Credit deflation and the reflation cycle to come (part 7)

[Castlevania]

3 minutes ago, Loki said:

If we get BTC futures it becomes just another spot price in the long list of manipulated spot prices

I thought BTC futures were already a thing?

[Democorruptcy]

I know I'm not the only one sometimes stuck in a captcha loop, when trying to load archive.ph Today I realised that the problem only occurs on wifi at home. On mobile data it loads every time. No idea why.

[Democorruptcy]

4 hours ago, crashmonitor said:

Looking at the smaller caps, the FTSE 250, you  would think that dividends would have at least covered the slide in the  index but the total return is down since the autumn of 2017 from 14,800 to 14,500. Six years of losing money with dividends.

The irony is that I remember the "experts" lauding the FTSE 250 back then as it powered through the 20,000 mark, in a similar vein to them lauding the Hang Seng in 2019 and advising to invest in both  indicies.   Both have since performed dreadfully. 

Meanwhile at least the FTSE 100 has given a modest return once you factor in dividends.

 

 

The problem with comparing the 250 and the 100, over that timescale is that some of the players have swapped sides? When a 100 player is doing badly he's relegated to 250. A 250 doing well is promoted to the 100. You always get the currently best performers in the 100. OK as long as your trades were timed to match relegation/promotion on some of them?

[DurhamBorn]

3 hours ago, Harley said:

Only 54%?  I had double that in mind.  Was it that time distracted with the pointing?  Or the ladders, coal mine, or fence posts!  I feel deflated!  Is that what the thread title means?!

PS: Don't worry, the bromance is as strong as ever!

Big portfolio and some poor entry points on some 23% allocation to telcos during the collapse pulled returns back.Im very very happy with the return though given everything.It should of been around 75%,but mistakes on some pulled it back.Im also up against allowances everywhere,so im leaning more and more to income i spend and less big capital gains.Im spending more now than i ever have before on things.Still drive an old car etc,but clothes,good food,being slowly rubbed with oil that sort of thing ,im happier than iv ever been,even given the state of the country because i feel like they aint got me yet,and im in control of my own destiny,i love the little victories.I see myself at war with my own polos like we were when i was a kid..Its been a tough 6 months,i think around 8% down,but nothing in the long cycle we are in.What makes me very very angry though is seeing the transfer of wealth to all the none producing,that is the real evil going on.The the taking of freedoms.

Edited October 25, 2023 by DurhamBorn

[Stuey]

1 hour ago, NogintheNog said:

 

So @Stuey can you tell us how we get that 'disorganised energy' of heat in the atmosphere back. I'm assuming that's the point you were making?

The sun is providing us useful heat and light all the time. Our CO2 release allows plants to grow from it and be eaten by animals (yumm yumm). 🐄

[Loki]

54 minutes ago, Castlevania said:

I thought BTC futures were already a thing?

Have to admit I thought you needed an ETF to base futures contracts on but it looks like you're right 

[DurhamBorn]

Next telco to announce earnings higher than expected ,Telenor,hopefully this is where the cycle plays to them,might be some dips and a few who struggle,but its starting to turn.

https://advanced-television.com/2023/10/25/telenor-sees-solid-growth-in-q3/

[Lightscribe]

https://inews.co.uk/news/politics/half-a-million-parents-universal-credit-benefit-cuts-work-2709535#:~:text=More than half a million,under changes being implemented today.
 

This is will go down like a lead balloon.

[DurhamBorn]

Telefonica know whats needed,and i think it will happen.Likely big consolidation across the sector,and big traffic users paying more (or being slowed down).The sector is going to do a baccy i think (maybe half a baccy) I will be proved right,everyone else wrong 

https://www.telefonica.com/en/communication-room/blog/sowing-seeds-connectivity-after-telecom-ministers-meeting-leon/

 

Our proposal is to work on a range of instruments that can help to deliver the necessary investment through a variety of means, including ensuring that those who put the highest burden on digital connectivity make a proportionate contribution to its sustainable future. The initiative also aims to encourage major traffic generators to take greater responsibility for the traffic they generate, to be more aware of the impact of their traffic on the additional resources required by digital networks, and to incentivize traffic efficiency and sustainability. Our proposal  aims at exploring ways to free up resources for investment in network capacity to be used for coverage expansion and innovation, but also to reduce energy consumption and CO2 emissions by reducing traffic inefficiencies. As telecom operators bear most of the costs of inefficient network use, policy makers should incentivise all players in the Internet value chain to finally agree on models where all parties contribute to efficient network use and balanced business relationships taking into account the services they provide to each other.

[SpectrumFX]

2 hours ago, NogintheNog said:

One of the problems with Gold and Silver is people don't want to have the risk of the physical storage. Throughout history Decentralized Bearer Assets such as Gold and Silver have been stolen in heist after heist!

But I'd like someone to explain to me why you would hold a paper Bitcoin ETF when you can just hold Bitcoin?

One advantage would be that you could hold it in an ISA or SIPP for the tax advantages.

[headrow]

5 hours ago, wherebee said:

Surely dividend income ABOVE inflation is the goal for the next few years?  If I can get 5% in a bank, but 9% from BAT....

the 9% keeps my head above water a little bit longer?

That's always been my target but I'd have been way better off if I'd kept my VOD money sat in cash in my current account.

 

It would be an interesting comparison to see what 20k in a savings account returns compared to 20k in VOD which sits at 74p currently over the next 5 years. I've no idea if the current share price has actually factored in a dividend rerating , I suspect it hasn't  and that is currently setting a the floor in the share price. I can't see the upside.

 

I'm with them for broadband , currently paying less now than I was 5 years ago. Not good for an investor when we've supposedly had double digit inflation. 

Edited October 25, 2023 by headrow

[headrow]

I noticed in the results for Lloyds Banking Group today that they stated that a record amount of cash was being deposited into an ISA account. This is what the Asset Managers are up against now , the retail investor has left the stock market , no wonder their share price is struggling to find any floor.

 

Ashmore isn't far off the lows of 2008 , N91 just about it's all time low , Schroder's , Abrdn and Jupiter getting battered every day , in fact they are behaving like a penny share , getting whipped all over the place.

 

When does the money return?

 

[JMD]

6 hours ago, ThoughtCriminal said:

I know you keeping caveating it by saying the Titanic (UK) will eventually change course and avoid the iceberg, but I keep wondering, there's has to be a point of no return surely? We can't just keep heading towards the metaphorical iceberg forever.

That's a good question. I think of it in terms of us (the West) not actually having to hit that metaphorical iceberg. Instead, once it becomes clear to TPTB that they have exhausted all realistic attempts at further can kicking - and them finally realising that the 'old' economic levers no longer work - the West's economic Titanic will be unceremoniously scuppered and sunk at sea! 

I don't know what form that sabotage takes. But it's probably more down to political timing, and who knows how the minds of TPTB work?! However I am worried about the current political war in Ukraine and the conflict that may be about to develop in the Middle East. Are those obvious and immediate alarm signals, or should other tools ideally also be in place before our economic vessel is finally holed below it's water line - such as CBDC's, or maybe because this is politically driven, our polos need to instil a more powerful narrative before embarking on their exploitative control and social change plans of the populus, including say being able to portray the emerging Global South as a existentially adversarial trading block of evil anti-Semites and climate-deniers?

Edited October 25, 2023 by JMD

[Loki]

2 minutes ago, JMD said:

a dangerous and adversarial trading block of evil anti-Semites and climate-deniers?

Is there a 3x long ETF? (Asking for a friend)

[BurntBread]

10 minutes ago, headrow said:

I noticed in the results for Lloyds Banking Group today that they stated that a record amount of cash was being deposited into an ISA account. This is what the Asset Managers are up against now , the retail investor has left the stock market , no wonder their share price is struggling to find any floor.

 

Ashmore isn't far off the lows of 2008 , N91 just about it's all time low , Schroder's , Abrdn and Jupiter getting battered every day , in fact they are behaving like a penny share , getting whipped all over the place.

 

When does the money return?

 

One option of course is that the money doesn't return, and both the general stock market and the  sellers of "pans and shovels" continue to do badly.

In a second scenario, the Great British pound takes a permanent step down in value ... either against the dollar, or more interestingly against EM currencies (specifically BRICS). Then, although the ISA holders will have missed out, foreign stocks (and UK companies with foreign earnings) will start to look like an insurance against further exchange rate risk, and the asset managers start to attract back a percentage of the punters' wealth.

I'm down on the asset managers, and quite happy about that. I like the diversification and the hedge against different types of risk. However, I'm buy-and-hold on pretty much everything, and the oilies have protected me against all the other head-winds so far. I have learned a huge amount over the last three/four years. Of course any outcome is possible from now on, including considerable and permanent losses. If I end up just evens (nominally) against cash in a year or two, then the experience will still have been worth it for me: it will have stretched my perception of risk and made it possible for me to take part in a much wider range of strategies than I would have contemplated years ago.

My biggest investment though, and most important risk management strategy still consists of learning to be happy with very little. I need freedom and self-determination, and that's about it. Lots of risks there too, but they are mostly not financial, but rather related to health and people.

[JMD]

7 minutes ago, Loki said:

Is there a 3x long ETF? (Asking for a friend)

I do like hyperbole and so i've added 'existential' to my post...  Therefore a 6x long (or would it be short?) ETF might be well worth a punt!!

Edited October 25, 2023 by JMD

[DurhamBorn]

41 minutes ago, headrow said:

I noticed in the results for Lloyds Banking Group today that they stated that a record amount of cash was being deposited into an ISA account. This is what the Asset Managers are up against now , the retail investor has left the stock market , no wonder their share price is struggling to find any floor.

 

Ashmore isn't far off the lows of 2008 , N91 just about it's all time low , Schroder's , Abrdn and Jupiter getting battered every day , in fact they are behaving like a penny share , getting whipped all over the place.

 

When does the money return?

 

The fact that record amounts are going into cash would say cash is likely to prove a terrible investment from here.I think lots of stocks are offering incredible entry points ,but it will be choppy before we get a sustained upswing.We got the first part of the cycle bang on,now im hoping for the same for the longer second part.Back in March/April 20 things turned for me at -14% after positioning,from highs im at -8% here,so i would be very very happy with a turn within another 6% across the portfolios.

[DurhamBorn]

33 minutes ago, JMD said:

That's a good question. I think of it in terms of us (the West) not actually having to hit that metaphorical iceberg. Instead, once it becomes clear to TPTB that they have exhausted all realistic attempts at further can kicking - and them finally realising that the 'old' economic levers no longer work - the West's economic Titanic will be unceremoniously scuppered and sunk at sea! 

I don't know what form that sabotage takes. But it's probably more down to political timing, and who knows how the minds of TPTB work?! However I am worried about the current political war in Ukraine and the conflict that may be about to develop in the Middle East. Are those obvious and immediate alarm signals, or should other tools ideally also be in place before our economic vessel is finally holed below it's water line - such as CBDC's, or maybe because this is politically driven, our polos need to instil a more powerful narrative before embarking on their exploitative control and social change plans of the populus, including say being able to portray the emerging Global South as a existentially adversarial trading block of evil anti-Semites and climate-deniers?

I think whats interesting regards the Titanic and the iceberg is that its likely the ship would not of sunk if it slowed as much as it could and just hit it head on.It was the fact it tried to swerve without enough time that ripped a hole too far along.Polos are doing the same now.Instead of sorry the promises we made on pensions and bennies dont stand and hitting it head on,they are trying to swerve and ripping the economy apart one bulkhead at a time.

Edited October 25, 2023 by DurhamBorn

[JMD]

6 hours ago, DurhamBorn said:

Yes,it could be today,or ten years,life slowly getting worse and worse.Lots of things to change first.Less cars,more multi generational living etc.Retired public sector will also give leg ups to their children to enforce even more divide,using the tax of children not in that situation.The government know it,its why the cowards froze allowances,but that hits everyone.

In regards to things getting worse - the columnists Peter Hitchens has for a long time commented that our police force is pretty much useless - but recently I note that he has begun saying the police only remain in their jobs for their pensions. I wonder if he's been reading the thread?!

Edited October 25, 2023 by JMD

[Harley]

3 hours ago, Axeman123 said:

Could be as simple as requiring it to be held by a registered intermediary and all transactions reported, all self-custodied BTC becomes tainted after a certain date. While a segregated shadow economy for "dark" BTC would persist the permanent ledger feature would create two distinct BTCs, with no way to launder or rehabilitate the dark stuff. Think of having a million in fiat notes in a suitcase under your bed and how limited the opportunities to actually use it would be as an example. It would seem innevitable that an exchange rate differential would arise, with dark BTC trading at a discount.

Assuming the majority of BTC would end up held in a compliant manner (even 51% AIUI would work) then a fork of the blockchain could potentially invalidate all non-compliant BTCs. It would be an easy sell on the basis that most BTC has been stolen or used on the silk road to buy drugs etc at some point and a permanent record of this exists. The offer might be: Regularise your BTC with proof of legitimate funds for initial purchase and sort out any tax implications then all sins will be wiped, anyone that doesn't has conceeded guilt forfeiting the BTC. The constant push for proof of stake over proof of work would also advance this agenda if it suceeded, since Blackrock would end up holding an awful lot of it as ETF custodians etc giving them the voting rights (bit vague on the intricacies of POS tbf) much like with equity ETFs. I am sure Blackrock would also lobby to be able to buy large BTC holdings from approved individuals no questions asked, enabling them to launder grey BTC for politically connected people at a discount to spot.

I am leaning towards the idea that we haven't had the surreal manic rally that makes no sense yet. 

Just an observation on new etfs (having been there during their introduction)..... they tended to initially pump and then slump hard.  I always waited a year or so before buying.

Edited October 25, 2023 by Harley

[DurhamBorn]

22 minutes ago, JMD said:

In regards to things getting worse - the columnists Peter Hitchens has for a long time commented that our police force is pretty much useless - but recently I note that he has begun saying the police only remain in their jobs for their pensions. I wonder if he's been reading the thread?!

Same as councils.Most of the public sector exists to give managers huge free pensions.The police are the worst of the lot,but not alone.The productive cannot sustain all of that and bennies.Polos wont changes the rules on them,so everyone else will suffer and suffer,its disgusting.

[Harley]

2 hours ago, headrow said:

.....It would be an interesting comparison to see what 20k in a savings account returns compared to 20k in VOD which sits at 74p currently over the next 5 years. I've no idea if the current share price has actually factored in a dividend rerating , I suspect it hasn't  and that is currently setting a the floor in the share price. I can't see the upside......

I once reviewed the performance of a life interest trust where the capital was held in interest bearing accounts.  This was back in the day like now where you got paid interest!  I assumed the FTSE would have delivered a far better return over the 20 years.  But no, not really, even before an equity risk premium.

[Eventually Right]

1 minute ago, DurhamBorn said:

Same as councils.Most of the public sector exists to give managers huge free pensions.The police are the worst of the lot,but not alone.The productive cannot sustain all of that and bennies.Polos wont changes the rules on them,so everyone else will suffer and suffer,its disgusting.

I always assumed they'd 'default' on the pensions by way of limiting increases to X percent under inflation.

There would be some grumbling, but there would still be a nominal year-on-year increase, and probably no protests etc.

The politicians have had the opportunity, with 10%+ inflation figures, but haven't done anything to limit pension/benefit rises...

Seems nuts, and/or a moral failure, as it puts the productive on the hook for it all.

[Axeman123]

2 hours ago, Loki said:

Have to admit I thought you needed an ETF to base futures contracts on but it looks like you're right 

The ETF is "needed" as custodian of BTC to lend it out to traders, so they can dump it to slam the price and then cover cheaper.

[DurhamBorn]

53 minutes ago, Eventually Right said:

I always assumed they'd 'default' on the pensions by way of limiting increases to X percent under inflation.

There would be some grumbling, but there would still be a nominal year-on-year increase, and probably no protests etc.

The politicians have had the opportunity, with 10%+ inflation figures, but haven't done anything to limit pension/benefit rises...

Seems nuts, and/or a moral failure, as it puts the productive on the hook for it all.

Yep,its crazy,the economy is screaming it cannot pay it.It might take a bond strike to focus minds.There is also another point.Forcing pensions to buy gilts for government bennies etc means our companies are hugely undervalued on the equity market,hence lots being bought out over the years and private pensions being undervalued on the equity etc.However as contrarians it could be the biggest buy signal in 44 years for UK equities.

Edited October 25, 2023 by DurhamBorn