How you pay for the city.

Discussion in 'Politics & The Economy' started by BISHI, Aug 7, 2013.

  1. BISHI

    BISHI
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    Did anybody hear this on radio 4 today..? Seems the cards are deliberately stacked against the general public wishing to invest in shares / ISAs etc.
    It would appear the general prejudice against the financial sector is perhaps more justified than many here would have us believe.
    It's not up on Iplayer yet but if and when it is I will provide a link. Very interesting listening that I would be interested to hear the 'regulars' comment on.
     
  2. BISHI

    BISHI
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  3. karkus30

    karkus30
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    That's why I froze pension and cashed in my mortgage endowments and moved to straight repayments 10 years ago.

    Investment is risky, if you want to make big money then its necessary to accept the loss of big money. Most people won't accept that loss and so they go with less risky strategies. Its these low risk strategies that are really just an expensive comfort blanket. The fund managers are really working in an area of diminishing returns, just like a books that puts a bet on a horse that has very low odds and then charges a fee to administer that bet. The reality is that the returns are often less than the fee.

    So, what do you do with your money ? Banks are giving nothing, standard ISA virtually nothing and all the time inflation is eating your wealth at the rate of several percent a year. You can put it into property because that is now high risk. If you want low risk then you either accept the offer from a deposit account or use a managed fund in the hope it might beat the market. The fund managers aren't taking any risks and so everyone is betting on the same low yield/low loss companies.

    What we need is a return to sound money and an end to credit fuelled printing with a fractional reserve system. That way banks pay out good rates of interest when demand for money is low ( lots of spending and little saving ). That means being prudent actually pays, but if no ones buying then it stops paying. Investment made outside the banks can then be of a higher risk, more long term nature with a genuine interest in the success of the company that has received an investment.

    These days a lot of the investment is really in public debt. We are effectively betting on ourselves without being able to control the spending.
     
  4. SNIPIT

    SNIPIT
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    City of London and its allies the wealthy elite will defend their own interests and has been doing since 1571, Its self governing and predates the consolidation of the modern UK and since 1980s, the era of Margaret Thatcher's "Big Bang" of markets deregulation, governments have enjoyed a cosier relationship with corporate finance, Since 79 its the case if you cant beat them join them, however I howl at the moon.
     
  5. sidicks

    sidicks
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    What did the Radio 4 program say (or are you just speaking from a position of ignorance)??
    :confused:
     
  6. MikeTV

    MikeTV
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    I know it will come as news to many people, but I've known about it for about 20 years. Those big gleaming towers in canary wharf - their main function is to fleece the public of their life savings, and the only people they enrich are the ones occupying them. And yet there are those who want us to believe they are the backbone of our whole economy. Nope. They just move money around - fleecing off a bit here, a bit there, until there's nothing left. The only people making any money for our economy are the ones that are actually producing things. In other words, the people outside the City.
     
  7. sidicks

    sidicks
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    :boring:
     
  8. SNIPIT

    SNIPIT
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    Nope enlightened, Your right for once :clap:, I have not listened to the "City",
    "the city of London", "Square Mile" "the stone dragon", UK's financial services and I stand by my first post steadfast.:smashin: Tax them until.....:D
     
    Last edited: Aug 7, 2013
  9. sidicks

    sidicks
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    As expected, a biased analysis, taking a few truths for certain aspects of the market and exaggerating and extrapolating them to an entire industry, providing a report designed to mislead listeners.

    No doubt it will get a big thumbs up from many people on here!
     
  10. sidicks

    sidicks
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    Well at least you've stop pretending you know what you're talking about and have reverted back to the ignorant rhetoric!
    :hiya:
     
  11. BISHI

    BISHI
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    And your evidence is..?
     
  12. sidicks

    sidicks
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    20 years experience, and much of the key points have been covered before.
     
  13. SNIPIT

    SNIPIT
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    Please point out where my ignorance is, the date, is it the name, is nobody wealthy who works in it, did thatcher not smooch up to them, is it not self Governing.
     
  14. sidicks

    sidicks
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    You're commenting on an article you've not listened to...

    ??

    ??

    ? There are wealthy people in many industries.

    Thatcher recognised that in a globalised economy, the country could not support itself with primary and secondary industries.

    No!!
     
    Last edited: Aug 7, 2013
  15. BISHI

    BISHI
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    Remind me.
     
  16. sidicks

    sidicks
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    Do a search!
    :smashin:
     
  17. BISHI

    BISHI
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    I provided the original link, it's up to you to persuade me it's content is incorrect - just saying it is biased is insufficient. I could equally respond saying your 20 years of experience makes you biased
    All in all I remain persuaded by what I heard on the programme.
     
  18. sidicks

    sidicks
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    Fine - as i said before, most people on this forum are happy to have prejudices confirmed rather than finding out the real issues.
     
  19. BISHI

    BISHI
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    It seems the real issue is that the general public are being misled into buying products that have so many hidden and undeclared charges that they are effectively being lied to and cheated out of the profits they were initially promised.

    You should also read this-

    http://en.m.wikipedia.org/wiki/City_of_London

    The City does indeed have a certain degree of self governance .
     
  20. sidicks

    sidicks
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    But that's not referring to the financial services aspects of 'The City' (which was the point of the thread!).
     
  21. MikeTV

    MikeTV
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    An interesting article in the New Statesman about The City (from 2011), and how it acts as the financial hub in a network of offshore tax havens and British Crown dependencies, and how much of it's activities are beyond democratic scrutiny:

    The tax haven in the heart of Britain

    "Don't tax or regulate us or we'll move to Switzerland," the bankers and hedgies cry; and all too often the politicians quail and cut taxes on the wealthy, deregulate finance further, and hand yet more freedoms to the City.
     
  22. sidicks

    sidicks
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    Except of course that the regulatory burden on Financial Services has increased significantly and continues to do so...

    And taxes on the 'wealthy' have increased under the current government.
     
  23. BISHI

    BISHI
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    Well, if the content of the R4 programme is indeed true, then quite clearly further regulation is required .
     
  24. Squiffy

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    Lies, damned lies and statistics.

    I haven't listened to the program, but I can guess. Were pensions mentioned as an example?

    Typically there is a management charge on the whole value of the pension fund. So as the fund grows, so do the management charges. And over the life of a pension fund, this can be a lot of money. It is often quoted that total charges amount to a significant percentage of the initial contributions.

    Well they would, when the management charge is on the whole fund including investment growth.

    Yet pensions are still one of the best investments you can make. They are sold with a clear charging structure, and you get annual reports showing what has happened to your money and what it will give you in retirement. For the vast majority, pensions are a great deal.
     
  25. karkus30

    karkus30
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    I've just laughed myself into a porridge bowl. It was bad enough with payday lenders, but now we must regulate those people who wish to have a financial flutter in order that they always win. Bloody hell get real. Would you walk into a gambling shop, bet on a horse, lose the bet and then complain that the bookie has made more money than you won ?

    Meanwhile, how about the savers who's money is being systematically stolen by the state while the BoE says 'sorry about that folks, its for the greater good. We must help out the gamblers who are going to lose a packet and unfortunately your cash is forfeit'.

    I'm confused. Has this country gone so completely bonkers to think this is acceptable behaviour. Lets just bail out every stupid person on the planet and let the prudent pay for it all until we have no money left and civilisation goes to hell in a hand cart.
     
  26. BISHI

    BISHI
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    I think you will find the 'gambling' is not the problem, it is the huge number of hidden charges that are not made clear to the customer. If they were, clearly most people would not front their 'stakes' in the first place.
     
    Last edited: Aug 8, 2013
  27. BISHI

    BISHI
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    Really..?

    http://m.bbc.co.uk/news/business-18883932

    And in the interest of balance, from the Telegraph-


    http://www.telegraph.co.uk/finance/...9471/Pension-fees-eat-40pc-of-your-money.html

    http://www.telegraph.co.uk/finance/...-considers-action-on-hidden-pension-fees.html

    http://www.telegraph.co.uk/finance/.../Cap-on-pension-fund-fees-to-help-savers.html

    Hidden charges eat up to 40% of your pension money..? Sounds like a real good deal to me...!
     
  28. karkus30

    karkus30
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    They were made very clear to me. Usually written on the paper work and advised verbally. Bit like the pay day companies, Interest only mortgages and PPI. We didn't know is just a poor excuse for not taking proper responsibility in the rush to get the loan to buy the shiny thing, or to make big money.

    Just because the Government and banks carelessly disregard the real value of money doesn't mean we should follow that terrible example. There are no free lunches and people are naive to ever assume there are.
     
  29. BISHI

    BISHI
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    Rubbish Mr K. You have the benefit of a mind attuned to finance, the majority do not. If these charges are clear why put them in the small print. Another good reason to maintain the state to intervene and regulate such practices.
     
  30. karkus30

    karkus30
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    It was a good deal when people were watching their pensions growing like there was no tomorrow. The charges aren't hidden. At work the broker clearly explained the charges and I asked for the projections based on the worst case scenario during this current recession. I told him I wasn't interested. At which point he suggested I would be wasting the tax efficiency of the company contribution. I suggested that it was that which was paying his wages and not helping mine.

    Professional advice is expensive. That's just how it is. Better just to leave it to the passive market or stick it in a deposit account. If you feel really brave divide it into pots and play Gold, pension and the more risky stock market game. It will take up a lot of time but will test your skill against the pro. Just like DIY it costs more to get a tradesman.
     

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