Sancho Panza

https://uk.investing.com/indices/eu-stoxx50-components 49 down out of 50 on the Euro Stoxx

You are Ron Paul,I claim my fiver.

Love the way they spin the positive side of this............. Property Industry Eye 23/3/18 'The Government is to introduce a new register of property ownership that will be the first of its kind in the world, set up to tackle corruption and money laundering. The register will show who owns and controls overseas companies and other legal entities that own property in Britain. A draft Bill is due to be published this summer, with the intention of making the register operational in 2021. The Government has made its intentions known in its response to a consultation on the proposals. The call for evidence opened last April, with NAEA Propertymark among the 56 submitting a response. One of the most controversial questions in the consultation was about the impact of the proposed policy on the UK property market. The majority of respondents thought the register could have a negative effect by deterring overseas investors. However, some thought the proposed register would have a positive impact by improving the reputation of the UK property market. It will be a criminal offence if those on the new register do not keep their information up to date.

https://wolfstreet.com/2018/03/21/was-carillions-collapse-the-beginning-of-the-end-for-uks-outsourcing-sector/ 'Two large British outsourcers are at risk of following in the doomed footsteps of Carillion, the infrastructure and services giant that collapsed in free-fall fashion in January. Between them the two firms, Capita and Interserve, employ roughly 150,000 workers worldwide and are responsible for delivering a dizzying array of vital public services in the UK. At the height of the rout, the government released a statement insisting that Capita was “not another Carillion.” But whatever the government might say, there is still a striking resemblance between the two companies, including their huge dependence on government projects and their penchant for running up absurdly high levels of debt. On the positive side, unlike Carlillion, Capita has over £1 billion of cash on its balance sheet. And Capita doesn’t have high-risk high-cost construction projects bleeding it dry. But nonetheless it is still hemorrhaging funds at a startling rate. Its reported revenues keep shrinking and it has been losing important business contracts, partly as a result of the political uncertainty over Brexit. Capita’s rival, Interserve, is in even graver condition. At last count, its total debt was over £500 million, and its current market cap has plunged to £112 million. In January the government became so worried about the company that it assigned a team of officials to monitor its financial situation. Interserve has been plagued for years by compounding losses in its waste management division. But recently the problems have spread to its core UK businesses, almost all of which are under-performing, If either Capita or Interserve do succumb in the coming months, the UK could begin to have a genuine crisis on its hands. Not only will investor confidence in an already fragile sector be shattered at a time that fears of Brexit are already taking their toll on market sentiment, but the government will pick up the pieces, once again, at substantial cost to taxpayers. Meanwhile, many of the fortunes amassed and extracted during the outsourcing boom continue to sit comfortably in private bank accounts dotted across many of the world’s tax havens. '

Highlighting the prolems presented with a price weighted index when a couple of the heftier shares start selling off 3M $223 Boeing $319 Cat $156 https://uk.reuters.com/article/us-usa-stocks/stocks-tumble-to-worst-day-in-six-weeks-after-trump-tariff-action-idUKKBN1GY1IF 'Major industrials slumped. Plane maker Boeing Co lost 5.2 percent, Caterpillar Inc dropped 5.7 and 3M Co lost 4.7. The three were among the biggest drags on the Dow Jones Industrial Average. The S&P industrials sector plunged 3.28 percent. '

AS per previous discussion. Also worththinking about the fact they pumped stocks to create a wealth effect.Stocks going down may reverse that factor(if it ever existed and I have my doubts that making the 1% better off increases aggregate demand. Worth noting that history is our guide in many things re the passing of Smoot Hawley in 1930,widely credited with exacerbating the Great Depression https://en.wikipedia.org/wiki/Smoot–Hawley_Tariff_Act

For now.

Richards more worried by dollar not rising than by Libor rises https://notayesmanseconomics.wordpress.com/2018/03/22/the-libor-problem-is-also-a-us-dollar-problem/ 'Libor-OIS As a consequence of the factors above this is also taking place. From Bloomberg reporting on some analysis from Citibank. Strategists at the U.S. lender predict that the gap between the London interbank offered rate for dollars and the overnight indexed swap rate will continue to widen, potentially leading to a sharper tightening of financial conditions than central bankers have been anticipating. The differential between three-month rates has already more than doubled since the end of January to 55 basis points, a level unseen since 2009. Now 55 basis points sounds much more grand that 0.55% but there is a flicker here as we try to price risk. Comment As you can see there are stresses in the financial system right now. Some of this was always going to take place when interest-rates went back up. But for me the real issue comes when we look at another market. This is because whichever way you look at the analysis here you would think that the US Dollar would be rising. You can arrive at that route by observing the apparent demand for US Dollars or by the higher interest-rates being paid in it or both. Yet it has been singing along to Alicia Keys. Oh baby I, I, I, I’m fallin’ I, I, I, I’m fallin’ Fall I keep on Fallin’ You can represent this by the UK Pound £ being in the US $1.41s or the Japanese Yen being in the 105s take your pick. The latter is off though because if Japanese banks are so keen for US Dollars why is the Yen so strong? To my mind that is much more worrying than Libor on its own as we switch to Carly Simon.

Shaun Richards https://notayesmanseconomics.wordpress.com/2018/03/22/the-libor-problem-is-also-a-us-dollar-problem/ 'From Bloomberg yesterday. The three-month London interbank funding rate rose to 2.27 percent Wednesday, the highest since 2008. The concern is that the Libor blowout may have more room to run, a prospect that borrowers and policy makers in various markets are just beginning to grapple with.'

Most shorted on the FTSE apparently. https://www.bloomberg.com/news/articles/2018-03-02/mike-ashley-gives-weary-debenhams-shareholders-a-glimpse-of-hope 'Billionaire retail magnate Mike Ashley is giving shareholders of Debenhams Plc something to cling on to. The embattled U.K. department-store owner soared in London trading on Friday, defying a broad market selloff, after announcing that Ashley’s Sports Direct International Plc had increased its share of the voting rights to 27.6 percent from 21 percent, just below the 30 percent threshold that would trigger a mandatory takeover offer. Debenhams is the most-shorted stock on the U.K.’s FTSE All Share Index, with bets on a fall accounting for 24.6 percent of shares outstanding, according to the latest data from IHS Markit. The stock has slumped 44 percent over the past year as sales were pummeled by a flight of customers to online retailers like Amazon.com Inc.' '

It was.

http://www.afr.com/real-estate/residential/sydney-melbourne-housing-boom-is-over-auction-clearance-rates-show-20180318-h0xmhl 'The Sydney and Melbourne housing boom is over as investors retreat further and sellers' price expectations continue to wind down. Preliminary auction clearance rates, a proxy for how the housing markets fare week on week, were in the 60 per cent range for the two biggest housing markets last week, Corelogic data shows. For the full week, Sydney's auctions cleared at a preliminary 67.8 per cent and Melbourne's clearance rate was 68.9 per cent. While the volume of auctions was similar to last year, clearance rates for Sydney and Melbourne were higher then at 76.8 per cent and 77 per cent respectively. "Buyers certainly feel like the tides have changed ... but we won't call them buyers' markets unless clearance rates are less than 50 per cent." New apartment sales have also slowed into what developers call a "normal market". While foreign buyers have mostly departed the market there was still plenty of appetite for well-located apartments from first-home buyers and owner-occupiers '

It's the kiss of the death....saying it like that.

Point taken but you can fit 30 Screwfix's into one B&Q warehouse.

hattip @Errol for the Grauniad link and reinforcing the downward pressure on rents.How many CRE loans are underpinnign these warehouse retailers? https://www.theguardian.com/business/2018/mar/21/carpetright-moss-bros-kingfisher-high-street-retail-mothercare 'Carpetright, Britain’s biggest carpets retailer, did not reveal how many outlets might shut, but it is believed to be considering axing up to a quarter of its 409 UK stores. A decision is expected in the next few weeks. It said the closures were needed to address the “legacy property issue” resulting from overexpansion under its previous management. The company is considering a company voluntary arrangement (CVA), a process designed to stave off insolvency by closing stores and negotiating lower rents with landlords. It has arranged an emergency short-term loan of £12.5m from shareholder Meditor in return for an additional 5% stake and also wants to raise between £40m and £60m through an equity issue. The potential Carpetright closures come as fashion retailer New Look’s creditors meet on Wednesday afternoon to vote on a CVA that will involve the closure of up to 60 of its 593 stores and rent reductions on dozens more. At B&Q, which is owned by Kingfisher, sales dropped by 5.1% as the chief executive, Véronique Laury, described the outlook for the UK as “uncertain”. Kingfisher’s profits for the year to end January were down by 10% to £682m. The slowdown at Kingfisher comes despite troubles at its major competitor Homebase, where sales have slumped since a botched takeover by Australian group Bunnings. The group is considering closing as many as 40 stores putting hundreds of jobs at risk. Department stores House of Fraser, Debenhams and Marks & Spencer are also closing store space as they try to adapt to changing shopping habits. ' Worth noting the point I made elasewhere that I suspect Kingfisher 5% down in sales will lead to a much bigger drop in it's bottom line without significant reductions in it's fixed costs.

'At B&Q, which is owned by Kingfisher, sales dropped by 5.1% as the chief executive, Véronique Laury, described the outlook for the UK as “uncertain”. Kingfisher’s profits for the year to end January were down by 10% to £682m. ' If sales are down 5% then I suspect the bottom line will suffer a lot more than 10%

Sorry to double tap you but that piece made me think of the following Jim Rickards speech where from 33 mins he outlines points made previously in this thread about the Fed's inability to generate inflation depsite all the printing due to the assumption that velocity was a constant.Worth a watch in it's entirety but definitely from 33 minutes

That's a super find and succinctly states where we are-this is a Central Bank crisis. From the article.Highlights are mine. ' They(the Fed) believe that by pulling levers and twisting dials in just the right combination, interest rates will gradually rise, the Fed’s so-called “quantitative easing” program will slowly unwind, and more than $4 trillion in “out of thin air money” created since 2009 will be “retired”—without triggering a recession. The truth is that when the Fed cuts interest rates or otherwise eases monetary policy, it is not "stimulating" the economy, as is claimed. What the Fed really is doing is distorting the two most important sources of information in the economy: the price of money (i.e., interest rates) and the supply (i.e., quantity) of money. BUT, when the monetary system is manipulated, i.e., when it is controlled by the Federal Reserve and other central banks—including the European Central Bank, the Bank of Japan, the Bank of England, the Swiss National Bank and the People’s Bank of China—the price signals become warped. As a result, more and more false information (“fake news”) is forced into the economic system. The price of money, and therefore all other prices, which are a derivative of the price of money, are not real. They do not accurately reflect supply and demand. When interest rates are artificially low, as has been the case since 2009, investors and entrepreneurs are incentivized to take more risk than they otherwise would have taken. Businesses and consumers load up on debt that they otherwise could not afford and will not be able to pay back when rates rise. Corporations borrow hundreds of billions to buy back stock, warping their capital structures (i.e., increasing their ratio of debt to equity) and setting themselves up for defaults, bankruptcies and rapidly falling share prices when rates rise. Lenders extend credit to borrowers whom they otherwise would avoid, such as subprime auto loan borrowers, subprime real estate borrowers and subprime credit card borrowers—running the risk of systemic bank failure when rates rise. This cycle has a name. Keynesians, who worship at the central bank altar, call it the "business cycle." They even warp the language to blame it on “business,” instead of blaming it on the real culprit: the Federal Reserve and other central banks. Would the “business cycle” exist without the Fed or central banks? Indeed, there were “booms and busts” before the Fed. But they were far less severe and were more short-lived. In effect, free market pricing corrected the excesses faster and with less economic and human damage than the Federal Reserve. As bad as the Fed’s overall track record has been, its manipulation of interest rates and the money supply has grown worse by the decade, largely as a result of the end of “anchored” money in August 1971. This was because money was no longer tied to a commodity like gold, so the Fed could now create money “out of thin air.” For the past four decades, the Fed has attempted—in dark comedic fashion—to manage its own mismanagement. It has invented even more levers and dials to use in a never-ending attempt to fine tune what the Federal Reserve Chairman, his or her fellow board members and their collective staffs of hundreds of Keynesian economists cannot even begin to understand. More specifically, the Fed and its minions have not allowed each successive, and ever worsening, boom and bust cycle, which they created in the first place, to run its course. Instead, the Fed, lurching from crisis to even worse crisis, has responded to every downturn with even lower interest rates and even more "easy money" than before. The Fed's response to the emerging markets crises of 1997–98 fueled the dot-com boom and its demise. The Fed’s response to that bust from 1999 to 2000 and its related recession enabled the 2008 housing bubble, which was encouraged by Congress for political reasons, and the Global Financial Crisis of 2009 that followed. The Fed’s response to that crisis, its coordination with central banks around the world to lower rates—even into negative territory in Europe and Japan—and print unprecedented amounts of fiat money, has created the biggest and most pervasive bubble the world ever has seen. Total world debt now exceeds $233 trillion, and the debt to “world GDP” ratio is 318 percent, down just slightly since hitting 321 percent in Q3 of 2016, the largest ratio in human history. “Soft landing” coming? Do not bet on it.' '

Good post.

Sounds like a chip ff the old block Same with the Bank of England and UK govt re huge debts.Rampant across working age households. Geogrpahically,the wages go much further up your way.Round Leicester,on a salary like that you're renting a slave box. Saw a terrace go through the auction the other day-Peterlee- £22k or something.

Nursing doesn't need a degree.Now they've made it mandatory if you want peoople to do it then you are most likely going to need to give them a wage that can pay thier loan off. Massive unnecessary overeducation.The Uni's teach little of practical value in my expereince. Depends where you are and what you do.Some wards are cushty other wards are really busy,lots of stress due to high pt/nurse ratios and irate relatives. A&E nursing particularly stressful as above,where failure to triage correctly can lead to complaints/investigations/witch hunts.I challenge anyone to eb the same nurse at the end of a 12 hour night shift as they are at the start...... Yep Loads of nurses currently working have no degree and the level of care is top drawer. Possession of a degree is no gurantee of quality in terms of patient care.

You wouldn't believe the half of it. In terms of workers that I see,I'd suggest a lot of nurses and Drs have been recruited from the Commonwealth rather than the EU but that's jsut my own experience of one or two hospitals in the Midlands.

The NHS could easily give these people some certainty in their shift patterns.Try organising chilcare with only four weeks notice and shifts that could be nights days weekends etc

Demand patterns play their part in the problems. Including immigration.

Know a nurse who worked a late notice shift here in the Mids and got £44 an hour. She was delighted as she was working in a hospital with less patients than her normal place of work. NHS has problems with retention and recrutiment these days,mainly stresses in the system,lots of patients with very high expectations.