Gcp Infrastructure Inves... Share Discussion Threads

[hpcg] 25/5/2023 09:34

Spec - energy pricing is volatile and thus a high frequency component of inflation. Shelter is an underlying low frequency permanent upward drift.

[spectoacc] 25/5/2023 09:06

Food prices were up 19.1% annualised, I'd question whether shelter is the driver of inflation.

Energy cost is the key driver of pretty much everything - it's the main input to growth.

The way out of the current mess is productivity, but good luck with that. Halving the size of the state would be a start. Again - good luck.

Student accommodation has definitely helped ease housing pressure around here - whole suburbs had been given over to students, and now no longer the case - so the London accommodation seems a good idea.

But social housing also needs to be built again by councils - another sector that's taken over private sector houses.

[donald pond] 25/5/2023 08:54

There was a piece on you & yours on R4 yesterday about purpose built accommodation in London for professionals but on the student model: individual rooms with bed, fridge, microwave and en-suite but shared kitchens and communal areas. Those living there seemed to like it and the rent covered all bills and was comparable to student hall rents in LondonStruck me as a model that might have some legs. If governments would throw in some support it's the sort of thing Gravis would look at.

[hpcg] 25/5/2023 08:45

I was going to write this on the commercial property thread last night, but may as well here. It is shelter that drives inflation in this country because it is the main driver of wages and then the cost of other services. We'll have to build, not just family homes but also accommodation that pensioners will happily downsize into, and tax differently, much higher property taxes, lower income tax and remove VAT from services including energy, broadband and mobile telephony, all food, and most FMCG.

[spectoacc] 25/5/2023 06:56

Probably marginal in the scheme of things, but eg they paid 92.25p for 250k shares a fortnight ago.

Still think GCP looks interesting back down here.

[fordtin] 24/5/2023 17:31

“I think we did for the population nonsense :)”

QED 😦

[stewart64] 24/5/2023 17:30

Seem to remember the average was 85.1p...so they bought at the last bottom and then only 100,000 shares.

[spectoacc] 24/5/2023 16:56

I think we did for the population nonsense :)

Meanwhile - GCP's buyback perhaps not looking so clever. What was the highest price paid recently?

[fordtin] 24/5/2023 16:55

Ahh, fiat. Now we need to start a new thread.

[spectoacc] 24/5/2023 16:50

That it may be, but it's naff-all to do with population growth.

Your ire would be better directed at fiat money.

[fordtin] 24/5/2023 16:47

A minority of people get richer by increasing the population in the pursuit of GDP growth.
However, the majority of people get poorer as a consequence of associated reduction of GDP per capita.

The current economy is all about those who have, acquiring more. Those who have, don’t really give a sht about those who don’t.

[spectoacc] 24/5/2023 16:38

"...but we're barely at replacement rate and need more immigration, not less, if there's any hope of controlling inflation or filling the jobs most won't do."

With the level of debt - an ever-growing economy and ever-growing population (via immigration, below replacement rate in UK) is sadly the only way forward.

So I'd be intrigued to know your "solution" to that. Lower population kills the economy. You think it will concentrate assets more, but it actually concentrate debt & makes that debt much more difficult to service.

[fordtin] 24/5/2023 16:31

re “Population - not the thread to debate it”,

As I said previously, over-population is the elephant in the room. It is the root of all environmental issues nationally and globally.
GCP invest in environmental infrastructure as well as housing, but apparently the elephant should be ignored on this thread!

Google say's it's known as Pachydermophobia!

[spectoacc] 24/5/2023 16:17

There is no shortage of housing in this country, despite what everyone other than me says. There's a shortage in the right places, mostly difficult to solve.

Add more houses = add more households, and extra houses as investment.

[But to bring solutions instead - councils building again, it's a nobrainer when you look at the housing benefit bill.]

House prices are predominantly credit-led - the Spanish and Irish built like crazy during their insane boons. If borrowing is easy, who wouldn't want a 2nd (or 3rd) house.

Population - not the thread to debate it, but we're barely at replacement rate and need more immigration, not less, if there's any hope of controlling inflation or filling the jobs most won't do.

Agree on ZIRP points, and govnts using taxpayer cash to support the market - at what point does Help To Buy debt come home to roost for the taxpayer?

One final OT point - house prices are nowhere near back to the level they were just before Covid. Isn't that strange? Why should a gigantic blow-off top boom during Covid handouts (not least BBL's) not have been given back after this huge rise in interest rates?

(I think GCP's getting into buying territory - but only if it holds this previous low).

[hindsight] 24/5/2023 16:07

fordtin, I dont wish that on anyone either, but its already happening from the London young I speak to who were hoodwinked by Baileys ZIRP
As for house building, suggest you write to Gove who has pulled the need for Councils to meet 5 year targets

[fordtin] 24/5/2023 15:53

Imo the best way to help people become homeowners would be to match supply with demand.
Building houses at a rate which ensures their is a buyer for every home, and every home has a buyer, should bring housing much closer to replacement cost.

Unfortunately we live on a tiny Island which means this is already unsustainable because we don’t have enough land to grow food for the current population. Stacking people up in tower blocks means the food deficit gets even worse.

We already rely very heavily on environmentally unfriendly imports. Without addressing the elephant in the room, over-population, there is absolutely no chance of providing affordable housing for all, whilst meeting unrealistic environmental promises.

[stewart64] 24/5/2023 15:50

You're condemning an entire cohort under 25 year olds and the unborn to impossibly high house prices forever ( unless they have recourse to Bank of Mum and Dad for the convenience of a few mortgage holders that have overstretched. And there will be a lot more forbearance this time and indeed those that will struggle might be better off with short term pain if it means the next stage of the ladder gets cheaper ( as was the case for me paying a 15% mortgage in 1992).
Never in the field of human economics has more damage been done to so many in the interests of a few mortgage holders by the Governor's Idiotic Zirp policy.

[fordtin] 24/5/2023 14:59

re "Yes higher rates mean the debt reduces lot faster"

When debt increases because a mortgage holder can’t find the money to pay the rapidly rising interest, coinciding with falling house prices, many end up with negative equity.

I knew several people who lost their homes in the 80’s. I wouldn’t wish that on anybody.

[panshanger1] 24/5/2023 14:27

Briefly below this in 2020 (76.50) l have

[stewart64] 24/5/2023 14:23

83.8p the all-time low I believe, so we might be approaching the bottom soon. I don't think the inflation news has ever been worse than this morning since GCP formed so today's price is to be expected. We are the most removed from international comparisons now and though we were expecting the spike last year ( when the headline rate was much higher), we were promised a quick drop by the clueless Governor. It's not happening.

[hindsight] 24/5/2023 14:02

Yes higher rates mean the debt reduces lot faster, providing the capital starting cost has adjusted
But ZIRP from Bailey created lot pain for young who brought. He was useless in ECN saga, useless in zirp, and expect will more to come

Anyway starting a holding GCP starting to interest me. Does anyone get their script dividend in a brokerage account ?

[stewart64] 24/5/2023 13:05

High interest rates an awfully lot more help than being faced with price to earnings multiples of about eight. All the things that are supposed to help the young..help to buy, low interest rates etc. just transfer wealth from the young to oldies like us. As I said the best thing that ever happened to me was paying 15% mortgage rates and being given house prices by 1996 at the lowest level in the history of mankind.

[fordtin] 24/5/2023 12:55

Re “give our kids a chance and crash house prices with high rates.”

How will crashing house prices as a result of high interest rates help?

If interest rates double and house prices halve, buyers still end up struggling to pay a daunting monthly mortgage bill.

If you want to give the young a better chance in the housing market, either build considerably more housing, or reduce the population.

The latter would be preferable as it would also help to achieve emissions targets.
Unfortunately, unless we can convince the population to address the out of control procreation and out of control net migration, the alternatives of war, disease and famine will probably be even less popular.

[stewart64] 24/5/2023 12:19

I don't think those that think interest rates should peak here understand the gravity of the situation. The belief in money is even more important than law and order. If money goes to zero then everything is pointless a' la Germany 1920s, even a lifetime of saving. We have the worst record in the developed world. All this dovish rate setting has embedded wealth inequalities and panders to geriatrics with expensive houses. The best thing that ever happened to me is rates rising to 15% in 1992 when I had a mortgage. All of a sudden by 1996 I was looking at a detached house as opposed to a starter home I then had. House prices fell to their lowest in history and late boomers like me never looked back. For God's sake give our kids a chance and crash house prices with high rates. Makes no difference to me only a third of my Equity is in unmortgaged property.

[spectoacc] 24/5/2023 11:31

@dp - their reputation is shot, it's what they now do to get it back. The Bundesbank they are not.

Cost-push has become demand-pull, but the way to avoid that was to hit the demand side hard. Not pleasant, but that was what needed doing. Look how long it's taken them to get to even 4.5%, and how many along the way have voted for unchanged (or a cut!).

Bottom line - how do you stop wages rising at average 6% (before we've even had most of the public sector settlements), when RPI is 10%, and when unemployment is stupidly low for this stage in the cycle.

I fear the answer is early 90's, and grim. I also doubt they'll do it.

Which makes investing rather tricky, other than that I can get a tidy 5% on cash.