Credit deflation and the reflation cycle to come (part 6)

[ashestoashes]

3 minutes ago, JMD said:

I think everyone should watch that video. It could have been lot shorter but it does put the perceived CBDC risk into context. 

Essentially CBDCs are overhyped rather like Elon Musk's self-driving car tech is. I wrote some time back about the Chinese CBDC experiment being more about attempting to create a trusting/reputation based culture than about control. Of course China is totalitarian but the problem the authorities identified several decades ago - and still need to solve - is one of social cohesion between Chinese groups/cultures/rural villages, etc. I've referred before to China's 15 provinces (actually that might be slightly inaccurate?) and the comparison to the former USSRs own 15 republics that each had different languages and cultures, and of course what ultimately happened there. 

However I still think CBDCs will be used in the West. But it will probably be used to implement one or all of - currency reset/inflation control/UBI dependency state administration. As others have often said on here the government already has electronic oversight of our spending and far tighter control will happen once cash is banned. 

 

would they have stopped you buying stuff if you weren't jabbed if they'd had CBDCs in the covid Pandemic ?

[Virgil Caine]

1 hour ago, Axeman123 said:

Literally a pension scheme with a country attached. You could even argue two of those three categories (plus minting PM coins as currency) are the only legitimate branches of government, and everything else is over-reach (maybe even including education).

The fact this figure is doing the rounds implies that the ruling class see this state of affairs as unsustainable IMO. Could we be about to see means testing of the state pension after the next election?

Yet it is only now we are getting media messaging about it.

Indeed. Pensioners often have assets they can draw down to support themselves, whereas working age benefit claimants sometimes don't even own their furniture or domestic appliances outright! Pensioners often hoard wealth, whereas working age claimants tend to splurge it all back into the economy. You can foresee the govt calculations on where the axe must fall.

Which means pensioner wealth will have to go down to pay it IMO, efectively a wealth transfer to prop things up a while longer.

Probably care worker or dodgy student etc visas. The boat wankers are a decoy for population replacement IMO. None of us are keen on lone fighting age males, but the legal migrants can end up bringing half their village here!

I agree that the figures suggest pensioners and working age welfare claimants in competition for the money. The government problem is the cost of the latter is increasing quite a lot faster than the former even allowing for boomer demographics. The situation is also skewed by the fact state pensions are taxable while working age benefits apart from JSA generally are not. While average Pensioner savings are about £113,000  and the average income including state pension about £18,000 the distribution is not even across the demographic with 1 in 5 having less than £1000 in savings. As DB Pensioners in older private schemes die I expect those figures to worsen as new pensions are unlikely to be as generous and not have any index linking. Under Australian style means testing that would still leave a significant number of people qualifying for a state pension. The savings from means testing Pensions also have to be offset against a potential decline in tax yield ( ie a Pensioner with an income of £18,500 has a taxable income of about £5000 so a £1000 goes straight to the Treasury in Income Tax). A lot of Pensioner capital savings also are also deposited in the financial system including government debt both indirectly and directly via things such as National Savings. Means testing will accelerate the rate at which they are liquidated.  So the net result is likely to be a temporary reprieve from collapse. It won’t prevent it because the real problems in the government budget lie elsewhere.  In addition as DB has pointed out the problem in the U.K. is excessive consumption not excessive savings in whatever form.

Edited August 10, 2023 by Virgil Caine

[sancho panza]

8 hours ago, Virgil Caine said:

Looking at past Budgets and spending rounds I think the annual cost of the state pension has been more than Education, Defence and the Home Office for quite a long time. Just adjusted for inflation the increase from 2022-23 would be about £8-9 billion. What the article fails to mention is that the total cost of working age welfare spending is nearly as much as the cost of the state pension. The killer in the forecast is actually the debt interest to be paid which is estimated to be more than the whole education budget

https://obr.uk/forecasts-in-depth/brief-guides-and-explainers/public-finances/

Thanks for highligihitng that Virgil.The hive mind at it's best.I was unaware.

4 hours ago, onlyme said:

Went to an event that covered supermarket promotions, quite of often apparently it is the supermarket that dictate the timing / type of offer with price they were willing to pay.  The suppliers wish to keep their favourable shelf positioning so are not in a position to really say no so pony up stock at heavily reduced margins but I suppose do get the additional exposure, for whatever that is worth in follow on sales.

Things certainly are changing, Aldi/Lidl seem to have middle isles either stuffed with more tat than useful stuff compared to pre-pandemic / inflation stocking or more selected food lines whch are not exactly cheap in many cases. A move to more branded product runs the risk of not really appealing to any particuar core group in some ways,  last visit to Aldi (admittedly after peak rush) the place was strewn with boxes, obviously understaffed and stock items (presumably the popular / in demand items) missing  all over the place - not sure this would appeal to the upper shopper segment whilst also not providing the product for sale to the lower / budget conscious shopping there in the first place.

Also quite noticeable is staff turnover. A few years ago you'd see the same core group running the local Aldi/Lidl  year in year out. Now it seems a complete set of new faces and they don;t stay there long either.

The supermarkets do have a lot of power.The appearance of some brands in the regular aisles at Aldi is the beginning of what you might call the dedollarization of tesco.It's bascially the big brands telling tesco to do one.In my eyes this is big news.Nespresso co partnering with aldi is equally powerful message.But fair play to their board for maintaining market share

The brand manufacturers are still mainly aiming to maintain margins from what I udnerstand from mrs P.I think that is until top line revenue starts getting hit and then they need to keep an eye on market share.by which time it might be too late

I've been suprised (from what I hear) about how brandeds haven't seen market share as an issue.I say that because you need to get young kids eating your products or they'll grow up used to aldi kethcup and will see no need to buy heinz.

Looking at the strategies Mrs P is telling me about the Unilevers of this world,they're not seeing the inflationary cycle coming.I've said to her they need a macro road mapper such as @DurhamBorn to lay out where this is going and then to build a strategy around the macro that is inbound.

genuienly,I'm amazed at what they spend on wages and don't appear to have an economsit worth their salt anywhere near the decison makiing bodies.

2 hours ago, DurhamBorn said:

The State pension is not a problem,,its the in work bennies and all the other bennies for retired with nothing else.There are millions who retire at 18 .They are trying to set up for where they cut,but only for those who have other pensions etc Im seeing lots of Africans around here now,within the last 6 months,big obese women dragging a few kids around who mostly look retarded.These are not coming in on boats,so where are they coming from?,all massive drains on the taxpayer.We are watching them destroy our country that took 1700 years to get where it did in a couple of decades.

I wonder how many arrivals are families of care workers? as per discussion with @King Penda ref care homes being staffed now by non EU workers.Also,nurses and otehr NHS staff.

We appear to be solving the Brexit problem with an even bigger problem.

[Castlevania]

2 minutes ago, sancho panza said:

Thanks for highligihitng that Virgil.The hive mind at it's best.I was unaware.

The supermarkets do have a lot of power.The appearance of some brands in the regular aisles at Aldi is the beginning of what you might call the dedollarization of tesco.It's bascially the big brands telling tesco to do one.In my eyes this is big news.Nespresso co partnering with aldi is equally powerful message.But fair play to their board for maintaining market share

The brand manufacturers are still mainly aiming to maintain margins from what I udnerstand from mrs P.I think that is until top line revenue starts getting hit and then they need to keep an eye on market share.by which time it might be too late

I've been suprised (from what I hear) about how brandeds haven't seen market share as an issue.I say that because you need to get young kids eating your products or they'll grow up used to aldi kethcup and will see no need to buy heinz.

Looking at the strategies Mrs P is telling me about the Unilevers of this world,they're not seeing the inflationary cycle coming.I've said to her they need a macro road mapper such as @DurhamBorn to lay out where this is going and then to build a strategy around the macro that is inbound.

genuienly,I'm amazed at what they spend on wages and don't appear to have an economsit worth their salt anywhere near the decison makiing bodies.

I wonder how many arrivals are families of care workers? as per discussion with @King Penda ref care homes being staffed now by non EU workers.Also,nurses and otehr NHS staff.

We appear to be solving the Brexit problem with an even bigger problem.

I’d imagine a fair few of the 17,000 Zimbabwean nurses hired last year would bring their families with them.

[sancho panza]

12 minutes ago, Castlevania said:

I’d imagine a fair few of the 17,000 Zimbabwean nurses hired last year would bring their families with them.

I work A&E mainly an 300k city in the Midlands.Currently,A&E would shut if it wasn't for African(particualrly),also Indian/Phillipino Drs and Nurses.

This started going badly worng when the UK govt decided to charge UK kids £50k for a nrusing degree that gets you a £27k job.Surprisingly,not enough volunteered.

So we imported lots of people who paid £3000 for theri degrees.

There's a massive impact on the thrid world obviously,but that's ok in the world of your tofu chomping virtue signaller because we're entitled innit.

Edited August 10, 2023 by sancho panza

[Option5]

9 minutes ago, Castlevania said:

I’d imagine a fair few of the 17,000 Zimbabwean nurses hired last year would bring their families with them.

I'm not sure that's true, all the ones I know of the want a British partner so they don't have to go back.

They're basically refugees who want to work and build a better life for themselves.

[ThoughtCriminal]

1 hour ago, Harley said:

But if they're so good why three pairs!

Yeh, overpriced burgers.  Didn't know they were that tough too!

Some people buy multiple guitars, I buy multiple walking shoes lol

 

Try them, you'll never go back. 😉

[kibuc]

1 hour ago, Eventually Right said:

Do you have any views on Hoka, TC? I'm meant to be walking the Camino De Santiago in a month or , tried Salomon, Merrell, North Face etc, and finally settled on these, with an extra wide toe box:

For zero drop with wide and flexible toebox, my brand of choice is Altra. Escalante for massive cushioning on flats, Superior for minimalistic sole with trail pattern. They also have cushioned trail shoes that I haven't tried.

I used to love Inov-8 before they went all crossfity and narrow. Bare-X 180 was by far the best pair of minimialistic road shoes I've ever had and I still have a pair but it's slowly falling apart. Sad face.

For zero drop with no cushioning at all I just go with bare feet. Gone are the years where I'd simply live barefoot all year round but I still keep it as an option on my walks.

Edit: someone mentioned Vivobarefoot - pricey but very comfortable indeed, got one pair of moccasins for clubbing.

Edited August 10, 2023 by kibuc

[Harley]

54 minutes ago, dgul said:

Wilko has gone.

Hope they managed to save their div!

[JMD]

32 minutes ago, ashestoashes said:

would they have stopped you buying stuff if you weren't jabbed if they'd had CBDCs in the covid Pandemic ?

Don't want to derail thread, but the point I was making was that CBDC joined up infrastructure designed to control society to the n'th degree is not possible (but I did give what I think could be limited use examples). China appear to have run the control experiment and it failed.

More effective in times of pandemic and war, to just use the BBC to frame the moral argument or to scare people. After all propaganda worked pretty well last time. Ok maybe the 'crises' wont be a pandemic next time (especially after party gate?), but phycology and shame are powerful state tools, so maybe just publicly shame some middle class transgressors and send them a fixed penalty fine in the post or by drone!

Edited August 10, 2023 by JMD

[M S E Refugee]

3 minutes ago, kibuc said:

Edit: someone mentioned Vivobarefoot - pricey but very comfortable indeed, got one pair of moccasins for clubbing.

What type of Clubbing?

Dance or Seal?

[Harley]

31 minutes ago, ashestoashes said:

would they have stopped you buying stuff if you weren't jabbed if they'd had CBDCs in the covid Pandemic ?

Steady on, remember a spokesman for big pharma apparently said the other day no-one was forced to take the vax.  I think a few polos said the same too.

[Option5]

59 minutes ago, dgul said:

Wilko has gone.

Not surprised, people blame management, market conditions etc.

No mention of the actions of the local councils making town centres practically inaccessible due to road schemes, speed bumps, pedestrianisation, cycle lanes, and most of all parking restrictions and charges.

Talk about killing the goose.

[Starsend]

3 hours ago, TNS said:

yep, I didn't realise until i saw this comment, that there are that many single mums of 3 or more kids!

Forgot to mention 135bn for people who have paid into the system is less than the 144bn and climbing of those who choose not to work. A perfect example is the 780000 single mums of 3 or more who recieve over 35k a year in handouts now that's more than 3 times a person's state pension . Says alot really

Holy shitfuck! Over three quarters of a million poncing huge amounts of money and that's just the ones with three or more kids. How many have one or two kids, probably millions and they'll still be getting housed and hosed down with free money. Decades of demonising men, encouraging divorce and handing free shit to women for being irresponsible and here are the end results. How the fuck does this get unwound!

[Starsend]

3 hours ago, ThoughtCriminal said:

Don't get me started on this. 

 

I used to buy Merrell chameleon and they'd last forever. About 7 years ago I walked the Camino De Santiago over the Pyrenees and across Northern Spain and I had to ditch my brand new Chameleons after 4 days as they'd started falling apart. I've tried Salomon, North Face, Adidas, Nike, all absolute shite, don't last more than a couple of months. 

 

I now wear Altra. Not cheap but zero drop and wide toe box, much better for your feet and body overall.

I know similar people who have bought "decent" brands and they've fallen to bits - amazing really, build up your brand and then destroy it by shipping production to some crappy factory in China - they deserve to lose their businesses. My son's new hiking boots fell apart on his very first hike, might have been Salomon.

I've walked to Santiago twice, once from St Jean Pied de Port and once from Porto in Portugal. I started out in an old pair of hiking boots that I'd already had for years, they got me to Santiago twice, but then they did fall apart. Had my money's worth out of them for sure.

Last pair I bought were £60, Mountain Warehouses own brand with Vibram soles. Now four years old, done a fuck of walking in them and they are still sound. A lot of the expensive brands are now shit so might as well buy cheaper and sometimes it's surprising how good they are.

[ThoughtCriminal]

1 hour ago, Eventually Right said:

Do you have any views on Hoka, TC? I'm meant to be walking the Camino De Santiago in a month or , tried Salomon, Merrell, North Face etc, and finally settled on these, with an extra wide toe box:

I haven't tried them but I read up on them previously and I've only heard good things about them so I think they'll be spot on 👍

 

Is this your first Camino?

[Starsend]

18 hours ago, Harley said:

Butting in......

Having tried once, IME that's a rabbit hole to over analyse.  I content myself with just looking at our cash balances.  Thankfully, most of our brokers are multi-currency and we do watch forex quite closely. 

Our core model portfolio is largely regional ETF based so limited UK exposure (UK is buried somewhere in the European ETF).  We took care to select ETFs with a proper country spread (i.e. not high US).  Then there are commodities and PMs which sidestep the issue.  Bonds are US and EM, with all UK bonds now sold at a loss.  Perversely, we got stung last month on our unhedged US bond holdings as GBP strengthened.  Could be reversing soon though.  Will ditch US bonds once the USD improves as we get more in cash (USD) atm. 

We also carefully selected our shortlist of upside (intermediate tradable) ETFs to ensure global exposure for the sectors, plus we include country ETFs.  Individual stocks are quite few atm but per DB, international (UK listed) or overseas listed.  IMO, if you get the international investing right, the currency risk declines (diversifies).

Yes, it's not as easy to do as you might imagine. I'm trying to come up with a method that keeps it simple but gives me a broad idea. I was pretty surprised with my initial spreadsheet showing that I was still over 50% in GBP, way too high.

[Long time lurking]

 

[azzuri82]

5 hours ago, onlyme said:

Went to an event that covered supermarket promotions, quite of often apparently it is the supermarket that dictate the timing / type of offer with price they were willing to pay.  The suppliers wish to keep their favourable shelf positioning so are not in a position to really say no so pony up stock at heavily reduced margins but I suppose do get the additional exposure, for whatever that is worth in follow on sales.

Things certainly are changing, Aldi/Lidl seem to have middle isles either stuffed with more tat than useful stuff compared to pre-pandemic / inflation stocking or more selected food lines whch are not exactly cheap in many cases. A move to more branded product runs the risk of not really appealing to any particuar core group in some ways,  last visit to Aldi (admittedly after peak rush) the place was strewn with boxes, obviously understaffed and stock items (presumably the popular / in demand items) missing  all over the place - not sure this would appeal to the upper shopper segment whilst also not providing the product for sale to the lower / budget conscious shopping there in the first place.

Also quite noticeable is staff turnover. A few years ago you'd see the same core group running the local Aldi/Lidl  year in year out. Now it seems a complete set of new faces and they don;t stay there long either.

I can't say the same where I am - local Aldi and Lidl always normally well stocked and see the same staff faces regularly. 

They aren't as happy/cheerful as they used to be - certainly - and I take your point about certain ranges being reduced and more branded items - but I guess it depends on where you are.

[Starsend]

16 hours ago, DurhamBorn said:

About 22% not including my house.Family has over 60% though.Most of mine is 5 years cash i always have,BT,and a few other stocks etc.Lots on FTSE still of course,but where they earn most outside the UK.Even TEF earns around a quarter from the UK.

That sounds a pretty good figure given the shitshow that is the UK at the moment and the high risk of a currency slide. I'd like to get mine down to a similar figure, 20 - 25% would be happy with, over bloody 50 at the moment, I thought it was way less than that until I had a proper look.

[sleepwello'nights]

34 minutes ago, sancho panza said:

 

This started going badly worng when the UK govt decided to charge UK kids £50k for a nrusing degree that gets you a £27k job.Surprisingly,not enough volunteered.

 

Also the BMA restricts the number of training places available!

https://www.bbc.co.uk/news/health-62594141

[ThoughtCriminal]

11 minutes ago, Starsend said:

I know similar people who have bought "decent" brands and they've fallen to bits - amazing really, build up your brand and then destroy it by shipping production to some crappy factory in China - they deserve to lose their businesses. My son's new hiking boots fell apart on his very first hike, might have been Salomon.

I've walked to Santiago twice, once from St Jean Pied de Port and once from Porto in Portugal. I started out in an old pair of hiking boots that I'd already had for years, they got me to Santiago twice, but then they did fall apart. Had my money's worth out of them for sure.

Last pair I bought were £60, Mountain Warehouses own brand with Vibram soles. Now four years old, done a fuck of walking in them and they are still sound. A lot of the expensive brands are now shit so might as well buy cheaper and sometimes it's surprising how good they are.

Couldn't agree more. There's very little correlation between quality and price these days.

 

The Camino is the best thing I ever did, I didn't want to come home. If money was no object I'd have carried on, just be a wanderer for life lol

[Harley]

20 minutes ago, Starsend said:

How the fuck does this get unwound!

Later, not now.  Right now, let's have all your money.

[Starsend]

1 hour ago, Harley said:

Yep, saving some after cancelling the home delivery.  I do miss the buzz of getting a slot during lockdown though.  Good game, good game.  Maybe they should have been up at midnight, etc if that desperate.  Loved our chats with the drivers over the gate, telling us how Armageddon (not) was going!  Haven't forgotten them and the rest like most folk. 

[Funn3r]

4 hours ago, Harley said:

For now, we'll be picky

Are you in the stock market business? I noticed you always say "we."

Apologies if you just mean your joint family finances. But would be great to have an actual professional onboard.