For those searching for a long-term investment perspective risk and volatility are big issues: and there's no better example of that rollercoaster ride than crypto-currencies. Adam Cox has chosen to focus this episode on Bitcoin due to its reputation for major swings in value — but it applies just as well to major asset sectors such as property and stocks. The fact is that cash left on deposit at a time of high inflation erodes real value just like a leaky bath: so it's important to come to terms with asset risk and not to suffer 'analysis paralysis'. Adam's time machine and rollercoaster analogy might help.
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As Rishi Sunak steps into the lead role in British politics, we look at the educational choices which have paved the way for him, and discuss how the search for a more egalitarian form of capitalism can reconcile opportunity for all with individual freedom. The degree to which parents take responsibility for that education, as Rishi's parents did for him, is critical — and that poses a significant question for the huge numbers of young people who are not enjoying a traditional family upbringing. Background Music: 'Everything Has a Beginning' by Joel Cummins
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Our new Chancellor of the Exchequer, formerly the longest-ever serving British Health Secretary, is uniquely well-placed to understand the burden that universal health care provision places on the public finances, and why we must crack this 70-year addiction. In this episode, we analyse how heavily this burden is impacted by care for older people, many of whom are well-placed to be able to cover the costs which they incur. Now is the time to take a fresh look at the 41% of central government spending committed to the health service — we propose that in future there should be an intelligent use of mandatory private medical insurance for those who can afford it, with the NHS drawing down the cost of their treatment from their insurer, as it’s incurred. (* 'FCE' stands for 'Finished Consultant Episode') Background music: 'The Plan's Working' by Cooper Cannell
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Original Broadcast: Thought for the Week
The past seventy years have seen remarkable progress in so many areas, but they have also been accompanied by a growing addiction to debt. We've lost connection with the disciplines which should govern the use of debt: like the road runner who has just lost touch with the cliff edge, there is no longer any solid ground on which we can land — so we must now anticipate painful re-adjustment as markets fall. We need to move to a mindset where debt is a form of investment for the future, to be drawn down carefully and sparingly — not to be used either for chasing higher and higher prices, or for incessant Government bail-outs. Background music: 'Addicted' by VYEN
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Original Broadcast: Thought for the Week
There's a key missing link in Kwasi Kwarteng's mini-Budget strategy — workforce capacity. The unemployment rate is already at a record low of 3.6%, with many more vacancies than job-seekers: if we don’t tackle workplace capacity, the new Growth Plan won’t work. However there are initiatives we can take at both ends of the working age-range which could increase the available workforce by at least half a million people, together with significantly improving mobility for young adults to take advantage of work opportunities wherever they arise, and reducing public expenditure on health and care services. So, while the current focus is understandably on Government borrowing and the exchange rate, we must increase workforce capacity for the Growth Plan to succeed. Background music: 'The Plan's Working' by Cooper Cannell
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Original Broadcast: The Financial Outlook for Personal Investors
If you missed Kwasi Kwarteng’s speech on Friday 23 September, here’s the opportunity to hear it in full, as delivered.
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Original Broadcast: This is Money
Britain's new Chancellor Kwasi Kwarteng delivered a blistering mini-Budget this week that was anything that small. A wave of tax cuts were unleashed. Some had been heavily trailed, such as spiking the National Insurance hike and a stamp duty reduction, but there were also two rabbits out of the hat: a cut in basic rate income tax to 19p from April and abolishing the 45p income tax rate. Those tax cuts joined a wave of spending commitments, most notably the huge energy price guarantee bailout for Britain's households and businesses. Paul Johnson, of the IFS, said: 'Mr Kwarteng is not just gambling on a new strategy, he is betting the house'. Georgie Frost, Lee Boyce and Simon Lambert discuss what the going for growth mini-Budget means for people, how much they may save in tax, and whether it will work or cause the UK economy even more problems down the line. One thing was clear in the aftermath: markets didn't like the break from the orthodoxy that they saw, and the pound tumbled below $1.10 while UK gilt yields jumped. But how much does that have to do with the mini-Budget and how much does it have to do with the Bank of England's rate decision that delivered a bumper rise of 0.5%, which was still considered small next to the US Federal Reserve's 0.75% bazooka? And finally, we've heard lots of 'glass half-empty' verdicts on our current economic situation but what is the 'glass half-full' one? Simon has a crack.
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Janice Turner's strikingly clear article in Saturday's Times (13/8/22) sets out why young people from low income households have such a struggle finding stability and economic security, after years of student debt, soaring house prices, and a much higher risk of split parents. In 2010 David Willetts' book 'The Pinch' was published, setting out the huge generational divide at that time: but over the past 12 years, the position has deteriorated significantly. Will Liz Truss call for change? Background music: 'Land of My Fathers' by The 126ers Links via https://www.shareradio.co.uk/thinkingaloud/newsletters/comment-wc-2022-08-15/
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Original Broadcast: Thought for the Week
Liz Truss and Rishi Sunak are both understandably focused on the UK economy, challenged by massive public debt and soaring inflation, but who will tackle the 'elephant in the room' of the gargantuan health and social care budget, which has resulted from seventy years addiction to socialist universality? We update our proposal first made in June 2018, since when the cost per adult of health and social care has doubled. Background music: 'Addicted' by VYEN
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Original Broadcast: Thought for the Week
Publication of the Austin Report by HM Treasury should herald a new era for a vibrant UK stock market and much greater profile for personal investors. However there needs to be significant improvements for the latter, including strengthened rights to share owner communication and voting for those whose holdings are in nominees, normalising the threshold levels for partaking in circularisations and resolutions, and the ability for personal investors to take part in the 'rump' sell-off of nil-paid rights so that personal investors as a genre are not diluted. It's a time for change .. Background Music: Hopeful Freedom by Asher Fulero
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