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About durhamborn

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  1. I like them,but they are expensive.In a bull i prefer miners with higher AISC,but big reserves.They get smashed in bears of course.Im not an expert on the space as i have avoided it for a long time,but into the next cycle its likely they will do very very well. The markets are whacking down companies with debt (deflation assets) hard now because they think rates are going to shoot up.They arent yet,rates are going down later this year probably,or next year,but its a taste of what happens in a reflation.The UK market has already suffered a massive bear,domestic stocks down 50%/70% from highs.The only thing keeping the market looking better are shares aimed at inflation.They will be hit very hard in the next stage of the sell off IMO.
  2. What/who will collapse first in 2018

    A lot depends on the business,cash flows and profile of the debt.Floating rate bank debt is bad.A corporate bond fixed until 2031 at 1.5% for someone like Vodaphone is a steal for the equity holders.Those bond holders have funded their network while inflation eats the debt away.In a reflation Vodaphone might be increasing prices at 6%+ a year while those coupons are fixed. Imperial have around £3 billion of cash flow.My uncle worked for BAT (Rothmans then BAT) and they spend less in their factories than probably any other business because they need such little capital.They likely need about £100 million from that cash flow at most to sustain their business,the rest can be used for dividends or debt repayment.Id also expect they would be investing around 10% so £300 million in next generation/vaping etc.Most of those liabilities will be duty/tax owed to government (£30 billion turnover would be roughly £7 billion to Imperial,the rest duty/tax).£12 billion is of course still a huge figure given if they keep the divi etc they will be deleveraging by about 8% a year.
  3. 30% pay rises for NHS workers.

    Tax,NI and loss of tax credits will be around 74% of any increase.If they also get any housing benefit and council tax benefit 60% of whats left,so 86%.They will be 14p in the £ better off. I
  4. 30% pay rises for NHS workers.

    Yep,this must be new.Last time i was there dentist did check up and a quick clean and the usual talk on gum disease,£20.This time she did the check,said there are a few 4s etc and as i was waiting for her to clean them she said il put you down for a booking with the hygienist,no clean in and out in 10 minutes.On the way out paid the £20 and noticed it would be another £32 when i saw the hygienist.I decided not to bother,and i also decided not to cancel the appointment so they could swing on their chair for an hour.
  5. 30% pay rises for NHS workers.

    My daughter is a nurse out in the community.Left uni with zero debts as the NHS paid for the course and she didnt take any loans for living expense,she was very frugal.She will have her house/mortgage paid off by around 32 shes already halfway through paying off a nice 3 bed semi,shes already getting about £28k+ car allowance.She should be part time by 35 for the rest of her life.She needs one more promotion band (i think starts at £32k then goes up) then shel go to two days a week a couple of years after the mortgage is paid off. Most of the people she works with are very well paid,but have huge mortgages and huge debts.They are mostly terrible with money,but i guess they just think the final salary pension is locked in.(the age you can get it isnt though).
  6. Yamana has great assets and terrible managers.Its a share best suited to traders.Iv had it several times over the last 2 years and been down 30% at times,but selling at an average 25% profit.Iv got a few left in my SIPP that are sat -8% at the moment. My favourite mid tier is Harmony Gold,but they are already up 35% since i put them on this thread.They are still very cheap,if gold runs up.If it doesnt they could drift lower again.They also have the South African risk.Iv also bought a few Anglogold Ashanti today and last week.In a gold bull id see them much higher. Gold miners are a very difficult area to invest in.When new to the area its best to stick to small stakes across a few.
  7. Yes it is,they take every bit of capital built up in the business for themselves then walk away.The first thing i learned was the most important thing in cycles is the cost of money.The banks/market wouldnt be able to fund all this fraud if there wasnt so much liquidity flying around at 0.5%.Of course as CBs tighten and debt is destroyed the economy implodes.
  8. Brown caused most of it yes,and of course it was Brown that caused the tax credit explosion.I feel much better now i know im not paying for it.Young people though are trapped and it sickens me that the ones who try and work etc are on a hiding to nothing.The fact they seem to think Corbyn is an answer though is even more troubling.Under the Thatcher tories when i left school i got share schemes,final salary pension,permanent job,house for 2x single salary.Thats leaving school at 16.Welfare for a single parent was £134 a week then including rent,my wage was £250.Now the welfare for a single parent with one child is £260 a week,and the local wages in ordinary jobs are £250 a week.Gone from double those who sit on their backsides to less.
  9. Intu deal looks poor to me.The smaller centres with lots of discounters where people live should do well going forward,these massive out of town places less so.The rents they need on those to cover the debts are very large.Metro Centre rents are around £28 - £75 sqf.Smaller provincial town centre malls have rents around £13 sqf.
  10. Incredible how VC companies can get away with it.Buy a company,get most of your money back by turning equity to debt.Then take all profit as dividends/wages for the directors until it implodes due to lack of investment/interest payments going over free cash flow.Of course most/all of the blame lies with the CBs.Once the cost of money is too low it makes this sort of fraud possible.Its one of the reasons we sucked forward so much consumption and a part of the credit deflation ahead.
  11. The Elephant in the Room? Inflation

    Inflation wont deal with the debts until much later in the next cycle when it hits double figures.For now massive involuntary debt liquidation (and with it massive wealth destruction) will do the job.There is no inflation,we have a tightening liquidity profile across the world.Deflation that I talk about is the macro-driven deflation that will result from an over-leveraged economy that rams into CB and government policy mistakes that ultimately lead to a very sharp reversal in the world economy, a financial crisis, high unemployment, plunging asset prices and tremendous financial dislocation. This macro-driven deflation just ahead is the real story ,its just very few see it yet.For a period of two years once this thing hits cash flow is going to be king as the credit markets will lock.The highly leveraged who see cash flow contract will go under.If your a company there is a small window to lock your debt into corporate bonds with a longer profile,you really dont want to be trying to roll over debt in credit deflation period..For consumers put a few years payments to one side to cover any debts so whatever happens you can pay the monthly payments. We have pulled a lot of growth forward over the past three or four decades and are beginning a payback period,and it wont be pretty.
  12. ISA,almost everything is now due to the £2k dividend tax limit.
  13. I wouldnt be (apart from NI),and thats what i would of done if id taken the job,however i dont want to give up any time working nd with my state pension and small final salary im at tax allowance rate on that at 68 so dont really want to increase my SIPP.I could of course withdraw from 55 to 68 £12k a year,and really i should increase my SIPP to that,but id rather have my time.
  14. Great to hear.I went to a few hours a week tax allowance level 7 years ago now.My capital has gone up in that time.If i had to draw down only it would last until im 67.Then id have state pension + about £80 a week final salary,good enough for me.I hope to be able to keep my business going another few years yet as that means i can continue to re-invest dividend income etc (once im back invested). Funny enough i was phoned last week for a job at a company 5 minutes from my house for £25k a year+ a pension,thats good money for a factory job in the north.I could take it and keep my small business going,but if i did id have to put 100% of the salary into a pension so as to stay at tax allowance level.I actually admire the company because it kept its factory here and it did cross my mind to do a couple of years and bang it all into my SIPP,but really its just not worth giving away two years of my life.Once the couple over the road stop getting £1800 benefits a month who have never worked i might be slightly more likely,until then il stick to what im doing now.At least im not paying for them anymore,some other poor sod at work is.
  15. No i dont,iv been buying some IBTL the last few weeks.