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I agree with this stargate.
Liquidity is one of the main reasons the US market is so successful. Stamp duty should be removed in the UK and the government should promote more pro-business rhetoric rather than using companies for cheap shots and extra tax.
Perhaps then we would end up with more Arm's, less Vodafones and BP would be flying.
That's an important article, thanks meoryou.
If the press starts reporting, and the market starts valuing the renewable side of the business, it will result in a nice rise to the share price.
Perhaps Looney's vision of BP integrated energy with a nice valuation in the future is achievable after all.
Want to make a prediction or suggestion on how low it might go?
1135 seems the first bounce territory
But I think 1085 is where I would top up next if it got there.
I doubt it would get that low before the results which I have listed as 13th on Trading View but I don't think there has been an announcement yet.
KevRow It could be anyone,
You would buy VOD if you thought you could make $15bn by splitting it up [and you had access to the finance].
A rival telco might believe they can get part of the company completely free by selling off other parts.
"I just feel it was all doom and gloom, and I don’t think it’s as bad as was predicted"
Sorry, I am not sure I helped with this.
Oil has been depressed because of the demand concerns. The way I look at it is BP is already priced for a recession, the larger the PE the further the potential drop.
Also the more buybacks whilst undervalued the better as it concentrates the value on the shares remaining. When we come out the other side the shares will rise fast.
Meoryou - sorry, I disagree. There are long lags with how things affect the economy, just because recession hasn't happened yet, doesn't mean it wont (even though we have been in an official recession for 6 months).
We have high interest rates and it will still be months and years before the raises are fully felt. Not every person has refinanced their mortgages at higher rates and not every company has refinanced it's debts. Governments also are issuing debt at higher rates.
You might say the BofE can reduce rates but they are not going to slam rates down to zero next month and real rates have been raising right up to the current month (Jan CPI was -0.53% and interest rates are at 5.25%).
The CPI is at the same level now as 8 months ago, there has been zero inflation in this measure (131.5 for June 23 and Jan 24).
You might be correct and it doesn't get worse from here but you are wrong if you think there is less chance of a deeper recession because it hasn't happened by now.
I still think current interest rates are way too high and we will be in a deeper recession by end of year with more QE. The huge money injections into the economy during Covid and supply side shocks have confused all the normal measures.
PANG
We had 21bn shares in issue in 2020 and there are around 16.8bn now from memory.
Murry said 16% of shares off the market yesterday
I guess 20% plus of shares have been bought off the market and we have been diluted 4% through share options to get the 16% figure.
I see this a a 10% return to shareholders per year including the dividend (as I now own a bigger percentage of the company).
@NalaKapala1
" The last couple of months dont bode well for results"
Why, oil price will be a known already and after the last results and price drop, you would hope the next set won't set off another downturn vs their peers?
Milei is trying to remove all the obstacles to international investment into Argentina.
He knows that there would be an economic boom if the Argentinians repatriated their dollars and international investors bought into the Argentinian revival story.
The problem is when you start from an underwater position the first few moves are very difficult and important. This plan shelves the $16bn debt whilst he can work on everything else including the Sovereign debt and IMF.
"milei the Argentine president has formally stated burford will get paid its $16 billion settlement money"
This is not necessarily how I read it and I think Milei has come up with a great solution for Argentina. Argentina would be sensible to negotiate the value down and the whole structure/legal workings of the bond need to be worked out.
There are still many unknowns. Burford might end up holding the bond which would save Argentina having to sell it into the market. If that's the case the value Burford end up with could be different than the settlement amount (it could even be higher if interest rates collapse).
This is great news, the timing of the new government is lucky for BUR shareholders - but you make your own luck I suppose. What this does is shorten the likely timescale for an end of proceedings which is very positive for the share price.
When the negotiators deal with this they will put Bogart's words down to managing investor expectations.
The mouthing off the Argentinians did in the run up to the election that ended up mentioned in court was on a whole different level.
The beneficiaries are in a good position because this court judgement puts them ahead of the Argentinian bond holders in the creditor priority. I don't see how the IMF negotiations can be done without acknowledging and allowing for the amount owed. Perhaps Argentina will try to negotiate a 25% haircut for a hassle free payment and work that into the IMF agreement.
the 8.3% average inflation rate is a bit misleading, if you remove the inflation spike between '73 and '92 the average rate is about 4%. the question is what environment we are in, i would argue we have really high debt which seems to result in very low rates as in the 2010's and 1934-1950.
basically, i don't see what has changed between 2018 and now except loads more debt. china is going to be exporting deflation to the world next year (both in their cost of goods and lack of demand causing commodities to fall).
so the answer
"can interest rate be lowered to help the economy this time and at what cost?"
is most definitely, and they will start printing again to save their own ****s.
we are at a weird time, oil prices have been pricing recession for a while, government bond yields are falling fast pricing in an economic slowdown but us stock markets are pricing growth.
Thanks fleccy, good post.
The lower interest rates should remove some of the investor worry regarding debt refinancing.
At the same time Vodafone should benefit from the previous inflation+ price increases it has given to customers. We will have to wait to see how far the disinflation goes but my guess has UK10Y hitting 3% in Feb.
Zero chance of a pro-oil, talented business operative as CEO
Task ~ Importance
Pursuing low carbon agenda ~ very high
Diverse board ~ very high
Keep aligned with the government ESG goals ~ high
Maximise profits ~ medium
Look after vulnerable stakeholders like the public ~ high
Represent shareholders ~ medium
Get strong leader as CEO ~ could cause trouble, high risk, avoid
All income stocks have been hit by the increase in Gilt yields. Why get 5% yield from BATS when you can get 5% on a 2 year.
But things have changed now, the bonds have already turned up and the shares haven't noticed yet. Sentiment is continuing the decline...
.....until it doesn't
When Gilt yields are 1% again, I doubt BATS will be yielding 10%.
It's tough building a position in BATS and VOD here.
I am bullish VOD, I don't have time for decent analysis currently but my thinking is the ROCE will improve from here out.
Input costs - energy and materials should be falling heading into a slower economic environment
Cost of debt also falling (not sure why share price hasn't already reacted)
But income should be rising due to their inflation++ contracted price increases.
Please let me know if I have missed something obvious?