Credit deflation and the reflation cycle to come.

[Frank Hovis]

5 minutes ago, Admiral Pepe said:

In regards to the funds, if you don't mind me asking what kind?

The big holdings that have done most well are Invesco Perpetual Income and Invesco Perpetual High income.

 

[A_P]

2 minutes ago, Gordie Lastchance said:

I'll have a look at that, thank you. I have the paper ones because I bought the shares so long ago! I had to phone Barclays to do a trade and it was, if I remember, £17.50 to buy and the same to sell. Dealing costs + losses = hacked off. Back then, I only had newspapers to follow, so my research was probably pretty rubbish. 

Just to add I think most of the brokers do a regular investing thing now

[Gordie Lastchance]

19 minutes ago, Admiral Pepe said:

Just to add I think most of the brokers do a regular investing thing now

Minefield here I come! 

[Lavalas]

Fed statement at 19:00 and Conference at 19:30. See what gold/silver do after that.

[A_P]

16 minutes ago, Gordie Lastchance said:

Minefield here I come! 

haha yeah tell me about it. A good start might here:

http://monevator.com/compare-the-brokers/

Generally the website is a good source of information

[sancho panza]

12 hours ago, Thorn said:

DB and Sancho Panza this lot might be worth you running your slide rules over- could be one to add to the list of reflation picks. See what you think. 

MasTec (MTZ). Seem to tick a lot of boxes. 

Cheers for the heads up.Looks interesting.I'll have to have a more detailed look when I have time.I'm not really looking to invest much at the minute as the asset class-shares-is overbaked generally.

In 2 or 3 years,they could be an intersting play.Chunky revenue to play with.

 

5 hours ago, Bricks & Mortar said:

I don't think they're favourites.  Expect them to try for a slice of course.  But:
1.  Only those contractors / housebuilders still existing at that point will be in the game.
2.  There are established social housing contractors, who be first in the queue.
3.  The private housebuilders present model is crap quality, kerb appeal and charge what they like with subsidised and clueless buyers.  Social housing is a government cheque to the council, and an obligation on the council to prove best value.  It's really not the same thing.

In Scotland, we're building council houses.  Here's the list of who's building them.  Not a Barratt among them.
https://www.scottishconstructionnow.com/26452/contractors-revealed-for-1-5bn-social-housing-framework/#

As ever, BnM I alawys appreciate your insight into the construction world where I'd sink without trace.It's amazing the education you can get from people who've had years on the inside of a sector because they can cut through the BS and get to the nub of the issues.

 

3 hours ago, DurhamBorn said:

Buying large,good quality companies when they are cheap and holding them a long time is how you make good money in shares.Compounding up the dividends and the slow increases.If you can compound between 6% and 10% youl end up doing very well.

People forget the dividend but its crucial.Vodaphone has a divi of 7.02% today.All things being equal if they can increase that dividend by 2.0% a year over 10 years on average then the shares should return 9% compounding.

Centrica pay 8.1% dividend today.They would just need to increase theirs at 0.9% on average over 10 years.

Card Factory pay 8.4% if the special divi is 7.5p,they would need to average a 0.6% increase over 10 years.

This is of course changed with dividend cuts etc,but over a decent sized portfolio of companies (15 to 20) bought when out of favour with a cycle that should favour them its within easy reach.

All my best long term returns have come from buying big companies when they were out of favour,sold off,even hated.Losses in my younger days were from buying companies loved and talked of as the future.Some people get lucky and bag some huge share price growth,but i prefer a nice steady quality portfolio compound away.

 

I'd go with that.All my biggest losses were derivatives trades where I tried to time the turn to make big bucks.

I've also sold a number of good cheap bought good value shares way too early,but I've learned from that.

 

It's cheaper to learn from other people's mistakes if you can

2 hours ago, Gordie Lastchance said:

Thank you for that, DB. I've seen you mention those names before and I do keep an eye on them. I know Centrica took a huge fall a wee while back and have been bumping along ever since. And I saw Vodafone take a drop last week and it was only reading on here that someone mentioned that had happened because it went ex-dividend. I just know if I buy either one they're going to take another hit. I know you can't time markets (something that's written about on here), but I if I could only get in close to the bottom!! 

I think you have to accept that there's an emotional side to investing.In teh past I used to anchor emotionally on being right or wrong which took my eye of the logic of what I was doing.

Now I prepare my trades/position (even if it's just sitting in cash),I then run it by a family member with significant experience of the market and use them as a sounding board to see if what I'm proposing is logical.If it passes that test,then I'll make the trade.

As with Centrica,we're down at the minute.At one point we were down 30% when it hit £1.24.Because we were happy with the lgoic that toook us into the trade and were prepared for a drop,we'll sit it out.

My Grandad always used to tell me to 'leave the top 10% and the bottom 10% to the gamblers'.I think that's good advice and would go so far as to say the top 20%.

Another good analogy I like is windsurfing.Apparently,only after you've fallen off 200 times do you learn to surf.In a way it's like that with investing.You will make mistakes,you jsut have to invest sums that don't concentrate your risk in one share or asset class and jsut move on if you have a Northern ROck or RBS or marconi moment.

I'll jsut throw this out there Gordie.Consider setting yourself a limit for investing a year, then spread that limit around various shares/sectors and just hold.Don't sell,don't try and time the market.Then do the same again next year.

'Dogs of the FTSE' approach is a good place to start.You will get some losers but you'll get some winners too.

https://www.fool.co.uk/investing/2017/12/27/could-the-dogs-of-the-footsie-outperform-in-2018/

 

1 hour ago, InLikeFlynn said:

This. Too much investment talk on the 'web focuses on buying shares in small and risky companies or instruments (mining cos, crypto currencies, CFDs), hoping for wild and exciting capital growth.

The cruel truth is that none of us can read the future reliably and that the "wild and exciting" capital gains more often than not turn out to be lame and depressing losses.

The dull but pragmatic approach of regular saving into low cost investment funds (in a tax efficient manner using ISAs, SIPPS, VCTs etc), with dividend reinvestment will usually offer much greater rewards in the long term. You will also be able to sleep at night.

Apologies for taking this thread OT,

as you were

 

Hardly OT.I referred to pump n dump earlier.The web is full of BS when it comes to trading.

[Gordie Lastchance]

2 minutes ago, Admiral Pepe said:

haha yeah tell me about it. A good start might here:

http://monevator.com/compare-the-brokers/

Generally the website is a good source of information

See, this is what's great about this place. People have their sources and resources they're prepared to share. Goodness knows when I'd have found that link you've posted. Cheers AP. 

[Gordie Lastchance]

5 minutes ago, sancho panza said:

Cheers for the heads up.Looks interesting.I'll have to have a more detailed look when I have time.I'm not really looking to invest much at the minute as the asset class-shares-is overbaked generally.

In 2 or 3 years,they could be an intersting play.Chunky revenue to play with.

 

As ever, BnM I alawys appreciate your insight into the construction world where I'd sink without trace.It's amazing the education you can get from people who've had years on the inside of a sector because they can cut through the BS and get to the nub of the issues.

 

I'd go with that.All my biggest losses were derivatives trades where I tried to time the turn to make big bucks.

I've also sold a number of good cheap bought good value shares way too early,but I've learned from that.

 

It's cheaper to learn from other people's mistakes if you can

I think you have to accept that there's an emotional side to investing.In teh past I used to anchor emotionally on being right or wrong which took my eye of the logic of what I was doing.

Now I prepare my trades/position (even if it's just sitting in cash),I then run it by a family member with significant experience of the market and use them as a sounding board to see if what I'm proposing is logical.If it passes that test,then I'll make the trade.

As with Centrica,we're down at the minute.At one point we were down 30% when it hit £1.24.Because we were happy with the lgoic that toook us into the trade and were prepared for a drop,we'll sit it out.

My Grandad always used to tell me to 'leave the top 10% and the bottom 10% to the gamblers'.I think that's good advice and would go so far as to say the top 20%.

Another good analogy I like is windsurfing.Apparently,only after you've fallen off 200 times do you learn to surf.In a way it's like that with investing.You will make mistakes,you jsut have to invest sums that don't concentrate your risk in one share or asset class and jsut move on if you have a Northern ROck or RBS or marconi moment.

I'll jsut throw this out there Gordie.Consider setting yourself a limit for investing a year, then spread that limit around various shares/sectors and just hold.Don't sell,don't try and time the market.Then do the same again next year.

'Dogs of the FTSE' approach is a good place to start.You will get some losers but you'll get some winners too.

https://www.fool.co.uk/investing/2017/12/27/could-the-dogs-of-the-footsie-outperform-in-2018/

 

Hardly OT.I referred to pump n dump earlier.The web is full of BS when it comes to trading.

Grateful to you SP. I think you've got the real me already - that's just what I want to do: buy and hold. But buy and hold good (better?) shares. I think I'm getting too wrapped up in playing a timing game - buying when I think they're at a good low point so that I can then enjoy the ride back up the way. I hadn't really put much thought towards dividends, until it was mentioned here - especially the way members have put it (compounding). I also think I've not appreciated the risks associated with the ones I bought previously. As for emotional - been there. The pharma company I bought was around 55p. Dot.com bubble took that to about £2 from memory. Then they dropped to £1.80. "It'll come back up again. Hold on for now." Then it slid to £1.60. "Gordie, that's a big hit. Wait for now, it'll come back up again." Then £1.50, then down and down to being worth bugger all. Same with the tech firm. Bought at 20p and it went to £1. Should have sold. Held on. Saw a hit, but thought it would come back up. Never sold. Same - now worth naff all. Grrr. These shares make me sound good (when they were at their peak), but it was all a big, fat, bubble; that went the way of all bubbles.   

[DurhamBorn]

3 hours ago, Gordie Lastchance said:

Thank you for that, DB. I've seen you mention those names before and I do keep an eye on them. I know Centrica took a huge fall a wee while back and have been bumping along ever since. And I saw Vodafone take a drop last week and it was only reading on here that someone mentioned that had happened because it went ex-dividend. I just know if I buy either one they're going to take another hit. I know you can't time markets (something that's written about on here), but I if I could only get in close to the bottom!! 

The time to buy is when companies that will do just fine in the following cycle are hated at the end of the last one.Everyone and his dog has put up stories over the last several years that the likes of Centrica will be destroyed by all the small players in the market.So much so pretty much everyone thinks that.The contrarian answer is thats utter rubbish.Centrica have £2.5 billion of debt.If they sell the 20% nuclear stake its worth £2 billion.They would be debt free.During a cycle where energy costs are going up smaller players cant hedge very well and get wiped out.

Im not saying pile into Centrica,but i am saying those are the sorts of things i look for.As night follows day,companies that struggle during a disinflation cycle will prosper during a reflation.The market at the moment prices Just Eat at around 65% the value of Centrica.It prices Next plc as worth more.Lets see what those numbers are by 2024.

[DurhamBorn]

20 minutes ago, Gordie Lastchance said:

Grateful to you SP. I think you've got the real me already - that's just what I want to do: buy and hold. But buy and hold good (better?) shares. I think I'm getting too wrapped up in playing a timing game - buying when I think they're at a good low point so that I can then enjoy the ride back up the way. I hadn't really put much thought towards dividends, until it was mentioned here - especially the way members have put it (compounding). I also think I've not appreciated the risks associated with the ones I bought previously. As for emotional - been there. The pharma company I bought was around 55p. Dot.com bubble took that to about £2 from memory. Then they dropped to £1.80. "It'll come back up again. Hold on for now." Then it slid to £1.60. "Gordie, that's a big hit. Wait for now, it'll come back up again." Then £1.50, then down and down to being worth bugger all. Same with the tech firm. Bought at 20p and it went to £1. Should have sold. Held on. Saw a hit, but thought it would come back up. Never sold. Same - now worth naff all. Grrr. These shares make me sound good (when they were at their peak), but it was all a big, fat, bubble; that went the way of all bubbles.   

https://www.thecalculatorsite.com/finance/calculators/compoundinterestcalculator.php

I always like to show people the power of compounding.Try something compounding for 15 years at 9%,or 7%.

A 6% yield share who increases divis by 3% a year will get you the 9% all things being equal.

 

[Gordie Lastchance]

33 minutes ago, DurhamBorn said:

The time to buy is when companies that will do just fine in the following cycle are hated at the end of the last one.Everyone and his dog has put up stories over the last several years that the likes of Centrica will be destroyed by all the small players in the market.So much so pretty much everyone thinks that.The contrarian answer is thats utter rubbish.Centrica have £2.5 billion of debt.If they sell the 20% nuclear stake its worth £2 billion.They would be debt free.During a cycle where energy costs are going up smaller players cant hedge very well and get wiped out.

Im not saying pile into Centrica,but i am saying those are the sorts of things i look for.As night follows day,companies that struggle during a disinflation cycle will prosper during a reflation.The market at the moment prices Just Eat at around 65% the value of Centrica.It prices Next plc as worth more.Lets see what those numbers are by 2024.

After you'd mentioned Centrica some time back, I looked online at it. I had it in my mind it was a company (okay a big one) that piped gas to your home and sent an engineer in a blue van round to look at your boiler if it was playing up. I couldn't believe the different aspects to its business. I've had my eyes opened by the likes of you to the fact that it does "proper work" yet other companies - you mention Just Eat for example - are valued (note: I've not said worth) so highly or by much more. It's brain-fuddling.

[TheCountOfNowhere]

Land registry up 1.2% in a mother !!!!

4% in a year

new builds up 6.4%, we're doing more "Help" that we used to.

Method of calculation changed, by all accounts last October to exclude some cheaperr houses 

US about to raise IRs...UK £ dropped a but but not as much as expected.

 

Surely, surely when the US raise rates this time the BoE has to follow, this charade can't go on forever.

 

[leonardratso]

31 minutes ago, Gordie Lastchance said:

After you'd mentioned Centrica some time back, I looked online at it. I had it in my mind it was a company (okay a big one) that piped gas to your home and sent an engineer in a blue van round to look at your boiler if it was playing up. I couldn't believe the different aspects to its business. I've had my eyes opened by the likes of you to the fact that it does "proper work" yet other companies - you mention Just Eat for example - are valued (note: I've not said worth) so highly or by much more. It's brain-fuddling.

sounds expensive that, do we really need an engineer just to come round to talk to the missus when shes sulking/going bats? cant just any bloke on a moped come round and sort her?

[Lavalas]

1 hour ago, DurhamBorn said:

The market at the moment prices Just Eat at around 65% the value of Centrica.It prices Next plc as worth more.Lets see what those numbers are by 2024.

That just says it all. What a perfect illustration of where we’re at/going.

[leonardratso]

11 minutes ago, Lavalas said:

That just says it all. What a perfect illustration of where we’re at/going.

you never know with these jing-bang food emporiums, look at dominos pizza, i remember fundsmith binning them off in favour of maybe idexx or some other laboratory pharma guys and dominos carried on to even greater heights. I know just eat is just an aggregator, but you cant just write it off because of that, mind you, it being worth 65% of centrica is somewhat deluded and laughable i would probably say, especially since its merely a toddler in the compnay size/age race.

Probably worth gordie looking into funds as well, if hes very risk averse, ive done very well out of fundsmith T class for example (mutual fund) and im doing okish out of some vanguard and even evestor is turning a profit, spread of spreads if you like.

[Funn3r]

2 hours ago, Gordie Lastchance said:

It's amazing the education you can get from people who've had years on the inside of a sector because they can cut through the BS and get to the nub of the issues.

I've had over 40 years in IT,  know it inside out, and the most I can personally leverage is "can you get this virus off my computer I'll buy you a pint mate" 

[sancho panza]

Shaun Richards on the utter delusion that underpins our inflation data

https://notayesmanseconomics.wordpress.com/2018/06/13/putting-rents-which-do-not-exist-in-a-consumer-inflation-measure-is-a-disgrace/

'I intend to point out that the RPI does indeed have strengths and it relates to my letter to Bank of England Governor Mark Carney from February.

“. I am not sure what is a step up from known error but I can say that ignoring something as important to the UK as that sector when UK  house prices have risen by over 29% in your term as Governor when the targeted CPI has only risen by more like 7% is exactly that.”

This is because it makes an effort to reflect this.

This is because the RPI does include owner occupied housing and does so using house prices and mortgage interest-rates. If we look at house prices we see that admittedly on a convoluted route via the depreciation section they make up some 8.3% of the index.

This compares for example with the Consumer Price Index which completely ignores the whole subject singing “la,la,la” when it comes up. There has been a newer attempt to reflect this issue which I look at below.

Also it means that the influence is much stronger that on the only other inflation measure we have which includes house prices which is CPI (NA). In it they only have a weighting of 6.8%. So the RPI is already ahead in my view and that is before you allow for the 2.4% weighting of mortgage interest-rates.

As you can see the new effort at least acknowledges the issue but comes up with a lower weighting. This is because they decided that they only wanted to measure the rise in house prices and not the land. This is what they mean by Net Acquisitions or NA.

Now with 8.3% ( 10.7%) and 6,8% in your mind look what happens with the new preferred measure CPIH.

Now let me bring in the alternative about which the National Statistician John Pullinger and the ONS are so keen. This is where rather than using house prices and mortgages of which there are many measures we see regularly in the media and elsewhere, they use fantasy rents which are never actually paid. Even worse there are all sorts of problems measuring actual rents which may mean that this is a fantasy squared if that was possible.

But this fantasy finds itself with a weight of 16.8% or at least it was last time I checked as it is very unstable. Has our owner-occupied housing sector just doubled in size?

As you can see whilst you cannot count the (usually fast rising ) value of land it would appear that you can count the ( usually much slower rising) rent on it. That is the road that leads to where we are today where the officially approved CPIH gives a lower measure than the alternatives. Just think for a moment, if there is a sector in the UK with fast rising inflation over time it has been housing. So when you put it in the measure you can tell people it is there but it gives a lower number. Genius! Well if you do not have a conscience it is.

Yet the ordinary man or woman is not fooled and Bank of England Governor Mark Carney must have scowled when he got the results of his latest inflation survey on Friday.

After all when asked ( by the Bank of England) they come up with at 3.1% a number for inflation that is closer to the RPI then the alternatives.

Just because people think a thing does not make it right but it does mean you need a very strong case to change it . Fantasy rents are not that and even worse they come from a weak base as illustrated below.

The whole situation gets even odder when you note that from 2017 to this year the weighting for actual rents went from 5.6% to 6.9%.

Who knew that over the past year there was a tsunami of new renters? More probably but nothing like a 23% rise. This brings me back to the evidence I gave to the UK Statistics Regulator which was about Imputed Rents which relies on essentially the same set of numbers. I explained the basis for this was unstable due to the large revisions in this area which in my opinion left them singing along to Fleetwood Mac.

I’m over my head (over my head)
Oh, but it sure feels nice

Today’s data

Let me start with the number which was much the closest to what people think inflation is according to the Bank of England.

The all items RPI annual rate is 3.3%, down from 3.4% last month. The all items RPI is 280.7, up from 279.7 in April.

So reasonably close to the 3.1% people think it is as opposed to.

The all items CPI annual rate is 2.4%, unchanged from last month. The all items CPI is 105.8, up from 105.4 in April

When we ask why? We see that a major factor is the one I have been addressing above.

Average house prices in the UK have increased by 3.9% in the year to April 2018 (down from 4.2% in March 2018). This is its lowest annual rate since March 2017 when it was 3.7%.

In spite of the slow down in house price inflation it remains an upward pull on inflation measures. You will not be surprised to see what is slowing it up.

The lowest annual growth was in London, where prices increased by 1.0% over the year.

Now let me switch to what our official statisticians,regulators and the economics editor of the Financial Times keep telling us is an “improvement” in measuring the above.

The OOH component annual rate is 1.1%, down from 1.2% last month.

Which is essentially driven by this.

Private rental prices paid by tenants in Great Britain rose by 1.0% in the 12 months to May 2018; unchanged from April 2018.

So they take rents ( which they have had all sorts of trouble measuring and maybe underestimating by 1% per annum) and imagine that those who do not pay rent actually do and hey presto!

The all items CPIH annual rate is 2.3%, up from 2.2% in April.

I often criticise the media but in this instance they deserve praise as in general they ignore this woeful effort.

Comment

Today has been a case of me putting forwards my views on the subject of inflation measurement which I hold very strongly. This has been an ongoing issue since 2012 and regular readers will recall my successful battle to save the RPI back then. I take comfort in that because over time I have seen my arguments succeed and more and more join my cause. This is because my arguments have fitted the events. To give a clear example I warned back in 2012 that the measure of rents used was a disaster waiting to happen whereas the official view was that it was fine. Two or three years later it was scrapped and of course we saw that the Imputed Rent numbers had a “discontinuity”. The saddest part of the ongoing shambles is even worse than the same sorry crew being treated as authorities about a subject they are consistently wrong about it is that we could have spent the last 6 years improving the measure as whilst it has strengths it is by no means perfect.

Let me give credit to the Royal Statistical Society as it has allowed alternative views an airing (me) and maybe there is a glimmer from the House of Lords who have speedily replied to me.

Staff to the Committee will be in attendance this evening, and we have emailed the details to the members: the unfortunate short notice and the busy parliamentary schedule currently means it may be unlikely for them to attend. We will report back to them on the event nevertheless.

I hope the event goes well for you.

Returning to today’s we now face the risk that this is a bottom for UK inflation as signalled by the producer price numbers.

The headline rate of inflation for goods leaving the factory gate (output prices) was 2.9% on the year to May 2018, up from 2.5% in April 2018.Prices for materials and fuels (input prices) rose 9.2% on the year to May 2018, up from 5.6% in April 2018.

This has been driven by the rise in the price of oil where Brent Crude Oil is up 56% on a year ago as I type this and the recent decline in the UK Pound £. This will put dark clouds over the Bank of England as the wages numbers were a long way from what it thought and now it may have talked the Pound £ down into an inflation rise. Yet its Chief Economist concentrates on matters like this.

[Cosmic]

1 minute ago, Funn3r said:

I've had over 40 years in IT,  know it inside out, and the most I can personally leverage is "can you get this virus off my computer I'll buy you a pint mate" 

To which you reply: "Sorry not my area. But if you want to migrate your SME from on premises Exchange to Office 365 using a swing migration, my rate is £500 a day + expenses".

[leonardratso]

7 minutes ago, Cosmic Apple said:

To which you reply: "Sorry not my area. But if you want to migrate your SME from on premises Exchange to Office 365 using a swing migration, my rate is £500 a day + expenses".

and btw, that bloke you sent round to shut my yapping boiler up has run off with her, so looks like i owe you a pint instead.

[Gordie Lastchance]

42 minutes ago, leonardratso said:

you never know with these jing-bang food emporiums, look at dominos pizza, i remember fundsmith binning them off in favour of maybe idexx or some other laboratory pharma guys and dominos carried on to even greater heights. I know just eat is just an aggregator, but you cant just write it off because of that, mind you, it being worth 65% of centrica is somewhat deluded and laughable i would probably say, especially since its merely a toddler in the compnay size/age race.

Probably worth gordie looking into funds as well, if hes very risk averse, ive done very well out of fundsmith T class for example (mutual fund) and im doing okish out of some vanguard and even evestor is turning a profit, spread of spreads if you like.

If my boiler knew how you spoke of it, it would blow a fuse!!! However, I looked at Fundsmith (thank you - something else I had no idea about) and am attempting to get my head round it. I think I worked out what inc and acc means - took ages, like! Admiral Pepe mentioned monevator, so I've been fiddling with that too. A Fidelity fund is attempting to relieve me of my remaining grey matter. This finance stuff ain't half complicated.   

[janch]

3 hours ago, Gordie Lastchance said:

I'll have a look at that, thank you. I have the paper ones because I bought the shares so long ago! I had to phone Barclays to do a trade and it was, if I remember, £17.50 to buy and the same to sell. Dealing costs + losses = hacked off. Back then, I only had newspapers to follow, so my research was probably pretty rubbish. 

Yes I had paper certificates and then stopped "investing" after I followed a share tip and bought Marconi because my dad used to work for Plessey (which turned into Marconi) only to see the lot wiped out.............and I used to follow all the action on Ceefax too.  I did use HL to buy and sell via  the phone and I'm not sure about using t'internet and nominee accounts being such an old fashioned kind and risk averse to boot.  However DB is slowly converting me to have another go.  I'd also worked out it's probably better to go for divis rather than worrying about capital gains/losses.  Dealing costs are a big deal too so the idea of a savings account and £1.50 per deal as mentioned by Castlevania seems a good idea.

I've been expecting the mother of all crashes in property and other assets since about 2003 but it seems they've managed to keep the plates spinning all this time so what do I know. 

[spygirl]

1 hour ago, TheCountOfNowhere said:

Land registry up 1.2% in a mother !!!!

4% in a year

new builds up 6.4%, we're doing more "Help" that we used to.

Method of calculation changed, by all accounts last October to exclude some cheaperr houses 

US about to raise IRs...UK £ dropped a but but not as much as expected.

 

Surely, surely when the US raise rates this time the BoE has to follow, this charade can't go on forever.

 

Ive mentioned here (I think) and on ToS - US FED sets the risk free price of cash.

The BoE can only set UK IRs higher than the FED.

Until Carney, we've never had IRs below the FED. UK always has to set rates ~-1-.15% higher - currency risk, lower growth.

Even the ECB cannot buck the FED:

https://www.ft.com/content/c01d76d8-6d7b-11e8-92d3-6c13e5c92914

ECB unwinding QE.

It has to. No cover from FED.

The BoE is so far bhind raising rates. The BoE are kidding themslves that a lower pound will help exports - uit seems like every fucker i nthe UK is working in a nailbar or whatnot.

There are very UK exporters.

I doubt there are any large UK exporters - bar petrol - that export a product entirely sourced in the UK.

Ill give you Scotch and lamb/beef.

 

 

[sancho panza]

Edit to add- we own a raft of these at not dissmilar prices to current.Some up,some down.

I'm weighing purchase of Sibanye/Kinross

 

15 minutes ago, sancho panza said:

Just looking up bombed out goldies

 

 

Stuck these in the wrong thread....

 

5 minutes ago, sancho panza said:

Anglogold market cap is less than it's revenue..........

Sibanye 50%

Utterly bombed out.

DYOR etc...

 

https://www.investing.com/indices/arca-gold-miners-components

 

 

[sancho panza]

7 minutes ago, janch said:

Yes I had paper certificates and then stopped "investing" after I followed a share tip and bought Marconi because my dad used to work for Plessey (which turned into Marconi) only to see the lot wiped out.............and I used to follow all the action on Ceefax too.  I did use HL to buy and sell via  the phone and I'm not sure about using t'internet and nominee accounts being such an old fashioned kind and risk averse to boot.  However DB is slowly converting me to have another go.  I'd also worked out it's probably better to go for divis rather than worrying about capital gains/losses.  Dealing costs are a big deal too so the idea of a savings account and £1.50 per deal as mentioned by Castlevania seems a good idea.

I've been expecting the mother of all crashes in property and other assets since about 2003 but it seems they've managed to keep the plates spinning all this time so what do I know. 

There's some very bright people I know been the wrong side of the trade for 10+ years.Blow out should have happened in 08.

Mish Shedlock/Karl Denninger etc been warning for years and years.

[Gordie Lastchance]

14 minutes ago, janch said:

Yes I had paper certificates and then stopped "investing" after I followed a share tip and bought Marconi because my dad used to work for Plessey (which turned into Marconi) only to see the lot wiped out.............and I used to follow all the action on Ceefax too.  I did use HL to buy and sell via  the phone and I'm not sure about using t'internet and nominee accounts being such an old fashioned kind and risk averse to boot.  However DB is slowly converting me to have another go.  I'd also worked out it's probably better to go for divis rather than worrying about capital gains/losses.  Dealing costs are a big deal too so the idea of a savings account and £1.50 per deal as mentioned by Castlevania seems a good idea.

I've been expecting the mother of all crashes in property and other assets since about 2003 but it seems they've managed to keep the plates spinning all this time so what do I know. 

You wouldn't happen to be the twin I never knew I had?! Back in the day (I know I am going to take pelters for this) I actually bought into British Steel because of something I read in The Sun. No, I didn't have some sort of inspiration coming down from above - I mean the tabloid (what was I thinking?). Oh yes, going on to Ceefax to see how (badly) things were going: been there, done that. Take it from me, these (the contributors to this thread) are a nice, helpful bunch of people who might be able to restore your faith. I'm frightened about risk, but I think I'm getting there. I've never been afraid to ask the stupid questions during my life and folk here have been more than happy to answer them (time will tell if they get fed up of me!).