Rob's Investment Thoughts

Last 30 years - next 30?

2011-05-27T01:50:00.002+01:00

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everyone said it was a great British economic miracle during the 1980s, as credit became much more easily available, so house prices took off, so people needed more credit to buy the expensive houses, and house prices rose again ... don't be left behind ! Get on the housing ladder !

So factories were closing and we bought stuff from abroad ? Cool ! German and Japanese cars are better anyway. Comparative advantage ! They're better at manufacturing and we're better at ... er..

Before the Thatcher Miracle you had to have been saving for several years with a building society before they'd give you a mortgage - of 3.5 times one person's salary max.

But now you could have that house AND fill it with consumer durables AND pay that restaurant bill.

"Access takes the waiting out of wanting" - and the credit card meant you could now buy things even though you didn't quite have the cash on you.

NuLab just continued and intensified these trends, adding a few tweaks all of their own.

But the trees do not grow up to the sky. Indebtedness cannot continue ad infinitum. It may be that we've reached not only the point of inflexion, but the top of the curve. On the other hand, there are still plenty of people (Archer yesterday?) implying that we just need to restart the party.

The economy's done the equivalent of staying awake for 30-odd years with ever increasing doses of amphetamine. Great fun at the beginning, then its something you just need and is normal, but you know it's going to be awful when you finally stop.

to be followed by the great correction... japan's lost decadeS... deflation + debauching most currencies.

Answer? Invest east (not easy), gold/silver (10% + of wealth as insurance), global shares at reasonable prices (pharmaceuticals?), oil, armaments (I fear).

2010-10-11T13:22:00.002+01:00

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Long :-
silver
soon gold
BP
Shell

short:-
Russell2000 US shares index
Barratts
Rightmove

expecting a correction in stock markets (down) by end of Nov 2010. Then printing of money and god knows what! House prices to slide gently down? Stocks to rise on back of wall of money, gold/silver up fast (after corection down).

Then lots of collapsing after.

Worldmapper's map by population

2009-10-02T14:40:00.002+01:00

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Quite interesting....

http://www.worldmapper.org/svg/map2/index.html

Activity Oct 2009

2009-10-01T11:48:00.001+01:00

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Possible shorts:-

Anite - software - topish (current 34, shorting at 46/52/58/60 [max allowed])
Cisco - networking - recently rallied 30%+ (current 2352, shorting at 2650/2951/3598)
Dana Petroleum - p/e too high at 35 (current 1345, shorting at 1580/1680/1880)
Enterprise Inns - pubs - directors selling, debt high - can't short
WH Smith - p/e at 12 and what does it do well? (current 447, shorting at 470/480/520)
Methanex - methanol producer - US - risen too high? can't.
Serco - outsourcer - market favourite, over valued and possible risk of lost UK gov business because of cutbacks (but that's also why market likes it - outsourcing replacing gov work). Short above 570p. (current 500, shorting at 550/620/670)

Possible buys:-

Brit Insurance - p/e <10> 7.5%, NAV discount 14% - buy at 170p ISA, 151p, 131p, 111p, 91p spread bet
Standard Life - insurers, good company, expanding abroad, solvent, buy at 165p ISA
Accsys - wood processing, allows softwood to replace hardwood with non-toxic process, good cash reserves, but some risk of partners defaulting/building collapse, ISA 0.55 euros
Vivendi - low p/e, yield>7%, diversifying away from GBP (Euros-French), buy at 17 Euros (not limit on ISA)
Katanga Mining - Cobalt & copper miner - cobalt stocks very low (used by military, car batteries), Canada listing (not limit on ISA)
Geovic Mining - Cobalt, nickel, managenese miner - some risk - so buy at a discount - holds cash reserves - buy at C$0.52 (not limit on ISA)
Commerce Resources - Tantalum miner - rare metal essential in advanced tech - hold supply outside Congo, ethical and risk reasons to avoid Congo, very experienced and financially strong (not limit on ISA, can't spread bet)
Atlantis (LSE:AJG) - Jap small stocks - diversify from GBP - often book value of these firms is way above share values, and fund is at discount to shares (18%). (can't spread bet)
Prospect (LSE:PJF) - Jap small stocks - diversify from GBP - often book value of these firms is way above share values, and fund is at discount to shares (27%). (not possible on ISA, can't spread bet).

Rob's First Investment Newsletter

2009-10-01T10:53:00.000+01:00

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Updates:-

29/9/9 - Sugar sold at 1281p (bought 22/11/07 for 666.95)
1/10/9 - Crude Oil sold at 1584.60 (bought 23/02/09 for 1261.03)

Barretts small profit.
Concerned about US stocks rising with the amount of money being printed. This would be bad for me. Conversely, even a moderate fall would be very good for me.

From my original email:-

I've decided to note down buys, sells and thoughts. For a long time, I've believed that you can't trust anyone, especially paid advisors for investment advice.

Because of this, I've got more and more interested in investment topics.

I don't discuss this with many people, but you (whoever you may be...) and I have discussed such things. You may even have got yourself an ISA (share.com/selftrade/Hargreaves Lansdown maybe?).

At some point in the future I would like to switch away from my current job and build a career along these lines. I hope you'll forgive me experimenting on you....

I'm not licenced to give advice and you should always do your own research, DON'T take my ramblings as advice.

BUT if it triggers thoughts in you that you wish to act upon, fair enough. Consider it as a conversation after a pint or as part of a share / investment club.

Anyway, today's activity...

ISA

Prepared a sell order for Sugar ETFS

22/11/07 Buy 666.95
Current 1170
willing to sell at 1280

Prepared a sell order for Crude ETFS

23/02/09 Buy 1261.03
Current 1491
willing to sell at 1570

I previously bought ETFS Lean hogs, this was a bit of a disaster.

Current: 59p (95c)
Bought: between 64p and 115p

I've put an order that will buy at 40p on my ISA and on my spreadbet account (US$, so hard to compare) I have added 3 bets, 1 at today's price (96.75c) and 2 around 75% of current values (70c & 80c).

Reasons:-

1) Sugar - taking profits.

2) Crude - I think next leg down of recession will hit in next 5 weeks

3) Lean Hogs, I can't believe they can get much cheaper, the producers would be out of business.

4) Dealing 'at limit'. Much of what I do is denominated in US$, plus the markets are volatile, so there's two levels of volatility - this means that at some point, my aspirational asking/buying price might be met. Especially when doing the deal in the first place, I work out what I think is a fair price and offset by a large chunk.

Most of ISA is connected with Silver's price in GBP. A weakening GBP and rising silver price is doubly good for the ISA.

My spreadbetting consists of loads of what-ifs, unless prices are really low/high, I won't be dealing (see reason 4).

My open positions are:-

barclays (small loss)
Barratts (houses) - evens
Lean Hogs - just done today
Ultrashort Russell 2000 Index ie when a share index in the US rises 1 point, this falls 2 points & vice versa. I am hoping the US stock market tanks (currently losing!).

Overall around 5% up on the year. A fall in the Russell 2000 Index (and rise of my Ultrashort) could make loads.

That's all....

Rob