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Tyrion Lannister
Posted: 28 September 2017 23:12:12(UTC)
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Sara G;51513 wrote:
Thanks for the very comprehensive reply, Tim.

That article about Japan trackers has really got me thinking... I must admit I tend to just think 'active or passive' and don't really pay attention to which index is being tracked, but will look into this further.

As regards hedging Japanese exposure, I've been both hedged and unhedged over the years and have been fortunate enough to time the transitions well (more luck than judgement - I went unhedged accidentally once when ii switched me into the wrong fund!). I'm hedged at the moment because post-Brexit I felt that sterling was likely to recover strongly at some point, while the yen might fall due to Abenomics (and more recently N Korea)... but with the prospect of a Labour government being somewhat more likely than it was, and the Yen's safe haven status seemingly unassailable, I'm not so sure!



Many people assume that a Labour Government would be bad for the market.

Why? There's no track record of this from recent Labour governments (admittedly they were facist relative to Corbyn 😀) And Corbyn is not stupid, even he recognises the need for the UK to have strong businesses.

Obviously any form of nationalisation would be bad for the stocks in question but would that really happen?
Captain Slugwash
Posted: 29 September 2017 07:12:58(UTC)
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Quote:
Many people assume that a Labour Government would be bad for the market.


As with the markets and investments, we can only judge by past performance.
Unfortunately history shows us that all Labour Governments have followed policies of high spending, borrowing, and taxation, usually leading the country to the brink of financial ruin before being voted out.
As our current Government is also high spend/borrow/tax I must assume that they are really Blue Labour and Corbyn represents the much missed Old Labour who want to take us back to the 70's.

If we forget history we are doomed to repeat it.
Sadly people do, which is why I am buying candles.:D
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Big boy
Posted: 29 September 2017 08:57:44(UTC)
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In order to get the widest spread from small unquoteds to major conglomerate through out the world buy at least 20 Investment Trusts( companies) If possible buy a big discount but not anything over 30% unless you know what you are doing. Sell at 15% discount and add to holdings with the largest discounts. Make sure it's within a tax wrapper. You will tend to be in unloved sectors which will be set for recovery. For research all you need is Trustnet and the Investment Trust (companies) websites.
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Mickey on 29/09/2017(UTC)
King Lodos
Posted: 29 September 2017 11:34:40(UTC)
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Tyrion Lannister;51521 wrote:
Many people assume that a Labour Government would be bad for the market.

Why? There's no track record of this from recent Labour governments (admittedly they were facist relative to Corbyn 😀) And Corbyn is not stupid, even he recognises the need for the UK to have strong businesses.

Obviously any form of nationalisation would be bad for the stocks in question but would that really happen?


The previous Labour government under Brown effectively bankrupted the country, and under Blair sold off half the nation's gold reserves at the bottom of the market.



I think it's unlikely this Labour government get an outright majority, which should mean renationalisation plans are unlikely to get through .. I think the economy would have to get quite a bit worse before we start voting in chaos – so we'd probably already be out of UK stocks.

The problem with Tories is they're left to pick up the pieces – so they're usually stuck having to implement austerity to avert more serious problems .. And it's a problem that universities are so left-wing, we've got a western world full of economists who'll tell you austerity doesn't work and infinite debt is good – so there are real structural problems here
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Tyrion Lannister
Posted: 29 September 2017 19:06:01(UTC)
#43

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King Lodos;51533 wrote:
Tyrion Lannister;51521 wrote:
Many people assume that a Labour Government would be bad for the market.

Why? There's no track record of this from recent Labour governments (admittedly they were facist relative to Corbyn 😀) And Corbyn is not stupid, even he recognises the need for the UK to have strong businesses.

Obviously any form of nationalisation would be bad for the stocks in question but would that really happen?


The previous Labour government under Brown effectively bankrupted the country, and under Blair sold off half the nation's gold reserves at the bottom of the market.



I think it's unlikely this Labour government get an outright majority, which should mean renationalisation plans are unlikely to get through .. I think the economy would have to get quite a bit worse before we start voting in chaos – so we'd probably already be out of UK stocks.

The problem with Tories is they're left to pick up the pieces – so they're usually stuck having to implement austerity to avert more serious problems .. And it's a problem that universities are so left-wing, we've got a western world full of economists who'll tell you austerity doesn't work and infinite debt is good – so there are real structural problems here


Oh, come on KL, you don't really believe that Tory propaganda? Before the financial crisis, national deb was lower in real terms than it was before Blair came to power, it was American debt that triggered the global recession not the Labour party. Could I also remind you 1) that Labour's spending plans prior to the crisis had cross party support, so there's no reason to suppose the Tory's would've handled things any differently, and 2) national debt has more than doubled since the Tories embarked on their total failure at austerity.

I don't support one party over the other, I'm just taking the contrarian view, but the key point imo is that historically whichever party has been in power, it's made little difference to investment performance.

Politicians are politicians, in it for themselves and either incompetent, disinterested, or both when it comes to managing the affairs of the country - whichever party they represent.
King Lodos
Posted: 29 September 2017 20:02:02(UTC)
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Tyrion Lannister;51549 wrote:
Oh, come on KL, you don't really believe that Tory propaganda? Before the financial crisis, national deb was lower in real terms than it was before Blair came to power, it was American debt that triggered the global recession not the Labour party. Could I also remind you 1) that Labour's spending plans prior to the crisis had cross party support, so there's no reason to suppose the Tory's would've handled things any differently, and 2) national debt has more than doubled since the Tories embarked on their total failure at austerity.

I don't support one party over the other, I'm just taking the contrarian view, but the key point imo is that historically whichever party has been in power, it's made little difference to investment performance.

Politicians are politicians, in it for themselves and either incompetent, disinterested, or both when it comes to managing the affairs of the country - whichever party they represent.


No one's saying there's a causal relationship between Labour and the Financial Crisis .. But there is an interesting relationship between it and financial engineering (which is something Labour and the Democrats like to do).

You can trace the origin of mispricing subprime loans to a 90s legal action against Citibank (brought by a young Obama amongst others) as part of the Democrats' Affordable Housing Act .. This basically forced a major bank to lend to riskier customers, which created a fundamental market inefficiency .. But being that conservative viewpoints are virtually chased out of US colleges, it's quite unpopular among Marxist academics.

The idea Tories have in fact "doubled" debt is a deliberate obfuscation peddled by lefties .. It really makes no sense to look at debt in isolation – e.g. a tiny country with our debt would already be sunk, while a larger economy can handle much more .. So you have to look at Debt relative to GDP .. The Tories have trodden a fine line between growing the economy and managing debt, and we've had arguably the best recovery of any G7 nation (wide image in next post)
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Guest on 29/09/2017(UTC), t s on 30/09/2017(UTC), Sara G on 30/09/2017(UTC)
King Lodos
Posted: 29 September 2017 20:03:06(UTC)
#51

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https://pbs.twimg.com/media/C_Ah7IhXcAE3z6D.jpg
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Guest on 29/09/2017(UTC)
Tyrion Lannister
Posted: 29 September 2017 21:52:17(UTC)
#45

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King Lodos;51554 wrote:
Tyrion Lannister;51549 wrote:
Oh, come on KL, you don't really believe that Tory propaganda? Before the financial crisis, national deb was lower in real terms than it was before Blair came to power, it was American debt that triggered the global recession not the Labour party. Could I also remind you 1) that Labour's spending plans prior to the crisis had cross party support, so there's no reason to suppose the Tory's would've handled things any differently, and 2) national debt has more than doubled since the Tories embarked on their total failure at austerity.

I don't support one party over the other, I'm just taking the contrarian view, but the key point imo is that historically whichever party has been in power, it's made little difference to investment performance.

Politicians are politicians, in it for themselves and either incompetent, disinterested, or both when it comes to managing the affairs of the country - whichever party they represent.


No one's saying there's a causal relationship between Labour and the Financial Crisis .. But there is an interesting relationship between it and financial engineering (which is something Labour and the Democrats like to do).

You can trace the origin of mispricing subprime loans to a 90s legal action against Citibank (brought by a young Obama amongst others) as part of the Democrats' Affordable Housing Act .. This basically forced a major bank to lend to riskier customers, which created a fundamental market inefficiency .. But being that conservative viewpoints are virtually chased out of US colleges, it's quite unpopular among Marxist academics.

The idea Tories have in fact "doubled" debt is a deliberate obfuscation peddled by lefties .. It really makes no sense to look at debt in isolation – e.g. a tiny country with our debt would already be sunk, while a larger economy can handle much more .. So you have to look at Debt relative to GDP .. The Tories have trodden a fine line between growing the economy and managing debt, and we've had arguably the best recovery of any G7 nation (wide image in next post)


Of course the economy's been doing OK, we've been in recovery from a major recession. I'd suggest that's despite the the governments management, not because of it.
King Lodos
Posted: 30 September 2017 00:35:10(UTC)
#46

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Tyrion Lannister;51557 wrote:
Of course the economy's been doing OK, we've been in recovery from a major recession. I'd suggest that's despite the the governments management, not because of it.


There's no 'of course' – the last time we had a financial crisis on anything like this scale (the Great Depression) markets took about 30 years to recover, and we had a whole lost generation .. Whether we've just kicked the can down the road, this recovery's been entirely driven by government intervention.

The most surprising thing is that it looks like it might actually be working (very much not what economists predicted) .. And as for the Tories: we all started 2009 in the same boat; we've had the best recovery of any European nation – and we had the same debt/GDP ratio as Greece not long ago. (for an idea of how badly things could have gone .. how many here would even still have their state pensions had we had a different government in?)
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JohnW on 30/09/2017(UTC)
Tyrion Lannister
Posted: 30 September 2017 13:47:02(UTC)
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King Lodos;51559 wrote:
Tyrion Lannister;51557 wrote:
Of course the economy's been doing OK, we've been in recovery from a major recession. I'd suggest that's despite the the governments management, not because of it.


There's no 'of course' – the last time we had a financial crisis on anything like this scale (the Great Depression) markets took about 30 years to recover, and we had a whole lost generation .. Whether we've just kicked the can down the road, this recovery's been entirely driven by government intervention.

The most surprising thing is that it looks like it might actually be working (very much not what economists predicted) .. And as for the Tories: we all started 2009 in the same boat; we've had the best recovery of any European nation – and we had the same debt/GDP ratio as Greece not long ago. (for an idea of how badly things could have gone .. how many here would even still have their state pensions had we had a different government in?)



The UK economy on aggregate looked like it was doing better largely thanks to finance sector which has served London and the South East very nicely, try telling people in the rest of the country that the economy is good and they'll think you're off your rocker.

Also, the eurozone has overtaken the UK economy over the last year or so, particularly in Germany.

And, most economists would argue that the UK economy is more akin to the US than the rest of Europe and since 2009 the US economy has been significantly better.
King Lodos
Posted: 30 September 2017 16:28:47(UTC)
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Tyrion Lannister;51566 wrote:
The UK economy on aggregate looked like it was doing better largely thanks to finance sector which has served London and the South East very nicely, try telling people in the rest of the country that the economy is good and they'll think you're off your rocker.

Also, the eurozone has overtaken the UK economy over the last year or so, particularly in Germany.

And, most economists would argue that the UK economy is more akin to the US than the rest of Europe and since 2009 the US economy has been significantly better.


Always remember charts like this when you prefix sentences "most economists":

https://i.imgur.com/jLw8Bae.gif

Hans Rosling famously showed that economics students score significantly lower than chimpanzees when given simple tests on the global economy. (i.e. you're better flipping a coin – or asking a mandrill)

It's a problem with parts of modern academia – when there's no incentive to be right, subjects become overrun with ideologues teaching any old nonsense they want .. There's a whole generation of economics students now refusing to learn about capitalism .. They'll be called economists, with only PhDs in Marxism – insisting that Venezuela and North Korea are actually prosperous utopias with PR issues.


The UK's been top for annual GDP growth for years – you might not realise how poorly the likes of peripheral Europe have been doing .. Brexit's obviously thrown things off a bit – although most of that so far has just been market reaction .. UK small-caps are still one of the best performing sectors (surprisingly)

https://static.independent.co.uk/s3fs-public/styles/story_medium/public/thumbnails/image/2017/02/23/10/2016qqg7.jpg
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Keith Cobby
Posted: 30 September 2017 16:39:35(UTC)
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It seems to me that the fundamental problem is that the Western world is ex-growth. We have had 300 years of progress and we are now suffering from demographics and have lost the can-do attitude of old. An increasing proportion of national output is being spent on social programmes. We have become much softer. Also much of our growth seems to have been brought forward from the future through higher debt and QE. I doubt it much matters whether the Tories or Labour are in government.

I have sold almost all our UK sector trusts and reinvested in asia-pacific and global funds this week.Time to sell UK Plc.
Keith Cobby
Posted: 30 September 2017 16:51:04(UTC)
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I also think the answer to the question is about 12.
JohnW
Posted: 30 September 2017 17:41:29(UTC)
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Quote:
We have become much softer.


Interestingly in some cases forced to become soft. As a production engineer my department was borderline on weight, liftable, but only just. Then the health and safety got involved and set limits on what a working man could life and at a stroke we had the expense of fitting cranes to many of the machines. This meant everything had to be retimed to allow time to use cranes. Once everything had been retimed the men stopped using the cranes, so effectively took a wage rise by increasing the bonus earned. Meanwhile everything we made had to be repriced to allow for the increased production costs. Interestingly that company has now pulled stumps and moved to Poland. Ask the men, now out of work what they think of the HSE and all their rules.

John
King Lodos
Posted: 30 September 2017 18:12:22(UTC)
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Demographics are a huge problem for 20th century economics – but are we going to need new models to factor in AI and automation?

One interesting effect of automation we might be seeing already is an unexpected increase in productivity growth, along with an unexpected absence of inflation – perhaps because some of this productivity growth is coming from automation, and is exerting some downward pressure on wage growth inflation?

It's astonishing to see how automated Rio Tinto's become (shopping-centre-sized robot behemoths being controlled via satellite) .. How close we are to a complete production process – from digging metals out of the ground, to turning them into cars, to having them drive themselves out of the factory and become taxis or transporters – without any human intervention necessary .. And I think there's a LOT of growth to invest in in the Emerging world .. But what I'm becoming more concerned about is how we find meaning in a post-work society?
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Tim D on 01/10/2017(UTC)
Alan Selwood
Posted: 30 September 2017 22:42:56(UTC)
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Keith Cobby;51573 wrote:
It seems to me that the fundamental problem is that the Western world is ex-growth. We have had 300 years of progress and we are now suffering from demographics and have lost the can-do attitude of old. An increasing proportion of national output is being spent on social programmes. We have become much softer. Also much of our growth seems to have been brought forward from the future through higher debt and QE. I doubt it much matters whether the Tories or Labour are in government.

I have sold almost all our UK sector trusts and reinvested in asia-pacific and global funds this week.Time to sell UK Plc.


The other factor is that for several hundred years we could rely on vast quantities of cheap raw materials from our colonies and could then profit from turning them into manufactured goods that we could sell globally at highly competitive prices that also gave us large profits.

The balance of trade has changed dramatically since then, and it has been much less viable to manufacture goods here when Far East countries could undercut us in labour costs.

Also, our demographics have worsened, since our people are living much longer, the birth rate has gone down, and it gets harder to support an ever-growing retired age group. When countries like India, Vietnam and similar have young populations earning low wages, it's not easy to compete. I agree that many UK residents are less willing to work long hours in unattractive jobs for low pay. So a double-blow to our economy.
King Lodos
Posted: 30 September 2017 23:00:15(UTC)
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I'm not normally one for social engineering – but given the economic backdrop (the end of a long-term debt cycle), I'd happily take a leaf out of Bulgaria's (I think) book and start incentivising educated, professional, British nationals to have kids.

Make it affordable – because for many it really doesn't seem like an option .. I'm glad at least China and E.Europe can take these kind of actions – but it concerns me we're going to lose our culture to political correctness and an awkward unwillingness to address real challenges
Jim Thompson
Posted: 01 October 2017 05:08:39(UTC)
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I think we are definitely losing our culture and political identity, the movement of people and integration will create an 'average' European/West Indian person in a few decades time.

Working as a team gives you motivation, and a will to win. An identity. UK plc is no longer a team, or maybe we don't know what team we are on. We are losing our identity to mass migration, being emasculated by machines taking over our jobs, the constant need for positive appraisals on social media, and losing sight of what makes life worthwhile.

Robots have set us free? Ok, maybe for the dangerous jobs, but I think we would be happier going back to having humans do mindless repetitive jobs, as long we know why we are doing them.

KL - I don't agree that we need to have yet more conspicuous consumers on the planet, less if anything. We will just have to take the hit financially now, in order to support the current sway towards an ever larger aging population. I would hope that the demographics would sort themselves out naturally over time without us encouraging people into socially engineering a solution which come back and bite us in the back side 30 years later.

Sorry if this sounds like I have been hitting the gin, but in my defence the thread had already gone off at a tangent anyway!

PS - I would say Keith is about right.
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