Indholdsfortegnelse for 1144 i MoneyWeek

Sometimes a single headline says a great deal. Take this one from The Times on Tuesday: “Jeremy Hunt told to stop targeting golf and raise private pension age instead”. The chancellor told retired over-50s that they should get back to work instead of spending their time going to the golf course. Now the Resolution Foundation think-tank is (correctly) telling him that this isn’t going to happen, but suggesting he should raise the private pension age faster and cap tax-free lump sums to stop others from following them out of the workforce. There are any number of bad ideas on display here, starting with the belief that the government has any role dictating to people that they should be working rather than playing golf or on the ski slopes (see page…

“One of the big reveals of the pandemic was just how much time we collectively waste commuting from ever longer distances… Not many companies cared much about this before. Now, it’s become a problem for corporate America, and so it is slowly moving up the priority list… Europe has managed through the post-pandemic era better than the United States. Credit shorter commuting distances, better mass transit, and more walkable cities and villages. There are many good reasons to want to see people working collaboratively together in the office. It’s hard to train and harder to mentor new, young employees. [Getting people back there] won’t be easy; it’s going to require a wholesale change to the infrastructure of your region, from where people live and work, to how walking and bike-friendly…

Early bidders for Manchester United are pitching “competing visions” for the football club, says the Financial Times. The Glazer family puts its stake in the New York-listed business that owns the team up for sale three months ago. Now the first contender has gone public. Jassim bin Hamad Al Thani, the son of Qatar’s former prime minister, announced his interest, emphasising plans to bolster the balance sheet and invest in the club’s facilities. He was followed a few hours later by Jim Ratcliffe (pictured), the founder of chemicals group Ineos, who stressed the importance of “rebuilding fractured ties with the United fan base and halting the march of foreign ownership in English football”. While Premier League rival Chelsea fetched $3bn last year, Manchester United – one of the world’s most…

Construction and infrastructure giant Vinci has reported a 25% jump in revenue and a 64% rise in net profits, says Le Revenu. The airports division, which includes a majority stake in London Gatwick, is recovering after the pandemic. The motorways division, which runs half of France’s motorway concessions, will benefit from inflation-linked price increases this year. The group is also moving into higher-margin renewable energy projects, especially in Spain and Latin America, with the planned opening of its first Brazilian solar farm this year. The shares trade on 13.9 times this year’s net forecast earnings and a 3.8% dividend yield (UK investors will receive this net of 25% withholding tax).…

Politics & economics A record 93.5 million Nigerians will this week choose among 18 candidates to replace president Muhammadu Buhari, who has reached his two-term limit. Frontrunners include Bola Tinubu of the ruling All Progressives Congress party, former vice-president Atiku Abubakar of the main opposition Peoples Democratic Party, and Peter Obi, a relative outsider from the Labour Party. The election comes at a “pivotal juncture” for the country, amidst “record unemployment and inflation, a massive debt burden, fuel shortages, worsening security conditions, endemic corruption and crumbling public services”, says Elliot Smith on CNBC. Nigeria’s election matters to the rest of the world, say David Pilling and Aanu Adeoye in the Financial Times. Nigeria is the biggest economy in Africa and, with a median age of 18, has a population predicted…

Vladimir Putin may now have other countries in his sights, as “ominous” signs emerge of a “hybrid campaign” being waged against Moldova, says Lucy Williamson on the BBC. The aim appears to be to lay the groundwork for “a Kremlin‑backed coup” as Russia restricts energy supplies, plunging the former Soviet Republic into an economic crisis and forcing the resignation of the pro‑European government. A new prime minister, Dorin Recean (pictured), has been appointed, but last weekend saw a succession of street protests that were “allegedly financed by a pro‑Russian fugitive oligarch” and attended by paramilitary groups and former soldiers. “With its hands full in Ukraine,” you might think it would be “folly” for Russia to tie down its troops in Moldova, says The Washington Post. But Putin has proved himself…

In need of some renovation. Would benefit from light work. Located in an up-and-coming area that still has a few challenges. As the online estate-agency Purplebricks puts itself up for sale amid widening losses and a collapsing share price, the jokes write themselves. Purplebricks, one of the pioneers of online house selling, floated almost a decade ago. By 2017 its shares were above 500p. Since then, they have fallen to less than 10p amid heavy losses and management upheavals. Last week, the firm said it was actively looking for a buyer. With losses potentially as high as £20m this year, it remains to be seen whether any emerges. The British online estate-agency business is not looking very attractive right now. A whole series of once ambitious start-ups have floundered. Emoov…

Earnings before interest, tax, depreciation and amortisation (Ebitda) is a measure of profit that can make it easier to compare the valuation of two companies, or to give a clearer view of a firm’s underlying profitability. It looks at earnings before the effects of capital structure (how the company is funded), taxes and accounting conventions (depreciation and amortisation are charged to earnings, but how companies choose to write down the value of tangible and intangible assets can be very different). So, for example, Ebitda enables investors to compare two businesses on a like-for-like basis by taking their enterprise values (EV), the market value of all their shares in issue, plus net borrowing or excluding net cash, and comparing this with Ebitda. The lower the EV/Ebitda ratio, the cheaper the stock…

“I’ve had a very, very lucky life. Money’s never been my God. In my life it’s very much a sense of duty I feel to the heritage of this family and to its future. So financially I’m probably no better off than my parents. I’ve been given most of the things by my family that actually belong to me, and all I own are the clothes on my back.” Emma Manners, the Duchess of Rutland, quoted in The Sunday Times “In 2012-2013, the idea of an Indian pop-up in a Soho pub was so unusual. People haggled and I had to lower my prices so low it covered only my ingredients and I made no money… When someone told Fay Maschler, the Evening Standard food critic, that she should try…

theguardian.com The time we spend with close friends has fallen in the past decade, and it got worse in the pandemic, says Anita Chaudhuri. A YouGov poll in 2021 found that one in eight had only one close friend; 51% said they struggled to make new friends. Some go for weeks seeing no one but the postman. This does not make for happiness. Aristotle identified three distinct types of friend: those of utility (the neighbour who can pick the kids up from school); of pleasure (the pals who join you at the pub); and of virtue (the “soulmates” who will be with you through thick and thin). To expand your circle, it’s a good idea to stop looking exclusively for soulmates and simply get out more – join a local…

Six months ago, Cornwall Insight, a consultancy that nobody had previously heard of, was forecasting that the energy price cap would reach £6,616 per year. Mainstream media accepted that without question. In fact, the price cap was set at £2,500 and although the government has said that it will be lifted to £3,000 in April, gas prices have fallen so far that the same firm is now forecasting that the cap will be only £2,200. Gavin Law from the McInroy & Wood division of leading energy consultants Wood MacKenzie remains cautious. “It is too simplistic and too short term to think that the energy crisis is over,” he says. Oil prices fell back below those prevailing when Russia invaded Ukraine, after more supply came on-stream and Russian oil was rerouted.…

Activist investor ValueAct has taken a stake in streaming service Spotify and is calling for it to cut spending, says the Financial Times. The move comes a few weeks after Spotify announced it would cut 6% of its workforce and restructure to reduce costs. Spotify spent heavily on growth, expanding into podcasts and signing high-profile deals with sometimes controversial hosts such as Joe Rogan. That has helped boost advertising, and total revenue rose more than 20% to €11.7bn last year, but losses ballooned to €430m. “[Spotify’s] operating expenses and funding for content exploded,” Mason Morfit of ValueAct said, as he disclosed his firm’s position. “It is now sorting out what was built to last and what was built for the bubble.”…

Telecoms firms are under scrutiny by media regulator Ofcom over mid-contract price rises for phone and broadband customers, writes Jasper Spires. Since 2021, most firms have included contract terms allowing them to increase charges for existing customers in April each year, typically in line with the consumer price index plus an additional margin (often 3.9 percentage points). With inflation at 10.5% in December – the month that most contracts are based on – that means many prices will rise by about 14.4%. A few are even higher – some O2 and Virgin Mobile deals increase with the retail price index plus 3.9 percentage points, meaning a 17.3% hike. Users who are within their minimum contract term mostly do not have the right to cancel penalty-free, although some Virgin Media and…

Annuities continue to return to favour. Insurers report sales of the income products rose by 10%-15% last year after an extended period in the doldrums. The return of annuities is quite a surprise. After the pension freedom reforms of 2016, which gave people more choice about how to turn their pension savings into income in retirement, annuities fell from favour. An annuity provides a guaranteed income for life – which may remain fixed or rise over time, depending on the terms. However, many people preferred the more flexible income drawdown arrangements, which enable you to leave your savings invested and to draw an income directly from them. Now that flexibility looks less attractive to some retirees. Market volatility of the past couple of years has hit some savers’ pension funds…

It has been a mixed fortnight for my long tips, with three rising and six going down. Furniture retailer Dunelm increased from 1,193p to 1,194p, luxury clothing brand Burberry advanced from 2,447p to 2,563p and discount-store chain B&M European Value Retail rose from 483p to 486p. Construction firm Ashtead fell from 5,654p to 5,586p, US housebuilder DR Horton decreased from $98.30 to $94.08, estate agent Savills dropped from 1,102p to 991p, and streaming service Netflix declined from $361 to $347. At the same time, online clothing retailer ASOS fell from 922p to 818p and telecoms firm Gamma Communications went down from 1,178p to 1,174p. Overall, my long tips are making collective net profits of £5,094, well down from £5,729. My short tips also had a mixed performance, with two rising…

Online used-car dealer Cazoo has been forced to carry out a share consolidation to avoid delisting from the New York Stock Exchange, says The Telegraph. Investors have received one new share for 20 old ones in order to lift the price of a single share above the $1 minimum that the NYSE requires. UK-based Cazoo has struggled with tough competition and a failed expansion into Europe. It is targeting up to 50,000 car sales in the UK this year, down from 65,000 last year, as it tries to increase margins. The shares are down by 96% over the past year, and the market cap has shrunk from $8bn when it floated to just $125m.…

James Bond fans with deep pockets will be in “00-heaven” over the Prop Store’s auction in London, says Saskia Rowlands in the Daily Mirror. The sale, which runs until 2 March, brings together the world’s biggest collection of Bond posters from the Sean Connery era. A UK “quad” poster (the traditional size of British film posters after World War II, equivalent to four imperial “crown” sizes of paper, measuring 30” x 40”), introducing Connery as Bond in Dr. No (1962), is one of the highlights of the sale. The poster, illustrated by Mitchell Hooks, is also the first to feature the now-iconic 007 “gun” logo, designed by Joseph Caroff. It is expected to sell for £10,000-£20,000. Another UK quad poster, for Connery’s follow-up outing as Bond in From Russia With…

£29bn The value of lost business investment since the Brexit referendum in 2016, according to a study by Jonathan Haskel, an external member of the Bank of England’s nine-strong interest-rate-setting monetary policy committee (MPC). £30m How much Foreign Office officials spent in the 11 months from October 2021 on government credit cards, typically on hotels and dining out, when Liz Truss was foreign minister – 50% more than in the last 11 months of her predecessor Dominic Raab’s tenure. 3.9bn How much in Thai baht (£94m) the government of Thailand aims to collect this year from a new tax on foreigners visiting to pay for accident insurance for tourists. From 1 June, visitors arriving by air will pay 300 baht and those by land or sea 150 baht. 3.7bn How…

A luxury hotel in Germany is suing two of its guests for more than €230,000, says The Times. The married couple – who have not been named for legal reasons – moved into the Nassauer Hof hotel in Wiesbaden in the summer of 2019, paying €5,600. This turned out to be the only money that the hotel would receive during their stay. The couple refused to settle their bill and instead lodged a series of complaints, “claiming that their room was infested with cockroaches, that the nuts were mouldy and that they had found a worm in the salad”. When the hotel insisted on payment, the man claimed that he was having medical treatment in a local hospital. They were evicted in December 2021, after which the man spent four…

“Europe’s energy crisis seems to be over for now,” says Trading Economics. European natural gas futures have fallen below €50 per megawatt hour (MWh), which is an 18-month low and nearly 85% below a peak of €339/MWh in August. Unseasonably warm weather and efforts to conserve gas are mostly responsible for the turnaround, says Anna Cooban on CNN Europe. The region has leaned heavily on higher imports of piped natural gas from Norway and North Africa, as well as liquefied natural gas (LNG) from the US and Qatar. “Europe looks like it has successfully weaned itself off Russian gas,” says Henning Gloystein of consultancy Eurasia Group. But prices remain high relative to the pre-crisis long-term average. The risk is that renewed demand from China this year could cause the global…

Go to a jeweller for a diamond and you’ll probably be offered a choice of natural or laboratory-grown, says The Wall Street Journal. Lab-grown stones have the same chemical, optical and physical properties as natural ones, but cost much less. Unlike mined diamonds, they are subject to tough competition. Equipment for the chemical vapour deposition (CVD) process now costs around half a million dollars, production capacity has tripled since 2018 and costs are falling at 12% per year. So far this hasn’t affected sales of mined diamonds, but a flood of lab-grown gems may make diamond jewellery more of a commodity. However, the real prize would be to get costs low enough that diamond materials could eventually displace silicon in semiconductors.…

BHP, Rio Tinto and Chilean-based copper specialist Antofagasta all announced substantial cuts to their dividends this week. BHP cut its half-year payout from $1.50 to $0.90, Rio cut its final dividend from $4.17 to $2.25, and Antofagasta announced a final payment of $0.505, down from $1.189. BHP’s “surprisingly poor” results provided the first confirmation of how soaring inflation and weaker commodity prices are hitting earnings, say Leslie Hook and Nic Fildes in the Financial Times. Revenue fall by 16% to $25.7bn and pretax profit by 30% to $10.2bn in the six months to 31 December, compared with the same period a year ago. However, BHP still sounded optimistic that higher Chinese demand – including relaxing an unofficial ban on Australian coal – will boost commodities. It was inevitable that earnings…

Germany’s first initial public offering (IPO) since Porsche in September 2022 has got off to a disappointing start, says Bloomberg. Web-hosting firm Ionos saw its share price drop after listing on the Frankfurt Stock Exchange on 7 February. The company priced its shares at €18.50, the bottom end of its initial target range of between €18.50 and €22.50, but has since seen them fall to less than €16.40 this week. The float raised €389m and puts it on a valuation of €2.6bn, which was roughly half of what its owners – internet-services firm United Internet and private-equity firm Warburg Pincus – were said to be hoping for when the IPO process began in December.…

My confident prediction in last week’s column that former deputy leader Angus Robertson was very likely to be the next leader of the SNP hasn’t exactly aged well: Robertson promptly stated that he wouldn’t take part in the contest to become Nicola Sturgeon’s successor. Instead, with £19,070 matched on Smarkets, punters have health and social care secretary Humza Yousaf favourite on 1.49 (67%), while former minister for community safety Ash Regan is in second place on 5.6 (17.8%), and Kate Forbes is in third place on 7 (14.2%). I make it a rule never to tip a contest where I’ve already made a recommendation, so I won’t be making any other predictions. Instead, let’s look at the Aston by-election in Australia, which is due to take place on 1 April…

Investing in Alibaba, the Chinese e-commerce giant, was “one of the worst mistakes I ever made”, says Charlie Munger, the longtime business partner of Warren Buffett. Munger invested heavily in Alibaba during 2021 through the Daily Journal – a newspaper publisher/investment vehicle that he runs independently from Berkshire Hathaway – but slashed his stake in 2022. “In thinking about Alibaba, I got charmed with the idea of their position on the Chinese internet. I didn’t stop to realise they’re still a retailer. It’s going to be a competitive business,” he told investors at the Daily Journal’s annual investor meeting this month. However, he is full of praise for electric-car maker BYD, another leading Chinese firm, which Berkshire Hathaway first bought in September 2008 at Munger’s urging. “I have never helped…

spectator.co.uk There are some that would have you believe that Waitrose shoppers are “out-of-touch snobs”, “Marie Antoinette figures who think nothing of paying over the odds for their tatsoi, baby kale and Burford Browns while the country heads for penury”, says Zoe Strimpel. A recent Which report found it to be the dearest supermarket in 2022, with an average shopping basket costing £81.63 more than at Aldi, or 38% over the odds. What the report doesn’t say is that the shopping experience and quality of the items bought are “easily 38% better”. “Life is short”, and shopping at Waitrose represents a “good use of funds”. The premium is manageable, if only for special occasions, for most people. The supermarket is cooperatively owned and its trainee scheme is one of the…

Oil and gas companies don’t make money from high prices, as governments will always intervene to extract the windfall gain through taxation. They make money, like any business, from investing well, operating efficiently and managing their finances conservatively. Still, firm prices reduce the risk of new investment, enabling producers to increase revenues and profits. The risk is that high prices encourage commodity producers to overinvest, resulting in excess supply, lower prices and poor returns on capital. John Bennett, manager of the Henderson European Focus Trust, raised his exposure to the energy sector significantly in mid-2022 due to favourable valuations, companies becoming more fiscally responsible and the aversion of many investors leading to an attractive outlook being ignored. “One of the unintended consequences of the ESG (environmental, social and corporate governance)…

■ Troubled real estate investment trust (Reit) Home Reit endured a “frosty” annual general meeting with angry shareholders on Monday, says the Daily Mail. Some investors are preparing to sue the Reit, while others are looking to replace the board. Home Reit, which lets accommodation to charities to house the homeless, is in disputes with several major tenants who are withholding payments in protest at the conditions of some of the properties. Trading in its shares has been suspended since the start of the year after it failed to file accounts on time, and a firm of forensic accountants has been brought in to investigate allegations of bribery in connection with the purchase of rundown housing at seemingly high prices. “No resolutions were put to a vote at the meeting,…

● The cheapest mortgage rates have dropped to their lowest since September as a price war between lenders heats up. Platform (part of the Co-op Bank) has launched a five-year fixed rate of 3.75%. The deal is aimed at wealthier borrowers, with a minimum loan size of £400,000 and a £1,999 set-up fee, says Rachel Mortimer in The Telegraph. Platform is the seventh lender to reduce rates on five-year fixed mortgages below 4% in the past two weeks. “Repeated repricing is driving rates down gradually and more lenders are joining the sub-4% club,” David Hollingworth from mortgage broker L&C tells The Telegraph. The average five-year fix has dropped from a high of 6.51% in October to 5.05% today, while the typical two-year rate has dropped from 6.65% to 5.34%. ●…

● Government promises to maintain the “triple lock” state pension guarantee are unsustainable according to a study from the Institute for Fiscal Studies. The influential think tank says that the policy – which sees state pensions increase each year by the higher of 2.5%, average earnings growth or inflation – will eat up a larger and larger proportion of national income over time. Many workers paying for the policy through their taxes today are unlikely to benefit from it by the time they get to retirement. ● The number of complaints about employers failing to make pension contributions on behalf of employees rose by nearly 30% last year, according to new figures from the Pensions Ombudsman, published in the Financial Times. They reveal a worrying increase in the number of…

One of the big trends in technology in recent years has been software as a service (SaaS). The big idea is that instead of selling people a piece of software that they might not replace for several years, companies can make much more money if they sell an annual subscription, forcing users to pay again every year. Payroll company Paycom (NYSE: PAYC) has done well from this shift and its shares have risen by around 1,900% since it floated in 2014. Today, it is valued at almost $18bn. Yet all good things must come to an end and Paycom is facing two sets of headwinds. In the short run it faces challenges from the current state of the US economy. While America seems to have outperformed the gloomiest forecasts so…

Many cash-generative Aim companies saw their share prices fall dramatically during a torrid 2022. This has highlighted the income potential of Aim, since yields have risen substantially for some well-established firms with long records of dividends . Another further attraction for many when investing on Aim is the potential to save future inheritance tax (IHT). Those investing in Aim for IHT planning purposes may often be transferring out of other income-generating equities, and so the idea of regular dividend income from a portfolio of Aim shares may be appealing. Here are three high-yielding Aim stocks that could qualify for this tax relief. Solid dividends from construction Alumasc (Aim: ALU), a supplier of sustainable building products, systems and solutions, benefited from the post-lockdown construction boom. Revenues climbed 15% to £89.4m in…

“Sometimes in my dreams – the happy ones, not nightmares – I am back in Bradford, driving a bus and feeling content with life,” says Anwar Pervez, recalling his early years in Britain in the 1950s. “The lavatories were outside, there was no central heating and once a week you’d go to the baths.” But having arrived penniless from Pakistan he relished the opportunity to build a new life. And how, says The Sunday Times. Nearly 70 years on, the Bestway billionaire is “driving a much bigger bus” – and, after taking a sizeable stake in Sainsbury, has got the City “guessing what comes next”. Pervez already bestrides a sizeable empire. Perhaps best known in Britain for its wholesale grocery cash-and-carry business (the UK’s second largest), the privately held Bestway…

“The 2023 Lamborghini Urus isn’t just an exotic SUV wearing a supercar badge, it’s a supercar with an SUV shell,” says Eric Stafford for Car and Driver. Not only is that evident in its twin-turbo four-litre V8 that makes 657 horsepower, but also in its “gob-smacking performance” on racetracks. This is a car that’s light and racy, and lives up to the brand’s exotic pedigree. There’s simply no other SUV like the Urus. Yet it’s also very much “a road machine”. From standstill, it sprints to 62mph in just 3.6 seconds. That makes it one of the fastest SUVs on sale, says Mat Watson in CarWow. “It’ll also reach 190mph if you’ve got the space – and courage.” Boasting all the confidence of its Lamborghini high-speed pedigree, the Urus makes…

“Three Rocky videos sold for $53,750” Many families in the 1980s and 1990s collected mountains of VHS tapes in the years before online streaming and Blu-rays became available. Then, in 1997, the DVD arrived, exiling all those VHS tapes to trunks and chests in living rooms and dusty cardboard boxes in attics to be forgotten. Should any videotape still be in its original cellophane wrapping – because it was bought by mistake, or received as a gift when you already had it – it could now be worth a bob or two. It’s hard to tell for sure as the auction market in old VHS tapes is still in its infancy. Texas-based Heritage Auctions (HA), one of the leading auction houses in selling memorabilia, held its inaugural VHS sale only…

The FTSE 100 closed above 8,000 points for the first time on Thursday 16 March. The index of British bluechips hit its first record high in more than four years at the start of this month and has continued to rally since. The 8,000-point level is symbolic – it simply tracks progress since the index was launched in 1984, at a starting level of 1,000 points – but will be seen as an important psychological level. The FTSE 100’s strength at a time of faltering UK growth leads to much confusion, says Graeme Wearden in The Guardian. The index is dominated by multinationals, with FTSE 100 firms deriving roughly 75% of their revenue from overseas. The rally thus reflects an improved outlook for the global economy. Closer to home, investors…

“Politicians have hurled brickbats at bank bosses for failing to pass on the benefits of rising interest rates to savers,” says Lex in the Financial Times. “Results from NatWest suggest the banking bonanza may have been overhyped.” Last week, CEO Alison Rose unveiled its highest profits since it was bailed out in the financial crisis in 2008. Operating profits jumped to £5.1bn from £3.8bn in 2021. Its net interest margin (NIM) – the gap between rates paid to savers and what it gets from loans – was 3.2%, up from 2.3%. Yet the shares dipped 7% after it said the NIM may have peaked. Savings rates are having to rise faster, while competition in mortgages is heating up. Still, it is possible that this year’s profits might still meet expectations.…

Five to buy Coats Investors’ Chronicle This 268-year-old thread maker is still “surprisingly nimble”. It’s managing to push through price increases and productivity improvements to keep it ahead of inflation, helped by its focus on the more expensive end of the clothing market. There are long-term growth opportunities in footwear, sustainable and recycled products, and “performance materials” for specialist applications, including fibre-optic cables and cars. Market pessimism has left the shares on a price/earnings (p/e) ratio of just nine times forecast earnings from 13 a year ago, which “feels short-sighted”. 71p Grainger Shares Grainger, one of Britain’s biggest professional landlords, has a portfolio of roughly 10,000 homes, with 7,000 new build-to-rent homes also in the pipeline. The property market is in for a bumpy ride, but that is reflected in…

There aren’t many high-level relationships in investing that seem to work consistently, but the connection between the strength of the dollar and the performance of emerging markets (EMs) is one. When the dollar goes up, EMs tend to struggle; when it is weak, EMs have a much better chance of delivering good returns. There are two broad explanations for this, the first of which hinges on pretty much what any investor would predict about capital flows. EMs tend to have relatively small, immature capital markets of their own. They are heavily affected by flows from foreign investors. If foreigners are keen to invest, it pushes up the price of shares, or makes it easier for them to borrow at lower rates. The US is the world’s largest and most liquid…

Britain needs to get saving Martin Wolf Financial Times It is widely agreed that the UK invests too little, yet how can investment be funded by a country that is “even more strikingly short of savings than it is of investment”, asks Martin Wolf. According to the IMF, gross investment averaged 17.1% of GDP from 2010 to 2022, behind Germany’s 21.1% and America’s 20.6%. During the same period, gross national savings averaged 13.3% compared with 19% for America and 28.2% for Germany. This low savings rate is why foreign investment (and maintaining foreign confidence) is so important. It also means that a “big part of the returns on investment go to foreigners”. If the country saved more, it could not only invest more, but its people could “accumulate a nest…

bloomberg.com/opinion The land-value tax, an idea that dates to Henry George and the classical economists of the late 19th century, is “having another one of its moments”, says Tyler Cowen. Martin Wolf of the Financial Times says the case for it is “overwhelming”, as do many others. I’m not so sure. The idea is to capture the entire value of land, as opposed to that of anything built on it, and redistribute the revenue to the government and, in turn, the citizenry. The theory is that, as the land has nowhere to go, you can raise revenue without distorting the allocation of resources. But this requires a system to determine what the value of the underlying land is, and the only way to do that is for it to be…

The World Alpine Ski Championship in Courchevel and Méribel this week provided plenty of thrills and surprises, including a first-ever medal for Greece when AJ Ginnis took an unexpected silver in the men’s slalom. Yet perhaps the biggest victory was simply that there was enough snow. Several other competitive events have been cancelled or curtailed due to a lack of snowfall in recent months, while the press has been full of stories about the warm winter leaving many resorts with patchy snow and forced some pistes to close altogether. The threat of climate change is the last thing the sector needs while it recovers from the lockdowns that wiped out much of the ski season over the past two years. Yet that’s exactly what it faces. “Study after study has…

Law Debenture (LSE: LWDB) is an investment trust with a difference. It’s generally bucketed with other UK equity funds, but this overlooks the company’s best qualities. Unlike most other equity trusts, which tend to focus on managing a portfolio of stocks and shares, Law Debenture has two operationally separate arms. There’s the investment portfolio and then there’s an independent professional services (IPS) business. IPS is what helps the trust stand out from its peers. UK value portfolio Law Debenture’s investment trust portfolio is managed with the goal of achieving “long-term capital growth in real terms and steadily increasing income”. Its portfolio managers, James Henderson and Laura Foll of Janus Henderson, try to achieve this by investing using a value-slant with a UK focus. Currently just over 83% of the investment…

All that cash sprayed at upstart fintechs over the past few years is finally finding its way into useful products. Some of these will probably fall by the wayside, so you shouldn’t bet the lot on any particular product I mention below, but they could offer easier, cheaper or novel ways to manage your savings and investments. Starling Bank is head and shoulders above the other “neo-banks” with its banking functions (see MoneyWeek 1140), but its savings aren’t so strong. So I use Goldman Sachs’ Marcus app for short- to medium-term savings: it’s really just an instant access savings account wrapped up in an app and pays 2.5%. Chase offers 3% instant-access savings on top of a current account with cashback (see below). Kroo is a relative newbie that pays…

Time is running out to take the opportunity to close the gaps in your National Insurance (NI) record and claim a more generous state pension. A temporary initiative that allows people to fill in holes going all the way back to the 2006-2007 tax year comes to an end on 5 April. After that, you’ll be limited to making good shortfalls only from the past six tax years. The idea is to maximise the state pension you can look forward to in retirement. You need to have made at least ten years of NI contributions to claim any state pension benefit at all. You need 35 years to claim the full amount, which is £185.15 a week at present. If you’re not sure about your current position, the government’s online…

After a 2022 pummelling, France’s CAC index is up 11% this year. The blue-chip benchmark has just reached new highs on hopes that the eurozone will dodge recession. Shares in luxury-goods groups serving Chinese consumers have done particularly well. Still, not all the CAC’s members have joined in the fun. Food producer Danone (Paris: BN) has been a long-term laggard. However, after years of dashed hopes, there are signs that its performance is about to improve. A sluggish global giant Danone was founded as a yoghurt maker in a Barcelona pharmacy in 1919. It has grown to become a €35bn market-cap business, with a range of global food brands. Sales are geographically diversified, with 32% in Europe, 24% in North America, 12% in China, north Asia (eg, Japan) and Oceania,…

Stock splits take place when a company decides to replace existing shares with multiple new shares. For example, in a two-for-one split a company could decide to replace one 100p share with two 50p shares. The idea is to stop the price of individual shares from getting so expensive that ordinary investors aren’t able to buy them, which could end up making them less liquid. For example, had Amazon not split its shares four times over its history, including a 20 for one split in 2022, its shares would be trading at $22,800 each rather than their current price of $97. Stock splits are often seen as a bullish sign, as they suggest that management thinks that the share price will continue to rise. A 2012 study by Alon Kalay…

Multinational bank Standard Chartered has announced a $1bn share buyback and an increased final dividend as it tries to bolster its case for remaining independent, says Bloomberg. Shares in the London-based but emerging-markets focused lender have risen in the last few months amid speculation about a takeover bid, with the UAE’s First Abu Dhabi Bank confirming in January that it had explored making an offer. The firm has undergone a radical restructuring since CEO Bill Winters took over in 2015, but its shares remain below where they were eight years ago. However, they are now up 38% in the last 12 months.…

Philip Fisher (born 1907) graduated from Stanford University with a degree in economics, but dropped out of the Graduate School of Business after a year to work in the then booming banking sector. In 1931 he started his own investment firm, Philip Fisher & Company, which he ran, with an interruption for military service, until his retirement 68 years later in 1999. His bestselling books Common Stocks and Uncommon Profits, Paths to Wealth Through Common Stocks and Conservative Investors Sleep Well are regarded as investing classics. What was the trade? In 1954 an analyst with Standard & Poor’s told Fisher about Texas Instruments, a pioneer in silicon transistors. Intrigued, Fisher researched the company and met its then head, Erik Jonsson. At the time Wall Street was cautious about the firm…

2019 Spottswoode, Lyndenhurst Cabernet Sauvignon, Napa Valley, California Approximately £78, fourwallswine.com; jeroboams.co.uk; emilewines.co.uk; citywinecollection.com There are a handful of days each year when I am lucky to taste more than just a few stellar wines. While it is rare for me to find wines to which I award scores over 19/20, on 2 February, I tasted no fewer than ten wines with 19+ scores from just two estates. I started the day with the 2020 releases from Domaine de la Romanée Conti, and there is no doubt that these are some of the year’s most expressive and impressive wines. I have already written them up on my website, and best of luck securing any bottles, as allocations are shorter and more sought-after than ever. Later the same day, I…

Going… The Codex Sassoon (pictured), the oldest and most complete surviving Hebrew Bible, is being offered by Sotheby’s in New York on 16 May. It is composed of 24 books, divided into three parts – the Pentateuch, the Prophets, and the Writings – and dates to the late ninth/early tenth century. It ended up in the synagogue of Makisin, present-day Markada in northeastern present-day Syria. The town was destroyed in the medieval period, but the Bible somehow survived in the keeping of a community member, called Salama bin Abi al-Fakhr. With a $50m upper estimate, the codex is potentially the most expensive manuscript ever offered for sale. It is being exhibited at Sotheby’s London rooms until 28 February. Gone… A 400-year-old copy of the Geneva Bible was sold last month…

How are the sanctions on Russia working out? Bloomberg reports that Russia has done more oil drilling than in the past decade. RussiaBriefing tells us that Russian rail-freight volumes heading east exceeded westbound freight for the first time. The reversal is no surprise given the sanctions, but it does symbolise the extent of the “pivot to Asia” Russia has gone through in little under 12 months. This is what the sanctions have wrought: a whole new ballgame is taking shape. Not only has a 40-year trend of rising asset prices and lowering interest rates finally reversed itself, so has a two-centuries trend of growing US imperial power. And now the combination of bad money and bad policies will set off a whole “cluster” of terrible things. One of them is…