Credit deflation and the reflation cycle to come (part 9)

[Pip321]

5 hours ago, Yellow_Reduced_Sticker said:

i put my limit buy order in on monday at 135, for my last ladder, what an idiot i am as the low price since is 136,  sometimes it does NOT pay to be a tightWAD!

BTW, YESTERDAY added a DESPERATE 56p final ladder in national express...well what did ya expect today ...YEP MCG bloody well DOWN again!

Abdn back to 138p.....I was waiting for 130/135 but might ladder in. Nah, fuck it...I will wait 😂😂

That's down a fair amount from the surge to 145p this morning...joking apart maybe this is my time to have a go considering I sold this at 180p

Edited April 24 by Pip321

[Axeman123]

1 hour ago, ThoughtCriminal said:

Wtf is this madness? 90% of people not getting a survey before buying a house.

They call the bank's valuation a "valuation survey", so I am sure the normie buyer assumes that covers it - a bit like some that think an MOT test on a car counts as a sevicing.

[Axeman123]

David Hunter with an eye watering prediction: euro to equal 0.65USD in the bust! If we are generous to the pound and assume it might = 1.20euro at that point, we could expect it to = 0.80USD. Commodity inflation would hit this country like Weimar on that basis IMO.

Its just one man's prediction, but I really can't imagine wanting to live anywhere in Europe later this decade. Buying a house here right now would be like buying one in Venezuela a few years back too.

 

[sancho panza]

1 hour ago, DurhamBorn said:

My roadmap signals are vertical.The sea water is bursting over the bulkheads and she is going down fast.

This point is technically off topic but more broadly on topic.They are jsut losing control in so many different ways.It's not jsut domestvcially

Whats telling here is that the malaysians are effectively flicking the bird at the US/EU/UK.....

 

[Loki]

1 minute ago, Axeman123 said:

later this decade

That's not very far away now either.  I got so used to thinking "2030s, end of decade" over the years and now it's less than 10 years away even at the far end 

[Heart's Ease]

4 minutes ago, Axeman123 said:

David Hunter with an eye watering prediction: euro to equal 0.65USD in the bust! If we are generous to the pound and assume it might = 1.20euro at that point, we could expect it to = 0.80USD. Commodity inflation would hit this country like Weimar on that basis IMO.

Its just one man's prediction, but I really can't imagine wanting to live anywhere in Europe later this decade. Buying a house here right now would be like buying one in Venezuela a few years back too.

 

"I do have a target for this year. GBPUSD to 1.50. And yes probably below 1.00 in the bust."

DH helpfully follows up in a later response.

Listened to his State of the Markets (Tim Price) yesterday and DH went into lots of his early working life which was v interesting.  

[Formerly]

5 minutes ago, Loki said:

That's not very far away now either.  I got so used to thinking "2030s, end of decade" over the years and now it's less than 10 years away even at the far end 

Think of it as one Labour government away. Sorry if that spoils anyone's day!

[Axeman123]

1 minute ago, Loki said:

That's not very far away now either.  I got so used to thinking "2030s, end of decade" over the years and now it's less than 10 years away even at the far end 

AIUI the next economic cycle could be a short one, not least because this current one has been so long but also AIUI commodity lead economic cycles are generally very short. So we could literally have 1-2 years to the bottom of the BK, 4-5 years for an inflationary partial recovery (with markets and asset prices never getting near previous highs), and then the absolute destruction arrives around 2030.

It really will all be here soon.

[Loki]

Just now, Axeman123 said:

AIUI the next economic cycle could be a short one, not least because this current one has been so long but also AIUI commodity lead economic cycles are generally very short. So we could literally have 1-2 years to the bottom of the BK, 4-5 years for an inflationary partial recovery (with markets and asset prices never getting near previous highs), and then the absolute destruction arrives around 2030.

It really will all be here soon.

Agreed, everything is getting compressed (not just financial action) and the old expression about the final 90% of a crisis happening in the final 10% of the time comes to mind (like the Titanic sinking to use a thread favourite)

[Axeman123]

4 minutes ago, Heart's Ease said:

"I do have a target for this year. GBPUSD to 1.50. And yes probably below 1.00 in the bust."

DH helpfully follows up in a later response.

I saw that. Below parity has been widely discussed, I just thought 0.80 was something else!

That 0.80 is actually giving the £ a lot of benefit of the doubt IMO. The EU is uniquely fucked, but then is the UK much better? Maybe it is Euro parity for the £ that we should be preparing for...

This is all just in the bust of course, but once a currency loses parity to the dollar it drops firmly into the EM (or submerging market) bucket and likely will struggle to ever regain it. That would be a near permanent 20% loss of purchasing power when measured in USD just from the currency move.

 

[DurhamBorn]

1 hour ago, Pip321 said:

Abdn back to 138p.....I was waiting for 130/135 but might ladder in. Nah, fuck it...I will wait 😂😂

That's down a fair amount from the surge to 145p this morning...joking apart maybe this is my time to have a go considering I sold this at 180p

Main things im looking for in the EM leaning asset managers is net flows turning slightly positive and then them winning mandates from EMs themselves,ie wealth funds etc.Once both of those happen i think the sector might double.They are hated and risky,but a great way to leverage EMs going on a generational bull run as i think they might.I love areas that can leverage where my roadmap is showing my direction.These calls can fail of course,but i like the risk/reward in them.ABRDN of course have big UK exposure so not fully leveraged to EMs,but i see them getting lots more mandates when things turn.Being in the UK but having capital outside should be the trade over the next decade.

[ThoughtCriminal]

1 hour ago, Axeman123 said:

They call the bank's valuation a "valuation survey", so I am sure the normie buyer assumes that covers it - a bit like some that think an MOT test on a car counts as a sevicing.

It does explain why I've had a lot of calls this year from people saying they have asbestos in their Artex walls and ceilings of the house they've just bought. Surveyors usually pick that up and put an "assume contains asbestos" note in.

[ThoughtCriminal]

Well there's a doozy of a chart.

 

[DoINeedOne]

 

[Ash4781b]

6 hours ago, sancho panza said:

SO bascially private equity JAB Holdings paid £1.5bn for Pret in 2018.

Latest report I can easily find from july 23 states revenue in 2023 looks to be around £830mn.Profit for 2022 =£50mn

Debts at £700mn by year end 22.

wtf.

@Ash4781b if you around,you got any knowledge of this end of retial?are the rest in a similar boat?

https://uk.finance.yahoo.com/news/pret-manger-brings-back-co-082036941.html

The London-based sandwich chain has brought back Larry Billett, Pret’s former Chairman from 2003 to 2011, alongside Sinclair Beecham who co-founded the business in 1983 with Julian Metcalfe. Billett will join the board as a non-executive director while Beecham will act as an adviser.

Meanwhile, Olivier Goudet, who has served as Pret’s chairman since 2018, will step down and be replaced by current board member Konrad Meyer.

Pret had racked up loans and borrowings of £698 million by the end of 2022, its latest accounts show, as pandemic closures led to steep losses at the firm.

Much of the debt has been agreed using 3-month SONIA rates set by the Bank of England, which has seen the interest rates on the debt rise to nearly 9%.

https://www.pret.co.uk/en-GB/pr-pret-financial-2023

H1 2023 sales reach £429.9m, up 20.2% vs H1 2022 (£357.8m)

2022 Full Accounts show return to profitability for the first time since 2018, reporting annual operating profit of £50.6 million for Full Year 2022

No not really following too much. Although I was surprised to read “Continued investment in people and shops, including 19% staff pay increase in 12 months up to April 2023” . 
 

“Pret has continued to invest in its people to support them through the cost-of-living crisis. In April 2023, Pret staff were given their third pay rise in 12 months, meaning average base pay for shop staff increased by 19% in the year to April, above the UK rate of inflation.”

The reality of the labour market ? Seems to be common across retail. It’s going to be difficult to unpick. You will have those people who buy a drink and sit there for hours using it as a meeting room so it’s cheap. If you are just going in for a drink or sandwich etc you’ll get rinsed £5 a sandwich in there I think. 

[Jay]

2 hours ago, Axeman123 said:

David Hunter with an eye watering prediction: euro to equal 0.65USD in the bust! If we are generous to the pound and assume it might = 1.20euro at that point, we could expect it to = 0.80USD. Commodity inflation would hit this country like Weimar on that basis IMO.

Its just one man's prediction, but I really can't imagine wanting to live anywhere in Europe later this decade. Buying a house here right now would be like buying one in Venezuela a few years back too.

 

Sure euro going below parity..the us does have a problem..it’s debt and so unless it’s war then those are really slim odds of that happening..Germany is still key to Europe…if the call is correct I will probably be jumping out of a window..politely waiting for my turn as I there will be a huge queue in front of me..be lucky..

[Axeman123]

37 minutes ago, Jay said:

Sure euro going below parity..the us does have a problem..it’s debt and so unless it’s war then those are really slim odds of that happening..Germany is still key to Europe…if the call is correct I will probably be jumping out of a window..politely waiting for my turn as I there will be a huge queue in front of me..be lucky..

Indeed.

It has me thinking though, the EU and Britain largely rode out the last period of dollar strength while EMs AIUI got hammered by it. A BK involving an even higher dollar and less room for interventions to cushion the public from it by CBs could see some real hardship here just from FX impacts on food and energy.

[Mandalorian]

10 hours ago, MrXxxx said:

The three most expensive areas of the World stock market...so working on the simple principles of Forward PE and future discounting what does this tell you?....people have bought into the [potentially] lowest performing part of the market.

Despite what the doom monkeys on this thread say:  Never bet against the United States.

[Mandalorian]

8 hours ago, HousePriceMania said:

Don't panic, there's still time...

 

Another growth share?

[Mandalorian]

6 hours ago, DurhamBorn said:

https://www.telegraph.co.uk/money/pensions/cut-public-sector-pensions-pay-better-salary-lord-odonnell/

How about pay them the same salary as now (usually more than the equivalent job in the private sector) and have a defined contribution pension scheme like every bugger else?

Any idea what other countries do for civil service pensions?  Or is it like rNHS (a crap system nobody else wants to copy)?

[sancho panza]

Cathie Wood bites the corporate carpet to waylay the pain.

It did all go a bit tech bubble back then in 21.

Mish sticks the boot in.

https://mishtalk.com/economics/ark-destroyed-more-wealth-than-any-asset-manager-over-the-previous-decade/

Investors have pulled a net $2.2 billion from the six actively managed exchange-traded funds at her ARK Investment Management this year, a withdrawal that dwarfs the outflows in all of 2023. Total assets in those funds have dropped 30% in less than four months to $11.1 billion—after peaking at $59 billion in early 2021, when ARK was the world’s largest active ETF manager.

Shares of Tesla, the largest holding, are down almost 45% this year and trading around $142. Wood has been buying the dip and reiterated her moonshot five-year price target of $2,000 in a CNBC appearance earlier this month.

By the end of last year, ARK funds had destroyed more wealth than any other asset manager over the previous decade, losing investors a collective $14.3 billion, according to Morningstar. ARK’s biggest inflows came in the months surrounding the innovation fund’s February 2021 peak, unfortunate timing for many investors.

 

Skill Assessment

It takes skill to be the worst. Not anyone can do it.

First you have to make wildly speculative bets. Then you need to develop a cult following right at the top. Then you have to make mistake after mistake on the way down.

[Loki]

1 minute ago, sancho panza said:

Skill Assessment

It takes skill to be the worst. Not anyone can do it.

 

Buying high and selling low isn't for everyone. Thanks for playing Cathie

[sleepwello'nights]

10 hours ago, ashestoashes said:

They're not auto corrects though

Pedant 

[Joncrete Cungle]

41 minutes ago, sancho panza said:

Cathie Wood bites the corporate carpet to waylay the pain.

It did all go a bit tech bubble back then in 21.

Mish sticks the boot in.

https://mishtalk.com/economics/ark-destroyed-more-wealth-than-any-asset-manager-over-the-previous-decade/

Investors have pulled a net $2.2 billion from the six actively managed exchange-traded funds at her ARK Investment Management this year, a withdrawal that dwarfs the outflows in all of 2023. Total assets in those funds have dropped 30% in less than four months to $11.1 billion—after peaking at $59 billion in early 2021, when ARK was the world’s largest active ETF manager.

Shares of Tesla, the largest holding, are down almost 45% this year and trading around $142. Wood has been buying the dip and reiterated her moonshot five-year price target of $2,000 in a CNBC appearance earlier this month.

By the end of last year, ARK funds had destroyed more wealth than any other asset manager over the previous decade, losing investors a collective $14.3 billion, according to Morningstar. ARK’s biggest inflows came in the months surrounding the innovation fund’s February 2021 peak, unfortunate timing for many investors.

 

Skill Assessment

It takes skill to be the worst. Not anyone can do it.

First you have to make wildly speculative bets. Then you need to develop a cult following right at the top. Then you have to make mistake after mistake on the way down.

Is that another growth share?

Edited April 24 by Joncrete Cungle

[Red Debt Redemption]

5 hours ago, DurhamBorn said:

Copper in my street got a pension INCREASE of £5k a year over the last two years.Someone working in the best paid factory within 15 miles of here will have around £135k  needed to equal that after 26 years working.So the retired copper gets INCREASES in 3 years to equal the entire 40 year savings of the £35k pa factory worker.BUT,it does not stop there.If the factory worker is in a 60/40 or lifestyle set up over 30% has been taken already through monetising to pay those retired public sector pensions (and bennies) so it would take a private sector workers 54 years pension savings to equal JUST THE 3 YEAR INCREASE in the coppers pension.Not the pension,the 3 year INCREASE.

There is huge inequality in the UK,huge,but its between the private sector and those on the state tit.

My roadmap signals are vertical.The sea water is bursting over the bulkheads and she is going down fast.

The factory workers think they are retiring on £30-£40k per year when they stop working though, almost no one works out or checks what's in the pot they hear 4% contribution, 6% employer and told its a good pension and believe it be lucky if they get £6-7k per year on drawdown. 

None of them know about the public sector in comparison either they think its the same as them.

Edited April 24 by Red Debt Redemption