Credit deflation and the reflation cycle to come.

[DurhamBorn]

2 minutes ago, Barnsey said:

Same here 

Once GDX gets through 21 its off to the races .This consolidation might last a few more days,or maybe into early November.The moving averages are coming together now and energy is building.Uk market has seen some huge falls already.Noticed even more passing the down 50%+ mark the last few days with the likes of William Hill etc.

[Democorruptcy]

7 hours ago, Sideysid said:

Exactly. These ‘Lifestyle’ pensions are based blindly with no active management, so a persons entire pension could be transferred from one downturning sector to another at fixed intervals shedding capital. 

One point of note is that the civil service partnership pension options are moving away from Equitable Life, Standard Life and Scottish Widows. Monthly contributions have all switched from September to Legal and General in a default ‘Pathfinder’ fund. It will be interesting to see if this has an effect on people reevaluating their situations etc and moving to cash funds etc.

What I would say is at least the Pathfinder fund is actively managed and low fee. Not the worst (in a very limited list of options) for someone with no capital already in there, who’s contributions are going forward into a falling market. Now that the current direct benefit civil service pensions are linked with state pension age, pension options are limited.

Here’s a link if to the new fund list if anyone’s interested.

https://www20.landg.com/DocumentLibraryWeb/Document?lgrouter=CommApp&targetApp=MANAGEYOURSCHEME_DOCUMENTLIBRARY_ENTRY&reference=cabinet_office_pathway_investment_guide.pdf

Funnily enough I got some info from my deferred Mitchells & Butlers pension today. They have switched from Blackrock to L&G and new investment options called "Pathway" have been introduced. L&G must have crossed some palms with silver, they seem to be taking in a lot of money?

I don't like the sound of it and should have moved it to my SIPP when I got the transfer value earlier this year.

[MrXxx]

9 hours ago, DurhamBorn said:

Its incredible how bad DC pensions are.The funds offered in my old Glaxosmithkline pension are laughable.One of the biggest pharmas in the word yet a shocking choice.My new employer is the same a  massive company,yet the pension choices poor.It seems everyone has now decided that low fee passive trackers are the way to go.As a contrarian when the crowd all think one way is certain i like to be on the other side of that trade.

I keep seeing someone say at 55 with say £100k when the markets slide and its cut to £70k (at best),then its moved into the "lifestyle" section as most corporate DCs do about 7 years from retirement,,mainly bonds,just as inflation gets going and bonds enter a long bear.That £100k could end up at £35k if the timing is really bad.

I think passive trackers were a very good choice for a dis-inflation cycle as money flowed into markets,but that doesnt say they will be in a distribution cycle.My answer would be allow people with a SIPP to have their contributions from employers paid direct into that.

The problem is DB, the majority don't understand investments/pensions (or they don't want to), they just want something as simple as possible OR only really realize the importance of their pensions when it is too late I.e once retired...

[Bobthebuilder]

Not much to add to this great thread but, a few guys ive known for years in the London trades have all started talking about a recession this week. First time ive heard it since 2007.

[Harley]

1 hour ago, Democorruptcy said:

L&G must have crossed some palms with silver, they seem to be taking in a lot of money?

Certainly been hearing their name a lot.

https://legalandgeneralgroup.com/pensions-de-risking/

 

[Van Lady]

5 hours ago, DurhamBorn said:

A brick layer started working with me this week.He said Taylor Wimpey had pushed back starting two new sites from late this year to "late next year sometime".He said he was just getting their basic wage instead of that and bonus.He said it was good money as they were only laying bricks two days a week now,but then had to still be on site "sweeping up etc" for the other 3 days so that made it crap money (he said £350 a week then the rest was bonus on top) so he decided to leave "for the winter".I doubt he will get back myself.

This is just two sites in the north east of course,but says to me they are slowing building as they cant sell what they already have on the sites already being built.

Another anecdotal.

My son works in the building trade for a major house builder operating in south west Scotland and Cumbria.

My son’s team are currently at a site in Carlisle but are planning to move on soon because the builder is going to redesign the site because the houses aren’t selling. The last site the builder completed at Carlisle had people waiting to move in when the house was ready. These are a higher end detached new build style of house.

 

[Barnsey]

Lots of drama over at Wall Street today!

[sancho panza]

4 minutes ago, Barnsey said:

Lots of drama over at Wall Street today!

What's going on?

Just looking.I put a first staircase short on Netflix this afternoon,-10%....last time I checked I had one in the blue and that was Whitbread...now 5 and 5.

What's going on?Just looking at the Dow,Microsoft down 5%....United technologies -6%...caterpillar -5%....Goldman Sachs -4%(didn't put any on)...

[sancho panza]

23 minutes ago, Van Lady said:

Another anecdotal.

My son works in the building trade for a major house builder operating in south west Scotland and Cumbria.

My son’s team are currently at a site in Carlisle but are planning to move on soon because the builder is going to redesign the site because the houses aren’t selling. The last site the builder completed at Carlisle had people waiting to move in when the house was ready. These are a higher end detached new build style of house.

 

Intersting,it's that detached market that is msot sensitive.At the lower end,there's generally always some demand.

I follow the £550k+ market in Leicestershire regularly to see changes over 24 hours.Surprising amount of reductions lately.

[sancho panza]

3 hours ago, DurhamBorn said:

Once GDX gets through 21 its off to the races .This consolidation might last a few more days,or maybe into early November.The moving averages are coming together now and energy is building.Uk market has seen some huge falls already.Noticed even more passing the down 50%+ mark the last few days with the likes of William Hill etc.

You put a thought in my head and I had a look at the GDX chart and actually,that chart is way more stable and readable than any individual stock.Just saying.I never really check the ETF charts as I don't buy them.That'll teach me.

You got a view on the sort sell off we're facing here DB? Is it a crash or as Wolf argued t'other day,is it a drip drip sell off featuring rallies that lasts years.I was in that latter camp until the last few days,but even from oversold conditions-in my opinion-it's jsut not recovering.

[Majorpain]

10 minutes ago, Barnsey said:

Lots of drama over at Wall Street today!

Bloombergs SMART index is signalling something very bad is brewing.  These things come around every 10 years and we are overdue a recession, front row seats of the carnage!

[sancho panza]

...

[Funn3r]

4 minutes ago, sancho panza said:

Intersting,it's that detached market that is msot sensitive.At the lower end,there's generally always some demand.

I follow the £550k+ market in Leicestershire regularly to see changes over 24 hours.Surprising amount of reductions lately.

Near me (Wokingham) I've been watching several "demolish old crap house with normous garden and build x2 or x3" projects. They have made it to the finish line  but not selling. These are 5-bed detached I should think so million plus. Not long ago would have been no need to put for sale board up even. A couple I drive past every day incomplete and not seeing much happening. Then when I get nearly to work the Redrow site is surprisingly slow. I remember going on holiday August 2 and scaffolding was up and roof half on... Scaffolding still up and roof finished, but that seems slow to me. 

[azzuri82]

5 minutes ago, sancho panza said:

...

Netflix down 9.4% today 

[sancho panza]

3 minutes ago, azzuri82 said:

Netflix down 9.4% today 

I had plans to staircase in at 340,350,360,370.Shows what I know.I'll uopdate the short thread later.Added some Starbucks and facebook as well since we last liaised

[Barnsey]

Nasdaq had it's worst day since August 2011, but it's still the *only* major global index remaining in the green (only just) YTD.

Apple the one to watch, hit it's resistance of 215 but already back up at 217 after hours.

Tesla up considerably after v good earnings figures, but things may not be as good as they seem.

Oh yeah, and the Wall Street crash of 1929 started on October 24th. Exactly 89 years ago.

[sancho panza]

6 minutes ago, Barnsey said:

Nasdaq had it's worst day since August 2011, but it's still the *only* major global index remaining in the green (only just) YTD.

Apple the one to watch, hit it's resistance of 215 but already back up at 217 after hours.

Tesla up considerably after v good earnings figures, but things may not be as good as they seem.

Oh yeah, and the Wall Street crash of 1929 started on October 24th. Exactly 89 years ago.

Youre full of cheer.

Tesla showing +$33 in the after hours ........

Any idea when the buy backs can start again?

[DoINeedOne]

AMD crashes 25% https://www.zerohedge.com/news/2018-10-24/amd-crashes-25-after-revenue-miss-q4-guidance-cut

[Barnsey]

6 minutes ago, sancho panza said:

Youre full of cheer.

Tesla showing +$33 in the after hours ........

Any idea when the buy backs can start again?

Might be because I'm on nights this week  (I hate nights)

Buyback activity will return with a vengeance next month, November typically the busiest along with August. Will be interesting to see how much can be saved after the carnage of the next few days, bearing in mind the cheap money with which they buy their own shares is rapidly drying up.

[sancho panza]

35 minutes ago, Barnsey said:

Might be because I'm on nights this week  (I hate nights)

Buyback activity will return with a vengeance next month, November typically the busiest along with August. Will be interesting to see how much can be saved after the carnage of the next few days, bearing in mind the cheap money with which they buy their own shares is rapidly drying up.

I hate nights as well particualrly weekend nights-NHS,you can guess why...-

My reason for opting for 2019 for the big kahuna was buybacks.Are you still of the view it'll be 2019?I'm getting very unsure where we are... this latest set of drops feels very different to the start of teh year.

Worth noting HUI was a sea of red today,jsut down less than the  rest.

 

Have eyed a few Dow stocks and things like Visa which have gone up 10 times since the bottom in 09.The more I dig the more I'm finding.......

[Barnsey]

57 minutes ago, sancho panza said:

I hate nights as well particualrly weekend nights-NHS,you can guess why...-

My reason for opting for 2019 for the big kahuna was buybacks.But this latest set of drops feels very different to the start of teh year.Have you got a view re the question I posed at DB earlier?

 

Have eyed a few Dow stocks and things like Visa which have gone up 10 times since the bottom in 09.The more I dig the more I'm finding.......

This does indeed feel much different to earlier in the year, I've got a lot of faith in @DurhamBorn's charting it's just the timeline I'm fuzzy on, whilst we've been waiting forever to crest the peak, DXY still seems to be predicted to strengthen >100 in the near term until there's a significant change in direction from U.S., last country standing as it were.

In regards to short rates, Powell can't reverse course just because of autos & housebuilders (yet), and can't be seen to be heavily influenced by Trump either, so barring a shock crash in November, Dec hike seems certain, but what happens thereafter looking increasingly dovish. Amazing the difference a few weeks make. Remarkably, 70% of S&P 500 stocks now in correction.

Keep seeing mid 2019 pop up as the key point where this reversal occurs, and from a variety of analysts/traders/economists that I've been following for a long time now and trust their methodology reasonably well. Naturally, if what we're seeing this week becomes self-reinforcing by pure fear then this could well be it, otherwise I see the excruciating zig zagging down over the next 18-24 months as quite possible, like 2000 all over again.

I guess we're at the point at which you might well lose out on whatever you allocate, just about minimising losses and seeing the macro picture ahead. I'm only focused on this side of the pond for my own modest allocations, lots of value to be found as widely discussed on here, yes a little inevitable downside risk when the recession hits but nothing compared to the FTSE stocks up in the heavens. Spent the past couple days setting up all my price alerts based on primitive long term trends, won't buy unless they're hit or close, otherwise cash is king on the sidelines.

Still lacking confidence to jump into GDX and GDXJ even though it makes sense long term.

[Bear Hug]

https://www.telegraph.co.uk/business/2018/10/24/market-reportleaderless-bt-buoyed-rivals-results/

Quote

BT shares hit their highest level in nine months as speculation swirled over the future of the leaderless telecoms giant and strong results from rivals lifted sentiment in the sector.

BT swerved the turbulence on markets after solid third quarter figures from European peers KPN and Orange Belgium and rumours resurfaced over its future without departing boss Gavin Patterson.

City traders speculated that long­-standing suitor Deutsche Telekom could be tempted to make a bid or a new boss could push for a break-up of the group amid shareholder pressure.

Deutsche Telekom is already BT’s top shareholder with a 12pc stake but the German giant cannot make a move until an embargo on it buying or selling...

The rest is behind paywall.

I thought BT did well so far and sold about a quarter of my holdings last week, but it just keeps on going up.  I am just surprised Vodafone is not getting any of that buoyancy.

The embargo they talk about is this (from an old article):

https://www.capacitymedia.com/articles/3790075/Deutsche-Telekom-CEO-says-BT-attractive-a-year-before-embargo-on-bid-expires

Quote

Deutsche Telekom has been the largest shareholder in BT for two years, ever since BT bought mobile operator EE – previously a Deutsche Telekom/Orange joint venture. Under the terms of the takeover, which left Deutsche Telekom with a 14% stake, the company cannot sell its shares or buy more until the beginning of 2019. 

Deutsche Telekom has seen the value of its stake in BT fall over the past few years – partly because of the financial performance of the UK operator but also because the UK pound has fallen in value against the euro.

In May 2016 BT’s its shares were trading at around £4.52 each. At the pound/euro exchange rate at the time, each BT share Deutsche Telekom owned was worth €5.92. Today BT’s shares are worth £2.42 each, but the fall in the value of the pound means that is equivalent to €2.74 each, just 46% of their value two years ago.

A private source told Capacity before the 2016 deal was completed that Deutsche Telekom would want to buy BT as soon as it could. The same person said that Höttges would take a non-executive role on BT’s board – something that both companies officially denied but later proved to be true. 

 

[onlyme]

Ozark, one of the biggest US construction lenders in trouble. Lender to Kushner project, see 2nd link.

"Trouble In Arkansas": This Cycle's Countrywide Financial Just Imploded

https://www.zerohedge.com/news/2018-10-24/trouble-arkansas-cycles-countrywide-financial-just-imploded

https://www.bloomberg.com/news/features/2018-07-10/how-a-tiny-bank-from-the-ozarks-got-big-and-outpaced-wall-street

 

[Harley]

3 hours ago, sancho panza said:

You put a thought in my head and I had a look at the GDX chart and actually,that chart is way more stable and readable than any individual stock.Just saying.I never really check the ETF charts as I don't buy them.That'll teach me..

I mainly trade ETFs!  GDX still hard to trade IMO.  I've tried a few times over the years but never won.   Get OK signals on the weekly but not usually a great risk to reward.  Sell signals (exits) are hard.  Looked today and think currently no buy signal for me.  Will pass and stick to the metals.

[Harley]

3 hours ago, Funn3r said:

Near me (Wokingham) I've been watching several "demolish old crap house with normous garden and build x2 or x3" projects. They have made it to the finish line  but not selling. These are 5-bed detached I should think so million plus. Not long ago would have been no need to put for sale board up even. A couple I drive past every day incomplete and not seeing much happening. Then when I get nearly to work the Redrow site is surprisingly slow. I remember going on holiday August 2 and scaffolding was up and roof half on... Scaffolding still up and roof finished, but that seems slow to me. 

Is that the stuff on the drag into town from the Binfield roundabout?  £1m+!  Crazy!