Peter Hun
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Posts posted by Peter Hun
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Over the years I've accumulated many shares in my employer - around £30K worth. I've also got 10,000 approved share options (at £1 below current share price) which I have to take by 2012 and a SAYE scheme which will mature with £10,000 in 2013
My remaining assets are cash - around £10K in cash-ISA and £10K in savings account
My only debt is a mortgage of around £200K @ lifetime tracker of boe base + 1.1% (i.e 1.6%). My LTV is probably around 50% bearing in mind the current house market.
Even though my employer is safe (doesnt depend on UK economy and established for over 120 years), and I fully expect the share price to rise next year, having kids is making me less of a risk taker. Having some much of my wealth (and income!) tied with my employer is clearly risky
So what to do? Those £30K shares have always paid good dividends (currently 6.5% gross) and saving rates are so far behind inflation
My thoughts were to sell off £15K of shares this finanical year (no CGT) and then next year invoke my options in a cashless exercise (again, avoiding CGT). The problem is I dont know where to put the cash... is there no way to keep your savings in line with inflation without taking risks?
Just some more info, I'm 39, married and a higher rate tax payer
Many thanks
Put the money into Blue Chip shares.
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MAster Slave Manipulator?
http://en.wikipedia.org/wiki/MSM
MSM may refer to:
in science and technology:
* Methylsulfonylmethane, a chemical compound
* Markov switching multifractal, a financial model of asset returns
* Method of simulated moments, a statistical estimation technique
* Magnetic shape memory, a type of variation of material shape
* Master-slave manipulator, a type of remote manipulator
* Metal-semiconductor-metal, a metal-semiconductor junction
in education:
* Manhattan School of Music, a conservatory in the United States
* Marriott School of Management, a business school in the United States
* Master of Science in Management, an academic degree
* Mount Saint Michael Academy, a high school the United States
* Maastricht School of Management, a business school in the Netherlands
* Mount St Mary's School, a primary and secondary school in India
* Mercator School of Management, a business school in Germany
* Missouri School of Mines, former name of Missouri University of Science and Technology
in military:
* Meritorious Service Medal (disambiguation), a military award in several nations
* Mechanist Sergeant-Major, a military rank
* Mine Setting Mode, a tactic of a minesweeper (ship)
Other uses:
* Modern Standard Mandarin, the modern Chinese spoken language
* Mont Saint-Michel, a tidal island in France
* Men who have sex with men, a medical and social research designation
* Mainstream media, an expression often used in blogs
* Mechanically separated meat, a food product
* Muscat Securities Market, a stock exchange in Oman
* Miami Sound Machine, a musical group formed with Gloria Estefan
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I just can't cope with this, I wish they could make up their mind and stick to it, either they are in talks or aren't.
You get the feeling that they are up some creek without a paddle and are hoping to avoid a total collapse before the bailout money arrives. The Irish may feel they have more of a bargaining position if they can contain the bond situation.....
I think you are missing the point. Ireland don't need to raise any money until mid 2011. The price of Irish bonds are therefore of little concern to the Irish.
The problem is that the banks holding them are holding depreciating assets which could make them go under. Obviously GERMAN BANKS have a lot of these bonds are thats why the GERMANS are asking Ireland to get a bail out.
The Germans are trash taking Ireland for their own benefit and in the hope that EU tax payers will bail out German (and probably French) banks.
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One of the big indicators in measuring any quality of life, is the availability and distribution of contraception. One of the main reasons as to why relatively poor people in the west have a much better quality of life compared to fifty years ago is the simple fact there's less mouths to feed. Probably why contraception in this (and many other) countries is supplied by the state for free.
Sorry but capitalism on its own has never and never will be the sole answer to future prosperity.
Besides since when did state subsidised enterprise ever be considered capitalism?
Most of the world has a far better quality of life than 40 years ago becuase of the agricultural revolution. Food prices have fallen by 75%.
Contraception has had nothing to do with it and why you mention it in relation to Poland is ...interesting. Eastern Europe was under Soviet occupation until 1991 and that had far more influence on their wealth than the number of mouths to feed, population growth there was as low as the west.
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Ireland don't need to go to the bond market until January, until them, its academic.
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Natural Gas is pretty much at an all time low. (See chart)
So it looks like a commodity which can only go up. However I've been caught out by contango on ETF's before so I'm wary of investing directly in UNG. Anyone know of any other ways of playing natural gas?
The reason why gas has gone down is that new production techniques (fractured gas) has increased production and potential reserves and there has been a large number of gas transporting ships built to use what has previously been waste. Poland, for instance, has been assessed to have 1000 years gas supply with the new technique.
I'd speculate on something else if I was you.
I doubt UK gas prices have any relation to the wholesale cost.
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Damn right, the unemployed are responsible all the countries debt and should be made to pay for it.
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Peter, you keep carrying on like this and you may well smash the price down singlehanded.
Why would I want that?
I think you will find all the sane posters left this sub-forum long ago which is the only reason it would be single handed
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Are they really bubbles or cycles? Do you understand what a bubble is?
This last event was a property bubble and is unlikely to repeat again in the same magnitude imo.
Inflation has had little to do with the recent price of gold.
Yes of course everyone sudden interest in Gold is because they have discovered its very pretty to look at.
I which case I think I should point you can make very pretty stuff with using Gold.
Bubble/cycle whats the difference?
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Gold could well spike again, bubbles rarely occur in the same place twice though.
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Looks like we are still some way from a bubble doesn't it? Last time gold spiked it was a bubble, this time paper has dived because of a global credit crisis which is far from over.
I'll quote these for prosperity.
Here's an image of a bubble never happening twice, here it shows it three times, in fact there has been about a dozen house price bubbles over the last 200 years.
The last Gold price bubble was cause by inflation, just like the current bubble.
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Heres a chart with a bit more history, specifically showing what happened at the last big spike in Gold prices. Being a moron, I'd suspect that maybe the same thing will happen (Gold price collapse) as it did in the early 1980's
Now, tell me how it will be 'different this time' and not another bubble?
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Indeed. Think there might be something in this story?
Why not put a chart for the oil price in there as well? Oil has gone up ~400% in the last decade, in GBP, and you can actual use Oil for something rather than looking at it.
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Hello
This is my first post, on any forum. I have little investment knowledge. I work hard and save what i can. I found this site a few years back and enjoyed reading the posts because they gave me optimism that one day i may be able to afford a house at a reasonable price.
From reading the threads i have learnt bit about gold. Initially i had no savings, but have finally built up a stash of cash. A few months back i thought i really should invest in gold. But i am over cautious. I waited and watched, a little too closely perhaps. I hoped for a correction but, as you know, it didn’t come. Gold was at 1200 dollars an ounce then. I wa sworried i'd missed the boat. If you were me, would you enter the game now? Am i too late or just in time? Should i wait or jump in now. OK so its 1400 now, all time high. I think I'm gonna go for it, probably 10% of my savings on physical gold and 5% on silver. Just looking for reassurance really.
While i'm posting, i have another couple of questions. If I buy silver from Guernsey, 1 coin at a time, its VAT free. If i buy Silver Britannia’s I don’t pay tax on my earnings. Is it possible to buy Britannia’s VAT free from Guernsey? If not, then surely i’m better of buying here and paying VAT as opposed to tax on any future profits?
If I buy >5000 pounds of gold ID is required and the transaction documented. If i sell >5000 pounds of gold is this documented? I guess they won’t pay cash? Britannia’s or not, wont the tax man come looking for me?
Gold isn't a investment, investments pay you to hold them (Dividends with shares, rental income with property). Buying gold is a gamble, similar to punting on a horse. This gamble requires the price of Gold to keep rising and in the same way that a Ponzi scheme works, it requires a constant new stream of gamblers to buy into the bet. Once the economy recovers, Gold will crash in price until the next economic recession.
By all means buy Gold, in the short/medium term it will keep rising, but keep a constant track of the price as the bubble could burst at any time. To protect your 'investment' trawl the internet and encourage other punters to gamble on Gold. In five years time the world economy will have recovered and the price will be back near its production cost.
Good luck, and here is some more web sites you may find useful
www.betus.com
www.online-betting.me.uk/
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For comparison Houses in Poland for under $100K
http://dom.gratka.pl/domy-sprzedam/lista/malopolskie,,50000,275000,co,cd.html
Are there are cheaper places in the EU...
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Looks like a good place to retire.
Myself, I went to America - Miami, didn't think a lot of it to be honest.
Everyone else seems to rant and rave about the place though, South Beach especially. Could have taken a job there with the company I work for, but it didn't do anything for me, especially with the 10 days holiday and instant dismissal lark.
Guess I'm just a little Englander at heart.
I suppose the great thing about America is that it is such a vast country with so many different states there is something for everyone. Might show this to some of my mates, they've been talking about moving to the ex-colonies as of late.
You can't retire to the US unless you have a visa, basically you can only live there for 3months of the year.
You can buy a dirt cheap house anywhere in the UK or EU, at least you may have a small chance of a legal paying job and free healthcare and no danger of six months in a high security jail for being an illegal immigrant. $100k will give you many options through out Europe.
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He admitted later on that he was wrong about holding junk and that coins were the way to go. Can't remember why he said that coins would be better but there it is.
His problem with coins is that they are far too high value for most dealers to accept or for you to carry around the resulting cash that they generated. Walking out and getting robbed, plus marking you as a potential holder of lots of gold was against his grey-man concept .
I've never seen any post where he prefers coins, can you link that?
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So it seems you agree gold isn't a bad hedge against inflation or a bad investment during troubled financial times.
Yes, a hedge. Not an investment. Ferfal uses junk gold chains to swap to cash when he needs it. However his income comes from property.
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My example was shares versus gold in the period 1970 to 1980. Since then, due to fiscal sanity taking hold with a return to high interest rates in 1980, we had a period of economic growth that meant gold wasn't the best asset to be in. Since then property and shares did well and gold fell in value, I don't dispute this.
However, in real terms, since 2000 the stock market indexes have produced negative returns, and in terms of gold UK house prices have fallen consistently since 2005.
On the other hand gold has risen since 2000, when valued in any fiat currency.
It's all about picking the right investment theme for the times (I bought property in 2002 and sold in Aug 2007 at a decent real profit, now I am in gold
). Those that just 'fire and forget' lose in the long run.Agreed, as a medium term investment Gold is a good alternative to cash, just as its remembered that when stability returns, Gold is pointless.
I assume TFH means Tin Foil Hat? Well rather than pointing to Weimar or Zimbabwe a better example maybe Argentina. Argentina has suffered hyperinflation in the past (5000%) and has very high inflation now (possibly 25-40%, real figures are impossible to come by as the government fakes them).
This web site http://ferfal.blogspot.com/ discusses the whole dealing with the real effects of a crash; in summary buy Gold and Property and get rid of cash. Ferfal stresses the importance of money, no matter what Gold, doesn't replace money in day to transactions but it defends your wealth. A source of income is very important and he discusses that as well as pointing out that property can provide a in come in direct proportion to the wages that people can earn. Most people still work and need somewhere to live and they will pay for that with something that you can live on, no matter what. A warning though, Ferfal makes a living selling right wing concepts to right wing gun nuts so he doesn't like any comments that suggest that socialism and the current president in particular is the root of all Argentina's problems (even thought Argentina's problems can be traced back to the right wing Junta and decades of corruption). So of the things he comes out with are down right crazy. He prefers to ignore why Argentina's currency collapsed by 75% overnight (a fake fix to the US dollar which was unsustainable and no reflection of the true exchange rate) and simply blame 'socialists'.
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This is not true. In the 70's, the closest approximation for the situation we have now, the stock markets returned a real return after infaltion, but only just (can't remember the exact figure - think it was 5% from 70 to 80). Meanwhile gold increased in real terms many fold.
The same is true today. Look at the stock and property markets priced in ounces of gold and they are both down in real terms, only gold is up in real terms.
Not true.
Gold isn't even at its inflation adjusted high, In other words it has fallen in value against paper money (massively, even now) while returning no income. You are being selective with your time span and ignoring the income shares produce. Asset appreciation is not as important as income.
Property keeps returning an inflation busting income, you don't mention that.
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Well done on demonstrating a complete lack of critical thinking. If gold is a billion dollars and ounce, how much is your sold to rent/saved deposit in sterling now worth? It will be even more relevant if you are on the wrong side of the trade, because rather than expanding your wealth and enjoying a better standard of living, you'll see your wealth go up in smoke and you standard of living collapse.
Ok. When are you going to sell Gold? obviously never becuase to do so would be madness. You will starve watching the shiny metal. Until the price collapses,as it always does...
Holding an asset that returns an income is a far better, becuase as inflation rises the real purchasing power of that income will rise with it.
I went out and took a loan 14months ago and bought a farm. I don't have any cash, I invest it immediately on refurbish my apartment and (next) the farm because they will provide an inflation proof income for decades.
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http://www.housepricecrash.co.uk/forum/index.php?showtopic=154242&st=132
Rather than hijacking the OP, I thought that I would bring this over here.
I have to admit that I had never thought about gold in these terms before. If the world goes all Weimar / Zimababwe, the owners of 100 to 1,000 ounces of gold will be very rich.
The logic of holding 5% to 10% of any portfolio in physical gold is further strengthened by this argument. Someone who "only" loses 90% of their wealth when everyone else loses 100% of their wealth is still very well off.
The same applies to any other asset such as property or shares, particularly shares that earn foreign income. In Argentina for instance (historical hyperflation and currently over 25% in reality) single bed apartments go for $250K. Cash has devalued by 75% but property kept its value.
Why do you think share prices go ballistic with QE? becuase they are an inflation hedge and unlike Gold they return a dividend, Gold simply sustains your wealth - it doesn't make you richer.
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Oh Oh, me first!
British emmigrants?
Well actually to an extent, yes. Many Poles working elsewhere in the EU are saving to buy property in their homeland.
There is also 10million plus ex pat American Poles who buy in Poland and which distorts the market. The price of property is some areas is ridiculous compared to wages here.
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I have become very suspect of Mish since he posted about Iceland s banking problems being caused by international bankers. In fact, Iceland's problems were entirely home grown. This is more evidence that he simply cannot to do a bit of research
Edward Hugh take on it -
Poland was basically able to endure without too much bloodletting for three principal reasons.In the first place the level of household indebtedness is still not excessively high. In the second place Poland had maintained a floating exchange rate which meant that it could let the zloty rise during the heady days of 2008, and then allow the currency to devalue when the crisis hit. An thirdly, the level of Forex lending never rose as high in Poland as it did in some of its East European neighbours, which meant that when the time came to devalue there was not such a threat of increasing the Non Performing Loan rate. As can be seen in the chart, it was starting to take off when the credit crunch came along and (fortuitously) stopped it dead in its tracks.
http://polandeconomy.blogspot.com/2010/07/polands-deficit-issues.html
Forex lending has gone down since this chart finished, banks in Poalnd have always been tight fisted with lending in comparison to other countries. Its difficult to get credit. Maybe there was 62% forex lending at one point, but that is NOT the same as 62% of mortgages are in a Forex. As the letter points out, the total is below 50% and will stay that way.
Mish's comment:
Thanks Robert! I always appreciate emails like yours so readers in the US can find out what is really happening in Europe.Mortgages denominated in foreign currencies are a disaster waiting to happen, not only for the debtors but to the banks that made the loans.
First, Poland is join the Euro so its not exactly a foreign currency (although whether that will or should happen is another thing). Second, the Zloty is the most undervalued currency in the world, Polands central bank has a constant fight to keep down, so its a pretty sure thing that it will appreciate due the lousy average earnings in Poland (about £7K).
I stopped reading Mish's blog becuase he is full of crap when it comes to anything outside the US and therefore suspect on anything he says about the US (with his political taint on things). He has a habit of making sweeping statements without putting any thought into it.
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In Poland, there has been a property bubble since 2006-7 that never really popped. Prices in central Warsaw are comparable to prices in Berlin and Vienna, and of course incomes are way lower. Prices have fallen 10-15% from the peak, but our currency has strengthened, so the net effect is zero. Prices has been fueled, as is typical for the whole region of central/eastern Europe, by cheap capital denominated in Swiss Francs and Euros, coordinated mainly by Austrian and Italian banks and originating in Switzerland. 62% of mortgages are taken out in foreign currency. Almost all mortgages are variable-rate. However, the Polish regulators have recently begun cracking down on all of this.
http://polandeconomy.blogspot.com/2010/07/polands-deficit-issues.html
(I can never post in the news articles, my comments just disappear)
Why You Can Pick Up A House For Next To Nothing In The Us?
in House prices and the economy
Posted
"Based on statistics reported to the Federal Bureau of Investigation, Camden was the third-most dangerous city in the U.S. during 2002, and has been ranked the nation's most dangerous city in 2004, 2005 and 2009.[53] "Most dangerous city" is based on crime statistics in six categories: murder, rape, robbery, aggravated assault, burglary, and auto theft."
http://en.wikipedia.org/wiki/Camden,_New_Jersey#Additional_facts
Not the most representative city..