Your discussion points have cause me to burn up more grey matter and lost more strains of hair!
On DCN, I am of the opinion that had DCN maintained the throughput of 28Koz for the Mar qtr, DCN would had moved out of the turnaround story line and that would have imply any of its SP movement will be very much tie up with GP movement. Looking like the completion of the turnaround story will have to wait for another quarter i.e. June qtr is going to be critical. If
@Johnathonc statement is correct, then the confidence level on delivery of the production volume will take a big leap up to become an inevitable event! However time will tell.
On the inflation front, the US Yr-to-Yr figure of 4.6% came off from a sharp drop of inflationary pressure due to the economy shutting down in April 2020. I think the Yr-to-Yr figures will continue to be high or higher in the coming months versus my projection of 4-5% and therefore this projection is going to look mild! Most economists are projecting that this high level of inflation is going to be transitory and therefore is likely to come off next calendar year due to the supply side constraints being resolved. However my grey matters/cells are telling me that the supply side story is not the only cause. The huge amount of money i.e. M2 being pumped into the US economy will have surely have some consequence to the inflationary pressure and this pressure is not going to go away while M2 is circulating within the economy. So I don't think the US inflation is going to be transitory and it is going to be long lasting and more so when the expectation of inflation starts to seep into the mindset of suppliers and consumers. I do agree that stagflation is coming and the scenarios of the 70s and early 80 is likely to play out before things will settle down. Relying on such scenarios and the saying that history does not repeat but rhyme, I think we are going to get an explosive GP movement.
The major correction will come only if US FED decides to step in to curb inflation and my thought is the FED will, as inflation begins to look like getting out of control. As I said before inflation and US FED raising interest rate is what will cause the stock market, real estate and bond bubbles to burst all at the same time. The past couple of days of US stock market fluctuations are just a prelude to what will become the norm in the coming days and months as the stock market becomes more volatile: a good time to play the market for the brave! However the big crash will not come until US FED steps in.
As for the local economy and if iron price is to tank, I think we are going to be in a lot of troubles. The current stoush with China is not going to go away any time soon and if US goes into recession again, Australia will follow suit.
Above are just my thoughts and opinions(fairly cheap even if I burnt up some grey matters but expensive by losing some hairs!
).
Cheers.
