I the £ on an up againt the euro???

[Quillan]

Not with my blinking pension fund they can't. I'm on the home straight now but its been a struggle and as its under 10 years its probably not likely they put any of my money in to these bonds. I 'bet' some of it on Commercial Property last year which did better that I expected and seems, whilst bucking the general property trend, to be doing quite well in relationship to the other funds. So I will stick with that till the end of the year and re-appraise the situation. Its like betting on horses and the last (and only) time I foolishly did that was back in the 80's on the Grand National and the horse is still out there somewhere trying to get past the winning post. [:'(]

[Gluestick]

[quote user="Quillan"]Lets hope they have it right and don't get saddled with a dead horse. [;-)][/quote]

Oh they will, Q: be lumbered.

The global bond market (particularly government bonds) is very flaky; and the largest global bond investor started shedding such paper weeks ago.

 

[Martin963]

[quote user="Gluestick"]

[quote user="Quillan"]Lets hope they have it right and don't get saddled with a dead horse. [;-)][/quote]

Oh they will, Q: be lumbered.

The global bond market (particularly government bonds) is very flaky; and the largest global bond investor started shedding such paper weeks ago.

 

[/quote]

I read that as "shredding paper" and had a moment of blind panic as to how truly worthless these things had become.....

Back to ordinary normal-panic levels....

[bubbles]

Yes, I read it as "shredding" too.

[Gluestick]

It's not new news.

http://www.forbes.com/2010/01/28/pimco-us-treasury-debt-markets-bonds-economy.html

However, it is a growing trend.

And longer term, markets are made from growing trends: rather than knee jerks.

 

[Quillan]

I can remember some chap talking about trends, "no more boom and bust" he said. I do make you right its a growing trend and longer term, going down that is. I love banking people, whenever things start to go wrong they always come out with something along the lines of "well you have to be in it for the long term". Trouble is many don't have a 'long term', basically they are moving in to the evening of their lives only to find the money has been either stolen (by the tax man or more to the point GB) at worse or just gambled away by 'professional' financial advisers and bankers who have of course already made their money from what they have charged their clients irregardless of if their savings rise or fall.

I often think that rather than these bankers etc being paid an actual wage their salary should be index linked to the money they make their investors. The more they make the more they get paid, the less they make the less they earn, if they make a lose for their clients then they have to make up the difference from their own pocket. I think it would focus them a lot more.

[Martin963]

I have at times encountered "financial advisers" from various organisations.

When we get to the nitty gritty I always ask exactly what the costs to me of their "vehicle" will be.   After the usual obfuscation an up-front % charge  figure is eventually produced,   and I reply,  "Well I'm happy to pay that in full after two years if such-and-such a level of performance,   corresponding to that which you are indicating,  is attained".

At that point the meeting normally ends PDQ,  often with the adviser being quite agressive and abusive.

It's such fun too wasting these people's time.......

[Gluestick]

[quote user="Quillan"]

I can remember some chap talking about trends, "no more boom and bust" he said. I do make you right its a growing trend and longer term, going down that is. I love banking people, whenever things start to go wrong they always come out with something along the lines of "well you have to be in it for the long term". Trouble is many don't have a 'long term', basically they are moving in to the evening of their lives only to find the money has been either stolen (by the tax man or more to the point GB) at worse or just gambled away by 'professional' financial advisers and bankers who have of course already made their money from what they have charged their clients irregardless of if their savings rise or fall.

I often think that rather than these bankers etc being paid an actual wage their salary should be index linked to the money they make their investors. The more they make the more they get paid, the less they make the less they earn, if they make a lose for their clients then they have to make up the difference from their own pocket. I think it would focus them a lot more.

[/quote]

Right now, no one has a wee real clue where the global capital markets are headed: QE was and is uncharted territory, they said. Not to me!

It is simply printing money and therefore increasing money supply when GDP is headed South! Which as a Monetarist, to me means the unit value of pounds and US dollars is each less!

I meant the "Trend" Comment, against Knee Jerks in the sense that whenever the capital markets are edgy they are also fickle: very fickle indeed. And tends to disregard underlying realities and seems to start believing in fairies.

Warren Buffet is for the ultimate "Value Investor" BTW: for the long term: and his performance with Berkshire Hathaway rather speaks for itself.

As the Sub Prime insanity emerged with all its attendant problems, capital flowed out of US Dollars and rushed into the Euro, as what was believed to be a safe haven: and gold, of course.

Now the "Hot Money" is rushing back into US Dollars. Despite the actual reality that the dollar is still a mighty sick proposition, again, if one cares to analyse the underlying realities.

Now, to my cynical eye, bankers are immune to real trends: and have for many years focused on short termism.

That said, they keep on throwing money at emerging trends; when they are unsustainable.

They suffer, like so many in the City from Lemming Instinct: I have seen this operating in speculative property, particularly three times now: 1971/2 onwards: the Thatcher-Lawson 1984-1989/90 Boom-Bust: and now the Bliar-Brown era.

Bankers additionally threw vast sums into the late 1970s Eurobond Third World Debt fiasco; then LBO mania and Junk Bonds: then the Dot. Bomb episode.

Their sole criterion at times like these is greed: or if you like interest rates: even where the proposal is hugely iffy, all provided the returns seem big enough then they all pile in. Which rather sums up the Sub Prime Debacle neatly!

"They cannot afford to borrow this money: so we'll charge them a much higher rate of interest to cover the greater risk of default, so they can afford it even less!"

One notes the rate demanded on the latest Greek bond issue, for example: which accords to this precept!

The Institutional Investors suffer from Lemming Instinct far more than bankers! What is always forgotten, is the vast fresh new funds inflow these guys enjoy each and every working day: despite the recession, people still have extant pensions, life assurances, mortgage term insurances and the rest. And dealing with this cashflow leaves too little time other than to follow trends. Normally the wrong trends!

 It is only really the boutique funds and such as Buffet who really research their targets. And deliver performance accordingly.

 

[AnOther]

[quote user="Gluestick"]Right now, no one has a wee real clue where the global capital markets are headed: QE was and is uncharted territory, they said. Not to me!

It is simply printing money and therefore increasing money supply when GDP is headed South! Which as a Monetarist, to me means the unit value of pounds and US dollars is each less![/quote]Here's a thought.

It would appear to a simple chap like me that with QE the BoE have produced real money to replace the virual money which evaporated in the crash. That being so there has been no actual increase in money supply hence no devaluation due to increased supply.

[Gluestick]

The QE funds were produced "Electronically", according to the B of E: make of that what you will.

Problem is, to another simple chap, bankers will assure you that "Credit Money" is not real money: problem is at some time, it has to be settled.

And in any case, if the concept of Credit Money held true, then no problem!

As Lehmans et al could have simply gone on creating something out of nothing and solved their liquidity problems!

Same with Northern Rock, RBS, and the rest.

And this, for me, is the core problem of Fiat Currency Systems: historically, of course, bankers "Creating" money by issuing their own banknotes was common: and this led to much abuse of banks printing oodles of the damned things and crashing, since there was no asset backing and led to the Bank Charter Act of 1844, which vested sole rights in the B of E to print and issue promissary notes: i.e. bank notes. (In England and the B of Scotland in Scotland).

In any case, however, the greater the volume of money in circulation (however "Circulation" be defined), and on deposit as available liquid funds, then the less the unit value of each unit.

Result: Inflation.................eventually.

Unless, of course, Merve the Swerve has secretly discovered the Philosopher's Stone and has been rather busy changing base metals into 999.999% fine bullion gold and replacing that flogged off for peanuts by Prudence and more!

 

 

[Martin963]

Further evidence that the folly of devaluing the pound is actually doing us in Britain anything but huge harm.

http://www.telegraph.co.uk/finance/economics/7404682/UK-exports-plunge-threatening-hopes-of-economic-uplift.html

I weep that we are led and advised by such muppets.

[Quillan]

Talking of muppets here's another. Whilst I admire the man as an inventor I think he's got a bloody cheek. Is this not the man who closed his factory down in the UK making a shed load of people unemployed and moved production to a country where he pays people next to nothing?

Sir James Dyson plan to fill UK's engineering vacuum

[Chancer]

A very clever guy who knows how to work the media and sell snake oil.

20 or more years on they are still selling vacuum cleaners claiming no bag thus no loss of suction, he never uses the word filter as his machines have at least two small exhaust filters which block up and reduce the suction much quicker than a conventional bag vacuum and guess where you have to go to buy new ones? [:P]

His real genius was patenting the clear container for dust and demonstrating how much muck his machine would pick up when it went over a carpet previously cleaned with a traditional hoover it was in fact no more than the same hoover would have picked up on the second pass but of course you cannot see through the bag.

He knew that it was women who were the decision makers when it came to buying a vacuum cleaner and his marketing was aimed at persuading them to pay more for his product to great effect.

[velcorin]

Malmesbury: Probably the daftest place in Britain to build a manufacturing plant, middle of the bl**dy Cotswolds. We were busing temps in from Bristol and even at one time from Gateshead, and accomodating them. No, Quillan we didn't make anyone redundent...............couldn't get full timers! Locals were all retired Generals, Lady This, Sir That, and of course Charles Wales. Sorry, I worked for "Sir James" for 2 years, he hasn't got a clue.......yes, that's what you have to call him.

Just done my monthly reviews with UK Account Managers. All UK chemical plants are working absolutely flat out, unlike Germany where 45% are are on shutdowns. In our industry, I can see that the UK imported feedstocks, which were phenomanally high in January, will be refined and exported in February/March time (and before any jumps on it........they are ALL exported). There will always be a time delay. I'd would certainly not give any form of credence to 1-2 months figures, except to use them as a positive sign of improved economic activity.

[Gluestick]

[quote]I can see that the UK imported feedstocks[/quote]

Aye! there's the rub!

Most UK "Manufacturing" these days relies on imports: and is thus more accurately, re-exporting.

Thus it all depends on the value added: and if, like so much these days it is Marginally Costed, then there's the answer really.

 

[velcorin]

These are not Transfer Pricing or Margin Costing items, chemical industry doesn't work like that, it's a free market, with heavy government, enviromental, and H&S monitoring. The UK chemical industry has found itself in a remarkable position. The flexible plants that the UK specialises in, are working flat out, unlike the integrated plants which is the rigid German model, they require all the units to function at full capacity. Hence, the Germans shut their capacity 12-18 months ago, cashing in the Carbon Credits/ERUs, and getting the Federal Government to pay the workers' wages, very lucative.

At the moment, there is a global shortage of just about all organic and inorganic chemicals, hence you can demand just about any price you want. We have no plans to restart the German plants, the current situation there is cashflow positive. Downside is that it can't continue. The Federal Govn can't afford it. However, you can't just push a button to restart one of these plants. The checklist is about the size of the Encyclopedia Brittanica, and takes 8-12 months. Go figure!! Some people in our industry are starting to think the integrated German model, and the billions invested is dead, but doesn't know it yet. We'll see.

[Gluestick]

Indeed.

However, what is the Import Value : Export Value ratio?

From my past involvement in refinery and oil and gas product financing analyses, most chemical plants these days are in fact Petro-Chem plants: thus the raw feedstocks have a high Petrochem base.

And most (If not all) raw material components are imported.

 

[velcorin]

[quote user="Gluestick"]

However, what is the Import Value : Export Value ratio?

[/quote]

It would highly unethical, and illegal, to even discuss in passing, a customer's selling price. Price fixing is a German speciality(every time the EU or US fines a cartel, it's mainly German companies!), and I don't want to even think about it. So, I can't answer your question. Suffice to say the Management Accounts I get from some customers show they are "coining" it at the moment. In fact, as many products are on Allocation, they are forcing their customers to sign fixed price, long-term contracts, to cement the future.

I think you may also be alluding to the old style high visibility petro plants. It's not like that any more, you can't build plants like that these days. Smaller, hitech plants, surrounded by trees and grassy banks, to improve the environment, means you wouldn't even know the plants are there. Big dirty plants are definitely not allowed, places like Le Havre or Leverkusen, are no longer allowed! 

 

[Gluestick]

I wasn't seeking prices: just the ratios between import gross value and re-exported gross value.

Anyway, from OECD stats;

Year Range: 2003 - 2008: Type Inorganic Chemicals.

Imports		(d)  10 766 739 102	13 176 084 522	13 928 332 678	14 758 107 842	17 559 749 060	15 694 899 783
Exports		(d)  10 549 156 400	11 833 424 815	12 902 560 563	15 526 671 653	14 827 004 886	15 008 250 441

Now it will be readily seen, that every year of the stats sampled, import cost exceeded export value.

 

[Benjamin]

Sorry to get in the middle of your discussion but if you believe in opinion polls (and in this instance they all seem to be saying the same thing), then the £ isn't going anywhere upwards in the short term.

http://uk.reuters.com/article/idUKTRE62807920100309?pageNumber=1&virtualBrandChannel=0

[velcorin]

Sorry, I broke my crystal ball, didn't guess.

2003-2008? That's a different world era! I'm working in Q1 2010. Ancient history now.

Internally we have discussed where this data comes from. As the world's 4th largest chemical company we have never been asked, and certainly Ineos, UK 1 and world 3, would absolutely, catergorically, 100% certain, NOT supply this sort of data, and their UK export T/O is in excess of GBP15billion alone. I know how they data should be compiled, just that it isn't!

[velcorin]

For anyone interested Jan 2010 data for France.NB UK data specifically excludes invisibles (insurance, banking, services).........here no comment is made, but guess it's the same, as that data won't be available yet.

http://www.lefigaro.fr/conjoncture/2010/03/09/04016-20100309ARTFIG00411-la-france-profite-de-la-reprise-du-commerce-international-.php

Germany should be available tomorrow.

[Gluestick]

[quote user="velcorin"]

Sorry, I broke my crystal ball, didn't guess.

2003-2008? That's a different world era! I'm working in Q1 2010. Ancient history now.

Internally we have discussed where this data comes from. As the world's 4th largest chemical company we have never been asked, and certainly Ineos, UK 1 and world 3, would absolutely, catergorically, 100% certain, NOT supply this sort of data, and their UK export T/O is in excess of GBP15billion alone. I know how they data should be compiled, just that it isn't!

[/quote]

Well, one of the core data streams for EU and OECD stats is of course, VAT (TVA et al) return data.

Most companies resident and trading in the UK of any significance complete a VAT form: and the bit at the bottom demands gross (Ex Vat) Values of sales, purchases and Imports Exports. Same for all EU resident trading companies.

ONS additionally, carry out various enquiries for all UK registered businesses: we recently completed one on behalf of a client.

Chemical manufacturers, dealers, importers, exporters, processors etc are working in an area included in Value Added Tax regulation.

Statistically, of course, 2008 is not long ago; mainly due to reporting lag.

Unless you are suggesting that companies managed to plan, obtain local permissions, build and bring onstream complex industrial plant in less than two years lead time................

 

[velcorin]

I've received the ONS forms via the UK sales office in the past, never filled it in, presumably they stopped sending it. That'd chuck their figures out!

The IntraStat data is Quarterly...............so where do they get the Monthly figures?

[Gluestick]

Lies, damned lies.................?

[:D]

Ooh dear!

They (ONS) normally get heavy and threaten prosecution for failure to return the form!

Intrastat: Quarterly to monthly?

Probably since VAT return reporting periods are staggered. Quarterly Accounting traders are purposively given various months as their reporting and final filing date.

Then, of course retailers operating one of the schemes finalise their accounts only once per annum.

Then there is Cash Accounting: and then............................

Yawn. Yawn!

[:D]

More seriously, I believe the trade statistics are coallesced from a wide reporting range: including Port Customs and Entry Documents.

Interestingly, the UK storage depot for all data (Paper returns) is circa 15 miles where I am now sitting!