Has War Just Changed?

As is often the case, out of something that seemed trivial, we may have witnessed a “significant moment” in history without grasping the implications. In short, we are asked to wonder if war has just changed. It seems to me that war is invariably about an inability to cope with or live with difference. Often this is expressed as a conflict of ideology but of course theology too. Some regard war as a battle over land, which perhaps is the case, but I’d suggest that this is merely the physically binding frame of reference used to galvanise support along lines of difference and to physically represent the boundaries of control. This week we learned that the boundaries shifted. The vast majority of the media missed the story, selecting to reflect the inane rather than the insane.

The story? this is about a executives at a film company bad-mouthing movie stars and being caught. The real story is that national boundaries have just been obliterated by hackers, who acted to squash something they didn’t like… but not just squash, threaten. Of course, some countries operate on the basis of a few bullies oppressing the masses – this is sadly nothing new and will probably never cease. I found myself looking at an image in a magazine recently, wondering how on earth so few, odd looking irrelevant men can control an entire nation, yet it happens all over the world.

The sadness is that film-makers and journalists are meant to be the ones that keep our focus on the truth, revealing darkness and oppression, helping to inform and change. Sadly many in Hollywood shirked this responsibility for fear of reprisal and financial cost. George Clooney couldn’t get anyone to sign his petition – ANYONE. So why should we be concerned if others aren’t? – after all haven’t Sony executives themselves to blame for expressing personal opinion and hitting that send button? Well, certainly some wisdom is needed in expressing opinion in a digital age, but the truth is that I doubt anyone has not said something about someone at some point in their life of which they are now not terribly proud. However, this isn’t really the point – the point is where does this lead? Can hackers now be hired by anyone, any nation to bully another into compliance? How does this impact our free speech? and surely this isn’t simply the domaine of terrified, narrow-minded tyrants, but also enters the arena of corporations who don’t like stories about their leadership or activities. Surely this has the potential to influence how we perceive and from a financial services perspective, appearance can be everything – just ask Tesco or BP.

This story has implications for you and I, our use of social media and the freedoms we enjoy. Obviously it isn’t wise to hurl insults and the adage, if you wouldn’t say it to their face, don’t say it at all seems pretty pertinent. But we surely cannot live in a world where we are terrified of legal action or reprisal. This is a “tipping point” for the double-edged sword of the internet, offering the prospect of genuine freedom of information to all (which we take rather for granted in the comfort of the West). As for me, I have never liked bullies, whether they come in the guise of a big kid in the playground, a teacher, boss, an investment bank, politician, pseudo military general, bigot, racist, rabid fundamentalist or of course my own tendency to think lazily and turn to petulant expression in frustration, which certainly in my “madder moments” it is a very good thing that weapons are not within easy reach…and sadly my own temper is easily fuelled driving, cycling or walking these very streets all too easily… which is of course the advantage of a society that doesn’t permit liberal gun ownership, encourages thought, education, tolerance and self-reflection, but unfortunately often seems more obsessed with narcissistic reflection in the eye of… well the media.

Dominic Thomas

Has War Just Changed?Dominic2023-12-01T12:39:48+00:00

Dark October Days

There is something about October that makes me feel somewhat downbeat. Perhaps it is waking up in the dark and then coming home in the dark. The weather is generally pretty grey and miserable, autumn, for all its glorious colours is truning into winter and the summer feels like a distant memory. I also find walking the dog much more of an effort – wellies and avoiding the rutting stag in Richmond Park. This is cold-catching time and to say that markets tend to catch a cold in October would be an understatement.

Most will remember the more infamous “Black Monday” market crash of October 1987 with the FTSE100 falling 12.22% in a single day. More recently October 2008 provided some of the most terrifying and largest single day falls (in percentage terms) ever on 6th falling 7.85%, 10th falling 8.85% and 15th falling 7.16%. Today as I write, the markets are once again “in a state of turmoil” depending on what you read and who you listen to, as news is digested and responded to.

However, despite this “evidence” on 16 October 2008 the FTSE100 stood at 4,377.30 yesterday it closed at 6,211.64. Despite the news, markets have been rising and opened at the start of this month at 6,211.60 Looking at short-term statistics is very unhelpful, add in the occassional image of a stockbroker clutching a phone, peering at a monitor or holding his head in in hands and the scene is set for the appearance of further market chaos and sentiments of “you simply cannot trust the markets”. Well, in practice, despite October having what appears to be an unusually larger than fair share of bad days hostorically, it isnt actually much different from other months. Markets rise and fall, reflecting sentiment about the state of the world, which invariably has little to do with reality. This is partly due to several European countries still struggling to generate economic growth and the US finding life harder going. This is not really a new phenomena is it?

Keep to the long-term principles of investing, if you are keen to make a short-term play then a market fall is essentially a discount, some would argue “a more accurate value” but either way, sitting on the sidelines waiting for the markets to rise again before getting back in is the wrong choice. So stay the course, keep to the game plan.

Dominic Thomas

Dark October DaysDominic2023-12-01T12:39:32+00:00

Another Bumper Apple Harvest

1967: Thee Bites of the Apple

As Apple seem to be the benchmark in technological coolness, it seems appropriate to keep you posted on their financial numbers too. Yesterday they announced the Q3 results (only Apple could make 30 June mean third quarter). This revealed $35bn revenue for the quarter and a net profit of $8.8bn, which by my maths is a 25% net profit margin. These numbers are an increase on the same period last year.

All those gadgets that we are buying – amounted to 26 million iPhones (up 28%) and 17 million iPads (up 84%). Apple’s original product – the Mac, well they only sold 1 million desktop macs and 3 million portables, an increase of just 2%. Read into that what you will, but my suspicion is that the portable device market is the clear, big winner for Apple. However, this is a market with increasing competition and of course impact of the death of Steve Jobs on the direction and innovation of the company remains to be seen. If you have Quicktime, you can see the presentation here. The lion share of the revenue is derived from the US and Europe. It should also be noted that nearly half of the total revenue was derived from iTunes – some $16.2m.

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Another Bumper Apple HarvestDominic2023-12-01T12:22:25+00:00

Turmoil Continues

The global markets remain highly volatile and values have fallen further this week. This is primarily driven by fear that it will take longer than expected to return to economic growth. The media glibly use terminology that is highly inflammatory and loaded with sensationalism. The reality is that we are in a global recession, we have not and had not left this behind us. The graphs may suggest a “double dip” but in reality this is merely a valuation chart and little more. The economic data has been weak and I think we are all aware that Governments around the world have also been somewhat insipid in their ability to restructure economies.

When I was on my holiday in America in July/August I was struck by the general folly of American politicians and the lack of retail activity. Admittedly my ad hoc sampling of the shopping experience (which was deliberately limited) was hardly scientific, but I was struck by how few shoppers there were. Consumers are generally very concerned about budgets and affordability (not before time!) this filters through to slow retail sales and lacklustre growth.

The current turmoil is sadly a reflection of a lack of faith in the ability of economies to recover quickly or Government’s to make a difference quickly. Gold has continued to be a “safe-haven” and prices continue to rise making it expensive. Cash is currently providing a guaranteed loss (interest rates below inflation rates) so investors are stuck with what appears to be a lose-lose choice. Bonds are normally a helpful low risk investment, but essentially being issued by Governments, remain a risk due to the ability of Governments to meet their liabilities.

What will help? frankly reform of the system – particularly the tax system which needs to properly address the question “how do you raise tax revenue without alienating the population and dis-incentivising them?” Answers on a postcard please.

We are a boutique firm of financial planners. We create financial plans designed to achieve a desired lifestyle. We will craft and implement your plan that will provide you with the greatest chance of accomplishing your unique goals based upon the values that you hold. Financial products are little more than the tools to achieve your required results
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Turmoil ContinuesDominic2023-12-01T12:49:20+00:00

Monthly Market Report

Solomons-financial-advisor-wimbledon-blogger

For consistency, the latest monthly figures to the end of July 2011 are made available once again via our website in the news section. These are of course now out of date. Markets have fallen sharply. It will however be interesting to see the mathematical impact on longer-term returns at the end of August and how the current chaos is reflected in the figures. I also wish that I was providing better news!

Dominic Thomas
Solomons IFA

You can read more articles about Pensions, Wealth Management, Retirement, Investments, Financial Planning and Estate Planning on my blog which gets updated every week. If you would like to talk to me about your personal wealth planning and how we can make you stay wealthier for longer then please get in touch by calling 08000 736 273 or email info@solomonsifa.co.uk

Monthly Market ReportDominic2023-12-01T12:49:23+00:00

Sign for the Times

As I was driving past my local hospital this morning I reflected on the signage for the hospital. Those travelling to a hospital are often stressed, perhaps due to anxiety about an appointment or visiting a relative. There may be other reasons too, perhaps being rushed to A&E or maternity. In short the sign that effectively says “there is a hospital here” is accurate but missing the point that because there is a hospital here, people in the vicinity, on the way to or from it, may be in a heightened state of anxiety. As a consequence they may not be as focused on their driving, parking or walking as much as they normally would be. The sign then becomes a warning to others in the vicinity to also take more care as a result. I know that as many of you work in a hospital, that this will be all too familiar and indeed the trip to your place of work may also be fairly stressful.

Today is simply another day, but today’s context is different from a couple of weeks ago. Today there is further cleaning up of damage, there is some reflection on how we reached this point as a society. The stockmarkets around the world remain highly volatile and nervous, we have deep seated economic problems. The world is not as it “should be”. It would be rather helpful if the stockmarket came with helpful signage – or indeed our society. So we look for other signs, which is really what investors are currently attempting to see. There will be further volatility, there are no certainties, sadly that is part of life. However, we are not impotently standing by, but continuously reviewing the situation and acting with caution and I am doing my best to protect clients from making poor decisions. Hindsight is a gift only to those that live in the past, so as the media noise rumbles on, remember that to date nobody has successfully predicted the future consistently. The market is essentially a place where different (perhaps opposing) views are given shape in the form of a price, not value. So as you listen, read or watch reporters attempt to make sense of what is going on, remember the Hospital sign.

We are a boutique firm of financial planners. We create financial plans designed to achieve a desired lifestyle. We will craft and implement your plan that will provide you with the greatest chance of accomplishing your unique goals based upon the values that you hold. Financial products are little more than the tools to achieve your required results
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Sign for the TimesDominic2023-12-01T12:49:23+00:00

Business Updates – presentation is everything

The media world is one that perplexes me. I still fail to understand why broadcasters insist on increasing the volume every time an advert break comes along – and I’m also baffled why (to my knowledge) nobody has shown an advert in slow motion (as most of us fast forward through them, it would seem that this approach might actually make sense). Anyhow, despite my misgivings about the effectiveness of advertising ITV have announced that they will now finally pay a dividend in December. The first time since 2008. The “troubled” broadcaster has seen an increase in revenue of 4% to £1,027m. It would seem that ITV has become very cost conscious and worked hard to reduce its debt and reduce expenses, this strategy has had considerable success for the company’s financial data.

Two big players within the financial services industry are continuing to struggle and adjust to the realities of a harsh economic environment, punitive fines and the new rules for advice giving in 2013. Barclays have announced 3,000 job cuts and HSBC are cutting 30,000 on a global basis as part of a £2.1bn cost cutting exercise. Barclays have actually been doing rather better, although a huge amount (£1bn – that’s a US billion and actually £1,000m) has to be set aside for PPI claims. Total income net of insurance claims reduced to £15,241m from £15,730m. Profit before tax was up from £2,963m to £3,678m which is a significant increase of £715m or 24%, although the statutory figures are almost the reverse with gross profit of £2,644m compared to £3,947m the year before, a reduction of £1,303m or 33%. This may be a case of how the data is presented.

We are a boutique firm of financial planners. We create financial plans designed to achieve a desired lifestyle. We will craft and implement your plan that will provide you with the greatest chance of accomplishing your unique goals based upon the values that you hold. Financial products are little more than the tools to achieve your required results
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Business Updates – presentation is everythingDominic2023-12-01T12:49:24+00:00

Back to Basics

I am now back from my summer holiday – which was fabulous. I took my family on a “holiday of a lifetime” to California, doing a fly drive from San Francisco to Los Angeles and then home to London via a 4 day stay in New York.

It was certainly an interesting visit, I took the opportunity to visit Wall Street and kept up to date with local and international news. Sadly, the current turmoil in the market is based upon some very real concerns. I saw nothing that convinced me that America is any better at managing an economy than anyone else. The problems that Obama is having to get through the necessary changes is widely reported. It seems that American politicians are now as loathed as our own and whilst some agreement has been achieved, frankly little real substance is behind the deal, hence the downgrading of the US from AAA to AA.

All this is of no comfort to investors who have been nursing losses for some years and despite the reality of where problems are located, all parts of the world are dragged into panic selling. As you may know, we reduced US holdings dramatically a few weeks ago, but this is of little real benefit when everything else gets sucked down.

My observation is that America is still very much in denial of the significance of the problems caused by the credit crisis. As yet, little has altered in terms of how Investment Banks behave or how they are regulated. Economic denial of reality can be lethal. Politicians must put the right measures in place and those that won’t should not be in positions of power that impact us all. It is said that we get the politicians we deserve, I sincerely hope that this is not correct.

As for the moment, sit tight. Markets are in a spin and investors must consider the long-term nature of investing, which is not easy when all around you are loosing their heads.

Dominic Thomas
Solomons IFA

You can read more articles about Pensions, Wealth Management, Retirement, Investments, Financial Planning and Estate Planning on my blog which gets updated every week. If you would like to talk to me about your personal wealth planning and how we can make you stay wealthier for longer then please get in touch by calling 08000 736 273 or email info@solomonsifa.co.uk

Back to BasicsDominic2023-12-01T12:49:26+00:00

Quietly Brilliant?

You may have heard of the Blackberry or the iphone or indeed a variety of other handheld devices. One that to many in the UK is a relatively new player is HTC. They have virtually doubled their profits in Q2 against Q2 in 2010 to £380m HTC is based in Taiwan and manufacturers smart phones and is listed on the Taiwan stock market. I believe that HTC are the only manufacturer currently producing a handset with 3D capabilities.

We are a boutique firm of financial planners. We create financial plans designed to achieve a desired lifestyle. We will craft and implement your plan that will provide you with the greatest chance of accomplishing your unique goals based upon the values that you hold. Financial products are little more than the tools to achieve your required results
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Quietly Brilliant?Dominic2023-12-01T12:49:27+00:00

Is water the new gold?

Anyone with a pulse will appreciate that this is a planet covered largely by water, but unfortunately, drinking water is fairly scarce in many parts of the world and no doubt you will be aware of the drought that is occurring in East Africa. Water is a precious, life saving commodity. There are many that believe that it is a resource that is running out, particularly due to the way many industries use such vast quantities in production processes.

So it ought to be an incident of note when a business from Hong Kong makes an offer to buy one of the UK’s water companies. Northumbrian Water were approached at the start of the month by Cheung Kong Infrastructure Holdings Limited (CKI). The Board have agreed to permit CKI to conduct due diligence. The initial offer is 465pence per ordinary share. Northumbrian Water is a UK listed share.

We are a boutique firm of financial planners. We create financial plans designed to achieve a desired lifestyle. We will craft and implement your plan that will provide you with the greatest chance of accomplishing your unique goals based upon the values that you hold. Financial products are little more than the tools to achieve your required results
Call us today or visit our website for more information and to arrange a meeting

Is water the new gold?Dominic2023-12-01T12:49:28+00:00