Investment Reads

UK investment blog and feed aggregator. Last updated: 2010-09-04 09:10:27

Investment Reads is an automated services that aggregates RSS and Atom feeds relevant to UK investors and is not responsible, and does not endorse, the content.

Fund Strategy - Fund Blog

Faded star

September 03, 2010 04:24 PM
It does not seem too long ago (well not to me) that Gervais Williams was one of Gartmore’s prize assets.

Henderson New Star Money Moves Markets

Little news in US employment report

September 03, 2010 01:56 PM

Markets pay undue attention to the monthly US payroll numbers, which are at best a coincident economic indicator and are often revised heavily.

The latest figures show a rise in private sector employment of 235,000 in the three months to August, down from 450,000 in the prior three months. Such a slowdown was to be expected given a fall in GDP growth from 3.7% annualised in the first quarter to 1.6% in the second.

Commentators were relieved that private jobs continued to increase in August, by 67,000, with some having feared a contraction, signalling the ...

Euro Share Lab

Be careful if you are looking for a higher interest rate

September 03, 2010 12:25 PM

 

This week I ran into a piece written by the outstanding hedge-fund manager Seth Klarman in 1992. It's however so relevant to the current market environment it may as well have been written yesterday.

The article called Don't be a Yield Pig, is just 2 pages long but definitely worth 5 minutes of your time.

If you are frustrated by the current low interest rate environment I understand completely.

Both my parents have asked me if its not worthwhile to look for something else offering a higher return. My advice to them was to please stay away from ...

David Smith's Economics UK

Significantly weaker services

September 03, 2010 12:00 PM
The service sector purchasing managers' index made it three in a row, weakening in August as did the manufacturing and construction PMIs. The drop from 53.1 to 51.3 was bigger than expected and represented a 16-month low for the index....

Peston's Picks

How guilty is BP?

September 03, 2010 11:47 AM

How important will be BP's report into the causes of the Deepwater Horizon oil disaster, which is due to be published in the coming week or so?

Deepwater Horizon oil rig

Well it certainly won't be the last word on the subject: BP faces official investigations and court cases galore on how 11 rig workers lost their lives in April and why so much oil leaked into the Gulf of Mexico.

And some will refuse to believe any analysis by BP, on the basis that it can't help but be tendentious.

But even if you see the report as the case ...

A fistfull of Euros

Spain’s Economy Re-enters Contraction Mode In The Third Quarter

September 03, 2010 11:04 AM

Well, that didn’t last long, now did it. Two consecutive quarters of minimal GDP growth seem to have exhausted the forces of a more than fragile Spanish economy. All the post-June data we are seeing suggests the economy has now turned the corner (in the bad sense), and we should expect a negative quarterly GDP reading in the July to September period.

Perhaps the clearest indicator we have so far of the shape of things to come is offered by the August services PMI reading, which shows the sector went back into contraction in August, a performance that for ...

Monevator

Hedge funds lag the simplest portfolios

September 03, 2010 09:40 AM

Racy hedge funds are lagging boring ETF portfolios

I have often written about my skepticism over hedge funds, absolute return funds, and other sexy investment vehicles.

Some of the problems with these exotic funds include:

Now we can add a new drawback – poor performance versus ETFs.

It turns out most hedge funds are currently doing worse than the simplest tracker-and-bond portfolio ...

Bank of England

External Business of Monetary Financial Institutions Operating in the UK - June 2010

September 03, 2010 07:30 AM
Statistics relating to the external business of monetary financial institutions operating in the UK, covering external liabilities and claims analysed by currency and sector and by country.

Fund Strategy - Strategy Blog

The next crisis: coming soon

September 02, 2010 05:34 PM
Were you unnerved by the recent financial crisis? Well another one is coming soon and it is likely to be far worse.

Stumbling and Mumbling

A low-stakes election

September 02, 2010 02:28 PM
I’ve got three questions for anyone thinking of voting in the Labour leadership contest:
1. What is the probability of Labour winning under your preferred candidate, relative to the probability under your second preference?
2. How much superior would be a government under your preferred leader to that under your second choice?
3. What are the confidence intervals surrounding answers 1 and 2?
I suspect that honest answers to these questions would be: small, little and wide. But in this case, the outcome of the election just isn’t that important.
Instead, the result of the next election, and ...

The Financial Crimes

White collar crime is alive and well, and that's OK with the SEC

September 02, 2010 12:11 PM

Now I will be the first to admit, as something of an old fogey in the matter of risk and credit analysis, that I have never been a fan of the modern vogue for delegating a lot of risk analysis to the rating agencies, who to use the vernacular expression, "have no skin in the game", but it gets worse when it turns out that these so called experts get things wrong.

But I call it downright fraudulent when the rating agencies knowingly hide their mistakes and thereby mislead the market, which is exactly what Moody's did in 2007 ...

A neat sidestep.

September 02, 2010 11:47 AM

A few months ago, we had a Chancellor, called Darling, although his first name escapes me for the moment, Roger, Andrew, Peter, something like that. Anyway, like most of our financial problems over the last few years, he was Scottish (and probably still is) and is largely behind us, but he popped up the other day to tell us that his bankers' bonus super tax was mostly ineffective.

Indeed, a few days ago, one of the Swiss banks in London announced that several hundred "senior" bankers in London were to be paid big retention bonuses to make up for the ...

Bank of England

News Release - Patience and Finance - Paper by Andrew Haldane

September 02, 2010 11:40 AM
In a paper to be presented at the Oxford China Business Forum in Beijing on 9th September, Andrew Haldane - Executive Director for Financial Stability - discusses the roles of patience and impatience in financial decision-making, drawing on lessons from economics, history, psychology, neurology and sociology.

David Smith's Economics UK

House prices slip, construction growth eases

September 02, 2010 10:00 AM
The Nationwide building society reported a 0.9% drop in house prices in August, following a 0.5% fall in July, the first two-month fall since February 2009. The annual increase edged down from 6.6% to 3.9%. The temporary boost to prices...

The Financial Crimes

When the going gets tough

September 02, 2010 09:20 AM

The women go shopping. They are disappearing from the ranks of US finance workers, despite a decrease in sexual discrimination charges and a rash of new corporate programs to attract and retain them. Meanwhile, the number of men in the business has surged.

In the past 10 years, 141,000 women, 2.6% of female workers in finance, disappeared from the industry, while the ranks of men in the industry grew by 389,000, or 9.6%, according to a review of data provided by the US Federal Bureau of Labor Statistics.

The discrepancy is particularly pronounced at brokerages, investment ...

Blair's justification of the Iraq War

September 02, 2010 08:20 AM

"I don't seek agreement. I seek merely an understanding that the arguments for and against were and remain more balanced than conventional wisdom suggests... When I use the word responsibility, I mean it in a profound way. I say in the book the term responsibility has its future as well as past tense."

Future responsibility, as in being held to account in a court of law? I suspect not.

Stumbling and Mumbling

Goodbye New Labour

September 01, 2010 01:44 PM
Sunder and Left Futures do a good job of rebutting Blair’s claim that Labour lost the election because it was insufficiently New Labour. But there’s something to add.
Despite what its left and right critics say, New Labour was not just a marketing ploy. It was also an intellectual project intended to put new life into social democracy. New Labour thought that top-down managerialist policies - such as tax credits, the minimum wage, increased spending on education - could achieve both economic efficiency and greater equality.
 Labour’s problem is that this conception of social democracy has just run its ...

Monevator

101 ways to save money

September 01, 2010 01:20 PM

Ways to save money

Aside from big picture stuff like extreme frugality, I’ve never focused much on ways to save money here on Monevator. Plenty of blogs have that niche covered.

But be under no illusions. Spending less than you earn is the key to getting rich, whether you earn 20K a year or two hundred. The Micawber Principle is the one rule of financial planning that rules them all.

So I was delighted when fellow money blogger David Hamilton agreed to fix the frugal tip deficit on my blog with a guest post offering more than 100 ideas for how to ...

A fistfull of Euros

The Odd Couple

September 01, 2010 12:20 PM

The modern world moves at a breathtaking pace, even when most of us find ourselves on holiday. No sooner do we receive, read and start to digest one set of economic data than we find ourselves pushed to think about what the next set will look like. The clearest recent illustration of this undoubted reality is to be found in peculiar twist of events which meant that just as the news reached us that the German economy had expanded at a record rate in the second quarter, at almost the very same moment Federal Reserve officials meeting in Washington decided ...

David Smith's Economics UK

Manufacturing growing - but more slowly

September 01, 2010 11:30 AM
There are two explanations for the slowdown in manufacturing growth reported in the latest purchasing managers' index for the sector. One is that exporters are feeling the effect of weaker growth in markets, the other that the kick from inventories...

Henderson New Star Money Moves Markets

Is global liquidity starting to improve?

September 01, 2010 10:53 AM

Posts since the spring have suggested a defensive investment stance on equities and other "risk" assets, for two reasons. First, the annual growth rate of G7 real narrow money, M1, fell beneath that of industrial output in February (firm data available in early April). Historically, equities have underperformed cash on average under this condition, while outperforming significantly when real M1 has outpaced output.

Secondly, the US monetary base started to contract in early 2010 – markets have exhibited a lagged correlation with base fluctuations since the Federal Reserve embarked on "QE1" in late 2008. The fall in equities from April followed ...

Peston's Picks

A valueless banking boom?

September 01, 2010 09:36 AM

So how big has been the recent boom in some parts of the banking industry?

Big enough, according to new figures released this morning by the Bank for International Settlements (the central bankers' central bank, as if you didn't know) and the Bank England.

Man stands in front of an electronic boardAccording to the results of their latest triennial survey, global foreign exchange turnover rose 20% to $4trn per day on average (yes, that's each single day) in April 2010 compared with April 2007.

Or to put it another way, a sum equivalent to the entire output of the global economy is traded around once ...

Bank of England

BIS Triennial Survey of Foreign Exchange and Over-the-Counter Interest Rate Derivatives Markets in April 2010 - UK Data

August 31, 2010 10:01 PM
In April this year, central banks and monetary authorities in 53 countries, including the United Kingdom, conducted the latest triennial survey of turnover in the markets for foreign exchange (spot, forwards, foreign exchange swaps, currency swaps and options) and over-the-counter (OTC) interest rate derivatives.

Peston's Picks

How money talks to Labour and Tories

August 31, 2010 04:52 PM

My analysis of the latest cash-flow figures for the two main political parties yields two stark conclusions:

1) Labour is dangerously dependent on funding from a tiny number of wealthy individuals and trade unions;

Canary Wharf2) The Tories still rely on contributions from the City of London and financial services, especially hedge funds and fund managers, to a considerable extent.

In the crucial second quarter of this year, from 1 April to 30 June - the general election quarter - the Tories and Labour received almost identical cash donations, according to figures supplied to the Electoral Commission. The Conservatives received £10.23m and ...

Henderson New Star Money Moves Markets

UK Q2 national accounts confirm stronger domestic inflationary pressures

August 31, 2010 03:49 PM

Bank of England Governor Mervyn King and other MPC members continue to claim that the current inflation overshoot reflects transitory factors including the weak exchange rate and higher global energy prices, while underlying inflationary pressures are weak. This is not supported by a national-accounts-based measure of domestic inflation.

The “implied deflator for gross value added at basic prices” measures the domestic cost – in terms of wages, profits and rents – of producing a unit of output. It excludes, by construction, indirect taxes and import prices, including the cost of imported energy and other commodity inputs. The GVA deflator rose by 2 ...

Stumbling and Mumbling

Wages & corruption in cricket

August 31, 2010 01:45 PM
Dileep Premachandran quotes a recommendation from Mohammed Malik Qayyum in 2000:
Pakistani players for all their talent are not as well-paid as their counterparts abroad. As long as they are underpaid the tendency to be bribed remains.
For me, this rings true. There are four aspects to the problem.
1. Comparisons. Mohammad Amir gets a monthly retainer of £1300 from the PCB, and a test match fee of less than £2000. Of course, this is a fantastic fortune by Pakistani standards, and even many high-earning Englishman would be delighted to get such money for doing something they love. However, these ...

A fistfull of Euros

Spain’s Unemployment Continues To Rise

August 31, 2010 12:32 PM

Spain’s EU harmonised seasonally-adjusted unemployment rate (which is the interesting number) went up again in July, according to the latest data from Eurostat. It rose to 20.3% from 20.2% in June.

So despite a double digit fiscal deficit, Spain has not yet succeeded in putting a brake on the upward drift in the headline unemployment number.

And the number of those officially working continues to decline, according to the data on those paying insurance contributions from the Labour Ministry.

Clearly having broken the 20% barrier the number looks like heading up even further in the second half ...

Henderson New Star Money Moves Markets

UK monetary trends still encouraging despite July stall

August 31, 2010 10:54 AM

Key UK money supply measures were unchanged in July but have grown at a faster pace since early 2010, supporting hopes of a continued economic recovery. Corporate liquidity, in particular, has improved further. Unusually, households failed to expand their money holdings last month, probably reflecting a combination of low interest credited, an ongoing switch into mutual funds and use of spare cash to repay borrowing.

David Smith's Economics UK

Of housing peaks and troughs

August 31, 2010 10:30 AM
The National Housing Federation has generated headlines with its prediction that home-buyers who bought at the peak in 2007 will have to wait until 2014 before prices exceed those peak levels and, as they put it, they will have escaped...

A fistfull of Euros

On The Shoulders Of Giants – How Spain Is Destined To Follow In Germany’s Footsteps

August 31, 2010 09:17 AM

The current generation of policymakers seem to be like Captains of large ocean liners, out there on the high seas, bereft of either compass or adequate charts, trying hard to calm there worried passengers by telling them nothing is amiss. But the charts are there, if only they would look at them, and in the present Spanish case, unlike the old refrain, the future is ours to see, and it has a name: Germany.

For those willing and able to examine our present situation with a reasonably open mind, a comparison of the recent history of the Spanish and German ...

Peston's Picks

Penury that unites old and young

August 31, 2010 09:00 AM

I wish I could say I was overjoyed to be back in the supposedly real world, after a few days being revitalised by the benign winds and periodic sunshine of the Welsh coast.

Stack of pound coinsBut everywhere I look this morning there are gloomy stories about pensions (see the front pages of the Daily Mail and Telegraph, for starters) - and, of course, there is a direct relationship between the perceived salience of pension issues and age (which is why they oppress me and my contemporaries, and why younger people can't be bothered to save for a pension at all).

But here ...

Bank of England

Lending to Individuals - July 2010

August 31, 2010 07:30 AM
Monthly release of growth rates, amounts outstanding and changes in total lending to individuals, broken down into lending secured on dwellings and consumer credit.

Sectoral Breakdown of Aggregate M4 and M4 Lending - July 2010

August 31, 2010 07:30 AM
Monthly release of growth rates of and changes in M4 and M4 lending for the household sector, private non-financial corporations, and other financial corporations, together with the second release of growth rates of and changes in aggregate M4 and M4 lending.

Analysis of Monetary Financial Institutions' Deposits from and Lending to UK Residents - July 2010

August 31, 2010 07:30 AM
Industrial analysis of deposits with, and borrowing from, monetary financial institutions in the UK by UK residents other than monetary financial institutions. The release contains growth rates, amounts outstanding and changes in deposits and borrowing, both in sterling and foreign currency.

Monetary and Financial Statistics - August 2010

August 31, 2010 07:30 AM
Informally known as Bankstats. It consists of: money and lending; monetary financial institutions' balance sheets; further analyses of deposits and lending; external business of banks operating in the UK, public sector debt and the money markets (including gilt repo and stock lending); sterling commercial paper, other debt securities, capital issues; financial derivatives, interest and exchange rates and occasional background articles.

A fistfull of Euros

One Swallow Doesn’t Make A Summer, But….

August 31, 2010 05:43 AM

Well, as we all well know one swallow doesn’t make a summer, and one data point doesn’t swing an argument one way or another, but the latest retail sales PMI reading for Germany is far from being either uninteresting, or (for my part) surprising. Basically after only two months (in the last twenty seven) of registering growth, the August PMI suggested that German retail sales once more fell back. And the anecdotal explanation for this: Spain’s victory in the world cup affected the shoppers appetite! Actually, from a long term aggregate point of view I think (and ...

Not Content With France, Now It’s Poland Too!

August 30, 2010 01:15 PM

Not only is the French economy the grateful recipient and beneficiary of sustained German export growth, so too is Poland (I’m sure they’ll be glad to hear that in Warsaw!). According to the FTs Jan Cienski:

German recovery boosts Polish GDP

Poland’s economy grew by an unexpectedly strong 3.5 per cent in the second quarter; the country’s statistical agency said on Monday, thanks in part to continuing strong exports to the rapidly rebounding German economy, as well as resilient domestic demand.

In fairness to Cienski he then does go on to inform us that according ...

The Financial Crimes

How much can a "free" service be worth?

August 30, 2010 01:03 PM

Well, based on secondary market transactions, Facebook is now worth as much as $33.7 billion. Common stock in Facebook trades as high as $76 a share as investors try to get a piece of the company before it files for an IPO.

Media industry sources say Facebook may soon make as much as $1 billion in annual revenues, mostly from its "engagement ads" program. Facebook dropped traditional internet advertising when its partnership with Microsoft expired and has chosen to focus on ads based around users' stated interests and preferences.

Facebook is certainly making money and the Facebook "fan page ...

Because it is a Bank Holiday

August 30, 2010 12:05 PM

I spent longer than usual in bed this morning and listened to the BBC propaganda machines recitation of Chris Mullin's diary. Now I have a thing about politicians who sell off their scribblings about the time when they were supposed to be working for the people who put them intom office, but all I can do is refuse to read their memoirs.

But listening to this I was struck by two things. First of all there was the vanity of Mullins, which was lirttle different from most politicians. Contrary to their view of themselves, an MP is not an ...

As Ian Dury would have said ...

August 30, 2010 11:43 AM

The FSA had 241 employees on staff in March who were paid more than £100,000, compared with 81 employees in March 2006, according to the regulator’s response to a freedom of information request.

One would like to think that is good news, but if 81 people can't figure out wghat is wrong with the banking system, why would 241 of them do any better? How many public companies in the private sectoractually have that number of employees earning that much, particularly outside the financial sector? And how many government departments.

They probably won't, but this is ...

A fistfull of Euros

Wolfgang Munchau Has It (More or Less) Right

August 30, 2010 09:03 AM

Well, having just posted a lengthy study of the German economy on this blog, I started to lazily browse my way around today’s economic news headlines, and Lo & Behold, what did I find over at the FT, a contrarian voice. That of Wolfgang Munchau. In his comment column he berates the Euro Area for its lack of product market and labour market mobility – in the sense that there are large differentials in both price and wage levels, yet few seems motivated to either shop or work around in the search for a better deal. Few seem motivated to follow ...

The Baron Münchhausen Effect

August 30, 2010 08:05 AM

Karl Friedrich Hieronymus, Freiherr von Münchhausen was a German baron born in Bodenwerder in the eighteenth century. Made famous by the Hollywood director Terrence Gilliam, the baron first came to public attention for his ability to recount outrageously tall tales about his adventures while fighting abroad in the Russian army. Among the astounding feats which legend attributes to him are riding cannonballs and travelling to the Moon. But perhaps his best known marvel is the story of how he managed to escape from a swamp by pulling himself out by his own hair (or by his bootstraps, depending on who ...

Ian Fraser

Gilbert: It’s time for Britain’s big banks to be broken up

August 29, 2010 10:48 PM

By Ian Fraser

Published: Sunday Herald

Date: August 29th, 2010

Martin Gilbert, chief executive of Aberdeen Asset Management, has declared that big institutions that straddle the investment and mainstream banking divide should be broken up.

Echoing the views of Scots economist and author John Kay, who coined the widely used “casino” and “utility” banking analogy for the divide, and Business Secretary Vince Cable, Gilbert claimed the UK’s banking sector must undergo radical structural change in order to become safer, serve the customer better and be less prone to blow-outs.

“The banks should be split up. That’s our view ...

Stumbling and Mumbling

Welfare benefits & unemployment

August 29, 2010 09:39 AM
Don Paskini claims that higher welfare benefits help people find work, pointing out that between 1996 and 2009, the numbers of lone parents in work increased, at the same time as benefits did.
His commenters are right to say the evidence doesn’t prove his claim, because perhaps even more people would have found jobs if benefits had been lower. But the evidence does prove something - that higher benefits can be consistent with lower benefit claims.
The problem here is that the anti-welfare lobby misrepresents its case. For example, when Neil O’Brien claims that higher benefits encourage people to ...

A fistfull of Euros

Another Irish lesson fail

August 28, 2010 02:09 PM

Not seen on the newswires from the Federal Reserve retreat in Jackson Hole, Wyoming –

The world of economics was rocked to its foundations yesterday when European Central Bank President Jean Claude Trichet urged countries to run huge structural budget deficits and massively pro-cyclical fiscal policy while creating huge contingent liabilities in their financial sectors.”

Because that’s not what M. Trichet actually said, or what the media took him to say.  But did he know that was the apparent implication of what he said?  Yes, it’s Ireland again, seemingly everyone’s favourite misunderstood episode of boom and bust.   It ...

Ian Fraser

Bust air firm may provide key to HBOS controls failures

August 28, 2010 01:04 PM

August 28th, 2010

Living the high life

[Editorial Note: This article was written in June 2010 but has not previously been published in its entirety. An edited version was published in The Sunday Times on June 27th, 2010]

Directors of an aviation business that went bust owing HBOS £113 million in September 2007 were allowed to buy the business back from administrators Price Waterhouse Coopers for an initial consideration of just £7.

A few months later they paid an additional £49,999 but were unable to pay the additional €10m they were supposed to pay by February 2008 to ...

Bank of England

Monetary Policy After the Fall - Paper by Charles Bean

August 28, 2010 01:00 PM
In a paper presented at the Jackson Hole Economic Policy Symposium, Charles Bean - Deputy Governor of the Bank of England and member of the Monetary Policy Committee (MPC) - discusses the lessons learned from the financial crisis for the future conduct of monetary policy.

Stumbling and Mumbling

The Spirit Level mechanism

August 28, 2010 10:49 AM
During my holiday, I finally got round to reading The Spirit Level. And I have a problem with it.
It’s not the data. This is convincing if you’re prepared to be convinced, and not if you are not. Facts are rarely decisive in political disputes.
Instead, it’s the mechanism: how, exactly, does inequality lead to ill-health, crime and the other ills Wilkinson and Pickett describe?
They say that “greater inequality seems to heighten people’s social evaluation anxieties by increasing the importance of social status.” The result is a “threatened egotism”. If the anxieties this creates are ...

Monevator

Weekend reading: Edinburgh edition

August 28, 2010 08:00 AM

Money blog articles

A silly season weekend musing followed by links to some of the week’s great posts.

I am in Edinburgh for the fag end grand finale of the Fringe Festival this weekend, so no links from this morning’s papers I’m afraid. Even my beloved FT will have to wait until I’ve boarded the train at Kings Cross.

Really looking forward to the trip; we’re in the quiet carriage outward and in first class for the trip back, and just £70 for the lot. The train takes five hours, but it deposits you right in the center ...

The Financial Crimes

Economic hurricane blowing in the wrong direction for Ed Balls

August 27, 2010 11:43 AM

Ed Balls, the desperate also-ran in the Labour leadership race says that we are facing an economic hurricane and that George Osborne's plan has as much economic credibility as a ''pyramid scheme''. Well Balls knows all there is to know about running a Ponzi scheme having presided over the last government's attempt to boost the economy by borrowing against aour grandchildren's future.

Unfortunately for Mr Balls' narrative, the UK economy grew slightly faster than initially thought in the second quarter, expanding by 1.2% rather than the 1.1% cent first estimated. That is the fastest quarterly ...

About

This site is run by Graeme Pietersz, who also writes Moneyterms, an investment reference site.

Investment Reads is a simple feed aggregator for sites of interest to British investors. It combines the feeds published by blogs and other sites to allow you to:

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