Credit deflation and the reflation cycle to come.

[No Duff (troll)]

26 minutes ago, stokiescum said:

pension firms could take a big hit if a few of the big multinations are found to be wearing the emperors new clothes mind.

Furthermore, pensions are the Achilles heel of the corporates because it's socio-economic and that's fatal.  It's a race for the corporates to divest themselves of this ticking bomb (the final salary ones, etc) before they blow up under the general economic strain to be placed upon them.  Has anyone looked at the trend in corporates shifting their pensions to the insurance companies?  Blame these new pension providers, even let them fail, but above all put it all at arms length from the body corporate.  It's somewhat laughable when you hear pension deficits are being eroded by an improved equity market.  No thought about that highlighted fragility.

Regarding your point about the pension firms themselves, there has been some talk that a key driver for rate rises in the US is due exactly to this exposure.  That is an attempt to move back to a more sound funding model, especially given the enormous number of new daily US retirees.  The collapse of pension firms would be socially and politically catastrophic.  The new Great Depression, only pensions not jobs.  In that sense, they are also the Achilles heel of governments.      

[Yellow_Reduced_Sticker]

1 hour ago, stokiescum said:

thats the problem,however if you guys can see the shitstorm comeing why cant the powers that be,mind china and russia might have they are stockpiling gold.maybe its time to upgrade my stockpile of tinned food up from 3 months worth to 6 months im aready classed has excentric by many who know me.

 

So I'm I maybe I'm ya twin  I find it nice being a bit of an oddball & eccentric!

[King Penda]

1 minute ago, No Duff said:

Pensions are the Achilles heel of the corporates because it's socio-economic and that's fatal.  It's a race for the corporates to divest themselves of this ticking bomb (the final salary ones, etc) before they blow up under the general economic strain to be placed upon them.  Has anyone looked at the trend in corporates shifting their pensions to the insurance companies?  Blame these new pension providers, even let them fail, but above all put it all at arms length from the body corporate. 

id heard they were being shifted to that sector but never thought to investigate has i dont have any skin in the game,i just cant see how the uk can pay for promises made by previouse goverments regarding some of the insane pensions due to the public sector.im basicly expecting them to be downgraded in the future but the question is how they will do it.imo off course.

[No Duff (troll)]

3 minutes ago, Yellow_Reduced_Sticker said:

 

So I'm I maybe I'm ya twin  I find it nice being a bit of an oddball & eccentric!

I would carefully listen to an eccentric oddball above anybody right now! 

[Bear Hug]

7 minutes ago, No Duff said:

Furthermore, pensions are the Achilles heel of the corporates because it's socio-economic and that's fatal.  It's a race for the corporates to divest themselves of this ticking bomb (the final salary ones, etc) before they blow up under the general economic strain to be placed upon them.  Has anyone looked at the trend in corporates shifting their pensions to the insurance companies?  Blame these new pension providers, even let them fail, but above all put it all at arms length from the body corporate. 

Pension schemes moving to insurers also suggests that markets value pension liabilities as relatively cheap.  Since the insurers need to at least cover liabilities and have some funds left for a profit. If anything, rising interest rates should lower the liabilities, and they have done.

[Yellow_Reduced_Sticker]

will you guys slow down posting i'm still on page 39 reading! Slow reading cos some good posts from @No Duff

[Yellow_Reduced_Sticker]

1 hour ago, stokiescum said:

its like chinese water torture though,id rather have chaos for 18 months .still i surpose for the majoraty its better this way and im just being childish wanting it over and done with.

im a retard not a genius lol.

[No Duff (troll)]

2 minutes ago, stokiescum said:

,i just cant see how the uk can pay for promises made by previouse goverments regarding some of the insane pensions due to the public sector.im basicly expecting them to be downgraded in the future but the question is how they will do it.imo off course.

Something will have to give and that will have profound social and political ramifications (citation needed!).  We currently have a form of "crowding out theory" going on.  You have highlighted an excellent thread.  A way in to explore how the future could play out.   You could pursue this by visualising its course and seeing the interdependencies and ensuing collateral damage.  You may well see how the whole tower of babel could collapse.  Try the old military "so what" analysis process......we have a funding issue......so what.....it's going to be an "x" problem.....so what.......and so on.  The importance is to fact check each implication, starting with the first, do we really have a funding issue?  Also get's a bit heavy when there is more than one valid implication, at which point the key is to use the military principle of "selection and maintenance of aim" or the Churchillian "the main thing is to keep the main thing the main thing" 

Think I'll have a go why I wait for my trades to ripen!

[King Penda]

3 minutes ago, No Duff said:

Something will have to give and that will have profound social and political ramifications (citation needed!).  We currently have a form of "crowding out theory" going on.  You have highlighted an excellent thread.  A way in to explore how the future could play out.   You could pursue this by visualising its course and seeing the interdependencies and ensuing collateral damage.  You may well see how the whole tower of babel could collapse.  Try the old military "so what" analysis process......we have a funding issue......so what.....it's going to be an "x" problem.....so what.......and so on.  The importance is to fact check each implication, starting with the first, do we really have a funding issue?  Also get's a bit heavy when there is more than one valid implication, at which point the key is to use the military principle of "selection and maintenance of aim" or the Churchillian "the main thing is to keep the main thing the main thing" 

Think I'll have a go why I wait for my trades to ripen!

at the moment enrolling in the numerouse pension schemes avaliable is optional im expecting it to be made compulsory,im low paid but my out goings are low so my disposable income isnt bad for my area.howver i think its just hit 3% has it rises its going to be noticed more by the lower paid and more will opt out at the moment its being masked by rises in the minimum wage.which i think is due to hit 9 quid by the end of next year.interesting times ahead.

[Game_of_Homes]

4 hours ago, DurhamBorn said:

This is all as expected.The next cycle will be reflationary because the seeds are already sown and during a credit deflation they will pump like crazy.The next cycle they will lose control.The BOE,ECB,FED only control short rates.They have no control over long rates.The ECB has had slight short term control by buying bonds,but that has created an even bigger disaster.The EU is on the edge of breaking up due to it.

The banks will access that money during and after a crisis,but it wont be stopping one.

Was it on the other thread i said the BOE would print £500 billion,i think it was.The Fed will print $10 trillion.Silver will see $200 (maybe $300) Gold $7000 (maybe $10,000+).

 

If they are going to do this, does this mean we are on the verge of the reflation then?

[No Duff (troll)]

1 hour ago, stokiescum said:

its like chinese water torture though,id rather have chaos for 18 months .still i surpose for the majoraty its better this way and im just being childish wanting it over and done with.

Yellow_Reduced_Sticker made me look at this quote again because flippancy often has meaning.  "im just being childish wanting it over and done with" to me reads something like "I'm childfull in that I care about the children (aka the next generation) and I want it over in my generation, not theirs".  Maybe you didn't mean that but nice thought eh!  

[King Penda]

7 minutes ago, No Duff said:

Yellow_Reduced_Sticker made me look at this quote again because flippancy often has meaning.  "im just being childish wanting it over and done with" to me reads something like "I'm childfull in that I care about the children (aka the next generation) and I want it over in my generation, not theirs".  Maybe you didn't mean that but nice thought eh!  

i want my kids to be able to buy at sensable levels and over 20 years not 40 plus,none are in debt has such yet.i will be brutaly honest i have little sympathy with people who have loaded up on debt and have no plan b should interest rates rise,but my attitude does in fact make me look like a twat.

[No Duff (troll)]

25 minutes ago, stokiescum said:

i want my kids to be able to buy at sensable levels and over 20 years not 40 plus,none are in debt has such yet.i will be brutaly honest i have little sympathy with people who have loaded up on debt and have no plan b should interest rates rise,but my attitude does in fact make me look like a twat.

Debt: a mechanism for some to borrow people's hard earned from the future, and for others to steal it.

[Gordie Lastchance]

16 minutes ago, stokiescum said:

i want my kids to be able to buy at sensable levels and over 20 years not 40 plus,none are in debt has such yet.i will be brutaly honest i have little sympathy with people who have loaded up on debt and have no plan b should interest rates rise,but my attitude does in fact make me look like a twat.

Couldn't agree more re sympathy for debtaholics, especially the show-off ones. I'm a fellow twat then, because I've tried to lead a life without going up to my nostrils in repayments. Debt gives me the heebie-jeebies, always has done. 

[No Duff (troll)]

31 minutes ago, Game_of_Homes said:

If they are going to do this, does this mean we are on the verge of the reflation then?

Most fundamentally, we need to internalise the fact that the false custodians of "money" do not see it as a store of value.  They have previously skirted this bowl and have now been fully sucked in.  To them it's a transient tool that has no inherent value.  There is no going back.  This requires a seismic shift in our thinking, even some of our beliefs, if we are to survive both physically and mentally.  We need to join Alice and walk through the looking glass.  

[Game_of_Homes]

1 minute ago, No Duff said:

Most fundamentally, we need to internalise the fact that the false custodians of "money" do not see it as a store of value.  They have previously skirted this bowl and have now been fully sucked in.  To them it's a transient tool that has no inherent value.  There is no going back.  This requires a seismic shift in our thinking, even some of our beliefs, if we are to survive both physically and mentally.  We need to join Alice and walk through the looking glass.  

So, what is a store of value then? London property? Gold? Silver? Bitcoin? Who fecking knows!

[Gordie Lastchance]

11 minutes ago, No Duff said:

Debt: a mechanism for some to borrow people's hard earned from the future, and for others to steal it.

Or:

Debt: Like a 3am kebab - it's not going to make you feel any better, but makes someone a mint.

[Gordie Lastchance]

23 minutes ago, No Duff said:

Debt: a mechanism for some to borrow people's hard earned from the future, and for others to steal it.

Or:

Debt: For people without access to a sawn-off shotgun and find balaclavas too itchy.

[Game_of_Homes]

https://wolfstreet.com/2018/06/21/next-central-bank-qe-unwind-bank-of-england/

[No Duff (troll)]

4 minutes ago, Gordie Lastchance said:

Couldn't agree more re sympathy for debtaholics, especially the show-off ones. I'm a fellow twat then, because I've tried to lead a life without going up to my nostrils in repayments. Debt gives me the heebie-jeebies, always has done. 

Prof Jordan Peterson et al follow a long tradition of writing about rights with duties (responsibilities).  Peterson, a clinical psychologist, is worth a read on how it's the responsibilities that give purpose, not the rights (in this case the show-off debtors).

About 1:40 in......

 

[No Duff (troll)]

22 minutes ago, Game_of_Homes said:

So, what is a store of value then? London property? Gold? Silver? Bitcoin? Who fecking knows!

Hard assets...whatever they are.......hence my earlier post........a work in progress........all thoughts welcome......seek and ye shall find.

[Thorn]

23 minutes ago, Game_of_Homes said:

So, what is a store of value then? London property? Gold? Silver? Bitcoin? Who fecking knows!

Tribes, I reckon.

John Kay - The Long and the Short of It - says modern day business is less about the making of stuff and more and more also about the intangibles like about solid rules making sure expectations met, regulations, relationships that mean a business has repeat business from it's loyal tribe who trust them.

Not bad for a Sunderland player.

 

[Alifelessbinary]

3 minutes ago, Game_of_Homes said:

So, what is a store of value then? London property? Gold? Silver? Bitcoin? Who fecking knows!

This is the fundamental problem I'm having at the moment. For the last 10 years I have managed my own finances, after sacking my FM who was effectively placing me in expensive tracker funds (1.5% costs!) and charging me 1% for the privileged. Overall I have pretty much followed a passive approach, as proposed in 'A Random Walk Down Wall Street and on Monevator ect...Trackers have been very kind to me in the recent bull market, but as has been mentioned previously they  are somewhat untested in a major bear market, especially as the quantum of capital has grown considerably since 2008.

In my quest for diversification I still hold about 60% of my portfolio in trackers, but now actively manage the remaining shares. Like many on this thread I've increased my gold exposure and I'm pleased to see that GDX is an option again. I currently site about 10% in PMs, although this may change as I continue to research this area.

Of all the major markets to use a tracker I actually  quite like the FTSE, as it seems well placed to deal with a deflationary crash and inflation due to large  oil, mining and infrastructure companies dominating its make up. These companies all derive a large chunk of their income globally which could prove extremely useful if sterling gets smashed.

 

 

[satch]

6 minutes ago, No Duff said:

Hard assets...whatever they are.......hence my earlier post........a work in progress........all thoughts welcome......seek and ye shall find.

I will have my 2p worth. Lots of things are I suspect can be classed as hard assets, but first you need a roof for you and your family, so owning a home outright is a hard asset worth in rent terms between 30 and 50% of a decent salary or today maybe 70% for some people in London which will be irresepective of whether that decent wage halves or doubles in either deflation or hyper-inflation.

[Game_of_Homes]

6 minutes ago, Thorn said:

Tribes, I reckon.

John Kay - The Long and the Short of It - says modern day business is less about the making of stuff and more and more also about the intangibles like about solid rules making sure expectations met, regulations, relationships that mean a business has repeat business from it's loyal tribe who trust them.

Not bad for a Sunderland player.

 

Maybe something like ETH and smart contracts then?