Funn3r said:

Here's the problem with all those kind of banks though. What if you start noticing queues of people outside their branches? Well not that they even have any branches but you know what I mean.
 

• You can’t withdraw money from your savings account prior to the end of the fixed term.

 

Just keep your savings under £85k for the FSCS.

[marceau]

15 minutes ago, DurhamBorn said:

Yes,the problem is though they are last man standing.When i do my roadmaps their real use is for direction,then you can cross market likely things happening,then you can push forward on that happening forcing something else to happen.Its why the macro has to be really tight and needs the work because i cant afford direction miss calls.I find getting the roadmap right in the first place gives me a rough 75% chance of being right two cross market affects later,the markets dont tend to be that far ahead,the Covid profits for us were so huge because we got the two steps over 75% right,but were 100% on direction,where market was almost 100% wrong.

Im not worried about keeping ahead,im worried about the fact nothing is moving the roadmap away from collapse,its saying certain even if i juggle some bits.Seeing the setup while they import millions of 3rd world scum is very worrying.It can only be the Tories want Labour to be destroyed once they get in.

I've said this before, and I'm sure most won't agree, but imo collapse is the best thing we can hope for. Sure it'll be very painful for everyone, maybe even lethal for some, but if we stay in this system nothing will remain of us at all. We're far beyond mere economics here.

[SpectrumFX]

24 minutes ago, Funn3r said:

Here's the problem with all those kind of banks though. What if you start noticing queues of people outside their branches? Well not that they even have any branches but you know what I mean.
 

• You can’t withdraw money from your savings account prior to the end of the fixed term.

 

I've been looking at HL's cash saving service. You can deposit money into multiple fixed term accounts (around 4.7% on offer), or easy access accounts (circa 3%) via HL. It takes the hassle out of opening and closing multiple accounts to chase after rates, although you do obviously have to be careful with the fixed terms.

 

 

[Frank Hovis]

43 minutes ago, Bobthebuilder said:

Agree, I think we should all be eating less meat but of a higher quality / welfare than at present. I always buy my meat direct from the source or as close as possible. Out of all my family and friends, I am the only one who has this approach.

@King Penda, @Frank Hovis Been in Lidl today to get my lout pilsner perlenbacher, 4 cans has been reduced from £3.50 to £3.09 unfortunately the can size has also been reduced from 500ml to 450ml.

 

I'm literally just back and didn't buy any beer, and wow it's a cheap shop when you don't buy beer!

I always stop buying for a while in the hope that others do the same and that Lidl and Aldi put their "absolutely no collusion whatever guv" price back down.  They have done so on at least two prior occasions so they must have seen a material decline in sales.

Is it still the same strength? 

Over the course of a year Lidl's decent bitter (they haven't sold the very cheap one for maybe fifteen year) Hatherwood went from a full bodied pub quality 5%, and my regular beverage, down to a watery 3.8% which pushed me onto the lager.

It takes a very skillful brewer to produce a 3.8% bitter with a full body and they certainly haven't managed it.  It's not that I want the higher alcohol percentage but without it the beer just doesn't drink as good.

 

[feed]

14 hours ago, Froggy2000 said:

Food production has already been hit hard by rules on pesticides, cost of fertiliser etc. Add in rewilding, more farmland built on for houses, renewables etc. Someone else further up the thread posted a clip from a farmer discussing finances and planting decisions. I can see a lot of farmers deciding not to plant anything and just let the land rest/collect subisidies since its not worth the financial risk at current prices. So soon we could have low supply in a market with inelastic supply and food prices explode soon after.

On the other we have all the freaks pushing a vegan diet. I would say perhaps this is all a grand conspiracy but as others have pointed out they are far too stupid for that.

They're not pushing a vegan diet, they're pushing a plant based diet.  i.e Highly processed and highly profitable food products.  If it they were telling people to go eat a cauliflower or something, then it be a bit different.  

for example, my partner is vegetarian and i don't digest dairy very well anymore, so we accidently eat vegan quiet often, but not a plant based product to be seen.