Sunday, 3 January 2016

capital thinking


Under the sign reading 'Duck or Grouse' and into the pub to meet a few friends.

We've all known one another for ages and will talk about most anything. This time, after the first pub, then the curry house and then the next pub, we were briefly talking about finances.

It was mostly about trying to make sense of the various ways we've all been turned over by the financial establishments. Not just on small things like inertia selling of utility services, but on big things like pension planning and investments.

The new Financial Conduct Authority has backed away from any systemic investigation, saying it prefers to precision target individual organisational investigations. Pah. Nothing whatsoever to do with ensuring that the City remains the intact.

Anyway, we'd all got tales of ways we'd been ripped off, from my case of collapsed Equitable Life pension scheme, to 'financial advisor schemes' running for multiple years with apparently 'no tax liability' (not me, I add, but still suspicious). All of us had stories and all of them implied largish losses.

We noticed a few common themes. Badly informed and often polarised financial advisors. Limited access to product sets, poor and mainly reactive regulatory controls throughout the industry, the way that the financial houses and planners win whatever happens (commission, run-rate, bail-out, bonuses) and the way that the average punter always pays (fee percentages, insidious effects from quantitive easing, the hidden effects of undisclosed inflation, and so on).

As a group of individuals we are all fairly switched on, yet each of us is somehow handling systemic challenges from these economic biases. We're all fundamentally survivors, yet each of us observed how it is getting tougher for those who follow us.

Maybe I'll need to add some other types of targets to my list for 2016.

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