The best anti-inflation investment you can make….

Tuesday 18th October 2016

In this issue of Money Truths….

  • The Marmite war….
  • The effects of a weak pound….
  • Prepare for the big squeeze….
  • The best anti-inflation investment you can make….

The Marmite war….

As wars go, it didn’t amount to much of one. Nor did it last very long.

The big guns and the heavy ordinance never made it to the theatre of operations. This was more a case of pop-guns and handbags at dawn. And if you blinked, you missed it.

Last week the consumer goods conglomerate, Unilever – producers of multiple brands popular with Britain’s supermarket trolley pushers (think Marmite, Dove shampoo, Ben & Jerry’s ice cream, Flora & Bovril) – wanted to increase their prices by an average of 10% across the board.

Unilever say that ingredients and the prices of commodities used in packaging – priced in dollars – have increased as a result of the weakened pound. Unilever’s case is this: unless prices rise now, their profits will fall.

Tesco – ever-mindful that every little helps – were resistant. Perhaps they were thinking about Britain’s hard-pressed consumers. Or perhaps there was a little more self-interest at work.

Tesco’s operating profit margin in the last financial year amounted to just 1.9%.… Click here to read more

Make like a bank in the search for yield….

Tuesday 11th October 2016

In this issue of Money Truths….

  • A quick spin through the big picture….
  • A new game for yield-seekers….
  • Make like a bank and put your capital to work….
  • Be aware – rewards come with attendant risks….

A quick spin through the big picture….

Ex-chancellor George Osborne admits that low interest rates have served to help the rich get richer whilst damaging the interests of savers.

Thanks for confirming what we already knew, George. Thanks for bringing us yesterday’s news tomorrow….

Meanwhile, Back of England Governor Mark Carney has come out and said that there is little more monetary policy can do to help Britain’s long-term prospects.

He’s effectively batting the ball back to government and inviting them to rethink fiscal policy – tinker with tax rates, borrow and spend or both….

Sterling plummeted to a 32-year low against the dollar. Britain’s economy didn’t immediately evaporate following the vote for Brexit. But markets know that the dis-engagement process hasn’t even begun and that the road out will be long, complex and troublesome. Uncertainty rules – and the current weakness of the pound reflects it….

There is potential trouble elsewhere too. Italian banks are carrying too much bad debt.… Click here to read more

A new world….

Tuesday 4th October 2016

In this issue of Money Truths….

  • A new world….
  • The winners….
  • The losers….
  • The challenge ahead….

A new world….

I’ve been banging on about low interest rates – and closely-related issues – for the last few weeks….

I expect you’ve noticed. You probably think I’m a bit of a pointy-head – one of those pipe-smoking pseudo-intellectual types who likes to while away the hours thinking deeply on big floaty ideas and themes….

But I can assure you I’m not. My wife will confirm as much. I can often get quickly out of my depth helping the children with their homework assignments.

But sometimes these big ideas have to be grappled with.

Big ideas like ‘the economy’, that seem only to exist somewhere far removed from reality or in the editorial columns of big newspapers, have this funny habit of filtering down the food chain and making a big impact on the life and prospects of the man in the street.

Interest rates are at an all-time low. The price of money has never been cheaper. And the point I really want to make – and have probably not been clear enough about – is this: low interest rates are here to stay deep into the foreseeable future.Click here to read more