Credit deflation and the reflation cycle to come.

[DurhamBorn]

14 hours ago, Nicolas Turgeon said:

 

Thanks for this @DurhamBorn, always great to see things from a different perspective. Very interesting way to sort your stocks into sets and then spread risk across both. I'm enjoying just watching the volatility on all these PM's!

Sandstorm Gold and Endeavour Silver results are both due out this evening (August 1st) after market closes, though I'm not holding either. Do you classify these as being on your good technical setup list? Cos from my amateur examinations they look fairly healthy!?

Endeavour Silver is very much indeed on my technical set up list.Sandstorm isnt.My two lists are actually doing exactly as id expect.The well placed technical set ups are doing well,even though the complex is at pretty much zero confidence.The rubber band stocks are going up 15% like Sibanye or down 23% like New Gold over short timescales.The rubber band stocks as a whole will probably inflict pain on the portfolio unless the whole complex turns,but if/when it does i expect some in the list to 300%+ at least.I built my PM portfolio from both lists.Yamana had the best technical set up when i last ran it and it has done very well.Its a very difficult area though,and one to be avoided for anyone who cant stomach wild swings and potential big fat reds for a long time,and of course the complex should only be a part of a balanced portfolio.Mine is now around 18% of my portfolio and spread across 11 stocks.Thats the maximum i would hold in the sector and never more than 4% in each stock.

[kibuc]

Meanwhile, Tahoe released its quarterly results and they are as lamentable as expected. Also, the court received two separate accounts from university researchers claiming that the population in the Escobal mine area is indeed indigenous to that area - a view that Tahoe is vehemently opposing. They just cannot catch a break, can they.

[DurhamBorn]

35 minutes ago, kibuc said:

Meanwhile, Tahoe released its quarterly results and they are as lamentable as expected. Also, the court received two separate accounts from university researchers claiming that the population in the Escobal mine area is indeed indigenous to that area - a view that Tahoe is vehemently opposing. They just cannot catch a break, can they.

It happens all the time in the sector.Yamana has Agua Rica that is probably the best undeveloped copper/gold prospect in South America.They also own Suyai a fantastic gold prospect.Both struggled to get off the ground due to local opposition etc.Over time though these tend to be priced at zero by the markets and then something changes.A different government,a new mine plan etc.Eldorado is in the same boat in Greece.Fantastic mines a couple of years from completion with hundreds of millions of capital stuck waiting for permits.The gold/copper/silver in these projects isnt going anywhere though and the value usually comes to the surface at some point in the cycle.I dont own Tahoe myself,but they are on my rubber band list and id be happy to buy them as part of a PM portfolio.Not for the faint hearted of course.

[Lavalas]

17 hours ago, Nicolas Turgeon said:

Sandstorm Gold and Endeavour Silver results are both due out this evening (August 1st) after market closes, though I'm not holding either. Do you classify these as being on your good technical setup list? Cos from my amateur examinations they look fairly healthy!?

I don’t own Sandstorm but I am considering it. Cerro Moro mine is in production, they’re easily on target to meet the top end of their (upgraded) targets and producing a lot of cash profit when the spot price is as it is. Them’s just the facts though, don’t be listening to me.

[Barnsey]

So we did see the BOE IR rise after all, unanimous 9-0, is my 'one and done' prediction going to be true or will they have time to squeeze a couple more in?

[Majorpain]

56 minutes ago, Barnsey said:

So we did see the BOE IR rise after all, unanimous 9-0, is my 'one and done' prediction going to be true or will they have time to squeeze a couple more in?

The majority of homeowners should have transferred to fixed rates whilst the rates were low (they were warned), im struggling to think of anything off the top of my head anything that will actually be affected by the rise for a couple of years.  I can still get a 0% APR phone deal as an example.

I think that the credit bubble cant be stopped till it bursts, the BOE are looking at it annually when man/woman on the streets is looking at it monthly payments wise.  What does a 0.25% rise on the base rate do to your monthly payments on a 5% APR car finance loan?  Not a lot I imagine....

[dgul]

38 minutes ago, Majorpain said:

The majority of homeowners should have transferred to fixed rates whilst the rates were low (they were warned), im struggling to think of anything off the top of my head anything that will actually be affected by the rise for a couple of years.  I can still get a 0% APR phone deal as an example.

I think that the credit bubble cant be stopped till it bursts, the BOE are looking at it annually when man/woman on the streets is looking at it monthly payments wise.  What does a 0.25% rise on the base rate do to your monthly payments on a 5% APR car finance loan?  Not a lot I imagine....

Fixed rates have priced in interest rate rises for years.  See, there's no 'free lunch' -- either risk is taken by the homeowner or risk is taken by the bank.  And the banks will be good at ensuring that either way the risk is actually taken by the homeowner (ie, by increasing spread on fixed to cover future rises).  More than that, most fixes are short term (2 or 3 year), so the homeowner isn't actually protected against rate rises to any real extent.

As it stands these rate rises are all about the central banks saying 'see, I told you we were serious'.  As soon as there appears to be any negative consequences of the rises rates will come back down again.  And it is at that point that the trouble really starts.

[NogintheNog]

10 minutes ago, dgul said:

As it stands these rate rises are all about the central banks saying 'see, I told you we were serious'.  As soon as there appears to be any negative consequences of the rises rates will come back down again.  And it is at that point that the trouble really starts.

I totally agree. They've been hamstrung by their own 'forward guidance'!

Now the 'forward guidance' is that any future increases “are likely to be at a gradual pace and to a limited extent” and said that the outlook for the economy could be “influenced significantly” by Brexit.

Behind the curve though, should have done this earlier.

Presumably gradual pace means glacial and certainly less than the real inflation rate. Can't see 0.25% having much initial impact, any bets for savings rates to go up???

[BearyBear]

2 minutes ago, NogintheNog said:

Can't see 0.25% having much initial impact, any bets for savings rates to go up???

I can see them going up by 50%. 

 

 

 

 

 

 

From 0.1% to 0.15%

[NogintheNog]

Just now, BearyBear said:

I can see them going up 50%. 

 

 

 

 

 

 

From 0.1% to 0.15%

[DurhamBorn]

Dont worry at some point in the next cycle rates will go up in 2% jumps towards the end.Real inflation is what will cause the debt deflation,interest rates going up slightly bring the defaults closer though.Probably be printing £300 billion within two years 

[Majorpain]

1 hour ago, dgul said:

Fixed rates have priced in interest rate rises for years.  See, there's no 'free lunch' -- either risk is taken by the homeowner or risk is taken by the bank.  And the banks will be good at ensuring that either way the risk is actually taken by the homeowner (ie, by increasing spread on fixed to cover future rises).  More than that, most fixes are short term (2 or 3 year), so the homeowner isn't actually protected against rate rises to any real extent.

A couple of years of fixed IR's is still kicking the can a few more years down the road, as long as the homeowner doesn't lose their job then they will chug along nicely.  The BOE through FLS also transferred a lot of the risk away from banks to the BOE, it isn't just the homeowner and bank taking the risk these days!

[Option5]

1 minute ago, Majorpain said:

A couple of years of fixed IR's is still kicking the can a few more years down the road, as long as the homeowner doesn't lose their job then they will chug along nicely.  The BOE through FLS also transferred a lot of the risk away from banks to the BOE, it isn't just the homeowner and bank taking the risk these days!

Not sure about that, a number of people I know were planning on consolidating their debts into a remortgage to lower their monthly payments to manageable levels. This of course requires their house to be worth more than the required valuation and them meeting the lending criteria, both now unlikely. Monthly payments going up with interest rates and no way out means problems.

[Yellow_Reduced_Sticker]

On 29/07/2018 at 08:43, DurhamBorn said:

Im not sure yet,but its very likely id sell my miners at that point,though i might keep some.I had a very good day on the reduced yesterday.I now know Asda's times as well so my partner went to Asda and i went to Tesco.She got some beef in chianti should of been £6 each for 50p, two of those.4 steak burgers 50p,extra special sausages 50p,sprouts 5p a bag,3 bags,2 packs of baby corn 10p a pack.I got a massive box of strawberries should of been £5 for £1,,two bags of pears 24p each,4 bags of green beans 20p instead of 89p,wholemeal bread 12p ,ready made mash (i dont usually get this as i get 25kg bags of spuds off the farm for £6 but it was a huge one) 50p instead of £2.25.Two ready rolled flaky pastry 10p each.

My partner said there was quite a few grabbing in Asda,but Tesco isnt so bad and i know a few who go in most of the time and we tend to get for each other and share once the scrum is over.Some nights there will be nobody there though,unlike most stores.

 

BLIMEY ...ya doing better than me on the YRS's!

 

Do ya have to put up with any aggressive inits/EE & Romanian vultures?

 

If not...

 

Maybe I should relocate to Durham?

 

Seriously considered moving to aspatria cumbria last year as have a couple of good friends that live there, people are really NICE in this village they live, only thing is winter ...cumbria it seems to RAIN a lot and very cold!

 

DB, Whats it like where you are in the winter?

 

[Yellow_Reduced_Sticker]

Where's the count with his MASSIVE HEADLINE...

Come on count me ol' mucker ya slacking a bit here!

Interest Rates HIKED!

 

The Bank of England has raised interest rates to 0.75% – the highest level since the financial crisis – after a unanimous decision by its rate-setting committee.

[Majorpain]

1 hour ago, Option5 said:

Not sure about that, a number of people I know were planning on consolidating their debts into a remortgage to lower their monthly payments to manageable levels. This of course requires their house to be worth more than the required valuation and them meeting the lending criteria, both now unlikely. Monthly payments going up with interest rates and no way out means problems.

I don't disagree, however when will interest rates rise to a level where it causes real problems for the above couple?  We are still at the over indebted having to cut back on Costa/Starbucks stage IMO, not yet at struggling to put food on the table. The only fly in the ointment is its been 10 years since 2008, that recession is not going to stay away forever and that will cause deflationary chaos.

[M S E Refugee]

38 minutes ago, Yellow_Reduced_Sticker said:

 

BLIMEY ...ya doing better than me on the YRS's!

 

Do ya have to put up with any aggressive inits/EE & Romanian vultures?

 

If not...

 

Maybe I should relocate to Durham?

 

Seriously considered moving to aspatria cumbria last year as have a couple of good friends that live there, people are really NICE in this village they live, only thing is winter ...cumbria it seems to RAIN a lot and very cold!

 

DB, Whats it like where you are in the winter?

 

Aspatria is widely considered as being a bit rough.

I have just moved from the sprawling metropolis of Carlisle to the Solway Coast, I wished that I had moved here years ago.

Have a look at the Solway Coast AONB,its very cheap at the moment and tourism has been steadily increasing with people walking the length Roman Wall.

[leonardratso]

arsepartia? never heard of it. is it posh for bum crack?

[Shatner's Bassoon]

35 minutes ago, M S E Refugee said:

Aspatria is widely considered as being a bit rough.

I have just moved from the sprawling metropolis of Carlisle to the Solway Coast, I wished that I had moved here years ago.

Have a look at the Solway Coast AONB,its very cheap at the moment and tourism has been steadily increasing with people walking the length Roman Wall.

I'm originally from Whitehaven. Now that's rough...

Anyone got any views on uranium as a contrarian bet? Massively bombed-out, unloved sector since Fukushima. 

Only option I've found so far for exposure is the amusingly titled Geiger Counter Ltd

https://www.hl.co.uk/shares/shares-search-results/g/geiger-counter-ltd-npv

[Yellow_Reduced_Sticker]

51 minutes ago, M S E Refugee said:

Aspatria is widely considered as being a bit rough.

I have just moved from the sprawling metropolis of Carlisle to the Solway Coast, I wished that I had moved here years ago.

Have a look at the Solway Coast AONB,its very cheap at the moment and tourism has been steadily increasing with people walking the length Roman Wall.

 

If i told you were i live now ...ya think i need me head examined!

 

The town i live now is the BIGGEST SH*T-HOLE in the SE!

 

I speak regular to the friends Aspatria - however haven't been up there in over a decade...

 

When i was up there we would go into cockermouth, (ya like that one @leonardratso  ) AND i will NEVER forget this...we walked into a pub bought some drinks i was introduced to some more of this friend mates...

 

Then out of the blue a foxy girl came up to me and BOUGHT ME A DRINK!

 

Maybe cos i had a southern accent - NO idea ...BUT I can tell ya that's NEVER happen to me here in the SE!

[leonardratso]

18 minutes ago, Yellow_Reduced_Sticker said:

 

If i told you were i live now ...ya think i need me head examined!

 

The town i live now is the BIGGEST SH*T-HOLE in the SE!

 

I speak regular to the friends Aspatria - however haven't been up there in over a decade...

 

When i was up there we would go into cockermouth, (ya like that one @leonardratso  ) AND i will NEVER forget this...we walked into a pub bought some drinks i was introduced to some more of this friend mates...

 

Then out of the blue a foxy girl came up to me and BOUGHT ME A DRINK!

 

Maybe cos i had a southern accent - NO idea ...BUT I can tell ya that's NEVER happen to me here in the SE!

you say foxy girl, but that was actually the village trans looking for fresh (unrelated) dna. still the foxiest gal in arsepartia.

 

[DurhamBorn]

2 hours ago, Yellow_Reduced_Sticker said:

 

BLIMEY ...ya doing better than me on the YRS's!

 

Do ya have to put up with any aggressive inits/EE & Romanian vultures?

 

If not...

 

Maybe I should relocate to Durham?

 

Seriously considered moving to aspatria cumbria last year as have a couple of good friends that live there, people are really NICE in this village they live, only thing is winter ...cumbria it seems to RAIN a lot and very cold!

 

DB, Whats it like where you are in the winter?

 

Quite a few Polish here and we have been getting quite a few more middle eastern,but very few compared to most places.The weather here is fine as we are east of the Pennine's,winter is cold but nothing special.I actually think its a great place to live considering the price.Places like Boro and the small ex pit villages arent very nice,mostly simply boring more than anything,but the better market towns etc are spot on.What i like about here is that i can be at the coast in 25 minutes,Scotland and the Lake District in about 1 hr 15.East coast mainline 9 miles away gets me to Kings Cross in 2 hrs 10 minutes for £30 return if i book early enough.Pretty much retired at 39 and can live a very nice life up here for not very much.At the edge of my estate if you head north youl not see much until the Central belt of Scotland,head west,nothing until the Lake District,but head east and its much more busy,Boro,Sunderland,Newcastle etc.Id much rather be here than Cumbria.Its beautiful over there,but quite isolated really.The southern lakes you arent far from Manchester etc,but the northern end,although fantastic only really has Carlisle.In my younger days i went around the country dating women mostly from offline.I pretty much visited and stayed in every area of the country and although i loved some of the places i never found anywhere i prefer to home and i found the more i headed south the more i disliked the place.I also found the more i headed south the more the women seemed to spend when we went out.They may of been gorgeous some of them,but once they get in the road of FIRE they were quickly kicked into the long grass 

[Yellow_Reduced_Sticker]

26 minutes ago, leonardratso said:

you say foxy girl, but that was actually the village trans looking for fresh (unrelated) dna. still the foxiest gal in arsepartia.

 

Hmm...could be cos we had quite a few beers before we left to go into cockermouth town!

[Yellow_Reduced_Sticker]

2 minutes ago, DurhamBorn said:

Quite a few Polish here and we have been getting quite a few more middle eastern,but very few compared to most places.The weather here is fine as we are east of the Pennine's,winter is cold but nothing special.I actually think its a great place to live considering the price.Places like Boro and the small ex pit villages arent very nice,mostly simply boring more than anything,but the better market towns etc are spot on.What i like about here is that i can be at the coast in 25 minutes,Scotland and the Lake District in about 1 hr 15.East coast mainline 9 miles away gets me to Kings Cross in 2 hrs 10 minutes for £30 return if i book early enough.Pretty much retired at 39 and can live a very nice life up here for not very much.At the edge of my estate if you head north youl not see much until the Central belt of Scotland,head west,nothing until the Lake District,but head east and its much more busy,Boro,Sunderland,Newcastle etc.Id much rather be here than Cumbria.Its beautiful over there,but quite isolated really.The southern lakes you arent far from Manchester etc,but the northern end,although fantastic only really has Carlisle.In my younger days i went around the country dating women mostly from offline.I pretty much visited and stayed in every area of the country and although i loved some of the places i never found anywhere i prefer to home and i found the more i headed south the more i disliked the place.I also found the more i headed south the more the women seemed to spend when we went out.They may of been gorgeous some of them,but once they get in the road of FIRE they were quickly kicked into the long grass 

THANKS for that DB!

I'm off to Tescos now on me push-bike...

[leonardratso]

2 minutes ago, Yellow_Reduced_Sticker said:

Hmm...could be cos we had quite a few beers before we left to go into cockermouth town!

did you wake up the next day with a bad headache and blood on your hands? cos if so i summise that you in fact ended up in the small town next to cockermouth - 'cockinarse'.