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dr ray

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Posts posted by dr ray

  1. I just found out about a Bulgarian bank that offers free-access to money account with interest at 6.57 % . For foreigners there is a 10 % withheld on all interest accumulated (tax)

    As far as i remember Last time in the UK interest were that high just before the Icelandic banks went bust .. we all remember that.

    Anyway , are there other EU spots witch such cool interest rates ? I never explored offshore accounts though ... perhaps there are some good offers .

    Does it make sense for Europeans to open such accounts in a small EU country ?

    Deposit protection is 100 000 EUR for Bulgarians , not sure for foreigners.

    http://www.fibank.bg/en/page/882/tab/883

    Has anyone got cash in here and is it FSCS covered?

    Thanks for posting this. I am always looking for new opportunities.

    This initially looked good as Bulgaria is in Europe now so deposits are covered by the 100K euro guarantee but the devil is in the detail here.

    When I looked into their FAQ page on the website it says any compensation would be paid in local currency. If their currency becomes worthless the official and actual exchange rate may well be very different so, regretably , for me "I'm out"

  2. Thankfully I've managed not to sell at any bottoms - I'm lucky enough to get out before big drops!

    I also intend to hold for long periods of time, but sometimes there are opportunities where you could make a couple hundred in one week with a trade and sell - only worth it putting in a couple grand and risky, granted...... What is your take on house builders and the banks? They are my main equity investments for now - got LLOY at 63p and BDEV at 83p - never put TOO much in as can stomach a loss if they bottom out below these values, when I'll pile in much more (if something catastrophic doesn't happen)

    I'm not a trader so I avoid anything volatile. I've no idea on LLOY and BDEV but for someone with time and access to cheap trading the wild swings in price are ideal.

    My priority is tax free income and capital growth as I pay tax at 50% and I don't have much time to track investments so I buy VCTs and high div stocks for my PEP (and gold legal tender coins) and just hold them. Its not been a highly successful strategy over the last 10 years because of losses on banks, BP and telecom and AIM VCTs in which I was overweight but I'm hoping I'll have a decent flow of tax free income when I retire in a few years

  3. Of course I know how they work! My point is that you can gauge how they're doing by looking at the figures for RPI and it I thought they would have been doing better (certainly I think inflation will rise but I think it seems higher to me than the figures represent).

    As I said - this is my safe money, don't want to risk it on shares - shares are obviously higher risk.

    Just a bum day for me. (P.S. harsh first comment!)

    I thought RPI would be higher by now too. Real inflation certainly is. I think even RPI will kick off in the new year. Commodity prices take about 6 months to feed through to the shops and the VAT rise will come through too. Government is either betting or else misinforming us that the excess capaciy in the economy will prevent retailers passing on prices but we will have to see.

    I think you will be glad you bought the NS&I certs especially if you are a higher rate taxpayer. There should be the opportunity to roll them on in 3-5 years too unless they change the rules and by then they will be like gold dust.

    There is the currency risk too but unless you can get index linked bonds denominated in Yuan I can't see any way around this.

    I thought BP would be a proxy for an index linked currency independant investment and I put a few Ks in this earler this year. Look where that got me.

  4. I have about 25K on zopa. Been with them about 18 months.

    The money is held by RBS until its lent out and then obviously held by the borrower. If zopa went bust they claim that the interest and capital repayments wouldn't be affected but I would foresee borrowers defaulting en mass. There is no compensation scheme and zopa can't be put in an ISA or SIPP.

    Until recently it was difficult to lend more than 25K as it needed a consumer credit licence (CCL) but a few months ago this was dropped at about the same time as NS&I index linked was pulled. I think this caused a flood of money into zopa and the rates have tanked. I stopped lending in September.

    Newbies pile in offering loans at 4-5% thinking its better than a building society but don't consider bad debt. When there is so much money at silly rates available it becomes less worthwhile.

    Bad debts are not tax deductable. Bad debt estimation is historical and could become much worse than indicated if unemployment bites.

    Regarding creating money from thin air - zopa doesn't. Money lent out is £ for £ the same money that lenders put in. No credit is created.

    IMHO worthwhile for a non-taxpayer or basic rate payer if rates improve a bit from now. Not worthwhile for higher rate taxpayer.

  5. I aim to raise 100k investing and then quit my job. Trading on 100k could give a decent annual wage for yourself, no rat race, and lots of precious leisure time :)

    Not even close. Most day traders lose money and 100k is not a sufficient amount to stop work for. You would need five times that, maybe more if you are young and don't want to live in a bus shelter.

    My niece was a high powered city trader who thought she might as well trade on her own account rather than make money for Parabas and lasted a few weeks before she had just about lost it all.

  6. For someone who has more than 3000 posts this shows a lack of financial understanding.

    The return on NS&I is linked to RPI and you will only get the full value of projected return if held to maturity. If you only bought them in July I think you will find your return is actually zero if you cash them now.

    If you knew the return on shares would be 6 times higher then you should have bought shares. Even better would have been agri commodities.

    The problem is that you didn't know and you still don't know what will be the situation in another 6 months. At least with NS&I you do know

    I hold a lot of NS&I and they performed exactly like I expected them to. My gripe is that RPI (though better than CPI or Core CPI) underestimates inflation because of product substitution (x becomes too expensive for people to buy therefore replaced with a cheaper alternative in index) and hedonistic adjustment (x product improves due to technological improvement but increases modestly in price eg cars, computers - considered to have become cheaper for index).

    RPI has surprised me in still being under 5% now giving me the equivalent return of maybe 11% pa on a safe taxed deposit on my certificates. I did expect more. If I had waited until RPI was say 20% so that I would get the same return as a punt on cotton or sugar in the last few months I would not have been able to by NS&i because they were withdrawn when they began to look like a no-brainer.

  7. Hi All

    I've been away for a year but I was thinking about the very same thing as bogbrush so came back on here to see what the concensus was. Nice to see all the old names still online.

    Argentina has 25% inflation at present and if you read Bill Bonner, they are in a crack up boom with people spending money before it becomes worthless. Houses increasing dramatically in nominal terms (and possibly in real terms too if supply is low) as a hedge against inflation. He says the buyers are cash buyers.

    Now it may be that the UK doesn't have enough cash buyers to cause HPI while credit remains tight so the question is whether QE will work through to the mortgage borrower.

    Where I live house prices are still vastly out of synch with wages or rental income and both these look like taking a hit as public sector is largest employer so on fundamentals it looks like a bad time to buy but if the crack up boom happens we can look at history and see that property will be sought after as a wealth protector. Like they say no one with 100oz of gold will ever be poor the same goes for anyone with 2 or 3 houses (unless property rights are removed).

    Just my opinion.

  8. He won't, he only talking about a "reveiw" to see "if" they should...............But BLOODY HELL something has spoked him!

    http://www.timesonline.co.uk/tol/news/politics/article6999958.ece

    Mike

    Funny thing is a comment by someone called Gavin Davies complaining about a 30K public sector wage.

    Sadly not the Gavyn Davies who is a good friend and advisor to Gordon Brown and as a previous Goldman Sachs banker amassed a personal fortune of £150 million

  9. But in virtually all societies there is a man at the top with a big gun, or a big set of muscles or some kind of feature meaning he is the one that sorts things out.

    Could be the alpha male in a pride of lions, Al Capone or the leader of a South American tribe.

    In our society that man is an organisation.

    That organisation is the State.

    Yes its about survival of the species (or the gene) rather than survival of the individual. The loyalties are to close family, distant family/village/tribe and then country or state or ethnic group (or proxy such as religeon).

    Different societies will work out by trail and error what is the best way to secure survival. In most human societies it is the wisest who usually rules not the strongest. The knuckleheads generally get sent off to fight other tribes and get killed. Most gangsters have a short rule.

    Totalitarian regimes like we are moving towards in the UK would like loyalty primarily going to the State and the move toward the State supporting many families rather than have the families supporting themselves can be seen as an example of this.

    Who now brings home the bacon in many families in the UK? Is it the family leader or the State?

  10. Some capitalists take a very Darwinian approach and define capitalism in exactly these terms : survival of the fittest.

    I see society as being made up of people across the spectrum of beliefs. Those who do not subscribe to a Darwinian view of the world exist in a democratic world in the UK and have every right to demand a fee (usually called taxes) from those who have a completely Darwinian view of the world.

    This fee is the subject of continual negotiation. This negotation is a true two way negotiation as the Darwinian capitalists do tend, on average to contribute a lot to economic growth. We are currently in a situation where the capitalists risk being snuffed out by the reaction of those who do not share their beliefs.

    Actually Darwinism is badly misunderstood and all sorts of theories based on "survival of the fittest" are completely wrong because of this misunderstanding.

    Think about it. A group of humans living in hostile surroundings. Are they more likely to survive and breed if they co-operate or if they fight among themselves to secure the last bit of food?

    On a broader scale are they more likely to survive if they destroy every other animal, because they can, or if they live in harmony with their surroundings?

    The Darwinian principle therefore encourages group co-operation and negotiation - almost completely the opposite to what people think it does when the talk about survival of the fittest.

    If there was to be a sort of Mad Max scenario the survivors would be the ones who co-operated and formed groups with standards of behaviour and mutual support not the ones with the biggest guns.

  11. Brown knows that if House prices did what they done else where he is finished. He is anyway but in the UK NOTHING is more important than HOUSE PRICE!

    Sadly, Gordo got away with it, the main collaspe will not happen on his watch.............years from now when the Tory goverment is the most hated in history Brown will be on Newsnight (taking time off from his Goldman Sac job of mangering their Gold holdings).........explaining how he had things under control & it was starting to recover.........& the Morons will agree with him.

    Mike

    Unfortunately he is right in that nothing is more important than house prices in the UK. The entire UK retail, manufacture and financial industry and the spending of UK citizens is almost entirely dependant on house price inflation. The toxic assets which brought down the banks and hence the uk economy become more toxic as house prices fall. He is also right that it is a global problem in that the toxic assets are also dependant on house prices in USA, Bulgaria, Spain etc but at least if the UK house owner can carry on borrowing and spending it would go some of the way towards giving the impression of recovery.

    I'm not absolving Brown by agreeing with him. He should never have encouraged the misallocation of capital which resulted in our dependance on HPI in the first place

  12. I was using law and order as an example of the greater good, not a literal be all and end all.

    If that's what we want as a society then it can be arranged.

    How is using state funds and high taxation to keep people unemployed rather than working to improve their own position and the position of the UK for the greater good?

    State interferance is not only making the well off use their time and ingenuity to avoid taxes rather than creating wealth and employment but also making it unprofitable to get work for the not so well off. Its a lose-lose situation.

  13. However on here you don't get rational people. You get nutters who moan about it being unfair that they have to pay to keep the place running so that we have a functioning society and not some anarchist paradise where someone could easily come and really steal their £100,000 salary, kick them out of their house and rape their wife while butchering their kids purely because they're the local warlord and that's what they can do for fun.

    They ought to get a grip. Or move to Somalia.

    Either suits me.

    The increased taxes isn't to maintain law and order. It is to subsidise borrowers so that they can continue to live beyond their means. We had just as much law and order when taxes were lower.

    Even if the increased taxes were for law and order I would find it cheaper to be burgled every other year and have every thing I earned that year stolen than pay tax at the proposed rate.

  14. I understand the "tax is theft" argument. However it just doesn't hold up.

    As I mentioned before, there are parts of the world where "the state" barely exists. I reckon taxes are probably quite low in Somalia. That's thanks to the fact that it doesn't have a functional government.

    You can of course argue that we don't live in a free country, because you have to work to pay taxes, and so on. So you could go and live in parts of Africa where you don't need to participate, and can be self-sustaining. You have *real* freedom.

    Until you're hacked to death with a machete. Because there's no law and order. Because there's no infrastructure and no education. Because there are no taxes.

    Some places had effectively 100% tax because you were forced to work for the state for nothing. Cambodia under PolPot wasn't a walk in the park either .

    What we are arguing is that there is a fair level of taxation or even value for money and the UK has gone over the line IMO.

  15. Here come the tedious "If I want someone to empty my bin and teach my kids I would pay for it voluntarily" responses.

    Hey AZ- I was replying to you earlier today to apologise for not realising your dig at public sector workers was sarcasm but I got busy.

    There are so many nutters on here now who dont distinguish public sector workers like the CEO of Northern Rock or Royal Mail from the ones who are essential for keeping the country running that it is difficult to tell what is sarcasm now.

  16. I'm assuming you've never read any of my previous posts then.....

    I can't say I ever read anything of yours that was memorable but on this thread you have come across as the lazy, envious, whats mine is mine and whats yours is mine type who thinks he's entitled to the things which others have achieved by forgoing instant gratification and working hard.

  17. Absolutely.

    And to be fair to the original poster - that's the fault of society and the tendency of people with control to look out for their mates & use instinct rather than use cold logic, not his.

    I'm afraid this is drivel. Sure if you are born to a family of wasters you are unlikely to ever want to work let alone earn over 100K but if I earned 100K I would be profundly miserable and see what I could do to boost my income. On the other hand I was working all night yesterday and I'm still at work today. I had no silver spoon. I couldn't even speak English until I went to school.

    I dont resent paying some tax but the vilification of people like me or the OP for trying to improve the circumstances of himself and his family is appalling.

    Hey, he might even be Jewish or a Black. Why don't a group of us get together and go and burn him out?

  18. Reduction in universality = reduction in buy-in. Saying "this benefit/allowance is not for the likes of you" invites the question "then why should I pay towards it?"

    At 100k it's at a (cleverly chosen, as evidenced by this thread) level where most can accept it, because only overpaid [email protected]@rds are affected. But it's a dangerous and slippery slope for the redistributionists to have started down. Next thing you know, there'll be mandatory private health old age care insurance above a particular income.

    Nah, That will never happen. You're just being alarmist

  19. Provided the tax rates are applied across the board, equally, to all people earning the same pay I couldn't give a shiny shite.

    However they aren't, because the rich pay someone to avoid paying their share.

    But Comrade AZ, the OP is paying more tax than most. Someone on a wage like I presume he is has no opportunity to work in the black economy or claim tax deductions or non-dom status. Your hatred of the superich and privilaged is being turned on folk who are not so different to yourself. Perhaps they were born a bit brighter or worked harder rather than piss away their university education but you seem to think that it is OK to take away what they have in excess of what you have.

    I can see Gordon Brown will be getting your vote at the next election.

    Forward Comrade. When the revolution comes we will all be driving Rolls-Royces!

  20. Didn't realise we had so many communists on HPC.

    Anyone earning lots must be punished (providing its not me). Yes that makes a lot of sense. How about you all try and understand that some people who earn lots do so because they work hard and deserve what they are paid while some people who earn little may not even deserve that.

    Someone told the OP to STFU and pay their share. At income between £100K and £113K the marginal rate of tax is around 62%. I would say he is paying more than his share.

    Some one else suggested it would have been simpler to extend the 40% bracket. Well that is being done too by not increasing the thresholds in line with inflation

    You all may not have much sympathy for the OP (which is why such major changes to the tax system are imposed with hardly anyone noticing) but in time most people in full time employment in an above min wage job will be hit by this because of fiscial drag.

    The government see the OP as the milchcow. He can be squeezed for cash and he can't complain because he'll get no sympathy. He can't tell them to stick it and go on benefits because he has a family to look after and he probably has some savings which the government will confiscate or inflate away so that the real parasites in society can be paid their bonuses/benefits/expense claims/consultancy fees (delete as appropriate)

  21. great

    tradesmans tokens to make a come back

    but will those caught bypassing the bankers system be executed

    http://www.independent.org/store/book_detail.asp?bookID=75

    In Good Money, George Selgin tells the fascinating story of the important yet almost unknown episode in the history of money—British manufacturers’ challenge to the Crown’s monopoly on coinage.

    In the 1780s, when the Industrial Revolution was gathering momentum, the Royal Mint failed to produce enough small-denomination coinage for factory owners to pay their workers. As the currency shortage threatened to derail industrial progress, manufacturers began to mint custom-made coins, called “tradesman’s tokens.” Rapidly gaining wide acceptance, these tokens served as the nation’s most popular currency for wages and retail sales until 1821, when the Crown outlawed all moneys except its own.

    Good Money not only examines the crucial role of private coinage in fueling Great Britain’s Industrial Revolution, but it also challenges beliefs upon which all modern government-currency monopolies rest. It thereby sheds light on contemporary private-sector alternatives to government-issued money, such as digital monies, cash cards, electronic funds transfer, and (outside of the United States) spontaneous “dollarization.”

    There was another reason for the factories to issue their own coinage.

    I visited an iron works in S Wales and they had a shop on site for the workers. They paid the workers in tokens which could only be used in the shop and they made almost as much profit from the shop as they did from making iron.

    It is almost certain people would use alternative currency of sorts but if the authorities take the line which has already been put forward that only drug dealers and terrorists have any use for cash then it will be evidence you are living off ill-gotten gains if you are found with any alternative currency, including gold and silver. They don't even have to make it illegal to have - they can just say you acquired it by illegal means or were going to use it to fund terrorism or other crimes. Not a big step to take nowadays.

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