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

[Castlevania]

1 hour ago, DurhamBorn said:

I was shocked.The mainn plant was invested,but you could tell they didnt spend on the fabric of the site.They buy up whole sectors though in chems then increase prices,you could say good business,but they seemed like sharks to me and treat their staff like shit,old contracts were good,but anyone new going in was on very poor wages.

Yeah. I read an article a few months ago about the North Sea oil and gas sector and the journalist had gone up to Grangemouth. This is where after Ineos bought the site from BP the workers went on strike after Ineos tried to fire and rehire on much lower wages. Back in 2008 the average worker at the site was earning £65k and had a final salary pension. The average wage at the same plant 15 years later is apparently £44k and I doubt anyone would still get a final salary pension.

[DurhamBorn]

57 minutes ago, Starsend said:

I'm sure this kind of thing goes on a lot, no limit to the number of gullible simps out there - but what kind of person could con somebody like that over a period of years; a cold hearted cunt I would say. Personally I believe in karma and some people got a fuckton coming their way.

They dont see it as a con thats why,their mindset is not the same as ours.You could argue the other way around,why does a bloke who cannot get a date think he can shag a fit woman every night for free.?.They treat the guy like royalty until they get the right to remain,some do end up staying with the guy,but more dont.My friend has hundreds of photos of her and hubby loved up on socials,he thinks she is head over heals in love,but no,she told me its for immigration so they dont knock her back.I see the bloke she is with as the fraud.He gets her here then they rent a shit house in a shithole place because he doesnt have any money other than his wage.She also told me she wouldnt take any money when she leaves him in 18 months,even if he had any.I dont feel sorry for him at all,and probably a better deal than being shacked up with some land whale for a few years.She did ask me if i wanted her as my gik (mistress) but i declined the offer,i said i dont think my partner would be very happy,she didnt understand why because a gik is accepted in their culture as normal.Different cultures,hence why multi culture societies take hundreds of years to merge into one.

 

 

[feed]

1 hour ago, King Penda said:

It’s not what you earn it’s what you spend that counts this is why anyone with kids and on benefits should be fine if they don’t squander money. If your single and on benefits then you’ve got a problem the money is bare bones

i know this is the happy home of the frugal.  But it's the you should live on what you earn that's (in part) allowed wages to be squashed. The productively is there, workers should be paid more.  And i do i accept that the benefits system is broken beyond repair.   

[Starsend]

9 minutes ago, DurhamBorn said:

They dont see it as a con thats why,their mindset is not the same as ours.You could argue the other way around,why does a bloke who cannot get a date think he can shag a fit woman every night for free.?.They treat the guy like royalty until they get the right to remain,some do end up staying with the guy,but more dont.My friend has hundreds of photos of her and hubby loved up on socials,he thinks she is head over heals in love,but no,she told me its for immigration so they dont knock her back.I see the bloke she is with as the fraud.He gets her here then they rent a shit house in a shithole place because he doesnt have any money other than his wage.She also told me she wouldnt take any money when she leaves him in 18 months,even if he had any.I dont feel sorry for him at all,and probably a better deal than being shacked up with some land whale for a few years.She did ask me if i wanted her as my gik (mistress) but i declined the offer,i said i dont think my partner would be very happy,she didnt understand why because a gik is accepted in their culture as normal.Different cultures,hence why multi culture societies take hundreds of years to merge into one.

 

 

Can't really agree with that other than them having a different mindset. She's guilty of cold hearted deception, he's just an idiot - one is worse than the other in my view.

Don't believe for a moment she won't take any money when she's told by a lawyer what she's "entitled" to - wouldn't fit with the rest of her mindset.

I don't feel sorry for the bloke either as it's his own fault for being so stupid - but it doesn't make deceiving somebody to that extent ok. I'm sure the bloke thinks that the reason he's punching above his weight is because he's giving her a better standard of living than she'd get in her own country.

[King Penda]

5 minutes ago, feed said:

i know this is the happy home of the frugal.  But it's the you should live on what you earn that's (in part) allowed wages to be squashed. The productively is there, workers should be paid more.  And i do i accept that the benefits system is broken beyond repair.   

This sounds a bit like the ragged Trousered philanthropist or at least where it seems to be heading. If you have a lot of people  5k a month each they would still spend the lot 

Edited October 21, 2023 by King Penda

[JMD]

4 hours ago, Harley said:

Upon reflection my last post stopped before the killer point.  That's the risk, if things continue as they have, people's capital bases are bled dry.

As mentioned, it's facilitated by the nature of the beast.  We could well get a melt up with great amounts of yap, backslapping, effort, etc but if not timed there's a fair chance of a correction ending up with nothing or even less.  Better to have stayed in cash if you don't have the capability or don't want to gamble?  A question mark because who knows - IMO the important bit is the second derivative:  regardless, you need to start looking.  That's a prime place for people's energy, well for those where this is more than a spectator sport.

At best, captial bases erode with a softening to the blow from some dividend income.  OK, it's my book, but this stresses the need for proper allocation both by asset class and time and maybe by other things.

The traditional allocation concept needs a review to ensure it remains current.  It's not quite like it was: asset classes like bonds v equities have not been inversely related and I mentioned a new idea of time (timing).  There's probably more to consider.

I can hear comments about "but..." which I'll preempt (and move on) with a "that's because you're "doing" allocation already but, dangerously, you don't realise it!".

This thread, being social media with all the distracting flashing lights, bells, whistles, bare reposts, etc can contribute to keeping us blinded to the elephant(s) in the room. 

Play at your own risk.

PS:  For us, that means atm (asset, etc allocated) core portfolios topped up with (timely bought) value stock portfolios and trend following portfolios.  Essentially, everything underpinned by a intermediate term (weekly/monthly based) trend following approach.

In think you raise an Important topic. I divide my asset wealth between equities (shares portfolio) and hard assets (physical pms, etc).

In specific regard to my portfolio i have been re-evaluating my portfolio asset-classes and allocations, particularly in regard to what should/could replace bonds. There is of course no direct replacement for (inversely correlated) bonds but the best I have come up with is energy + commodities + property/infrastructure, ok I'm still talking equities here, but crucially well run, conservative/boring, low debt(profile), global companies with strong asset base, etc.

Listening to people like Tim Price and Louse Vincent Gave over the years have convinced me that having 40% in the 'right companies' within the above mentioned sectors is a good strategy (I realise some here are perhaps already 40% invested in oilies alone, but for example I would be talking the larger, long-term hold, 'safer' oilies here, and not say speculative Harbour energy). 

I'm not suggesting anything radical I know. But I am personally trying to find methods to reduce risk in a more enforced/systematic way. I'm still working out how to order the other 60% of my equity portfolio.

I would welcome others thoughts and alternative ideas/strategies.

Edited October 21, 2023 by JMD

[DurhamBorn]

30 minutes ago, Starsend said:

Can't really agree with that other than them having a different mindset. She's guilty of cold hearted deception, he's just an idiot - one is worse than the other in my view.

Don't believe for a moment she won't take any money when she's told by a lawyer what she's "entitled" to - wouldn't fit with the rest of her mindset.

I don't feel sorry for the bloke either as it's his own fault for being so stupid - but it doesn't make deceiving somebody to that extent ok. I'm sure the bloke thinks that the reason he's punching above his weight is because he's giving her a better standard of living than she'd get in her own country.

It is deception yes,but they see it as a business transaction.ie he gets her for the time she is there,and she makes him very happy in the sack etc,she gets what she wants.Its really interesting the money thing.Something genuine happened to her daughter once and she didnt want to tell hubby she needed quick cash,it was not much,i gave her it.Two weeks later she gave me it back,i was shocked.She said no no i not keep,i not want your money,i love you, you are my friend.So they have boxes they put you in.

Your 100% right though the guys think they become attractive because like you say they give them a better standard of living,what they forget is once the girls get a Visa they can get an even better standard of living,or a similar one with a guy they really like and fancy,plus its more about Visas than money,most of the girls earn decent anyway.I guess if the guys meet a one their real standard things have a much better chance of working out,but when you cannot even pull in Darlington ever, then marry a beautiful Bar girl from Soi 6  your asking for trouble.

Edited October 21, 2023 by DurhamBorn

[Pip321]

27 minutes ago, feed said:

i know this is the happy home of the frugal.  But it's the you should live on what you earn that's (in part) allowed wages to be squashed. The productively is there, workers should be paid more.  And i do i accept that the benefits system is broken beyond repair.   

I take your point…for some on this thread though it depends on the motivation for living below your means.

The secret for me was probably similar to @WICAO in that just because you become frugal and live on less than you earn….that you must not let that become a disincentive to earn more. 

Living on less than you earn gives choices but once you have a genuine choice then the mindset changes….do I plod along or actually become more efficient.

By more efficient I mean once I was on the path I realised being nice to my boss, going the extra mile, sometimes doing a bit extra actually my pay went up…a lot. Won’t work for everyone that I know but I became a kiss ass, and to be fair having a really intelligent, business focused, hard working boss helped motivate me to help them. Then banging £40k a year into my pension 5 years before I left was also a massive motivator…earning more but living on less. 

In my sons case he has shifted jobs and now does earn less….but it is now school term work only, ie more pay per hour plus his commute is now a walk rather than a 22 mile round trip. So a bit less in his pocket but efficient rather than less.

So living in less wasn’t about lowering earnings expectations and accepting a depression in wages but rather it was about either earning more and squirrelling away for quicker financial freedom or earning a higher rate per hour but more efficiently.

Very individual thing though….

[Starsend]

7 minutes ago, DurhamBorn said:

It is deception yes,but they see it as a business transaction.ie he gets her for the time she is there,and she makes him very happy in the sack etc,she gets what she wants.Its really interesting the money thing.Something genuine happened to her daughter once and she didnt want to tell hubby she needed quick cash,it was not much,i gave her it.Two weeks later she gave me it back,i was shocked.She said no no i not keep,i not want your money,i love you, you are my friend.So they have boxes they put you in.

Your 100% right though the guys think they become attractive because like you say they give them a better standard of living,what they forget is once the girls get a Visa they can get an even better standard of living,or a similar one with a guy they really like and fancy,plus its more about Visas than money,most of the girls earn decent anyway.I guess if the guys meet a one their real standard things have a much better chance of working out,but when you cannot even pull in Darlington ever, then marry a beautiful Bar girl from Soi 6  your asking for trouble.

His mistake was bringing her back to the UK where the power shifts to her - and being all round stupid. He should have stayed in her country and built himself a harem in a nice sunny place - hang on I'm day dreaming again haha.

[JMD]

4 hours ago, PatronizingGit said:

looking at the GAD state pension sustainability projections from the late 90s, thats where the problem lies. Fewer old people than expected, more working age, costs no higher than expected...the big problem is wage levels for those paying in havent risen at all really. They continued to rise from 1998 to 2001 at a healthy rate, that slowed 2001-2004, and has been stagnant in real terms from 2005 on.

American workers have experienced similar wage suppression, but for longer going back to the 1970s, caused mainly by globalisation and mass uncontrolled immigration from Mexico. In the 1992 race for president the businessman Ross Perot offered them a possible lifeline but they rejected him and voted in Clinton. Damn fools. 

Not saying there were easy policy answers (we in the West have all been part complicit in living beyond our means for decades), but our useless Western 'leaders' actively embraced immigration and globalisation, and then lied about what they were doing... and that imo should not be forgiven.

Edited October 21, 2023 by JMD

[Lightscribe]

https://www.economist.com/content/rough-guide-hell
 

Quite astute

[ThoughtCriminal]

9 hours ago, feed said:

Just another way of saying that house prices are a function of the availability (and price) of credit. 

But that's social media, people saying that same thing over and over, just in slightly different ways.  

 

But US house prices are flat, barely any response to rates going from 3% to 8%

Pool of potential buyers has more than halved and not a flicker in the average price.

[Plan-b]

Stuey this one is for you...                                                                                        

[Chewing Grass]

9 minutes ago, ThoughtCriminal said:

But US house prices are flat, barely any response to rates going from 3% to 8%

Pool of potential buyers has more than halved and not a flicker in the average price.

Mexican Stand-off.

'Confrontation among two or more parties in which no participant can proceed or retreat without being exposed to danger'

[BWW]

4 hours ago, DurhamBorn said:

They dont see it as a con thats why,their mindset is not the same as ours.You could argue the other way around,why does a bloke who cannot get a date think he can shag a fit woman every night for free.?.They treat the guy like royalty until they get the right to remain,some do end up staying with the guy,but more dont.My friend has hundreds of photos of her and hubby loved up on socials,he thinks she is head over heals in love,but no,she told me its for immigration so they dont knock her back.I see the bloke she is with as the fraud.He gets her here then they rent a shit house in a shithole place because he doesnt have any money other than his wage.She also told me she wouldnt take any money when she leaves him in 18 months,even if he had any.I dont feel sorry for him at all,and probably a better deal than being shacked up with some land whale for a few years.She did ask me if i wanted her as my gik (mistress) but i declined the offer,i said i dont think my partner would be very happy,she didnt understand why because a gik is accepted in their culture as normal.Different cultures,hence why multi culture societies take hundreds of years to merge into one.

 

 

its not that gik is accepted by the partner. Partner actively encoures the gik because gik does everything partner doesnt want to do.

Makes perfect logical sense. Just western feelings culture (delusions?) is incompatible.

[Harley]

2 hours ago, JMD said:

In think you raise an Important topic. I divide my asset wealth between equities (shares portfolio) and hard assets (physical pms, etc).

In specific regard to my portfolio i have been re-evaluating my portfolio asset-classes and allocations, particularly in regard to what should/could replace bonds. There is of course no direct replacement for (inversely correlated) bonds but the best I have come up with is energy + commodities + property/infrastructure, ok I'm still talking equities here, but crucially well run, conservative/boring, low debt(profile), global companies with strong asset base, etc.

Listening to people like Tim Price and Louse Vincent Gave over the years have convinced me that having 40% in the 'right companies' within the above mentioned sectors is a good strategy (I realise some here are perhaps already 40% invested in oilies alone, but for example I would be talking the larger, long-term hold, 'safer' oilies here, and not say speculative Harbour energy). 

I'm not suggesting anything radical I know. But I am personally trying to find methods to reduce risk in a more enforced/systematic way. I'm still working out how to order the other 60% of my equity portfolio.

I would welcome others thoughts and alternative ideas/strategies.

I independently came to a similar place as Tim Price and co but with an extra leg to include the core versus upside portfolio approach (search the net).

So we have core, trend, and value portfolios.  Core is lower risk/lower return designed to cover core living expenses.  More concerned with preservation.  Value and Trend are upside designed to cover discretionary expenses.  They are higher risk/higher return. 

And that's the key for us.  IMO, the first step in answering your question is to do some financial planning based on assessed needs and wants and even some discounted cash flows.  Do it right and the initial allocations almost fall off the back. 

Only that way can you then construct risk/reward allocations and portfolios that are personally tailored for you.  You know what you need to do and why.  You are in control. 

Mr and Mrs Norm shouldn't take too much risk when they don't have to but without the process they're guessing.  We consider lifestyle funds, the 4% rule, the "attitude to risk" questionnaire, and the rest to be barbaric!  It also explains why we are hot on context in any discussion and did not chase 2020.

IMO, the above approach is key when entering drawdown but still applies during your accumulation phase, just the percentages vary.  The process remains valid throughout and the sooner it's applied the better.

I edited out a huge amount of detail on what all this looks like in practice.  There's a ton of detail!

[Harley]

1 hour ago, Plan-b said:

Stuey this one is for you...                                                                                        

Now I like a bit of TA but that stuff with crayons is just BS in my book!   

[King Penda]

46 minutes ago, Harley said:

Now I like a bit of TA but that stuff with crayons is just BS in my book!   

Is it bouncing off the orange line ? 

[Plan-b]

1 hour ago, Harley said:

Now I like a bit of TA but that stuff with crayons is just BS in my book!   

Thats why its for Stuey! 

[Bobthebuilder]

38 minutes ago, King Penda said:

Is it bouncing off the orange line ? 

Steady on, you will be trading next.

[King Penda]

3 minutes ago, Bobthebuilder said:

Steady on, you will be trading next.

We barter in stoke fuck technical analysis 

22 minutes ago, Plan-b said:

Thats why its for Stuey! 

Wibble

[Plan-b]

5 minutes ago, King Penda said:

We barter in stoke fuck technical analysis 

Wibble

[DurhamBorn]

Might as well talk to the pigeons in town than Pill,they likely understand the economy better.Dont think il bother.

"We are hosting a virtual Q&A with the Bank’s Chief Economist, Huw Pill, on Monday 6 November from 5pm-6pm.  This will follow the publication of the Bank’s Monetary Policy Report on 2 November.  If you would like to join the event to put your questions to Huw please register"

[King Penda]

1 minute ago, DurhamBorn said:

Might as well talk to the pigeons in town than Pill,they likely understand the economy better.Dont think il bother.

"We are hosting a virtual Q&A with the Bank’s Chief Economist, Huw Pill, on Monday 6 November from 5pm-6pm.  This will follow the publication of the Bank’s Monetary Policy Report on 2 November.  If you would like to join the event to put your questions to Huw please register"

Tell him plus .25% for shits and giggles 

[DurhamBorn]

14 minutes ago, King Penda said:

Tell him plus .25% for shits and giggles 

I can tell you they are a waste of time,he is the worst of the lot of them and thats saying something.Zero understanding of whats driving this cycle.

Edited October 21, 2023 by DurhamBorn