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Credit deflation and the reflation cycle to come.


DurhamBorn

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3 hours ago, DurhamBorn said:

They will,and hard,but i still think they run up first.Nothing is ever certain,but i still see gold around $1500 before this bear then sucks in the PMs too.The miners are hated and are a small,contrarian sector.They have ran up 20% then fallen again several times and nobody trusts them.Its a very very difficult time to structure a portfolio at the moment as its highly likely everything you are buying into keeps going lower.

Too right, ive been lucky so far with a small profit but its only one wrong move and your down 20-30% on a big chunk of your capital.  There is an old joke about thats what turns a trader into a long term investor!

The most important thing i learned is was Chris saying that PM miners are following the main markets more than they are PM's, so any losses in the main market get amplfied leading to the current situation where Gold rises but there is no follow through in the miners.  That obviously gets reversed if they are both going higher (which they eventually will if they print enough).  That signals to me that the next opportunity will be in Q1 2019 when the falling main markets meets the long term trend line, and should produce a nice bounce in miners if the fear factor is starting to ramp up, so im playing it safe and staying out of the more economically unviable miners for the moment.  Although the first story on MSN earlier today was "how prepared for the next recession is your State", everyone seems to be waiting for this one...

I tried laddering in on the first share i ever bought, sadly i was young without the experience i have gained from that painful episode.  It really doesnt work if it keeps going down!  Thats why i have an obsession with buying good companies with solid revenue, and not speculative investments in the arse end of Africa.

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Things are happening at Sibanye. Not only has the court just declared the AMCU strike action legal - it's a HUGE and quite violent one - but there's also a legal challenge to Lonmin deal. Court hearing is not expected to be conducted until January, which suddenly puts the whole deal into jeopardy. The deadline for the deal is end of February, and in January it was supposed to be voted by shareholders.

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Democorruptcy
40 minutes ago, Castlevania said:

Calm down. Then reflect. 

What’s Spirax-Sarco. Never heard of them

Must admit I'd never heard of them either. Well known ticker though SPX!

They have been steaming in recent years until the recent market dip SPX

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38 minutes ago, TheCountOfNowhere said:

No trust in DBs predictions?

?

As for DB from what I’ve seen I’ve 100% faith his readings are unreal- but it’s always DYOR for us all etc. I reckon he’s not here to lecture just to muse.

And its all a big balancing act. 

DYOR for me means keeping a roof over my family’s head because nobody else will. And landlords frequently throw you out when they feel like it because they are allowed to. Here in NIreland we get 4 bastard weeks notice to get out. 

 

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4 minutes ago, Thorn said:

?

As for DB from what I’ve seen I’ve 100% faith his readings are unreal- but it’s always DYOR for us all etc. I reckon he’s not here to lecture just to muse.

And its all a big balancing act. 

DYOR for me means keeping a roof over my family’s head because nobody else will. And landlords frequently throw you out when they feel like it because they are allowed to. Here in NIreland we get 4 bastard weeks notice to get out. 

 

4 weeks until what? They have to then take you to court which surely takes months. Fuck them. Move out at your own pace. It’s your right*

*unless NI law is completely different to England & Wales.

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3 minutes ago, Castlevania said:

4 weeks until what? They have to then take you to court which surely takes months. Fuck them. Move out at your own pace. It’s your right*

*unless NI law is completely different to England & Wales.

Fair point and have considered... but still.

 

1 hour ago, A_P said:

Why mixed? Do you want this particular house or feel like you're being pushed into it?

Feels like it's time for cooler heads to prevail. Will be plenty of opportunity over the next three months as project fear 3.0 gets ramped up. 

Want the place alright and happy with the calculations... mixed as in I reckon prices will come down. 

Probably the day after I sign something!

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6 minutes ago, Thorn said:

Fair point and have considered... but still.

 

It’s up to you. However, there is a price worth paying for the security of tenure if you have children. So I can’t blame you

Having said that, the law in terms of evictions is on your side. Don’t put yourself out for the sake of an awful landlord 

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4 minutes ago, Thorn said:

Fair point and have considered... but still.

 

Want the place alright and happy with the calculations... mixed as in I reckon prices will come down. 

Probably the day after I sign something!

Once you're committed to the purchase then I'm of the opinion one needs to disregard and forget the price you paid for it. It's a place to live and you want it to be a home for your family not an investment. You've done the sums and it makes sense to you. Good luck and hope it all goes through for you.

I've prepped our offer for one house. Going with 17.5% below listing with a view of trying to secure a 15% discount. I get the feeling they're expecting/desperate for our offer. I've purposefully dragged out a few questions to the EA regarding the property over the week and they've come back to me very swiftly each and every time. I doubt they will entertain but I can walk away from this one.

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3 minutes ago, A_P said:

Once you're committed to the purchase then I'm of the opinion one needs to disregard and forget the price you paid for it. It's a place to live and you want it to be a home for your family not an investment. You've done the sums and it makes sense to you. Good luck and hope it all goes through for you.

I've prepped our offer for one house. Going with 17.5% below listing with a view of trying to secure a 15% discount. I get the feeling they're expecting/desperate for our offer. I've purposefully dragged out a few questions to the EA regarding the property over the week and they've come back to me very swiftly each and every time. I doubt they will entertain but I can walk away from this one.

You might get lucky it’s worth a go I reckon. Definitely not a sellers market I think- some panicking first and accepting lower offers is what is needed- then local prices get reset to those margins. Sounds like us and yourself are on point and it’s not easy. 

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9 minutes ago, Thorn said:

You might get lucky it’s worth a go I reckon. Definitely not a sellers market I think- some panicking first and accepting lower offers is what is needed- then local prices get reset to those margins. Sounds like us and yourself are on point and it’s not easy. 

If it's anything like when I bought in late 2008 (on for £450k) offered and accepted £380. When it came to the bank valuation the bank's surveyor said £350k! Went back to the seller and they dropped to this price after we threatened to pull out.

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15 minutes ago, Cattle Prod said:

Bought 6 months ago, 10 year fix, 2.53%. As the guys have said its 4 walls and a roof, and when I tried to remember what I paid for it the other day it took me a minute to remember. 

I just don't care. The only number that matters to me is my monthly, which will be the same for the next 9.5 years, and what % of that is covered by my dividends.

My 2c is we get a bounce. Stocks, oil, PMs. Recessions haven't historically kicked n that quickly from first signals. This all feels like a taper tantrum to me. I still think Q3 next year for major pain. The top may be in and we may just get a bear market rally between now and then, which will hurt a lot of people. Either way I'll be cashing out next summer and waiting for the big drop to ladder into physical silver, oil, and blue chip stocks.

The one thing thats bothering me is that in algo world, things just may not have the same lags, and the past is no longer a guide to the future. This month's S&P candle looks rather rapid...

Check out the latest piece over on ZeroHedge ( I know- but it’s just his comments on actual charts from recently) - there’s a ton of panic out there it seems...

We give the final word to none other than Dennis Gartman who said this morning - "Stock prices continue to plunge and there is nothing else that one can say other than that... the internals remain manifestly, harshly, overwhelmingly, one sidedly, shockingly, dismayingly, margin call-creatingly bearish"

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14 hours ago, Democorruptcy said:

How do we make money out of the Gatwick drone? Chaos is opportunity.

This attack might not be the last. Go short a drone maker, drone supplier, airline, holiday firm etc.? Go long a tech firm to combat them. 

Short IAG,but I'd be doing that without the drone....

9 hours ago, Option5 said:

OK guys, quick straw poll, my new contract for 2019 gives me the option of being paid in GBP or NOK (Norwegain Kroner), I'm leaning towards NOK, any opinions?

NOK

 

7 hours ago, DurhamBorn said:

They will,and hard,but i still think they run up first.Nothing is ever certain,but i still see gold around $1500 before this bear then sucks in the PMs too.The miners are hated and are a small,contrarian sector.They have ran up 20% then fallen again several times and nobody trusts them.Its a very very difficult time to structure a portfolio at the moment as its highly likely everything you are buying into keeps going lower.However thats why iv always used ladders and always will.Stocks im buying i have ladders set up for are mostly already down 50% to 70% from their highs (a couple 35% to 40%).In the gold space 90% sometimes.If im buying a stock for the next cycle i dont really care if my first ladder ends up underwater by 30% as that means i should get all ladders deployed.If the stocks im buying all hit their bottom ladders (and id be then down around 15% excluding dividends) then most would be down 70% to 90% from their highs.These are all companies who have managed to keep decent free cash flow right at the end of a cycle that was against them.

Iv started a new ladder again today in BAT tobacco.I didnt think id own BAT again after selling out close to its highs (£48) after owning for 20 years.Return on that in the 1000s% including divis.Iv set up ladders from £25 (half what i sold at give or take) down to £17.

Once my ladders are in place i ignore the market.I simply buy when prices hit.Stagecoach hit one today and some were bought.Royal Mail hit a one yesterday a few were bought.Last week Imperial etc.

I would love the PMs to do what i think they will (GDXJ $60+) though as that would provide extra capital to deploy into chosen areas,time will tell.

 

Have to say there are lots of stocks ending the year badly,seems a symtpom of thetimes that Visa/Amex are getting mullered.Going to be an itneresing start to 2019-although I still maintain US market is oversold.

3 hours ago, Thorn said:

Put in an offer 10% under the asking today. Mixed bloody feelings. 

Bastard Landlords. 

AS Bart of Darkness on ToS used to say

'if you're not embarassed by the offer,it's too high.'

3 hours ago, Barnsey said:

Watching the US market close with the biggest bucket of popcorn imaginable, what a week!

Incredible,Just looking.Been busy at work today.See some of my recent US shorts have got pummelled eg Visa,Home Depot,FB,DPZ,SBUX.Naturally,I pulled out a week back .

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10 hours ago, Bobthebuilder said:

Its always a difficult decision to make, there is never a "right time", to many factors to consider.

I just accept a house as a pile of bricks with a roof on it that you can eat, sleep and shit in.

Look at it this way, at least you haven't bought at the top, and with a 10% discount you have a little wiggle room....sometimes circumstances means we have to make decisions when ideally we would choose not to make them but your fate gave you a break.

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Housing transactions take time, quite a long time nowadays to go through. if it all falls apart quickly then you will notice in the market pricing, though it does tend to be sticky initially with stock just building up. I bet a lot of the speculative purchasers use this time to decide on go / no go purchase decision, going ahead if they already perceive they have gained by the committing to the exchange. 

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27 minutes ago, onlyme said:

Housing transactions take time, quite a long time nowadays to go through. if it all falls apart quickly then you will notice in the market pricing, though it does tend to be sticky initially with stock just building up. I bet a lot of the speculative purchasers use this time to decide on go / no go purchase decision, going ahead if they already perceive they have gained by the committing to the exchange. 

The longer the transaction goes on ... the more likely it is to fail.

 

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35 minutes ago, Cattle Prod said:

The one with the fear index at 5? Yeah I saw that. Its fascinating how the herd turns, and can go to extreme emotions very quickly.

Panic is the right word, and people are stupid and irrational in a panic. I think its overdone, I think there are uncanny parallels to December 2015 and there is potential for a huge PM run for the next 6 months...but they all need to calm down! It's happening too quickly and its risking pulling everything down together.

Gartman it a tool, and a herd follower. He needs a cattle prod ;-)

I’m hoping for a repeat of February 2016 when everyone was concerned about China and global growth, and the industrial miners and oil companies could be bought for a song. PM’s did well then.

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Agreed that things are looking very oversold at the moment, short term rally still possible, just be careful that if you are bravely riding the PM wave short term, know when to pull out. This thing is going to be worse than 2008, when gdx went from $57 to $18 in 7 months.

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Democorruptcy
1 hour ago, onlyme said:

Housing transactions take time, quite a long time nowadays to go through. if it all falls apart quickly then you will notice in the market pricing, though it does tend to be sticky initially with stock just building up. I bet a lot of the speculative purchasers use this time to decide on go / no go purchase decision, going ahead if they already perceive they have gained by the committing to the exchange. 

Won't a Brexit factor be at play now? Project fear suggests house prices 30% lower than they would have been if we Brexit with no deal (over time not the often suggested straight -30% drop). If we did leave with no deal buyers might want a reduction on the agreed price and should get it - we all trust the jolly old BoE don't we? Alternatively if we abort leaving or go for the 2nd referendum won't sellers think they have agreed a price that's too cheap?

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48 minutes ago, Democorruptcy said:

Won't a Brexit factor be at play now? Project fear suggests house prices 30% lower than they would have been if we Brexit with no deal (over time not the often suggested straight -30% drop). If we did leave with no deal buyers might want a reduction on the agreed price and should get it - we all trust the jolly old BoE don't we? Alternatively if we abort leaving or go for the 2nd referendum won't sellers think they have agreed a price that's too cheap?

Yes.

On the other hand mortgages might be less available.

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46 minutes ago, Democorruptcy said:

Won't a Brexit factor be at play now? Project fear suggests house prices 30% lower than they would have been if we Brexit with no deal (over time not the often suggested straight -30% drop). If we did leave with no deal buyers might want a reduction on the agreed price and should get it - we all trust the jolly old BoE don't we? Alternatively if we abort leaving or go for the 2nd referendum won't sellers think they have agreed a price that's too cheap?

That's how I see it playing out to some extent and the well publicised 30% falls is very much a part in my offer letter/communique whether I believe the BOE or not ¬¬

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8 minutes ago, A_P said:

That's how I see it playing out to some extent and the well publicised 30% falls is very much a part in my offer letter/communique whether I believe the BOE or not ¬¬

+1

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Democorruptcy
1 hour ago, Thorn said:

Yes.

On the other hand mortgages might be less available.

Under what scenario?

Don't they already have a plan? The mansion house £1.2bn then and up to £5bn later, leveraged 150x to £180bn then and later £750bn, to keep credit flowing?

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