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DurhamBorn

Credit deflation and the reflation cycle to come.

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1 hour ago, sancho panza said:

'So be careful about strategy-creep. I don’t encourage anyone to change their discipline, whether they are passive investors, trend-followers, value-investors, or swing-traders. What I do encourage, however, is that you have a full understanding of where we are in the market cycle; that you consider the potential downside risk of the market; and that you honestly assess the amount of market weakness you would be able to tolerate without abandoning your discipline. '

Not sure.  Disciplines come and go depending on the season, in that some become relatively more profitable at certain times (not that all can't be profitable if correctly applied).  Making money in these markets have required you to do two things:  be lazy (and buy a passive index fund) and don't think too much (in case you worry).  If we get any closer to a turn, you'll need to do the exact opposite.  But most people are lazy and don't think too much!   Which is good as this is a zero sum game!

Edited by Harley

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1 hour ago, sancho panza said:

I'll do my Steve keen impersonation here and bang on about private detb and how the neo classicals at the CB ignore it.One of the comments is really quite enlightening and on point 

Wow.  Great selection there. 

You couldn't have put such a depressing set of quotes together:

o GDP is yet again totally flawed - they quote GDP for a period but miss off the debt fuelling it, debt which is consumption stolen from the future - talk about a lack of "matching".

o We are now back to, indeed past 2008, but in a worse place to deal with it.

o We've found new areas (student loans, etc) to turbo charge things even more.

These CBs and polos are criminals.

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So erm, yeah, what about the S&P 500 in recent days? O.o 

Heck of a turnaround, one last rally up to the 3000-3200 level then batten down the hatches? :ph34r:

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44 minutes ago, Barnsey said:

So erm, yeah, what about the S&P 500 in recent days? O.o 

Heck of a turnaround, one last rally up to the 3000-3200 level then batten down the hatches? :ph34r:

The magic is fading and the Fangs are sliding.  Amazon's chart in particular is showing the big spike downwards in the long run now, the trend is not your friend this time IMO!  See Bitcoin...

If all the central banks money printing inflated the market, then all the central banks tightening will deflate it.

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1 hour ago, Barnsey said:

So erm, yeah, what about the S&P 500 in recent days? O.o 

Heck of a turnaround, one last rally up to the 3000-3200 level then batten down the hatches? :ph34r:

As an amateur...

Strong buy signal on the daily on 30 October 18. 

Daily stochastic in the evelated zone but can always stay there for a while.

Weekly has a potential bullish type of MACD cross forming so maybe a smallish correction followed by a resumption of the uptrend to EOY.

Potential triple top forming on the weekly by year-end.

Or you could just look and say it's gone up too quickly so needs a pull back, we usually get a year-end rally,  but things are getting tired!

Or not - WTFKs!

PS: BTW the Jan 18 blow off top was a rarity (to go up, let alone that much) and was duly corrected in Feb 18.  Most Jans are negative months.  It seems that froth has stayed with us all year as we've had about half the year below it and half a year above with the downs being brutal and quick.  Nov and Dec will decide whether there are any significant gains for the year.  Not very healthy.

PPS: The monthly candles. especially their wicks, say a lot.....

Capture.PNG.f72e1d7e93152e518b62dee456e32d90.PNG

Personally, it's going to take some very special magic (not unknown) to break the Sep 18 high.

 

Edited by Harley

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1 hour ago, Majorpain said:

The magic is fading and the Fangs are sliding.  Amazon's chart in particular is showing the big spike downwards in the long run now, the trend is not your friend this time IMO!  See Bitcoin...

If all the central banks money printing inflated the market, then all the central banks tightening will deflate it.

This.

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23 hours ago, Harley said:

I've just checked and my concern with GK was the cash flow statement with a significant increase in the 2018 financing charge, causing a negative cash flow.  I should look closer as the 6.88% yield looks good as do the other metrics like dividend cover.  JDW only offers 1.05% (with a massive 5.20% dividend cover).  Clearly ones a div payer (falling share price) while the other is more a growth stock.

High financing charge due to a repayment of borrowings.

Complicated and all above my pay grade!

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1 hour ago, Majorpain said:

Amazon's chart in particular is showing the big spike downwards in the long run now

Still in play, for now.  Buy signal 31 Oct 18 (1,598).  Held on 5 Nov 18 pull back.  Currently indecision and having a lovely tug of war at 1,753 (9.6% up).  Would be healthy to give up some of yesterday's gains.  Looks very much like the S&P but then it kinda is!   

Edited by Harley

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4 hours ago, Harley said:

Wow.  Great selection there. 

You couldn't have put such a depressing set of quotes together:

o GDP is yet again totally flawed - they quote GDP for a period but miss off the debt fuelling it, debt which is consumption stolen from the future - talk about a lack of "matching".

o We are now back to, indeed past 2008, but in a worse place to deal with it.

o We've found new areas (student loans, etc) to turbo charge things even more.

These CBs and polos are criminals.

They also miss off the fact that 12% of most Western GDP's is imputed rents-an accoutning fiction to make the neo classicals sleep at night.

3 hours ago, Barnsey said:

So erm, yeah, what about the S&P 500 in recent days? O.o 

Heck of a turnaround, one last rally up to the 3000-3200 level then batten down the hatches? :ph34r:

It was oversold heavily,except in a big downdraft like 08 or 00,it rarely drops consistently below long term parameters imho.Without the fangs pumping on all cylinders I can't see 3200...........can I?

Having said that,I've already reshorted UK builders since I sold em all.Couldn't help myself.Looking a 100% sea of red in my IG a/c....

 

2 hours ago, Majorpain said:

The magic is fading and the Fangs are sliding.  Amazon's chart in particular is showing the big spike downwards in the long run now, the trend is not your friend this time IMO!  See Bitcoin...

If all the central banks money printing inflated the market, then all the central banks tightening will deflate it.

The fangs are sliding MP as you say and way below the normal dip in a long term bull.Something has changed.The problem I have with the S&P is that the Fang stocks have stopped people noticing that some sectors have been selling off for months.

 

Bit in bold is bang on.

2 hours ago, Harley said:

As an amateur...

Strong buy signal on the daily on 30 October 18. 

Daily stochastic in the evelated zone but can always stay there for a while.

Weekly has a potential bullish type of MACD cross forming so maybe a smallish correction followed by a resumption of the uptrend to EOY.

Potential triple top forming on the weekly by year-end.

Or you could just look and say it's gone up too quickly so needs a pull back, we usually get a year-end rally,  but things are getting tired!

Or not - WTFKs!

PS: BTW the Jan 18 blow off top was a rarity (to go up, let alone that much) and was duly corrected in Feb 18.  Most Jans are negative months.  It seems that froth has stayed with us all year as we've had about half the year below it and half a year above with the downs being brutal and quick.  Nov and Dec will decide whether there are any significant gains for the year.  Not very healthy.

PPS: The monthly candles. especially their wicks, say a lot.....

Capture.PNG.f72e1d7e93152e518b62dee456e32d90.PNG

Personally, it's going to take some very special magic (not unknown) to break the Sep 18 high.

 

I read that and starting running my slide rule over some choice US stocks after swearing I'd have a month off.

You're a one Harley.

Edited by sancho panza

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29 minutes ago, sancho panza said:

I read that and starting running my slide rule over some choice US stocks after swearing I'd have a month off. 

Not sure if that'll be your long or short slide rule!  I wouldn't know which one to pick up as we're only 113 point away from the Sep 18 close and 140 from its high.

Better 4%'s out there.

But then suppose it could take out the Oct 19 high of 2,939.

Personally, I'm leaving the door to that nut house well and truely shut!

Much nicer in the forgotten but saner FTSE.

BTW, something funny happening with my charting software (or its user).  Now showing a bigger difference between Jan and Oct!

Edited by Harley

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56 minutes ago, Harley said:

Still in play, for now.  Buy signal 31 Oct 18 (1,598).  Held on 5 Nov 18 pull back.  Currently indecision and having a lovely tug of war at 1,753 (9.6% up).  Would be healthy to give up some of yesterday's gains.  Looks very much like the S&P but then it kinda is!   

Yes, the market is even more mad than usual so a rally from here isnt out of the question.  The problem i have is i dont like anything at the minute, it feels like im investing in the least worst option rather than something im excited about.

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15 minutes ago, Majorpain said:

Yes, the market is even more mad than usual so a rally from here isnt out of the question.  The problem i have is i dont like anything at the minute, it feels like im investing in the least worst option rather than something im excited about.

Yep, traders (not investors) market!

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2 hours ago, Majorpain said:

Yes, the market is even more mad than usual so a rally from here isnt out of the question.  The problem i have is i dont like anything at the minute, it feels like im investing in the least worst option rather than something im excited about.

S+P might go to 3300+ in a blow off top.The industrial's,Semi-conductors and the PM miners should be the big winners from here until the bear really gets going.

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S&P might be going up, but if oil closes down yet again today (day 10) it'll be the longest streak of daily red closes in history!!! This as USDCNY heads back up towards 7. The signs are becoming Vegas sized billboards.

Edited by Barnsey

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Wesdome Q3 results just in. Well done overall, with one particular nugget:

* Recent drilling has now extended the A zone to 600 m down plunge, and based on limited historic drilling, is interpreted to extend an additional 600 m up plunge to intersect the VC zone.

That possibility has already been mentioned by their CEO at gold forum in Denver but it's the first time they put it in their report. In Wesdome speak it means they are all but certain that the VC zone is in fact an extension of the high-grade A zone they are currently drilling and defining. That is HUGE news.

Still expecting them to drop at the open :) Market was asleep at the wheel in May and they will most likely just look at earning per share again and be like "meh". In the meantime, I'm off to sell my kidney for some more WDO shares before December resource update kick-starts another rally.

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3 hours ago, Barnsey said:

S&P might be going up, but if oil closes down yet again today (day 10) it'll be the longest streak of daily red closes in history!!! This as USDCNY heads back up towards 7. The signs are becoming Vegas sized billboards.

Barnsey,do me a favour and connect the dots above for those of us scratching our heads re the significance of dropping oil and rising USDCNY please.

Is it inflation related?

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1 hour ago, sancho panza said:

Barnsey,do me a favour and connect the dots above for those of us scratching our heads re the significance of dropping oil and rising USDCNY please.

Is it inflation related?

Falling forward demand for oil as actual contraction (or loss of growth occurs), USD strength - hawkish FED, rates are going up despite recent stock market wobbles, the FED is going to carry on regardless.

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2 hours ago, sancho panza said:

Barnsey,do me a favour and connect the dots above for those of us scratching our heads re the significance of dropping oil and rising USDCNY please.

Is it inflation related?

No problem, oil has fallen into a bear market, and if it closes red today, will be worst losing streak *on record* (just think about that for a second), suggesting the global recession is pretty much here and about to go bang. Just a few weeks ago many were predicting $100, WTI has dropped below $60, I believe DB was expecting $20, many estimates looking for at least a fall to $40.

As for USDCNY reaching 7, it's a key psychological level, if broken all hell breaks loose in emerging markets, worse than we've already seen (MSCI emerging markets index futures down 5% in last 2 days this week), also correlated to Gold of late, so keep a close eye on how the two are inversely related until the "yuan peg" ends.

Also, 10/2yr yield curve has resumed flattening after yesterday's FOMC meeting

https://fred.stlouisfed.org/series/T10Y2Y

Edited by Barnsey
Added extra info

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11 hours ago, DurhamBorn said:

S+P might go to 3300+ in a blow off top.The industrial's,Semi-conductors and the PM miners should be the big winners from here until the bear really gets going. 

I will keep a close eye on them in the near future thanks, the market flipping between fear and greed is making my head spin! 

11 minutes ago, Barnsey said:

No problem, oil has fallen into a bear market, and if it closes red today, will be worst losing streak *on record* (just think about that for a second), suggesting the global recession is pretty much here and about to go bang. Just a few weeks ago many were predicting $100, WTI has dropped below $60, I believe DB was expecting $20, many estimates looking for at least a fall to $40.

As for USDCNY reaching 7, it's a key psychological level, if broken all hell breaks loose in emerging markets (much worse than we've seen already), also correlated to Gold of late, so keep a close eye on how the two are inversely related until the "yuan peg" ends. 

Midterms are out the way, next few months would be ideal for Trump if the blame for the next crash could be placed on another (any) country... 

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5 minutes ago, Majorpain said:

Midterms are out the way, next few months would be ideal for Trump if the blame for the next crash could be placed on another (any) country... 

Interestingly, his arch nemesis, Maxine Waters, will head the house financial services committee in January, very pro Dodd-Frank. Going to get very heated, and this'll be after the Dec hike and into January buyback blackout period :ph34r:

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8 minutes ago, Barnsey said:

Interestingly, his arch nemesis, Maxine Waters, will head the house financial services committee in January, very pro Dodd-Frank. Going to get very heated, and this'll be after the Dec hike and into January buyback blackout period :ph34r:

That would be "low IQ" Maxine. xD

Gets to oversee the banks at long last, the perfect fall-guy for Trump to pin the blame for their crashing on!

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SSE was on the back foot on Friday after the energy firm said its merger with npower will be delayed as the two parties renegotiate terms following the government's introduction of a price cap. SSE and npower owner Innogy SE said late on Thursday that they are working together regarding potential changes to the terms of the proposed combination.

Discussions are expected to take place over several weeks, with an update on progress provided by mid-December. As a result, completion of the merger will be delayed beyond the first quarter of next year, but the companies said all work to seek to achieve the formation and listing of the new company will continue.
 

https://www.hl.co.uk/shares/shares-search-results/s/sse-plc-ord-50p/share-news

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6 hours ago, Barnsey said:

Interestingly, his arch nemesis, Maxine Waters, will head the house financial services committee in January, very pro Dodd-Frank. Going to get very heated, and this'll be after the Dec hike and into January buyback blackout period :ph34r:

Can someone explain what the buyback blackout is and who governs it...thanks.

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A bit corny but maybe an inverse head and shoulders on the S&P, giving us that nice run up in December after maybe a bit more of a fall here:

Capture.thumb.PNG.52faf9ff03d1a849d0bba3a752b82213.PNG

Or completion of a double top at strong resistance!!!

Bit of a hunkering down with a rotation from equity and precious metals into long and short (mainly US) bonds today.

Edited by Harley

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