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Credit deflation and the reflation cycle to come.

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On 12/05/2019 at 22:43, Lavalas said:

In case you’re interested, this weeks ‘Notes from the Rabbit Hole’ newsletter is free to non-subscribers. I’m not a subscriber but I know it commands a fair bit of respect. Usual cost $33.50 per month.

I always thought it was PM focused but it’s much broader than that and fairly technical. 

Useful insight, perhaps.


Interesting newsletter.Disjointed and lacking in focus but has some thought provoking discussion on various ratios eg gold/silver,gold/oil,NDX/SOX.


I've been short SOX/SMH for a week or two now jsut so I follow them most days.Thye definitely seem to be calling a turn.SMH down from 118 to circa 103(jsut come off nights so not up to speed)


Thanks for posting

13 hours ago, Majorpain said:

Blood in in the water so the shorters are out in force, range of outcomes at the moment is looking like less than 100p to 0p (nationalisation). 

Every single withdrawal takes capital out the bank and makes the original problem (not enough capital) worse.

Worth noting that UK hosuebuilders have started downward trends breaking the uopside push of the last 5 months over last two weeks.


UK hbuilders turns presaged NR troubles back in 07.Loads of half built new builds in Leicesterwhire

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On 11/05/2019 at 15:30, Craig said:

Looked awfully to me like CZ from Binance and his six mates could've quite easily amended the ledger if they'd wanted to. That to me rings serious alarm bells. 

I think that would have resulted in a fork like ETH and ETC.

On 11/05/2019 at 20:03, Sound Money said:

Sorry but no. If they could do it, why didn’t they to save themselves what was it, $40M?

They would have to convince more than half of mining power to remove the transaction. And as long as one miner can still insert those transactions back into the new chain they would need to maintain >50% indefinitely, unless they could also convince users running full nodes to ban those transactions/addresses.

Not feasible at all

Agreed. There's a reason why BTC is number one by market cap.

31 minutes ago, sancho panza said:

Also,don't know whether anyone else has been noticing the drops in some fetiliser producers






I have! Looking for an opportunity that takes my fancy, but not quite feeling it yet.

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Four ways to tell whether a dividend may be safe

Writer, Russ Mould
Monday, May 13, 2019

Vodafone Group PLC


Marks & Spencer has already taken the plunge and announced a plan to cut its dividend and although BT has decided to keep its payment unchanged investors are understandably nervous about some of the yields offered by some of the UK’s biggest firms. With the best cash ISAs offering an interest rate of around 1.5% and the UK 10-year Government bond yield – or risk-free rate – coming in at barely 1.1% investors need to think about why a stock is offering a yield of 8%, 9% or even 10%.

The main reason companies such as Centrica, Persimmon, Taylor Wimpey, Evraz and Vodafone are offering huge dividend yields is that investors are demanding this as compensation for the capital risk that comes with owning the shares.

In plain English, the huge yield is investors’ polite way of saying they do not believe the analysts’ forecasts for profits and the dividend – or at the very least that they want more proof that the dividend can be sustained.

This is because there are few worse investments than a stock with a high yield that cuts its dividend. In these cases, the injury caused by loss of the yield is compounded by the insult of a share price fall – although in the case of Centrica and Vodafone (and BT for that matter) persistent share price falls mean that investors are already braced for a dividend cut. As such, you might start to wonder whether Iain Conn at Centrica and Nick Read don’t just get on with it and remove a millstone from their own necks and their companies’ share prices.

To help decide whether a chief executive is going to bite the bullet and cut a dividend, investors can carry out four checks to see how safe a payment might be. They are:

  • Dividend cover, according to earnings
  • Dividend cover, according to free cash flow
  • Interest cover and net debt
  • The size of the pension deficit or surplus

Vodafone will be used as an example below, in all four cases.

1. Dividend cover

Dividend cover is calculated as follows and is expressed as a ratio:

Prospective earnings per share (EPS)
prospective dividend per share (DPS)

Ideally cover should exceed 2.0. Anything below two needs to be watched and a ratio under 1.0 suggests danger – unless the firm is a Real Estate Investment Trust, obliged to pay out 90% of its earnings to maintain its tax status; it has fabulous free cash flow and a strong balance sheet; demand is relatively stable and insensitive to swings in the economy, which really means utilities and consumer staples (although the increasingly active role of the regulator must be watched here rather than the economic cycle).

In the case of Vodafone in the year to March 2019, the forecast earnings per share figure is 9.9p and the dividend 12.9p, according to consensus. That is dividend cover of 0.76, less than ideal.

For the year to March 2020, the analysts’ consensus expects EPS of 11.4p and a dividend of 12.9p, so again cover looks lower than you would like at 0.88 times.

  March 2019E March 2020E
Earnings per share 9.9p 11.4
Dividend per share 12.88p 12.88
Dividend cover 0.76 0.88x

Source: Sharecast, consensus analysts’ forecasts. Assumes an unchanged dividend payment of €0.1507

2. Operating free cashflow cover

Operating free cashflow cover adds extra reassurance, because it is cash that funds dividends – and there is another old saying here: “profits are a matter of opinion, cash is a matter of fact.” An extreme example of this is Carillion which was profitable and in theory offering an 8%-plus dividend yield just before it went bust owing to weak cash flow.

Operating free cash flow (OpFcF) - this can be calculated in the four-step process below. Quite simply the higher the figure the better, especially when taken as a percentage of sales or operating profit.

Net operating profit
PLUS depreciation and amortisation
MINUS capital expenditure
MINUS increase in working capital.

The operating free cash flow number can then be measured against the actual total cash value of the annual dividend payment. Companies publish how many shares they have in issue, so multiplying that figure by the value of the distribution will quantify the total cost in millions of pounds.

If free cash flow cover exceeds 2.0 then that is a good start though again it may be worth looking at where operating profit and operating margins are compared to prior cyclical highs and lows and the average over the last decade.

Vodafone does at the moment generate enough cash, even after unavoidable expenses such as interest on debt, tax and licensing and spectrum payments. However, the margin of safety is getting thinner and three factors may start to work against Vodafone: competitive pressure on mobile margins in key mobile markets like the UK, Spain and Italy is growing; interest payments will rise if the acquisition of European cable TV assets from Liberty Global gets regulatory approval; and spectrum and licensing costs are going up as Vodafone prepares to launch 5G mobile services.

€ millions 2016 2017 2018
Sales 49,810 47,631 46,571
Operating profit 1,320 3,725 4,298
Depreciation & amortisation 11,724 12,086 10,884
Net working capital -496 -48 -858
Capital expenditure -10,561 -7,675 -7,321
Operating Cash Flow 1,987 8,088 7,003
OpFcF from discontinued operations 1,645 1,203 858
Operating Cash Flow 3,632 9,291 7,861
Tax -738 -761 -1,010
Interest -982 -830 -753
Pension contribution 0 0 0
Licensing and spectrum spend -3,182 -474 -1,123
Operating Free Cash Flow -1,270 7,226 4,975
Dividend -4,188 -3,714 -3,920
Remaining free cash flow -3,921 2,783 1,320

Source: Company accounts. Financial year to March

3. Net debt and interest cover

A badly-stretched balance sheet can jeopardise a dividend payout, since a heavily-indebted firm will have to pay interest on its liabilities and repay those obligations at some stage. Ultimately a firm could have to reduce or pass its dividend to preserve cash and ensure its banks and lenders are paid so they do not pull the plug. One good measure of a firm's balance sheet is its gearing, or net debt/equity ratio. This is calculated as follows and expressed as a percentage:

Short-term borrowings PLUS long-term borrowings MINUS and cash equivalents

Shareholders funds

A more thorough analysis will include pension liabilities and assets, as well as off-balance sheet liabilities such as leases (which are now coming on balance sheet under IFRS16 accounting rules) and contingent payments.

Just looking at Vodafone’s basic cash and debt figures takes us to a net figure of €38.5 billion. Although this only presents a gearing ratio of 56%, Vodafone is about to take on another €18.4 billion of debt thanks to the European cable TV deal.

Moreover, Vodafone also has some substantial leases on network equipment so the total net debt figure is nearer to €45 billion, once other items are accounted for.

€ million Mar-18
Cash 4,674
Retirement benefit assets 110
Assets for sale 13,820
Cash and cash equivalent 18,604
Short term debt 10,351
Long term debt 32,908
Liabilities for sale 10,999
Retirement benefit liabilities 520
Leases 8,835
Debt and liabilities 63,613
Net debt 45,009
Equity 68,607
Net debt / equity ratio (“gearing”) 66%

Source: Company accounts

You can then add interest cover to the mix. This ratio is also a good litmus test of a group's financial soundness. It is calculated as:

Operating income PLUS interest income
interest expense.

The higher the ratio, the stronger a firm's finances and although Vodafone has plenty of debt, its interest cover ratio of 3.85 times suggest it is currently profitable enough to easily fund such a burden.

€ million Mar-18
Operating profit 4,299
Net interest income 339
Total 4,638
Net interest expense 1,202
Interest cover 3.85x

Source: Company accounts

4. The final check involves the pension fund, not least as this is becoming a political as well as an economic issue, following, Carillion, BHS and others.

The regulator is clearly becoming increasingly intolerant of companies that distribute cash to shareholders via dividends or share buybacks while they still have a big pension deficit.

To check for the risk of political interference, or the possibility that a company must plug a financial hole, always look to see whether a company has a pension deficit or surplus.

The good news is that Vodafone has a tiny deficit, with the balance sheet showing a net deficit of just €410 million. The annual costs of topping up the pension fund to profits in the year to March 2018 was a perfectly manageable €222 million.


In conclusion, Vodafone passes three of the four tests, which may be why boss Nick Read has so far stated it was his intention to hold the dividend unchanged at 15.07 euro cents for the year to March 2019 (even if this in itself was a big decision as it ended a streak of annual dividend increases that dates back to 1998).

Free cash flow cover looks adequate, there is no pension problem and the company seems built to withstand its debts. However, earnings cover is weak, debt will rise if the Liberty Global deal is approved and free cash flow could be put under pressure by spectrum and network equipment costs relating to 5G, so it would be no shock if Mr Read were to decide to prioritise investment in the company’s long-term competitive position and sacrifice some of the dividend payment. The share price is already expecting it and for the long-term good of the business it could well be the right thing to do.



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23 hours ago, Sideysid said:

Well, I have a real world example of margins being squeezed. In keeping up with the usual bargain discount posts, Iceland have now invented new stickers and  reduced their near date items to a 1/3 rather than 1/2 price. Still picked up a few packs of chicken breasts, but not great.

In other news in the spirit of the thrifty (tight bastard) ways off this thread, I thought I'd share that I gave away my longest serving jacket today. 12 years old North Face coat that travelled around the world with me, still looks as new, only the inside lining a bit worn (although still exactly same design as the modern version). My elderly parents bought me a new one as a gift today as they said they wouldn't be around to see me finish wearing out the next one. 

I was going to give my old one to a charity shop, but my partners best friend (who genuinely doesn't have much money) took my old one and thought it was in great condition and gave it to her son who thanked me. Hopefully it will see a good few more years use yet.

@Sideysid NICE post music to my ear holes!
Yeah I'm having the same issues with Tescos - just came back this evening with items only 50% to 75% off
Before new-year you could get grub at 90% off!
@DurhamBorn how are your YRS prices up north?
Anyway to soften the blow - I've found a (legit) way to get FREE krispy kreme donuts haha!xD
SERIOUSLY... You do NOT pay a penny, nothing, Nada, nought!
if enough tightwad members post HOW...I'll post the SECRET!
Just thinking with all the other money saving tips i have, Maybe i should write an e-book and flog it for £2.97 - once website is up...ring up LBC radio EVERYDAY to get FREE publicity to my website, would ONLY need 200,00 sales ...that would enable me to buy an OVERPRICED bungalow in a nice area in the SE!:Old:

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1 hour ago, Yellow_Reduced_Sticker said:
@Sideysid NICE post music to my ear holes!
Yeah I'm having the same issues with Tescos - just came back this evening with items only 50% to 75% off
Before new-year you could get grub at 90% off!
@DurhamBorn how are your YRS prices up north?
Anyway to soften the blow - I've found a (legit) way to get FREE krispy kreme donuts haha!xD
SERIOUSLY... You do NOT pay a penny, nothing, Nada, nought!
if enough tightwad members post HOW...I'll post the SECRET!
Just thinking with all the other money saving tips i have, Maybe i should write an e-book and flog it for £2.97 - once website is up...ring up LBC radio EVERYDAY to get FREE publicity to my website, would ONLY need 200,00 sales ...that would enable me to buy an OVERPRICED bungalow in a nice area in the SE!:Old:



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1 hour ago, MrXxx said:

Do you know how to get free gym membership for when you become a `lard arse` after eating all of those free donuts though?! :-) :-) :-)

Dress well, walk into one and ask for a free pass. Repeat with another gym.

note: give them unused phone number as they will haunt you.

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2 hours ago, MrXxx said:

Do you know how to get free gym membership for when you become a `lard arse` after eating all of those free donuts though?! :-) :-) :-)


AGREE with with ya on the `lard arse` issue thats why i do this the 1 time ONLY per month i pig out 'em then ...VOMIT the lot out!:oxD

I saw school kids doing this donut "FREEBIE TRICK" and blimey you wana see the size of 'em fecking discusing!:Old:

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Not long now before the annual In Gold We Trust report is released. I advise anyone with any interest in gold and the monetary markets to give it a read. The extended version is 150+ pages long so it provides a huge amount of detailed analysis (for free!).


'Since 2007, the annual In Gold we Trust-Report is THE authoritative report on gold investing, and is required reading for anyone interested in the precious metal market. As a team, Ronald-Peter Stöferle and Mark Valek analyze the state of the global financial markets, monetary dynamics and their influence on gold price developments like no other.'

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1 hour ago, Majorpain said:



EU down 33ish%

World down 15%

Advanced economies down 20%

I still think its a race between China and the Euro for who causes the avalanche, Trump jumping all over China and going easy on Europe for now makes me think he's got his target.

So we're approaching 2008 levels without a recognised '2008 happening'.

Cushty Rodders.

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Household formation takes a dip.Nothing to do with high house prices/cost of living.



Baby Bust Continues: Births Lowest in 32 Years as Fertility Rate Hits Record Low

The number of babies born in the US has declined in 10 of the last 11 years as the fertility rate slumps.

The Vital Statistics report on 2018 Births shows the baby bust continues.

Key Numbers

  • The provisional number of births for the United States in 2018 was 3,788,235, down 2% from 2017 and the lowest number of births in 32 years.
  • The general fertility rate was 59.0 births per 1,000 women aged 15–44, down 2% from 2017 and another record low for the United States.
  • The total fertility rate declined 2% to 1,728.0 births per 1,000 women in 2018, another record low for the nation.
  • Birth rates declined for nearly all age groups of women under 35, but rose for women in their late 30s and early 40s.
  • The birth rate for teenagers aged 15–19 was down 7% in 2018 to 17.4 births per 1,000 women; rates declined for both younger (aged 15–17) and older (aged 18–19) teenagers.

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Barclays and Metro Bank highlight that the banking crisis is not yet over

Posted on May 15, 2019

The credit crunch has in many ways been a story of the banks and a major banking crisis. All these years later after a proliferation of promises about reform we find that we have not truly shaken the issues off. One of the worst cases of this is Italy that has a decade after all this began still not completed its round of bailouts as the developing Carige story makes clear. We keep getting investors supposedly prepared to put their money into troubled Italian banks when then pull out. What can it be about the heavy losses of the Atlante bailout vehicle that has caused this? In Germany we see that the position of its main bank Deutsche Bank can be highlighted simply by quoting its share price, which as I type this is a mere 6.82 Euros.

In the UK we got on with the banking bailouts which is both good and bad, The good bit is that if you are going to do it then it is better to be swift and decisive. The bad part is that letting Northern Rock fail would have sent a signal to the other banks that they are subject to the same laws as everyone else. Instead we have moved forwards with nobody in a senior position in a UK bank being prosecuted even when there have been signs of fraud and misrepresentation on a major scale. To my mind there were three major issues.

  1. The merger of Lloyds Bank and Bank of Scotland which was very expensive for shareholders and requited a bailout.
  2. The rights issue of June 2008 undertaken by Royal Bank of Scotland.
  3. The Qatari investment in Barclays at the height of the crisis that turned out to be a case of some shareholders being more equal than others.

The UK establishment was never going to address point one for the simple reason that it had its fingers all over it! Instead we saw a classic cover up and fudge with Victor Blank being Knighted. Point two was kicked into the long grass as there was no settlement of any sort until 2017 which to my mind did not get even close to addressing this. From the So-Called BBC back then.

“The rights issue deals with concerns over the balance sheet,” said David Cumming, head of UK equities at Standard Life Investments, which holds a 3.5% stake in RBS.

This was how it was presented so how only a few months later did it collapse as highlighted by FN News below.

The investors bringing claims against RBS allege the bank omitted crucial financial information from the prospectus for its 2008 rights issue, which raised £12 billion. A few months later, the bank collapsed, requiring a £45 billion taxpayer bailout.

Frankly I find it hard to think of a more open and shut case and yet it went on for years.


The Financial Times summarises the issue here.

The charges turned on £322m of side deals and a $3bn loan the bank extended to Qatar in 2008, as Barclays twice turned to the Gulf state in emergency cash calls that kept the bank from a government bail-out.

Again on a prima facie basis that looks completely clear-cut as management paying someone to back the share price is misleading shareholders, especially as the truth was withheld for quite some time. In some ways they may as well have revealed it as nothing seems to ever happen about it anyway.

The charges against the bank were ultimately scrubbed by the courts last year and the bank has not had to stand trial. Related proceedings have been pursued against its former chief executive, John Varley, and three former top bankers, who all denied the charges against them. A jury trying the case was recently discharged.

Even the Financial Times finds itself mentioning this.

The SFO’s decision represented a rare example of a major bank facing UK criminal charges. ( SFO is Serious Fraud Office).

In my career the SFO has had a simply dreadful name symbolised by the way that Ernest Saunders got his prison sentenced reduced via a diagnosis of Alzheimers something from which unlike everyone else who gets it he subsequently recovered.

Where was our watch-dog the Bank of England? Well rather than representing us it found itself crying “The Precious! The Precious!”

The Bank of England warned prosecutors that a criminal charge against Barclays could present an existential threat to the lender, showing that regulators still worry about large banks being “too big to jail”. According to people familiar with the matter, in 2017, Sam Woods, the BoE’s top banking supervisor, told David Green, the then-director of the Serious Fraud Office, that there could be unpredictable consequences if there were charges against Barclays over crisis-era payments to Qatar.

This is classic Yes Prime Minister style action as of course “unpredictable consequences” cannot be challenged. Or if you prefer a type of what has become called Project Fear. It is perfectly safe as you cannot be specifically questioned because you have been deliberately vague. It is another form of regulatory capture as Sam Woods found itself mimicking the case made by Barclays itself.

Mr Woods questioned whether a corporate criminal charge would be in the public interest as officials believed it would present a small – but not insignificant – threat to Barclays’ safety and soundness. Barclays itself made similar arguments to the PRA, according to other people familiar with the situation.

Yet the problem is again highlighted by a share price of 160 pence which is not much of a return on the dark days of the credit crunch and some 26% lower over the past year. Putting it another way the share price suggests we have seen a fair bit of zombification at Barclays.

Metro Bank

The cases above relate mostly to past issues but Metro Bank brings us more up to date. This week has seen something of a mini bank run triggered by social media scaremongering such as this tweet from Emily Barthlow.

Please transfer all your money out of #metrobank @Metro_BankTHEY ARE GOING BANKRUPT I REPEAT THEY ARE GOING BANKRUPT @MetroBank_Help

Whilst Metro Bank plainly has problems highlighted by a share price of £5.70 such tweets ignored the fact that the deposit protection scheme is there for deposits of up to £85,000. Why is Metro Bank vulnerable to such rumours? City-AM explained yesterday.

Metro Bank also attempted to reassure customers that its £350m capital raise – in response to a major loans blunder – was “well advanced.”

Despite today’s bounce, the bank’s stock is down 77 per cent since the lender admitted in January that a swathe of commercial loans had been wrongly classified and should have been among its “risk-weighted assets.”

As to the classification error it was yet another triumph for the prescience of Yes Minster.

Sir Desmond: “Well, they placed their own interpretation on Treasury regulations. Someone has to interpret them.”
Sir Humphrey: “What about the Treasury’s interpretation?”
Sir Desmond: “It didn’t seem appropriate.”

The modern twist is that we had what I think is the first bank panic via Whatsapp.


In some ways we have been on a very long journey and in others on a very short one. In terms of time passed it is the former but it terms of approach it is the latter as the banks seem to remain above the law. We get thrown the occasional tit-bit such as some Libor or foreign-exchange riggers but nobody at the top seems to ever be held accountable let alone punished. Indeed establishment figures seem to develop a habit of being ennobled as we note that Paul Tucker of Li(e)bor fame at the Bank of England is now Sir Paul Tucker. I cannot avoid the thought that this is a reward for keeping quiet.

So whilst banks are pressed to keep more capital we are left wondering what has really changed? After all in a real crisis capital will be seen as insufficient anyway due to the nature of banking. We are left with bank directors provided with Star Trek style deflector shields in any crisis and in my opinion that is  partly why we rumble on with a zombified banking sector and weak economic growth. Putting it another way what Keynes called “animal spirits” are weakened by all of this.

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3 hours ago, sancho panza said:

We get thrown the occasional tit-bit such as some Libor or foreign-exchange riggers but nobody at the top seems to ever be held accountable let alone punished.

I was a juror on a Euribor fixing trial. It was a transparent stitch up; three former employees got thrown under the bus while their superiors all apparently got away with it scot free. I'm still angry about it months later.

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8 hours ago, sancho panza said:

the trade stats or the demogrpahics?


The demographics. As ever, your knowledge sharing is appreciated 

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3 hours ago, ashestoashes said:

buying opportunity for soon to be nationalised utilities ?

I think laying Corbyn as PM  will be the value bet at the next GE.I think there could be some tremendous opportunities for the brave/daring/stupid(if you get it wrong lol)

I'd really like to build a substantial holding in national grid.



Edit to add-middle class people just not going to vote for him in large enough quantities/Tories will buy off Brexit party with a Leaver leader.DYOR etc

Edited by sancho panza

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Debt deflation cometh....Fishers paradox???



Serious auto-loan delinquencies – 90 days or more past due – jumped to 4.69% of outstanding auto loans and leases in the first quarter of 2019, according to New York Fed data. This put the auto-loan delinquency rate at the highest level since Q4 2010 and merely 58 basis points below the peak during the Great Recession in Q4 2010 (5.27%):


This is what the banks are looking at.

The dollars are big. In Q1, total outstanding balances of auto loans and leases rose by 4% from a year ago to $1.28 trillion (this amount by the New York Fed is slightly higher than the amount reported by the Federal Reserve Board of Governors as part of its consumer credit data). Over the past decades, since in Q1 2009, total auto loans and leases outstanding have risen by 65%.

But the number of auto-loan accounts has risen only 34% over the decade, to 113.9 million accounts in Q1 2019. In other words, what caused much of the increase in the auto-loan balances is the ballooning amount financed with each new loan and longer loan terms that causes those loans to stay on the books longer.


This is what automakers are facing.

Lenders have already figured out that subprime auto loans have soured. They’ve been seeing this since 2015 or 2016. And ever so gradually, lenders have tightened their subprime underwriting standards. And subprime customers that don’t get approved for a new-vehicle loans may get approved for a much smaller loan for a cheaper used vehicle. This process has already been shifting potential new-vehicle customers to used vehicles.

For automakers, this has already shown up in their sales. New-vehicle sales, in terms of vehicles delivered to end users, peaked in 2016 and have been declining ever since. Through Q1 this year, new-vehicles sales, fleet and retail, were down 3.2% from Q1 2018, and so 2019 looks to be another down-year for the industry – the third in a row.

But this isn’t happening in a recession with millions of people losing their jobs and defaulting on their auto loans because they lost their jobs. This is happening during one of the strongest labor markets in many years. It’s happening when the economy is growing at around 3% a year. It’s happening in good times. And people with jobs are defaulting.

This is not a sign of a worsening economy, but a result of years of aggressive and reckless auto lending, aided and abetted by yield-chasing investors piling into subprime auto-loan backed securities because they offer a little more yield in an era of central-bank engineered financial repression. It’s a sign like so many others in this economy, that the whole credit spectrum has gone haywire over the years. Thank you Fed, for having engineered this whole thing with your ingenious policies. So now there’s a price to pay – even during good times.

And we already know what a scenario looks like when the cycle turns, when unemployment surges and millions of people lose their jobs and cannot make their car payments, even people with a prime credit rating – that will then turn into subprime. We know what happens to the auto industry when the economy dives into a recession. We know what this will look like because we’ve seen it before. The auto industry is very cyclical.

What we haven’t seen before is this kind of credit stress among car buyers during the best of times – with the bad times still ahead. So when credit stress gets this bad during good times, we don’t even want to imagine what it might look like during bad times. Whatever that scenario will be, it won’t be fun for automakers.

Edited by sancho panza

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Debt deflation cometh................please soon

My portfolio of well-known defensives and a few miners is down approx 11% this morning:(.  Not one of them is up.  I only started this investing lark in January and I may lose the faith if nothing happens soon:S..............(my middle name is gloom:D)

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