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POTATOES

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Everything posted by POTATOES

  1. I posted this as a reply on a thread about Govt cuts at "the other place"- I am Jack's Creation over there and got zero response; I think it slipped off the board before any body clocked it. Just wondered if anyone here had a different view or opinion to mine on some of the unintended consequences of the current course of action taken by the Central Banks and what strategies could be adopted to trade them sucessfully. Here is what I posted:- "The low interest rate policy the Government are hoping will stimulate growth is a profoundly stupid one for the following reasons:- 1. People tend not to pay their tax and living costs out of leveraged income. 2. Nobody with any sense would ever risk investing in a consumer orientated business ( or economy) when the tax burden is rising. It doesn't matter if you can borrow at 0.5% if you are going to lose 100%. 3. People reliant on income from savings will eventually burn through their money, wiping out their discretionary spending, as well as reducing the ability of the banks to lend and ultimately increasing the welfare burden. 4. Real Negative interest rates ( of about -3%, that's if you buy into the Govt's bogus inflation rates) and negligible growth will result in people not investing for their retirement and increase the future unfunded welfare liabilities. This negative rate has to be offset against any GDP growth. 5. The debt burden due to high property prices needs to be reduced for any growth to take place. The period of false economic stimulus gained from the securitization and lending on rising asset values is over, all that remains now are the debts. A good percentage of these need to be defaulted on. 6. Any system where the perverse incentive requires you to compete with ( 'forgiven') debtors, means the debt burden will eventually pass a tipping point where it becomes unpayable ( in real terms). The collapse of this system will be inevitable. We may already have passed this point, by the way. The only way they can increase growth is by cutting taxes and raising the base rate and this would only work if China didn't exist.......... The house price crash is nailed on by the way and prices will only stop falling when interest rates stop rising It will last longer and be far deeper than most people on here are expecting."
  2. POTATOES

    GEI consumer price inflation thread.

    Thanks for the update
  3. Hi Azazel-Any chance of an update on the inflation check? The figures should be extremely interesting by now. Unfortunately, I don't have a Morrisons anywhere near me, otherwise I would do it for you.

  4. POTATOES

    GEI consumer price inflation thread.

    Any update on the inflation thread? I suspect it should be very interesting by now. I don't have a Morrisons near me so cannot update.
  5. POTATOES

    GOLD

    The technical's look slightly better this morning (if you're in to that sort of thing) gold chart 10:00 am GMT Could be a nice little pop up from here.
  6. POTATOES

    GEI consumer price inflation thread.

    This is a great idea for a thread. Might I suggest a 6 pack of Coca-Cola, a bottle of Heinz Ketchup and a Mars bar.
  7. This would be a genuinely interesting twist.
  8. Thanks-much appreciated. So, given current Libor is 0.6 it would cost 6.6% to insure against Dubai's sovereign default. Is this an annual fee? or a one off payment for a unit that can be traded etc....Presumably the bonds are not index linked. It would be interesting to see if this movement in risk pricing is a leading indicator for shares that have a high exposure to Dubai govt debt and if it was how quickly the market would price this info in.
  9. Dr Bubb, can you give some of us who aren't familiar with how CDS charts break down, a layman's explanation of what these figure's mean and how to read them? Many thanks
  10. POTATOES

    Fewer Fireworks this year.

    Same here, much quieter than normal ( it's usually like the Gaza strip). The ones that were going off you could tell were the "cheap" selection and didn't last that long. There was a notable lack of air bombs. I like air bombs.
  11. POTATOES

    GOLD TO PEAK AT $5,800?

    Could be interesting- You'd have to wade through a whole series of various pairings past performances to see if they gave out any consistent momentum signals and maybe take out the ones that are excessively seasonal or prone to enviromental disruption (coffee etc)
  12. POTATOES

    GOLD TO PEAK AT $5,800?

    Very rough, back of a fag packet calculation comes up with 221 (19 point sample over the period). I was rather hoping it would be 196 (gold's atomic number) that would have been rather elegant.
  13. POTATOES

    GOLD TO PEAK AT $5,800?

    Goldfinger, have you done the average of the Gold/house price ratio over the 70 year period?
  14. +1 also The nature and character of the forum was changing- I was certainly visiting less. Too many posts by charmless, conspiracy nutbags who liked the sound of their own keypad. Hopefully things will now return back to the bone dry, in depth disscussions of some of the more esoteric economic theories that we know and love :lol:
  15. POTATOES

    Reasons to pay tax

    I'm just going to make this a light fisking. Joe gets up at 6:00 AM to prepare his morning coffee. He fills his pot full of good clean drinking water because some liberal fought for minimum water quality standards.Actually, It was a pre NHS 19th century English doctor, John Snow- he was trying to prevent Cholera epidemics. He takes his daily medication with his first swallow of coffee. His medications are safe to take because some liberal fought to insure their safety and work as advertised.- No it's fear of litigation that makes drug companies test their products. All but $10.00 of his medications are paid for by his employers medical plan because some liberal union workers fought their employers for paid medical insurance, now Joe gets it too. Which means Joe gets paid a lower wage He prepares his morning breakfast, bacon and eggs this day. Joe’s bacon is safe to eat because some liberal fought for laws to regulate the meat packing industry. Ah yes, the pre-regulation bad bacon death epidemics. Joe takes his morning shower reaching for his shampoo; His bottle is properly labeled with every ingredient and the amount of its contents because some liberal fought for his right to know what he was putting on his body and how much it contained .But, not how much extra this labeling and testing adds to the cost of the shampoo, or the extra cost in taxes that the government department responsible for monitoring the industry costs. Joe dresses, walks outside and takes a deep breath. The air he breathes is clean because some tree hugging liberal fought for laws to stop industries from polluting our air. He walks to the subway station for his government subsidized ride to work; it saves him considerable money in parking and transportation fees. But, not in extra tax, whether he takes the subway or notYou see, some liberal fought for affordable public transportation, which gives everyone the opportunity to be a contributor. With the threat of violence and prison if they don't contribute. Joe begins his work day; he has a good job with excellent pay, medicals benefits, retirement, paid holidays and vacation because some liberal union members fought and died for these working standards. Unfortunately, The Governments failure to protect their home markets, plus these costs to business are why Joe's job will soon be heading towards China Joe's employer pays these standards because Joe's employer doesn't want his employees to call the union. If Joe is hurt on the job or becomes unemployed he'll get a worker compensation or unemployment check because some liberal didn't think he should lose his home because of his temporary misfortune. What are the health and safety executive for , then? It's noon time, Joe needs to make a Bank Deposit so he can pay some bills. Joe’s deposit is federally insured by the FSLIC because some liberal wanted to protect Joe’s money from unscrupulous bankers who ruined the banking system before the depression. In the Uk, the compensation sceme is (or was) underwritten by the other banks and as I understand it the Taxpayer is being taxed to prop up the banks, private insurance would be cheaper Joe has to pay his Fannie Mae underwritten Mortgage and his below market federal student loan because some stupid liberal decided that Joe and the government would be better off if he was educated and earned more money over his life-time. That's right, they need to fatten up their tax cattle. Joe is home from work, he plans to visit his father this evening at his farm home in the country. He gets in his car for the drive to dad's; his car is among the safest in the world because some liberal fought for car safety standards. No, it was because Volvo started using safety as a marketing angle He arrives at his boyhood home. He was the third generation to live in the house financed by Farmers Home Administration because bankers didn't want to make rural loans. By taxing people who could never afford to buy a farm. The house didn't have electric until some big government liberal stuck his nose where it didn't belong and demanded rural electrification. (Those rural Republicans would still be sitting in the dark.) He is happy to see his dad who is now retired. His dad lives on Social Security and his union pension because some liberal made sure he could take care of himself so Joe wouldn't have to. I thought Joe's Dad was a Farmer? Anyway,Lucky old Joe, some other sucker has to pay for his Dad! After his visit with dad he gets back in his car for the ride home. He turns on a radio talk show. The host keeps saying that liberals are bad and conservatives are good. (He doesn't tell Joe that his beloved Republicans have fought against every protection and benefit Joe enjoys throughout his day- Almost certainly Bollocks) Joe agrees. "We don't need those big government liberals ruining our lives; after all, I'm a self made man who believes everyone should take care of themselves, just like I have." Joe is thick
  16. POTATOES

    GOLD

    I was very skeptical about Elliot wave theory. But, the only analysts who accurately called the last hard gold correction were the Elliot wave boys, ( and cgnao the day before the sell off). I still think there's a little too much post rationalizing when things don't turn out as predicted, but hey, that's human nature.
  17. POTATOES

    MAJOR DERIVATIVE MELTDOWN ALERT

    I mistakenly went to Hastings once- Christ, it was like somebody had bombed Netto! I don't think I've ever seen so many women with tattooed legs, (only half were spelt correctly). Plus, lot's of Families walking about with all three generations wearing football shirts. I try not to go through life being a judgmental snob, but when I went to Hastings I was presented with no alternative. GOM- Whitstable can be quite nice (good Oysters), or Seasalter just down the road if you like it nice and quiet.
  18. POTATOES

    GOLD

    Take the ETF profit- swap out the profit in to actual physical (brit's or post-decimal sovereigns - no cgt on resale) on this dip. Also might not be a bad idea to have a few singapore 3 -5 year bonds for safety, if you want to go that way. As a Speculative punt, with oil this low most of the mining companies operating costs will be dropping, look for companies that have low gearing and large reserves. I'm also begining to think the Big oil companies are looking like a long value buy at the moment. DYODD What does anybody else think?
  19. POTATOES

    GOLD

    If you like a good Cheddar, have you tried 'Black Bomber'? ( it's contained in a black wax). No good for toasting, but beat's every other cheddar style cheese I've ever tried. http://www.snowdoniacheese.co.uk/ (I don't own any shares -honest!!) Back on Topic:- I'd like to see 740-735 hold and the next leg up take out 835-845 on volume. That would be a big confirmation for me.
  20. POTATOES

    MAJOR DERIVATIVE MELTDOWN ALERT

    Very good call CTG -the law of unforeseen consequences once again makes sure you can only game the market so far. Cut and paste from Wiki:- The interest rate derivatives market is the largest derivatives market in the world. Market observers estimate that $60 trillion dollars by notional value of interest rate derivatives contract had been exchanged by May 2004[citation needed]. Measuring the size of the market is difficult because trading in the interest rate derivative market is largely done over-the-counter. According to the International Swaps and Derivatives Association, 80% of the world's top 500 companies as of April 2003 used interest rate derivatives to control their cashflows. This compares with 75% for foreign exchange options, 25% for commodity options and 10% for stock options.
  21. POTATOES

    MAJOR DERIVATIVE MELTDOWN ALERT

    This is the first time I've heard it expressed in those terms - it makes perfect yet terrifying sense. The problem's don't stop when they actually have to raise rates. Higher rates will lead to:- More loan defaults A deeper housing crash More small business loans called in (especially those using their home as collateral) This will result in:- Falling tax receipts This will lead to:- More Govt borrowing to cover spending commitments Higher bond yields having to be offered by the Govt for investors to buy Gilts This will relult in:- Higher levels of Taxation (45% is just the start) This will create:- less economic activity....more loan defaults ...etc, etc, etc The UK's only short term chance of survival is to cut spending massively. If they let the currency crash, we'll get massive inflation and we come full circle to the Government having to introduce higher interest rates. Which leads us right back where we started. DOOOOOM....
  22. POTATOES

    MAJOR DERIVATIVE MELTDOWN ALERT

    He must be absolutely balls deep in junior miners. Innuendo meter going off the dial!!
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