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Credit deflation and the reflation cycle to come.


DurhamBorn

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Wondered if that reduction in Vanguard mining stocks might move the market at all but I suppose they’ll have been quietly getting rid before releasing the news. Anyway, looks like the holdings are/were Agnico, Newmont, B2Gold, Franco-Nevada, Barrick, Randgold, Rio Tinto, Endeavour, Kinross and IAMGOLD so not much to trouble anyone there I wouldn’t think in the short or long term.

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1 hour ago, Barnsey said:

DjWm2vTX0AAs-KD.jpg.c328caa4fcfd0a28b6fa853a683dbf64.jpg

O.o

Quite striking isn’t it. I posted this article a few weeks ago...

On 14/07/2018 at 12:35, Lavalas said:

Here’s an interesting article on some signs that China not comex are controlling gold price and the possible circumstances for a breakout. I understand some of it and need to digest the rest.

https://www.sprottmoney.com/Blog/china-takes-control-of-gold.html

The guy who wrote it, David Brady, is worth a look on twitter or on his website. Lots of commodity trading chat around sentiment and fundamentals with a macro slant.

 

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On 29/07/2018 at 12:07, sleepwello'nights said:

Just a heads up btw, I bought some VOD, so expect a sharp fall O.o

Quite the opposite :D

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leonardratso
6 minutes ago, afly said:

Quite the opposite :D

yeah, what caused that big jump.

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24 minutes ago, leonardratso said:

yeah, what caused that big jump.

Elliot Investors have taken a stake,no doubt they see massive free cash potential.

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leonardratso
34 minutes ago, DurhamBorn said:

Elliot Investors have taken a stake,no doubt they see massive free cash potential.

aha, cheers, didnt catch that.

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On 29/07/2018 at 13:58, NogintheNog said:

That depends really on how much of your portfolio is in gold. If you have a £200,000 portfolio, with £190,000 in gold/equities it would be like riding the hulk.....

But who in their right mind would do that????

https://youtu.be/OsjdYQJc748

Haha, guilty as charged ;) The plan is simple:

1. Ride Wesdome until TSHTF.

2. Go all-in on IBTL until dxy hits 120-ish.

3. Back to miners, picking the ones with biggest production capacity. High AISC won't be a problem with gold north of 3k/oz. Barrick anyone? Yamana? Sibanye? Maybe sprinkle some industrials/telecoms on top, maybe not.

4. Retire early (or get broke and divorced).

Don't try it at home, though.

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Democorruptcy
36 minutes ago, kibuc said:

Haha, guilty as charged ;) The plan is simple:

1. Ride Wesdome until TSHTF.

2. Go all-in on IBTL until dxy hits 120-ish.

3. Back to miners, picking the ones with biggest production capacity. High AISC won't be a problem with gold north of 3k/oz. Barrick anyone? Yamana? Sibanye? Maybe sprinkle some industrials/telecoms on top, maybe not.

4. Retire early (or get broke and divorced).

Don't try it at home, though.

We have a casino economy now, so you might as well give it a go. The traditional way of doing things, working, saving, living within your means isn't enough against the props. When comparing what little extra you get for working hard to being a doley, you might as well go 'all in'.

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leonardratso
1 hour ago, kibuc said:

Haha, guilty as charged ;) The plan is simple:

1. Ride Wesdome until TSHTF.

2. Go all-in on IBTL until dxy hits 120-ish.

3. Back to miners, picking the ones with biggest production capacity. High AISC won't be a problem with gold north of 3k/oz. Barrick anyone? Yamana? Sibanye? Maybe sprinkle some industrials/telecoms on top, maybe not.

4. Retire early (or get broke and divorced).

Don't try it at home, though.

if you need more adrenaline, although you may have missed the boat a bit, theres always bitcoin and other here today maybe gone tomorrow altcoins, if gold/PMM is riding the hulk, then bitcoin has been like riding the hulk while he rides an insane bull at the rodeo while it tries to balance on an icy pond.

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PE ratios two weeks ago and today:

FB = 34 ---- 26

AMZN = 230 ----224

NFLX = 246 ---- 153

Google= 51 ---- 53

 MSFT = 70 ----50

FANG/Tech stocks havent even started to puke their guts up yet.  I suspect thats what keeping a lid on the dollar, sold my treasuries today as if a whopper of GDP increase isnt going to break the dollar higher nothing will.

Anyone keeping an eye on Tesla?  Elon Musk has pledged nearly all his stock as collateral for loans from many banks, so if the stock goes below a certain value he'll get the margin call from hell.  It does explain his "eccentric" behaviour towards shorts and people writing negative articles about Tesla, although i suspect its going to go very wrong for him sooner rather than later.

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18 minutes ago, Majorpain said:

PE ratios two weeks ago and today:

FB = 34 ---- 26

AMZN = 230 ----224

 

I saw Amazon had made a record profit  of $2 billion in the last quarter, how the fuck its worth close to 1 trillion is beyond me.

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11 hours ago, Barnsey said:

Just released, UK unsecured annual credit growth +8.8%, credit cards +9.5%.

Here I was thinking people were being more careful because of Brexit, but the party continues! Going to make one hell of a bang when it pops, just like last time.

Dire figures but completely expected, the only surprise is that they were not even higher.

Totally unsustainable, this is going to end badly, its just a question of when.

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ashestoashes
4 hours ago, leonardratso said:

yeah, what caused that big jump.

bought some last week @176, thanks DB

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Talking Monkey
1 hour ago, Banned said:

I saw Amazon had made a record profit  of $2 billion in the last quarter, how the fuck its worth close to 1 trillion is beyond me.

Anyone able to explain this one I too don't get how after all these years it can have such a huge PE ratio, is there really that much potential growth

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Talking Monkey
1 hour ago, Majorpain said:

PE ratios two weeks ago and today:

FB = 34 ---- 26

AMZN = 230 ----224

NFLX = 246 ---- 153

Google= 51 ---- 53

 MSFT = 70 ----50

FANG/Tech stocks havent even started to puke their guts up yet.  I suspect thats what keeping a lid on the dollar, sold my treasuries today as if a whopper of GDP increase isnt going to break the dollar higher nothing will.

Anyone keeping an eye on Tesla?  Elon Musk has pledged nearly all his stock as collateral for loans from many banks, so if the stock goes below a certain value he'll get the margin call from hell.  It does explain his "eccentric" behaviour towards shorts and people writing negative articles about Tesla, although i suspect its going to go very wrong for him sooner rather than later.

I been watching Tesla I just don't understand how they can be worth as much as GM or Ford who sell millions upon millions of cars. Added to which all sorts of electric cars are soon to be unveiled by competitors, Tesla's advantage will be greatly reduced. I reckon they will be in trouble soon and that shareprice will really plummet. Musk is going to be in big trouble, I wonder at what price the margin calls come in

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23 hours ago, sancho panza said:

I like the way you separate those stocks.Very thought provoking

I've been developing my short work of late looking to build into the top on Domino's pizza ,the UK builders etc (the latter going quite well).I've started running  lists based on the reasons why I'm shorting be it structural decline of a sector, overvaluation vs peers, or technical.It's really helped my thinking.

 

If you don't mind me asking, what sort of analysis do you do when deciding to short a particular stock? Care to share any of your work re: Domino's?

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48 minutes ago, Talking Monkey said:

I been watching Tesla I just don't understand how they can be worth as much as GM or Ford

 

How Is Tesla Different From Enron?

Answer:  It’s not. The longer I observe the Elon Musk/TSLA show – and the more I research in-depth the Company’s business model and financials – the more I’m convinced that there’s a striking similarity between Enron and TSLA.

http://investmentresearchdynamics.com/how-is-tesla-different-from-enron/

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leonardratso
2 hours ago, Errol said:

 

How Is Tesla Different From Enron?

Answer:  It’s not. The longer I observe the Elon Musk/TSLA show – and the more I research in-depth the Company’s business model and financials – the more I’m convinced that there’s a striking similarity between Enron and TSLA.

http://investmentresearchdynamics.com/how-is-tesla-different-from-enron/

yeah itll never be as good as theranos, now thers a company going places fast.

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8 hours ago, Talking Monkey said:

I been watching Tesla I just don't understand how they can be worth as much as GM or Ford who sell millions upon millions of cars. Added to which all sorts of electric cars are soon to be unveiled by competitors, Tesla's advantage will be greatly reduced. I reckon they will be in trouble soon and that shareprice will really plummet. Musk is going to be in big trouble, I wonder at what price the margin calls come in 

Yup, sadly the Margin call price is kept under wraps for obvious reasons.  However, the one thing guaranteed is the lower Tesla's share price goes the more frequent and deranged Musk's tweets will get!

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Democorruptcy

Have we had the June q and CAPE?
 

Quote

 

With the publication of the Z1 data up to 31st March, 2018 (7th June, 2018), I have updated my calculations for q and CAPE.

Both q and CAPE include data for the quarter to 31st March, 2018. In March, the S&P 500 was at 2702.77 and US non-financials were overvalued by 85% according to q and quoted shares, including financials, were overvalued by 123% according to CAPE. (It should be noted that I use geometric rather than arithmetic means in these calculations.)

As at 8th June, 2018, with the S&P 500 at 2779.03, the overvaluations by the relevant measures were 90% for non-financials and 130% for quoted shares.

http://smithers.co.uk/page.php?id=34

 

 

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Question for DB, do you see any correlation for Silver spot price and the AUD? If your predictions are correct and Silver does leap in value at some point, will the "little aussie battler" strengthen in tandem (all else being equal)?

If you had decent cash savings would you park it in £, ¥, $, AUD/CAD or other at this present time please?

Many thanks :)

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Will the Bank of England follow the Japanese model?

Paul Donovan, chief economist at UBS:

"The Bank of Japan met, and did nothing that is worth mentioning.

The Bank of Japan has had a lot of practice at doing nothing worth mentioning."

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Castlevania

That new Vanguard Global Capital Cycles fund sounds a lot like an off the shelf fund for us (or at least those who believe in a deflationary collapse and a reflation afterwards).

From the press release: 

In managing the fund, Wellington Management will adhere to a capital cycles strategy as its primary investment approach, seeking to capture opportunities in commodity-oriented industries, such as the materials and natural resource sectors, which follow cyclical patterns. The strategy will also focus on companies that own irreplaceable or scarce infrastructure assets primarily in telecommunications and utilities. While the fund will maintain meaningful exposure to precious metals and mining stocks, the capital cycles strategy encompasses a broader opportunity set from which to identify return potential.

https://www.prnewswire.com/news-releases/vanguard-makes-changes-to-two-active-equity-funds-300687845.html

EDIT: will we be able to actually buy into it?

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leonardratso
37 minutes ago, Castlevania said:

That new Vanguard Global Capital Cycles fund sounds a lot like an off the shelf fund for us (or at least those who believe in a deflationary collapse and a reflation afterwards).

From the press release: 

 

 

EDIT: will we be able to actually buy into it?

looks like usd, cant find it in vanguard uk retail, or lloyds funds, havent checked HL yet though.

might actually only be thru welly.

 

ah, sorry, didnt read it closely enough;

 

Vanguard said the revamped strategy, which will take effect in late September, is meant for investors who wish to complement their core global equity allocation with a strategy that exhibits lower correlations to the broad equity markets. However, the change will also see the fund’s expense ratio to increase slightly to 0.37%, up from 0.36%.

So whats 0.37% of £4.98 a year, thats all i can afford at the moment, but i did find 5p yesterday so i can go over the big 5.

 

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