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Credit deflation and the reflation cycle to come.


DurhamBorn

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Just now, DoINeedOne said:

Yeah I didn't put much into them was more of a little bet for me if the Greece project finally came through

Might as well hold now,if gold runs they might pop a lot higher.Its an amazing sector.It reminds me of woodwork at school.They stuck a lads bollocks in a vice and turned it until he was screaming,then loosened it,they were like footballs  then and just a bit sore,but the look of delight on his face that the worst hadnt quite happened.Welcome to the PM miner sector.xD

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39 minutes ago, DurhamBorn said:

Endeavour Silver,Coeur mining,Hecla Mining and several others depending on pricing and what i already own as i already own most and it would be top ups.

 

Thx, Endeavour looks interesting with their high AISC, but what pisses me off about those silver miners is that around half of their production seems to be byproducts. It's ok-ish if the byproduct is gold, but it's often lead, zinc or some other metal I don't want to have exposure to. With gold miners it's much easier to find pure exposure.

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1 hour ago, kibuc said:

Thx, Endeavour looks interesting with their high AISC, but what pisses me off about those silver miners is that around half of their production seems to be byproducts. It's ok-ish if the byproduct is gold, but it's often lead, zinc or some other metal I don't want to have exposure to. With gold miners it's much easier to find pure exposure.

https://moneyweek.com/500988/zinc-price-to-rise-here-is-how-to-invest/

The conditions are ripe for a spike in the price of this metal – here’s how to invest

By: Dominic Frisby23/01/2019

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I am very tempted to take some profits from my miners but I need to step back and look at the bigger picture. I have bought so I will hold for the ten year time frame.  A pull back is fine following which I can add more if need be. After all as I work full time I can allocate £20k into my ISA and the same in my SIPP every year.

 

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1 hour ago, kibuc said:

Thx, Endeavour looks interesting with their high AISC, but what pisses me off about those silver miners is that around half of their production seems to be byproducts. It's ok-ish if the byproduct is gold, but it's often lead, zinc or some other metal I don't want to have exposure to. With gold miners it's much easier to find pure exposure.

Endeavour are almost pure play silver with gold.I reckon theyd go bust if silver was below $16 for too long,but they have some great potential if/when silver goes up.They are debt free as well so could do a bit of equity if needed to tide them over.If silver goes to $200 as i expect they will probably 40x in price.They would be taken out though before that i expect at 5x to 10x.One of several i own where i expect a 10x minimum in a few of them in a silver bull.

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Democorruptcy
3 hours ago, DurhamBorn said:

I still think it is on after $1500,though im no way certain.My main concern is not seeing falls,its not owning the complex when it runs.Its highly likely if we do hit the $1500 level il sell some,but hold the rest.

I understand that's why I put 'potential' big drop. I vaguely remember you suggesting Silver from 16 down to 10 or 7? What I remember the most about it is me salivating. I haven't held any PMs or miners since selling my Silver Kgs at my target of 700 in 2011 (I missed the 900). I ignored my trigger finger when PAAS was 8 in 2015 - Doh!!

Do you have any opinion about Sprott? I was happy with the Central Fund of Canada as it was before they bought it. It was a pure silver metal play.

https://www.hl.co.uk/shares/shares-search-results/s/sprott-physical-gold-and-silver-trust-units

https://www.hl.co.uk/shares/shares-search-results/s/sprott-physical-silver-trust-units

If metals do run then CGT is a major factor, the first one is OK in ISA, Lifetime or SIPP. The second one just SIPP.

 

 

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1 minute ago, Democorruptcy said:

I understand that's why I put 'potential' big drop. I vaguely remember you suggesting Silver from 16 down to 10 or 7? What I remember the most about it is me salivating. I haven't held any PMs or miners since selling my Silver Kgs at my target of 700 in 2011. I ignored my trigger finger when PAAS was 8 in 2015 - Doh!!

Do you have any opinion about Sprott? I was happy with the Central Fund of Canada as it was before they bought it. It was a pure silver play.

https://www.hl.co.uk/shares/shares-search-results/s/sprott-physical-gold-and-silver-trust-units

https://www.hl.co.uk/shares/shares-search-results/s/sprott-physical-silver-trust-units

If metals do run then CGT is a major factor, the first one is OK in ISA, Lifetime or SIPP. The second one just SIPP.

 

 

Sprott would be a good buy i think and id gladly own it.My liquidity road map (or should i say my friends road map) says silver $23,down to $8 up to $200 minimum.As he has told me 1 billion times though,the road maps arent trading calls,they are road maps.Where we are going is what counts.This is a person who was in the room several times with Paul Volcker during the early 80s and was top 1 percentile performance in US pension funds from 75 until 89.He is in no doubt.Debt is about to be reset with inflation and only PMs,mostly silver will protect people.Im 100% he is the best macro strategist of our and the last generation.He says this.Western countries will not go down,but the debt will go.Debt deflation followed by full on reflation.He only prices everything forward in gold and silver,and as he says,what is old always becomes new.Fiat wealth is about to be moved to real money.Gold and silver.Lets see if that plays out,but im very very happy so put 20%+ of my wealth onto that trade.Id urge,really urge anyone to get some PM exposure.A few grand in silver miners might deliver a house.A few tens of grands might deliver a farm.If not so be it.Nothing is certain,but a 20% thats cut in half or a 2000%+ profit is good enough for me.

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Democorruptcy
4 minutes ago, DurhamBorn said:

Sprott would be a good buy i think and id gladly own it.My liquidity road map (or should i say my friends road map) says silver $23,down to $8 up to $200 minimum.As he has told me 1 billion times though,the road maps arent trading calls,they are road maps.Where we are going is what counts.This is a person who was in the room several times with Paul Volcker during the early 80s and was top 1 percentile performance in US pension funds from 75 until 89.He is in no doubt.Debt is about to be reset with inflation and only PMs,mostly silver will protect people.Im 100% he is the best macro strategist of our and the last generation.He says this.Western countries will not go down,but the debt will go.Debt deflation followed by full on reflation.He only prices everything forward in gold and silver,and as he says,what is old always becomes new.Fiat wealth is about to be moved to real money.Gold and silver.Lets see if that plays out,but im very very happy so put 20%+ of my wealth onto that trade.Id urge,really urge anyone to get some PM exposure.A few grand in silver miners might deliver a house.A few tens of grands might deliver a farm.If not so be it.Nothing is certain,but a 20% thats cut in half or a 2000%+ profit is good enough for me.

"$23,down to $8 up to $200 minimum."

I'd love to have some 8.

Your silver calls remind me of Tiho Brkan's shortsideoflong he was mega bullish about silver pre 2011. I don't know his views now. 

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Quick question whilst you financial wizz kids are on...I am looking at two ETFs, both exactly same except one is $$$ (0.25 % OCF) and the other is hedged against $ (0.3  % OCF)...does this mean that in the former the £/$ rate has to change by 0.5% before I am losing due to currency fluctuation?...basically how do I decide which one to go for?

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1 hour ago, DurhamBorn said:

Gold and silver.Lets see if that plays out,but im very very happy so put 20%+ of my wealth onto that trade.Id urge,really urge anyone to get some PM exposure.A few grand in silver miners might deliver a house.A few tens of grands might deliver a farm.If not so be it.Nothing is certain,but a 20% thats cut in half or a 2000%+ profit is good enough for me.

Does your friend see Physical PM`s going up by that much eventually or more so the miners shares..?

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1 minute ago, Gin said:

Does your friend see Physical PM`s going up by that much eventually or more so the miners shares..?

wrong question.

The question SHOULD be:

"If the huge injection of liquidity from central banks blows and results in rapid debasement of currency, what assets do I have that will inflate in line with consumer prices"

The answer is gold.

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10 minutes ago, wherebee said:

The answer is gold.

I have a few K in gold. But would that buy me a house ?o.O I am fairly secure finacially, & no debt to speak of but also low income, which I`m happy with.

Im in two minds whether to play around with some 3% credit, I am being offered over three years and buy some silver.

 

I see Gold is stepping up slowly but surely, close to its all time high once again

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2 hours ago, DurhamBorn said:

Sprott would be a good buy i think and id gladly own it.My liquidity road map (or should i say my friends road map) says silver $23,down to $8 up to $200 minimum.As he has told me 1 billion times though,the road maps arent trading calls,they are road maps.Where we are going is what counts.This is a person who was in the room several times with Paul Volcker during the early 80s and was top 1 percentile performance in US pension funds from 75 until 89.He is in no doubt.Debt is about to be reset with inflation and only PMs,mostly silver will protect people.Im 100% he is the best macro strategist of our and the last generation.He says this.Western countries will not go down,but the debt will go.Debt deflation followed by full on reflation.He only prices everything forward in gold and silver,and as he says,what is old always becomes new.Fiat wealth is about to be moved to real money.Gold and silver.Lets see if that plays out,but im very very happy so put 20%+ of my wealth onto that trade.Id urge,really urge anyone to get some PM exposure.A few grand in silver miners might deliver a house.A few tens of grands might deliver a farm.If not so be it.Nothing is certain,but a 20% thats cut in half or a 2000%+ profit is good enough for me.

Very much chimes with a few folks I follow, including Ray Dalio (of course) and Luke Gromen. Your friend's calls are uncannily similar to some elliot wave strategists including a Dane who does a lot of work on plotting the deflationary bust ahead. He sees silver at $8 some point in the summer, and not for a particularly long period either so you've got to get in quick when everyone is liquidating assets. U.S. debt is such that, as hinted by Powell just yesterday, they are ready to do ANYTHING it takes. That's when PMs and miners are going to the moon, seems he's inspired a final melt up in the mean time.

On housing, flipping typical that as I now start applying for jobs in the Midlands, house prices around Berkshire, my original target area, are now seeing juicy drops.

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5 hours ago, DurhamBorn said:

Iv taken some profits out SP and sold a few miners.Iv just a few minutes ago sold Yamana.Id had them a while and had 6 ladders in them and they finally pushed into a 15% profit today.Il re-enter if they go down 20%.They have been a long haul,i entered them too early,but happy to get out now with a profit.No problem with the stock,but i have a big PM portfolio and happy to lock that in and re-enter,and if not and it keeps going happy anyway.The only one im down on now is Eldorado and i actually sold a few of those down 30% and put the capital into some silver miners before they started to run up.I also top sliced Harmony as they went over 2.00.Big holding and the profits taken mean i can see a 25% cut in the price from here to break even.Happy with that and now the amount owed. (i had slightly too big a weighting)

Iv still got most of my miners ,leaning to silver and all in good shape,with capital on the side if there is a pullback.One thing im pretty sure of is that if there is then around May gold and the miners will then trend in a strong wave with GDX to around 36.Reason is i see the dollar really starting to go down around that time frame.So id be happy if they keep trending now,but if they do pull back il be happy to take the chance to add to some miners for probably the last chance.

Like you say nobody seems to see we are in a bear market.The mega caps holding up had hidden the fact.In $s though many decent quality FTSE 100/250 stocks are down 70%+ from highs.

 

DB you do appear to very actively manage your portfolio which is interesting. Taking a loss here and there while banking the odd 15% I must admit seems like a lot of work for moderate gains if the prevailing view is that the miners are all generally long term hold with huge potential uplift. Fair play by the way in the performance, I've never personally done well out of moving in and out so frequently and laddering in as you say (a case of chasing down in my case!) so it is interesting to follow.

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2 hours ago, MrXxx said:

Quick question whilst you financial wizz kids are on...I am looking at two ETFs, both exactly same except one is $$$ (0.25 % OCF) and the other is hedged against $ (0.3  % OCF)...does this mean that in the former the £/$ rate has to change by 0.5% before I am losing due to currency fluctuation?...basically how do I decide which one to go for?

One important factor is liquidity -- if everyone else is in the $ETF then the £ETF would cost on the spread.

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Eventually Right
3 hours ago, Barnsey said:

Very much chimes with a few folks I follow, including Ray Dalio (of course) and Luke Gromen. Your friend's calls are uncannily similar to some elliot wave strategists including a Dane who does a lot of work on plotting the deflationary bust ahead. He sees silver at $8 some point in the summer, and not for a particularly long period either so you've got to get in quick when everyone is liquidating assets. U.S. debt is such that, as hinted by Powell just yesterday, they are ready to do ANYTHING it takes. That's when PMs and miners are going to the moon, seems he's inspired a final melt up in the mean time.

On housing, flipping typical that as I now start applying for jobs in the Midlands, house prices around Berkshire, my original target area, are now seeing juicy drops.

Have you read Luke Gromen’s book, The Mr X interviews?

https://www.amazon.co.uk/Mr-Interviews-Fictional-Sovereign-Creditor-ebook/dp/B07M93N7MJ/ref=sr_1_1?ie=UTF8&qid=1548983899&sr=8-1&keywords=mr+x+interviews

I’d recommend it-relatively quick/easy read about how he sees the dollar declining as the worlds sole reserve currency. Good book on what might well be a dry subject in other authors hands!

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8 hours ago, dgul said:

One important factor is liquidity -- if everyone else is in the $ETF then the £ETF would cost on the spread.

Good point (and one I hadn't considered), but in this case its not an issue as its a large tracking index.

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11 hours ago, MrXxx said:

Quick question whilst you financial wizz kids are on...I am looking at two ETFs, both exactly same except one is $$$ (0.25 % OCF) and the other is hedged against $ (0.3  % OCF)...does this mean that in the former the £/$ rate has to change by 0.5% before I am losing due to currency fluctuation?...basically how do I decide which one to go for?

It's not quite as simple as the OCF. You will want to look at the underlying transaction costs and compare tracking errors. Personally I don't hedge.

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8 hours ago, Eventually Right said:

Have you read Luke Gromen’s book, The Mr X interviews?

https://www.amazon.co.uk/Mr-Interviews-Fictional-Sovereign-Creditor-ebook/dp/B07M93N7MJ/ref=sr_1_1?ie=UTF8&qid=1548983899&sr=8-1&keywords=mr+x+interviews

I’d recommend it-relatively quick/easy read about how he sees the dollar declining as the worlds sole reserve currency. Good book on what might well be a dry subject in other authors hands!

It's on the list! :D

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12 hours ago, SillyBilly said:

DB you do appear to very actively manage your portfolio which is interesting. Taking a loss here and there while banking the odd 15% I must admit seems like a lot of work for moderate gains if the prevailing view is that the miners are all generally long term hold with huge potential uplift. Fair play by the way in the performance, I've never personally done well out of moving in and out so frequently and laddering in as you say (a case of chasing down in my case!) so it is interesting to follow.

I had £13k in Yamana and the reason i sold was in the context of my PM portfolio.It was too big a holding (if i buy them back it will be about £6k in 3 ladders first ladder at $3.20CAD) and my gold miners were too big in my portfolio compared to silver miners.I had 6 ladders in them,i had bought them too early compared to all my other miners that have much better entry points.Harmony again i had a very large holding and its now much better sized with a nice entry point.I actually very rarely trade.I can go 5 years where my only trades are re-investing dividends and perhaps the odd very rare sale or top slice.The reason at the moment is that i liquidated my entire portfolio a couple of years to a year ago.It was a big portfolio,some owned since the mid 80s,most since the .com boom (thats when i bought the liked of BAT,Whitbread etc).I am slowly re-investing into stocks i want for the next cycle (roughly 10 years).My PM portfolio i consider apart to my main portfolio.Its about 22% of my wealth (10% if i count my house).I owned  no PM miners during the last cycle up until late 2015.I went back to work for the simple reason of investing 100% of the salary (actually working out about 85% as im paying my bills from the wages rather than share dividends at the moment) into the PM space,mostly silver miners.I wouldnt invest more of my portfolio as i have strict rules,so i decided instead to invest a year of my labour into them.

Once im full invested again my aim is 8% to 9% a year compounding.Or 2% compounding if i jack in work again and take 6% a year to live on (if i also jack my business) or 3% to live on if i decide to get a 16 hour a week job.

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12 hours ago, Gin said:

Does your friend see Physical PM`s going up by that much eventually or more so the miners shares..?

Both,silver to $200 minimum,some of the miners will likely 100 bag.The key though is not all miners ,and some will go under.He thinks the miners will be to the next cylce what the .com's were to the last one.If i had £5k to invest id buy £1k in 5 silver miners.If i had £100k id buy £30k in silver and £70k in 10 to 12 silver/gold  miners.It all depends on peoples risk,portfolio,assets,time of life etc.Lots to consider,and the space can crush people quickly.If risk is too much then is simply buy silver and look to sell it around 2027.

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