Jump to content
DOSBODS
  • Welcome to DOSBODS

     

    DOSBODS is free of any advertising.

    Ads are annoying, and - increasingly - advertising companies limit free speech online. DOSBODS Forums are completely free to use. Please create a free account to be able to access all the features of the DOSBODS community. It only takes 20 seconds!

     

IGNORED

Credit deflation and the reflation cycle to come.


DurhamBorn

Recommended Posts

14 hours ago, Hardhat said:

So what you're saying is... not saying that at all Ms Newman!

If you need housing, but you don't want to buy a house, you can rent, or live in a camper van or get a council house.

If you need a degree for your career, you don't have much choice apart from going to university. If you are bright but don't come from money, you need to take out a loan.

It might be a financial decision, but it is essentially made for you by the system. There is only one loans provider. The repayments are deducted automatically and you can't negotiate on them. The govt can retroactively change the terms of the loan. But without one you can't study, and you're back in the stock room at Foot Locker whilst all your mates become brain surgeons.

Of course maybe it's better to educate fewer people to degree level and have them state funded, and reintroduce polys, vocational training or better apprenticeships, as well as some kind of adult learning.

If people want to discuss student loans shall we start a separate thread for this?

Separate thread sounds good.

11 hours ago, Barnsey said:

Isn't it, I've been in this state of continued doom analysis since August 2015, now I wonder where the past 3 years have gone and what I could have done with my time more wisely instead of obsessing over everything economical, but I've learned a lot in this time and do find it (sadly?) incredibly interesting. Because I over-analyse and fill much of every day absorbing hundreds of tweets and articles, FWIW I can reassure that it would take a miracle (I can hear the QE desensitised sighs already xD) to turn this negative momentum around. All eyes on next summer being the crucial turning point in the US for interest rates, unless we get a black swan sooner.

Embrace it,don't fear it.I've been like that for 15+ years.On an intellectual/philosophical level,I'd have learned nothing if all I'd read was the words of Estate Agents

11 hours ago, DurhamBorn said:

How people feel "sentiment" is hugely important.In my PM indicators sentiment is right up there.What people are starting to feel is the end of a dis-inflation cycle.Its that feeling that its getting harder and harder.Cost are going up,but you cant pass them on.Margins coming down and down,where free cash cant cover outgoings and so companies eat themselves.

As a contrarian i look ahead and i see a distribution cycle alongside a reflation.That means only a few areas will see gains.Nothing to fear,there are huge wealth making chances coming,we only need to catch a few of them to do just fine,and i know we will catch more than a few.

Sentiment drives 90% of the price action imho.You generally make money with the trend.At the turn,many many people get caught off guard.

On top of that,markets generally sell of quicker than they rise.

Link to comment
Share on other sites

  • Replies 11.2k
  • Created
  • Last Reply
21 minutes ago, dgul said:

Ah, but olden days travel was different.

I still travel to olden days airports.  Sumburgh Airport (Shetland) is great (like the 50's) -- they take your luggage through the doors and dump it in the arrivals hall -- just takes a few minutes (as does getting to the arrivals hall -- which is actually just 'the big room part of the shed', and is shared with departures).  Berlin Tegel is also pretty good (like the 60's) -- you have to wait a few minutes, but your luggage is about halfway between the plane and the taxis, so about 50m out of 100m.

Compare that with most airports -- your luggage will go God knows where and be handled by God knows who, and eventually should end up at the other side of the airport (which will feel like a mile or so), but it might not.  

So it is hardly surprising that people prefer to go with the 'big hand luggage' these days.

[I try to travel with a bag that'll fit under the seat in front -- I don't know why so many people travel with such volumes of stuff]

Sumburgh brings back memories, I bet it's galloped into the 18th century since I last visited in 1998

Link to comment
Share on other sites

20 minutes ago, dgul said:

[I try to travel with a bag that'll fit under the seat in front -- I don't know why so many people travel with such volumes of stuff]

The amount of stuff people travel with often inflates to the amount required to fill their bag/s. This is basic human nature; "I'm allowed a bag this big. Okay, so I'll take this, this and this. Okay, there's still more room. Do I need another change of clothes, or a hairdryer, or x, y, z etc.?", and suddenly the bag is/was full - 20 kilos.

Say what you like about RyanAir, but their cabin baggage policy and charging for hold bags was quite revolutionary at the time - it made people actually assess whether they needed everything they normally travelled with - it's amazing how when you charge 'extra' for something like luggage, even if it's a simple token amount like £10, how many people realise they don't actually need anything like they previously travelled with.

1 hour ago, AnythingWithWheels said:

Much as I dislike posting OT - I’ve just flown Ryanair, with the supposed new cabin bag policy.  Everybody got to take their bag into the cabin just like the old days.  Certainly, none of the people sitting near me had paid the new charge to guarantee a place in the cabin.

It does amuse me how, years ago, people wanted bugger all hand luggage as it’s a pain in the arse carrying it to the gate. As much as possible went in the hold. Now, taking hand luggage costs extra...

I think the 'new' policy only affects flights from 1st November onwards, this might explain why.

Link to comment
Share on other sites

2 hours ago, DurhamBorn said:

http://truecontrarian-sjk.blogspot.com/

Great new article from Steve,for me one of the best contrarian investors out there.The tail end of the bull made some of his picks look poor,but that was only a timing issue.Longer term Steve has a superb record.

 

Some great advice in there.

' Most investors want to sell whatever has been underperforming since January 2018 in order to buy whatever has been outperforming.

Link to comment
Share on other sites

9 hours ago, sancho panza said:

Some great advice in there.

' Most investors want to sell whatever has been underperforming since January 2018 in order to buy whatever has been outperforming.

Interesting article, and what have I learnt?...to go and buy all the unloved stock, come onto as many forums like this as possible and talk them up, thus hopefully convincing you all to buy in....

Have you all heard, Foxtons shares are going to be the next ten bagger...don't miss out, buy now! :-)

Link to comment
Share on other sites

32 minutes ago, Barnsey said:

Monmouthshire and Newport

Need more than cheap house prices to move to Newport!  And what about the motorways (m4,m5,m32).  Already saturated.  Bristol's traffic problem is legion.  Madness.

Link to comment
Share on other sites

17 minutes ago, Barnsey said:

Latest LSL Acadata report out:

http://acadametricstest.com/services/house-price-index/

0.9% annual growth for England & Wales, predicted to be negative by year end. Monmouthshire and Newport saw highest gains, due to priced out Bristolians no doubt anticipating removal of Severn Bridge toll.

Says we've definitely peaked to me.

If we take a HTB new build house i dont think il see the prices today again in my lifetime inflation adjusted,or perhaps even nominal.

http://www.cityam.com/266171/auto-dealer-pendragons-shares-tumble-fresh-profit-warning

More profit warnings.New car sales causing plenty of pain now as well.

@sancho panza Ashtead and International Hotels getting whacked again.

 

 

Link to comment
Share on other sites

11 minutes ago, Harley said:

Need more than cheap house prices to move to Newport!  And what about the motorways (m4,m5,m32).  Already saturated.  Bristol's traffic problem is legion.  Madness.

Rapidly becoming less cheap, HTB mania. Very grim town, but now with increasingly mismatched house prices. 

Link to comment
Share on other sites

21 minutes ago, Harley said:

4 weeks old, but a trend?  Dubious throwaway comment at end.

https://moneyweek.com/495327/british-airways-pension-scheme-transfers-to-lg/

 

Indeed,going bust xD.Im not sure on if these are amazing deals for Legal and General or terrible ones.Given long term rates are going to head higher probably fantastic deals,but if they are getting into lots of swaps and derivatives probably terrible ones.Id love to get hold of how they invest to fund the liability.Iv done well over the years in Aviva and Legal and General,but sold both last year and wont re-enter due to them being far to involved in equity release etc.I think they will get burned on that and the FSA might slap them with holding higher capital once house prices start to fall heavily.

Link to comment
Share on other sites

22 hours ago, Gordie Lastchance said:

Talking about tech, I dunno if the following has been mentioned before re Stagecoach. Any views on here about it?

This is the link:

https://www.alexander-dennis.com/media/news/2018/july/stagecoach-trials-uks-first-full-sized-driverless-bus/

This is the article pasted:

 

Work is underway to trial the UK’s first full-sized driverless bus. 

Transport operator Stagecoach has partnered with bus manufacturer Alexander Dennis Limited (ADL) and technology company Fusion Processing to produce a single deck autonomous bus.

Once complete, the ADL Enviro200 vehicle will be completely autonomous and able to operate without a driver in an off-road environment. The technology also delivers road safety benefits when driven in manual mode.

Work on the vehicle is being carried out at ADL’s site in Guildford and the bus is expected to be ready for use by the end of this year.

In the short term, the bus will be used in autonomous mode only within the depot environment, to carry out movements such as parking and moving into the fuelling station and bus wash. Using self-driving vehicles within depots more widely could help improve safety, efficiency and space utilisation within the depot.

Legal restrictions mean the vehicle will not be used in autonomous mode in passenger service for some time. However the system can be used straight away to help improve the safety of road users. For example, when the bus is driven in manual mode, the sensor system on the bus, whilst not engaged to drive the vehicle, can still be used to provide assistance to the driver by warning of cyclists or pedestrians that may be in the blind spot or arrive unexpectedly close to the vehicle.

Over time, autonomous bus technology is expected to be used more widely, including on services carrying passengers, dependent on legal developments. 

Stagecoach UK Bus Engineering Director Sam Greer said: “Stagecoach has long been at the heart of innovation within the bus industry and this is an exciting trial that will deliver the UK’s first fully autonomous single deck bus. 

“We look forward to working with our partners on this project which we believe could, in time, help improve safety and efficiency within our depots, and over the longer term, help transform bus travel in the future.”

The Stagecoach bus will be fitted with the CAVstar® system provided by Fusion Processing Ltd. CAVstar® was utilised successfully in the UK’s largest public trial of autonomous vehicles to date, in Greenwich earlier this year, and a number of other projects.

The system uses multiple sensor types, including radar, laser, camera and ultrasound, along with satellite navigation to detect and avoid objects, in all weathers, day and night, and plan an optimum path for the vehicle.

Jim Hutchinson, CEO of Fusion Processing Ltd said: “We’re delighted Stagecoach and Alexander Dennis have selected our CAVstar® product, the sensor and control system that enables autonomous vehicles. CAVstar® will offer increased safety and efficiency, and will be demonstrated in the Stagecoach trials later this year. “

Ken Scott, Group Engineering Director at ADL, commented, “ADL is renowned for harnessing the latest technology solutions to enhance our products and services to benefit our customers, their passengers and the wider environment. We’re excited to be working with Stagecoach and Fusion Processing on this innovative project. In the first instance it will deliver real and demonstrable improvement to efficiency and safety in depots, while taking another significant step on our journey to bringing fully autonomous vehicles to market.”

I can't see how fully driver-less / autonomous vehicles are going to do anything other than decimate public transport providers in the short-to-medium term. Given that the biggest cost in running any form of road vehicles is the labour of the driver, who are broadly paid the same whether they are driving a taxi, bus, coach, whatever, you take this cost out of the equation and it removes the necessity for the vast majority of buses on our roads. Why would someone pay 50p for an autonomous-vehicle bus journey, when the equivalent journey in an on-demand private vehicle/autonomous taxi could be had for £1.00?

This is why Uber are continually allowed to run up such massive losses for years. Their private equity investors are betting that as soon as technology catches up re: autonomous vehicles, Uber can ditch the drivers entirely and will be in pole position to take over the world in such journeys.

Link to comment
Share on other sites

Gordie Lastchance
12 minutes ago, azzuri82 said:

I can't see how fully driver-less / autonomous vehicles are going to do anything other than decimate public transport providers in the short-to-medium term. Given that the biggest cost in running any form of road vehicles is the labour of the driver, who are broadly paid the same whether they are driving a taxi, bus, coach, whatever, you take this cost out of the equation and it removes the necessity for the vast majority of buses on our roads. Why would someone pay 50p for an autonomous-vehicle bus journey, when the equivalent journey in an on-demand private vehicle/autonomous taxi could be had for £1.00?

This is why Uber are continually allowed to run up such massive losses for years. Their private equity investors are betting that as soon as technology catches up re: autonomous vehicles, Uber can ditch the drivers entirely and will be in pole position to take over the world in such journeys.

But come rush hour, where are all the driverless cars going to come from if the travelling public are going to ditch buses? TfL says London's buses carry around 6.5million passengers per day (https://londonist.com/2016/09/london-bus-facts). Taking 90 people off a double-decker and putting them into 90 self-driving cars is going to be mayhem, isn't it? Doesn't this then create the congestion that public transport is supposed to alleviate?

I agree, though, I see the attraction of sitting solo in a car rather than sharing all the germs and other issues of a packed bus.

Link to comment
Share on other sites

Bricks & Mortar
5 minutes ago, Gordie Lastchance said:

Taking 90 people off a double-decker and putting them into 90 self-driving cars is going to be mayhem, isn't it? Doesn't this then create the congestion that public transport is supposed to alleviate?

I agree, though, I see the attraction of sitting solo in a car rather than sharing all the germs and other issues of a packed bus.

They'll control the numbers of self driving taxis through operators licensing.  Another reason Uber is allowed to run at sucha loss right now.

Link to comment
Share on other sites

44 minutes ago, azzuri82 said:

I can't see how fully driver-less / autonomous vehicles are going to do anything other than decimate public transport providers in the short-to-medium term. Given that the biggest cost in running any form of road vehicles is the labour of the driver, who are broadly paid the same whether they are driving a taxi, bus, coach, whatever, you take this cost out of the equation and it removes the necessity for the vast majority of buses on our roads. Why would someone pay 50p for an autonomous-vehicle bus journey, when the equivalent journey in an on-demand private vehicle/autonomous taxi could be had for £1.00?

This is why Uber are continually allowed to run up such massive losses for years. Their private equity investors are betting that as soon as technology catches up re: autonomous vehicles, Uber can ditch the drivers entirely and will be in pole position to take over the world in such journeys.

The biggest cost of running a bus isnt the labour,its depreciating the asset over 10 years and the fuel.A long time before we get mass use autonomous cars we will get on demand public transport and shared car use.At the moment we have the transport manufacturers the transport companies and the tech companies.Its highly likely there will be some form or merger of the three in the future.How the cards fall cant be known yet,but what can be known is the next cycle will favour public transport as fuel costs and car ownership costs rocket as consumers liquidity tightens.The likes of Uber are going to have to raise capital with rates over 7% in the next cycle and there is simply no idea about how much equity might be diluted before,or if they survive into a key player.Very interesting sector.

Link to comment
Share on other sites

1 hour ago, azzuri82 said:

I can't see how fully driver-less / autonomous vehicles are going to do anything other than decimate public transport providers in the short-to-medium term. Given that the biggest cost in running any form of road vehicles is the labour of the driver, who are broadly paid the same whether they are driving a taxi, bus, coach, whatever, you take this cost out of the equation and it removes the necessity for the vast majority of buses on our roads. Why would someone pay 50p for an autonomous-vehicle bus journey, when the equivalent journey in an on-demand private vehicle/autonomous taxi could be had for £1.00?

This is why Uber are continually allowed to run up such massive losses for years. Their private equity investors are betting that as soon as technology catches up re: autonomous vehicles, Uber can ditch the drivers entirely and will be in pole position to take over the world in such journeys.

Which is why I think there will be many subsidised free bus services in towns and cities up and down the country in years to come to encourage people out of their petrol/diesels, along with the bus companies buying up taxi firms where possible (See Transdev + Green Tomato Cars).

https://www.weforum.org/agenda/2018/06/estonia-is-making-public-transport-free/

Quote

Why free transport?

Some argue that public transportation should be free, just like schools, parks and libraries are. And that it’s good for cities because making it easy for people to move around fosters commercial activity.

The city of Tallinn website says that free public transport benefits those on low incomes most, but it also encourages higher income groups to spend money in local restaurants, cafes and shops.

In Tallin, registering as a resident means that the city automatically receives a portion of the national taxes paid by each resident, boosting the municipal coffers.

“There’s no doubt that we not only cover the costs, but also come out with a surplus,” Allan Alaküla, Head of Tallinn European Union Office, told PopUpCity.

“We earned double as much as we have lost since introducing free public transport. We’re happy to see that so many people are motivated to register as residents in Tallinn to make use of free public transport.”

The free Metroshuttle in Manchester springs to mind

https://www.tfgm.com/public-transport/bus/metroshuttle

 

Link to comment
Share on other sites

40 minutes ago, DurhamBorn said:

The biggest cost of running a bus isnt the labour,its depreciating the asset over 10 years and the fuel.A long time before we get mass use autonomous cars we will get on demand public transport and shared car use.At the moment we have the transport manufacturers the transport companies and the tech companies.Its highly likely there will be some form or merger of the three in the future.How the cards fall cant be known yet,but what can be known is the next cycle will favour public transport as fuel costs and car ownership costs rocket as consumers liquidity tightens.The likes of Uber are going to have to raise capital with rates over 7% in the next cycle and there is simply no idea about how much equity might be diluted before,or if they survive into a key player.Very interesting sector.

If you're running an efficient operation (...as Stagecoach and the likes definitely are - the vehicles don't sit idle), it's the labour. If you're talking long haul express journeys, it's a close call if you include maintenance, fuel and vehicles etc., but one of these VDL or Van Hool premium coaches Stagecoach runs that cost £300-350k new and depreciated over 6-7 years before being sold on will cost them less than £100/day over the period of ownership. They'd expect these vehicles to be on the road 28/29 days a month. I'm still willing to bet that the direct driver labour costs 20% more than the vehicles, fuel and maintenance combined.

If you mean the local routes on buses rather than coaches, the labour will be a much bigger part of their costs. A Dennis vehicle might last for 15-20 years if maintained properly - and although maintenance costs can be quite high, again this is mostly labour, and Stagecoach depots will have their own full-time maintenance guys, so it likely cuts the cost of maintenance in half.

Smaller, local operators (that make little to no operating profit), perhaps the vehicles are a larger part of their costs, but this tends to be family firms outwith the South-East of England, and they only make money when they actually sell a vehicle on at 5/6 years' old that they've owned from new.

Getting hold of reliable, experienced drivers in the industry is very difficult. I was speaking to an small'ish operator from the South East of England a few months ago who told me that in order to keep hold of their experienced drivers over the summer months to take advantage of the tourist trade, they were having to pay them £300-350/day.

Link to comment
Share on other sites

18 minutes ago, DurhamBorn said:

The biggest cost of running a bus isnt the labour,its depreciating the asset over 10 years and the fuel.A long time before we get mass use autonomous cars we will get on demand public transport and shared car use.At the moment we have the transport manufacturers the transport companies and the tech companies.Its highly likely there will be some form or merger of the three in the future.How the cards fall cant be known yet,but what can be known is the next cycle will favour public transport as fuel costs and car ownership costs rocket as consumers liquidity tightens.The likes of Uber are going to have to raise capital with rates over 7% in the next cycle and there is simply no idea about how much equity might be diluted before,or if they survive into a key player.Very interesting sector.

Already being trialled in Oxford...

https://pickmeup.oxfordbus.co.uk/

(I may have read about that in this thread)

7 minutes ago, Barnsey said:

Which is why I think there will be many subsidised free bus services in towns and cities up and down the country in years to come to encourage people out of their petrol/diesels, along with the bus companies buying up taxi firms where possible (See Transdev + Green Tomato Cars).

https://www.weforum.org/agenda/2018/06/estonia-is-making-public-transport-free/

 

Article a few days ago about free public transport in Dunkirk...

https://amp.theguardian.com/cities/2018/oct/15/i-leave-the-car-at-home-how-free-buses-are-revolutionising-one-french-city?__twitter_impression=true

Link to comment
Share on other sites

8 minutes ago, Barnsey said:

Which is why I think there will be many subsidised free bus services in towns and cities up and down the country in years to come to encourage people out of their petrol/diesels, along with the bus companies buying up taxi firms where possible (See Transdev + Green Tomato Cars).

https://www.weforum.org/agenda/2018/06/estonia-is-making-public-transport-free/

 

This is a possibility. Local councils subsidising buses is very much a possibility if you take the cost of a driver out of the equation. When the margins disappear in the industry (as has been felt with public school contracts in the last 10 years), the councils might have to step in and pick up the pieces out of necessity.

Link to comment
Share on other sites

Bricks & Mortar
6 minutes ago, DurhamBorn said:

The biggest cost of running a bus isnt the labour,its depreciating the asset over 10 years and the fuel

Notional numbers.  I hope within the realms of possibility.

bus running 15 hours/day -  2 full time drivers on £25K each = £50K/year.
Bus costing £350K, depreciating 10 year straight line = £35K/year.
Bus doing 9mpg, doing 35,000 miles/year = 3888 gallons = 17651 litres.  @ £1.20/litre = £21,181/year

Link to comment
Share on other sites

11 minutes ago, Bricks & Mortar said:

Notional numbers.  I hope within the realms of possibility.

bus running 15 hours/day -  2 full time drivers on £25K each = £50K/year.
Bus costing £350K, depreciating 10 year straight line = £35K/year.
Bus doing 9mpg, doing 35,000 miles/year = 3888 gallons = 17651 litres.  @ £1.20/litre = £21,181/year

Straight line is rarely used in the industry. Most use 15% per annum (...so the amount of depreciation decreases annually after year 1 with the decrease in value of the vehicle). Vehicle will likely still be worth around 15-20% of its purchase value after 10 years.

Link to comment
Share on other sites

8 minutes ago, azzuri82 said:

Straight line is rarely used in the industry. Most use 15% per annum (...so the amount of depreciation decreases annually after year 1 with the decrease in value of the vehicle). Vehicle will likely still be worth around 15-20% of its purchase value after 10 years.

And average bus driver salary in UK closer to £21-22k per year, I earned £24k in London but has since come down due to mass recruitment direct from EE and retiring drivers on better contracts

Link to comment
Share on other sites

56 minutes ago, azzuri82 said:

Straight line is rarely used in the industry. Most use 15% per annum (...so the amount of depreciation decreases annually after year 1 with the decrease in value of the vehicle). Vehicle will likely still be worth around 15-20% of its purchase value after 10 years.

The key buy signal iv always used in the past on the transports was when depreciation started to fall as it tended to lead to increased free cash.Likely that is due to the bus buying cycle.The key to the next cycle is that it will be inflationary and as such prices will go up faster than depreciation hence increased cash flow.Of course when to buy is difficult to decide as we are in a bear market,but il stair case in as i always do.Its also highly likely i will of sold out by 2025/27 as that when rates should catch up with inflation.Interesting sector going forward to see how things play out.

Link to comment
Share on other sites

Archived

This topic is now archived and is closed to further replies.

  • Recently Browsing   0 members

    • No registered users viewing this page.

×
×
  • Create New...