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

[The Bear of Doom]

1 hour ago, Wight Flight said:

You could well be right. He also worked at Dunsfold, and i know he worked on the harrier. I may well have confused employers / locations.

Harrier flight test and production was undertaken by HSA at Dunsfold. Thomas Sopwith would be spinning in his grace if he knew what has happened to his company, sort of links with what has been said upthread about the decline of productive industry in the UK, and the lack of "practical men".

[Wight Flight]

3 minutes ago, The Bear of Doom said:

Harrier flight test and production was undertaken by HSA at Dunsfold. Thomas Sopwith would be spinning in his grace if he knew what has happened to his company, sort of links with what has been said upthread about the decline of productive industry in the UK, and the lack of "practical men".

I know the tests were done at Dunsfold. FIL had to sign it off.

[Bobthebuilder]

3 hours ago, Stuey said:

They'll be back at 1% before they hit 6% brah. 

Why don't you add some substance to that, why they are going to 1%? what's going to reduce inflation significantly from here? Energy prices? 

I was talking to a friend today who runs a kitchen business, he was another who's talking about jacking it in and getting a small job instead, too much hassle. I respect this guy, I pretty much bought my house with the cash |I earnt through him over a decade. He has just managed to secure a 2 year mortgage deal at 4.7%, he is pretty happy with that as, yes rates could fall, but he sees it as a good hedge.

I look forward to your informative reply.

[RJT1979]

2 hours ago, AlfredTheLittle said:

I think it's nice to have a different view, pretty much everyone here agrees completely with each other, which can't be healthy.

It's not that. It's just endless repeating. Like f150 and cars. Possibly the same retard

[DurhamBorn]

Oh look The Telegraph ,they knicked our "groupthink" as the reason for the BOE being shit.

https://www.telegraph.co.uk/news/2023/06/19/inquiry-into-bank-of-england-to-save-britain-from-penury/

Its a very good article though pulling together our work.Notice the last bit.Collapse .

No mention though of the reason behind it all,monetising the welfare budget for governments.

[azzuri82]

1 hour ago, Bobthebuilder said:

Why don't you add some substance to that, why they are going to 1%? what's going to reduce inflation significantly from here? Energy prices? 

I was talking to a friend today who runs a kitchen business, he was another who's talking about jacking it in and getting a small job instead, too much hassle. I respect this guy, I pretty much bought my house with the cash |I earnt through him over a decade. He has just managed to secure a 2 year mortgage deal at 4.7%, he is pretty happy with that as, yes rates could fall, but he sees it as a good hedge.

I look forward to your informative reply.

Yeah totally understand why someone would do this - the margins don't make sense when you take on all the risk and hassle of managing staff etc.

Another thing I've noted particularly over the last 2-3 years is how poorly skilled/qualified the general populace are. Other than whatever field someone works in - people tend to have no manual labour skills or adaptability whatsoever.

Say what you like about the boomers/our parents' generation - but they could do stuff and fix/mend things themselves.

Now, granted - the people I normally deal with today aren't exactly high fliers - and I tend to like it that way - but at the same time - it's notable how many people just don't have basic skills or can't do basic DIY - and no one seems to want to learn anything.

Our little biz makes/made the highest of margins from the simplest of repair work/jobs - its crazy to me how much people will pay to avoid a couple of hours work and/or having to solve a problem themselves.

I tried to encourage one of our guys to learn to drive. I told him, look, if you get your licence, go out and piss about in the van, do the odd wee delivery/collection/whatever, we'll pay you another £2/hour - not just for the time you/he drives - but for every hour you work  (another £4k year) - still done nothing about it. One of the other reasons by it's pointless trying to build a business with a highly-skilled workforce - unless you're willing to train them yourself (and I'm not) - the skills aren't there to do anything other than stack shelves and scan things at a checkout.

Everywhere you look - people can't do anything - they are reliant on others for help with everything. That on it's own cannot be good for the economy - a populace that can't fix problems themselves and simply consume energy whilst being reliant on large corporations and/or government for their salary and to put food on the table.

 

 

[GoneDark]

7 hours ago, Stuey said:

Just what I was about to ask! Inflation and rates will be plummeting by year end. 

Gotta luv it. @Stuey, the contrarian to the dosbods contrarians.

We can have a non poll, poll, anyone interested?

Heart emoji for @Stuey's plummeting by year end.

Bogged for those who still think we’re all fucked regardless. 

[azzuri82]

8 hours ago, sancho panza said:

Thanks for your insights azzuri.I think I remember you being involved in one of the shorting threads sometime back-maybe 2019?would that be tyou?

Until the Ukraine invasion dicussion down ehre of systemic risk was relatively rare but the the Ukriane war and it's effect on the inflation that was alaready running(CPI 5%+) and the govts resposne to it has seen systemic risk disucssion become a daily occurrence.

This thread has had some form over the years for foresight and if you monitor it every day or two,you start to see trends that are indicative in themselves.

we've been hearing more and more about the quiet/great resignation on herer and your testimony sits powerfully amongst it.Thats a lot of tax you pay every year and a lot of hassle you go through to pay it.I'm not surprised you feel like giving up.

think about it,that's two families on bennies on @DurhamBorns close that you won't be paying for any more.

I'm in the NHS and do a shift a week.My life has improved no end since i reduced my hours in 2019.Tiem with the kids is a blessing and I hope you enjoy your new found freedom.Like you I don't know how the 2 FT salary hosueholds do it mentally.I suppose they have no choice.

Yeah that was me. I'm a terrible investor/trader generally because I have very little patience. I'm a tinkerer that constantly likes to fiddle with things.

I'm still to find a trading strategy that suits my personality. I get bored easily and find losses/reds hard to stomach. I don't have the focus for technical analysis and find it quite boring. I like investing for fundamental reasons but then ask myself why - is it for actual financial gain or just a hobby? Because if it was/is for financial gain, would likely make more in active business/es which I myself have an interest/involvement in.

It is/was a lot of tax, but of course you only pay it if you're making money (with the exception of VAT and business rates, of course). And of course running a business means you make a lot more than your average PAYE'r on a similar/same salary. 

But yeah, I'm an entirely unremarkable, average guy that's not excelled at anything, really.

The only reason I've made money is I've been remarkably lucky to be in the right place at the right time, and I'm not afraid of committing my time/energy to something just to see if it works. Been lucky enough to always have at least a few years' worth of living expenses behind me, so meant I wasn't ever afraid to leave a job to try something new/different.

 

[King of Fools]

11 hours ago, DurhamBorn said:

My daughter has a SIPP and ISA now and chooses some herself,she bought B+M before it rocketed and she has just bought National Express,she says "the age of the car is over",now thats her choice,but the worry for me is has @F150 been grooming my daughter? ,i must add she also thought the sun went around the earth.

Reminds me of a girl on Big Brother a few years ago. She thought the sun and the moon were the same thing. I couldn’t get my head around it. Does someone just turn the sun down a bit in the evening and then cranks it up again in the morning?

[Axeman123]

11 minutes ago, King of Fools said:

Reminds me of a girl on Big Brother a few years ago. She thought the sun and the moon were the same thing. I couldn’t get my head around it. Does someone just turn the sun down a bit in the evening and then cranks it up again in the morning?

I once worked with an incredibly stupid man, who insisted it was impossible to ever see the moon in daylight for some reason - I don't even remember how that came up.

One day I pointed to the moon and asked "so whats that then, scotch mist?". He insisted it was just clouds, but showed signs of glassy eyed panic like I had just wrecked his sense of reality.

He must have been getting on for 50, had he never looked up in all his years? Had he seen the moon in daylight before, and blocked it out thinking it a hallucination?

[Barnsey]

13 hours ago, DurhamBorn said:

Thats right,think Premier Inns model for the big boys going into rental.Same fixtures,fittings,a few standard designs etc.Thats how you do it to keep costs etc down and be able to run a real rental business.Like you say IO BTL is going to FTB at big discounts.I know many selling who dont even have mortgages,they cant be arsed with the regs changing all the time.Its a ludicrous business for most now.I know two who had 5 and 9 houses,all paid for,2nnd one had LTV of 17%,both did it right for 20 years,one a builder,one married to a bloke who was very handy and whos mates were all trades,both sold the lot last year as they said it was not viable going forward.

Watkin Jones (WJG) worth a look perhaps? 8% divi, P/E 7

https://www.watkinjonesplc.com/

 

[King Penda]

2 hours ago, Bobthebuilder said:

Why don't you add some substance to that, why they are going to 1%? what's going to reduce inflation significantly from here? Energy prices? 

I was talking to a friend today who runs a kitchen business, he was another who's talking about jacking it in and getting a small job instead, too much hassle. I respect this guy, I pretty much bought my house with the cash |I earnt through him over a decade. He has just managed to secure a 2 year mortgage deal at 4.7%, he is pretty happy with that as, yes rates could fall, but he sees it as a good hedge.

I look forward to your informative reply.

No chance will we see 1% again in our lifetimes unless the system want to go into negative territory to force people and corporations to spend there stash to keep the plates spinning 

[DurhamBorn]

3 minutes ago, Barnsey said:

Watkin Jones (WJG) worth a look perhaps? 8% divi, P/E 7

https://www.watkinjonesplc.com/

 

First photo on their webpage is a black bloke a white woman and a half chat kid,im out.

[leonardratso]

6 minutes ago, DurhamBorn said:

First photo on their webpage is a black bloke a white woman and a half chat kid,im out.

and also some wank about covid safety award

my god, no shame whatsoever;

Edited June 19, 2023 by leonardratso

[GoneDark]

36 minutes ago, azzuri82 said:

Everywhere you look - people can't do anything - they are reliant on others for help with everything. That on it's own cannot be good for the economy - a populace that can't fix problems themselves and simply consume energy whilst being reliant on large corporations and/or government for their salary and to put food on the table.

Really interesting posts you have made within the last 24 hours, it's much appreciated hearing real coalface life by a business owner. I also have been distracted from reading in the basement recently but I have been monging about in 'off topic', whereas I hope you have been having quality family time.

To the point, I think in some perverse way that is what the state want, as outlined multiple times in the thread. A completely docile populous that can be pushed or pulled in whatever direction the state wishes. Confuse them with 'gender' issues and any number of other bullshit 'ideas' to distract them whilst they continue their manipulate robbing ways.

It is strange though, that surely some of these people realise that they have to have a reasonably functioning society as that is what enables them to be able to live their lives as well, surely some of them understand this? 

I see it as that junga game (not sure if that is the correct name), that if you pull out the wrong piece, at the wrong time, or place, you get total collapse.

And no, I didn't learn that game from The Big Short via Jared Vennet and his presentation. There are bars, and their associates, all over Thailand who play that game much better compared to our central 'bankers'.

Looks like we're all in for a 'fun' ride...

[King Penda]

6 minutes ago, GoneDark said:

Really interesting posts you have made within the last 24 hours, it's much appreciated hearing real coalface life by a business owner. I also have been distracted from reading in the basement recently but I have been monging about in 'off topic', whereas I hope you have been having quality family time.

To the point, I think in some perverse way that is what the state want, as outlined multiple times in the thread. A completely docile populous that can be pushed or pulled in whatever direction the state wishes. Confuse them with 'gender' issues and any number of other bullshit 'ideas' to distract them whilst they continue their manipulate robbing ways.

It is strange though, that surely some of these people realise that they have to have a reasonably functioning society as that is what enables them to be able to live their lives as well, surely some of them understand this? 

I see it as that junga game (not sure if that is the correct name), that if you pull out the wrong piece, at the wrong time, or place, you get total collapse.

And no, I didn't learn that game from The Big Short via Jared Vennet and his presentation. There are bars, and their associates, all over Thailand who play that game much better compared to our central 'bankers'.

Looks like we're all in for a 'fun' ride...

I enjoy a fun ride 

[RJT1979]

8 minutes ago, King Penda said:

I enjoy a fun ride 

 

 

[King Penda]

6 minutes ago, RJT1979 said:

 

 

That’s just it I’m nuts I can’t take life seriously there’s a reason I work nights and it’s to keep away from managers .I know I have to conform to some extent  but I do the bare minimum and change jobs frequently what controls me is debt it’s my silver bullet 

[JMD]

An interesting macro analysis and history, plus some portfolio asset allocation suggestions. Written by the founder of Gavekal money managers, Charles Gave. Bit of a slow start but worth reading as contains many insightful nuggets. His thoughts mostly reflect the thread thesis, but does also introduce other concepts, however I think I'll have to reread the article to digest and fully appreciate his ideas.

https://haymaker.substack.com/p/making-hay-monday-guest-article?utm_source=post-email-title&publication_id=846890&post_id=129167319&isFreemail=true&utm_medium=email

 

 

[AWW]

2 hours ago, azzuri82 said:

Another thing I've noted particularly over the last 2-3 years is how poorly skilled/qualified the general populace are. Other than whatever field someone works in - people tend to have no manual labour skills or adaptability whatsoever.

Say what you like about the boomers/our parents' generation - but they could do stuff and fix/mend things themselves.

its crazy to me how much people will pay to avoid a couple of hours work and/or having to solve a problem themselves.

This isn't a recent thing. When I was a student back in the late 90s, I had a little sideline fixing bikes, as I had fixed my own bikes up since I was a kid. Most of the work was mending a puncture, for which I charged £10 plus the tube, if it couldn't be patched. I did anywhere between a few a day to a few a week. Easy money.

[King Penda]

56 minutes ago, AWW said:

This isn't a recent thing. When I was a student back in the late 90s, I had a little sideline fixing bikes, as I had fixed my own bikes up since I was a kid. Most of the work was mending a puncture, for which I charged £10 plus the tube, if it couldn't be patched. I did anywhere between a few a day to a few a week. Easy money.

It’s got even easier people now buy dogs and will happily pay other people to look after them .these are often highly skilled people who earn a lot of cash . Even a fair few forum members will admit to paying for dog sitters 

[Stuey]

6 hours ago, Bobthebuilder said:

Why don't you add some substance to that, why they are going to 1%? what's going to reduce inflation significantly from here? Energy prices? 

I was talking to a friend today who runs a kitchen business, he was another who's talking about jacking it in and getting a small job instead, too much hassle. 

Energy prices is the main driver, yeah. A key input for a vast number of processes - prices down 80% or so in less than twelve months. We're just waiting for the lag to pass. 

And I said 1% rates before 6%, before that starts getting distorted...

[Lightscribe]

6 hours ago, azzuri82 said:

Everywhere you look - people can't do anything - they are reliant on others for help with everything. That on it's own cannot be good for the economy - a populace that can't fix problems themselves and simply consume energy whilst being reliant on large corporations and/or government for their salary and to put food on the table.

Useless Eaters….

5 hours ago, Axeman123 said:

I once worked with an incredibly stupid man, who insisted it was impossible to ever see the moon in daylight for some reason - I don't even remember how that came up.

One day I pointed to the moon and asked "so whats that then, scotch mist?". He insisted it was just clouds, but showed signs of glassy eyed panic like I had just wrecked his sense of reality.

He must have been getting on for 50, had he never looked up in all his years? Had he seen the moon in daylight before, and blocked it out thinking it a hallucination?

Maybe he just had a fat neck?

Speaking about sense of reality, I’m definitely in the Dolly had braces camp in Moonraker and that Fruit of the Loom had the cornucopia. Don’t ask me how I ended up in this shitfest of a timeline.

[Lightscribe]

1 hour ago, Stuey said:

Energy prices is the main driver, yeah. A key input for a vast number of processes - prices down 80% or so in less than twelve months. We're just waiting for the lag to pass. 

And I said 1% rates before 6%, before that starts getting distorted...

As I’ve said before inflation is too sticky, inflationary uplifts and housing wealth in the UK has warped the balance of what effect interest rate rises have had (which is why as well as having a ‘service’ economy, technically we’re not in recession yet, whilst the eurozone is) We’ll have to wait for the layoffs en masse to begin before inflation ratchets down.

I don’t think however we’ll get the opportunity to drop rates before the secondary inflation wave starts to hit.  The PAYE, mortgaged, London middle class will be ripped a new one long before then.

[Jay]

8 hours ago, Bobthebuilder said:

Why don't you add some substance to that, why they are going to 1%? what's going to reduce inflation significantly from here? Energy prices? 

I was talking to a friend today who runs a kitchen business, he was another who's talking about jacking it in and getting a small job instead, too much hassle. I respect this guy, I pretty much bought my house with the cash |I earnt through him over a decade. He has just managed to secure a 2 year mortgage deal at 4.7%, he is pretty happy with that as, yes rates could fall, but he sees it as a good hedge.

I look forward to your informative reply.

It could happen..credit deflationary bust..house prices fall leading to lower spending..corporate and government spending down…qe back and emergency rate cuts..boe front runs the deflation by aggressive monetary expansion policy…2008 style..probably next year in the uk…if rates do fall that low then it’s not a good sign of the uk economy health..demand destruction…

or cost push inflation with smaller supply leading to inflation rises and further rate rises rises..unless we have erdogan in charge who cuts rates in inflationary times but he is a one off..

Not sure what happens next but it doesn’t look good..for the uk…stagflation probably..that’s what I am betting on until next year even though unemployment is at record lows..definitely a stock pickers market…be lucky..