Paper Summary: Thursday 16th January 2014

Economics

The World Bank has raised its global growth forecasts for 2014. In a report released yesterday, the institution claimed the world economy had “reached a turning point”, and that developed economies would now be able to generate “self-sustaining growth”. The bank forecasts that global GDP will grow by 3.2% this year, up from 2.4% in 2013, with much of the pick-up coming from developed economies. (The Daily Express, BBC)

 

Personal Finance

Research from the housing charity shelter has shown that 19% of householders borrowed money on credit cards to meet the cost of rent or mortgages, while 2% had taken out payday loans to meet housing costs. Campbell Robb, chief executive of Shelter, said: “Sky-high housing costs, stagnating wages and the high cost of living have taken their toll.” However, Chris Hopkins, Housing Minister, questioned the claims – saying “Shelter’s figures are based on a small number of calls to their helpline, while LSL’s figures show that the numbers of people in severe rent arrears are significantly lower than this time last year, and are 1.6% of the 3.8 million households who rent in the private sector.” (ITV, BBC, Mail, Guardian, Sky)

 

Property

The Royal Institution of Chartered Surveyors (RICS) has said that house price gains “can’t go on”, after revealing that sales have hit the highest level in six years, but that new supply has not caught up. RICS says more homes need to come on to the market soon to meet rapacious demand, or price rises will start to spiral out of control. (Daily Mirror, Graham Hiscott) However, writing in today’s Times, the commentator Peter Franklin argues that more building won’t be enough to keep house prices under control – saying the government should act to control speculation by those who own many different homes.

 

Recruitment

Mark Carney has dealt a blow to Ed Miliband’s mooted plan to limit bank bonuses. The governor of the Bank of England was careful not to be overtly political, but criticised the Labour policy, arguing the idea of a “crude” bonus cap was to blunt an instrument to use in the regulation of financial markets.

Other news in the world of work this morning is that the most fulfilled worker is aged 40 and earns £31,000 a year – and is a woman. Research from recruiter Randstad also found that the most fulfilled industries were construction and teaching, while those in the public sector feel their careers are the least fulfilling.

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Wriglesworth Paper Summary: Saturday 9th November 2013

Economics

Saturday’s economic news was overwhelmingly positive for prospects in both the US and China. Speculation has grown that the Federal Reserve will begin winding down America’s economic stimulus next month grew last night after the latest stats for jobs growth smashed expectations on Wall Street. Larry Elliot reports in The Guardian the US economy has recently created 204,000 jobs – way above expectations – on the back of above-forecast 2.8% annualised growth in the third quarter. (The Guardian, p.44)

Meanwhile, the Chinese economy has seen a strong rebound in exports – rebounding from a surprise slump in September with 5.6% annual growth in October. The numbers come as China’s leaders “prepare to set the fiscal and political direction for the next decade.” (FT p.8) In The Express, Peter Cunliffe comments on the impact of this manufacturing business – with China “ sitting on £2 trillion of foreign earned as manufacturer to the rest of the world”, and potentially using London as the centre of its investments of that money in the rest of the world. (Daily Express,. P.28) however, in The Independent Anthony Hilton writes on “why the City should be wary of banking too much on the Chinese” where he writes that while stuffed with cash, Chinese banks are far from immune from overstretching themselves, and are “notorious for being potentially among the most toxic in the world” (The Independent, p. 53)

Personal Finance

In Saturday’s Times Mark Atherton sets out the “tariff tart” approach to cut down on energy bills. Apparently, serial switching is the only way to cut down your costs as gas and electricity retail prices continue to increase dramatically. Atherton reports that one smaller supplier, Utility Warehouse, has ordered a 31.6% increase for some electricity customers. To avoid such surprises, reading all the small print form suppliers and switching as soon as anything unexpected arises is the only way it appears. “Active customers” should even be prepared to leave a fixed rate deal before it expires in order to pocket longer term savings, with Mark Todd of price comparison site energy helpline, commenting, “You need to be continually on your toes. If you are prepared to do this, you should be able to enjoy annual savings of £200 to £300 compared with what you would pay on the average standard tariff.” (The Times, p.67)

Property

Property Developers must start building new homes right away, or lose planning permission, according to the Planning Minister Nick Boles. A change in regulations is intended to “prevent land banking” and bring forward new building rather than allowing developers to simply make money out of rising land prices and the value of planning permission. The move against holding land now has cross party support, with the official Coalition policy now in agreement with Ed Miliband’s pledge to outlaw the practice at his conference speech in September. However, Nick Boles insists this particular measure “to extend planning permission has always been temporary…” (The Daily Telegraph, p.1)

Recruitment

An advert for a job in PR was advertised as “for men only” on the Guardian website. Proctor and Stevenson, a design company, were seeking a PR manager for £45,000 a year but due to their middle-eastern clients and “travel and work restrictions” for women in the area, the company needed to “restrict [their] candidate selection to males only” (The Times, p.41)

Paper Summary for 16th October 2013

Economy

According to a new forecast out today, from the Centre for Economics and Business Research, indicates that the UK’s economy will grow by 1.6% this year ahead of the expectations of major international groups, which is above previous forecasts from other groups. And it is thought that UK economic growth will speed up to 2.7% next year. The CEBR predicts that such rapid growth would be among the best in the developed world, bringing the government’s deficit to 4.7% of GDP. These figures come as welcome news, as the UK was expected to grow by only 1% this year.

Property

Prices have risen swiftly to a record quarter of a million pounds after a climb of 4% in the past year. The price of an average house in the UK shot up past its previous nominal peak during August, reaching record levels again according to  the ONS figures. For first time buyers the rise was even more rapid with prices rising 4.9% over the same period. The north south divide is growing: of the UK’s four countries only England’s average property prices have passed their pre-crisis peak in nominal terms. Banks are more willing to lend borrowers with low depsoits and confidence is rising rapidly. The underlying fact is that English prices are driven by London and the South East with every other region still below their 2008 peak levels. David Newnes of LSL Property Services points out that it is crucial that the growing momentum is also met head on by an increased supply of housing if in order to sustain growth in the long term and make certain future generations of home buyers won’t be priced out of the market.

Recruitment

New research shows that men control the highest positions in marketing, even though 75% of marketers are female, according to recruitment marketing specialist EMR. It is said the likely reason for career progression slowdown is due to women having children and the responsibilities of childcare. The most significant difference is between ages of 30 and 49 where 17% more men reach director positions.

Personal Finance

In a recent Lords debate over the Care bill, which is implementing elements of a review of the UK’s care system by economist Andrew Milmot, the Care minister, Norman Minister said that pensioners with £23,250 plus in savings and assets are “quite wealthy” as he defended plans to prevent some elderly homeowners from deferring the cost of residential care. The Government was blamed for ripping people off on a deal after it came to light that a scheme to defer a person’s care costs until after their death may be available only to people with assets, apart from their home, of less than £23,250. The Shadow care minister responded by saying they’ve discovered many older people must use up other savings and assets before they qualify for help and that many elderly people will feel angry that the Government has tried to pull the wool over their eyes about what the plans really mean. 

Wriglesworth Paper Summary: 6th August 2013

Economics

Things are getting better, and they’re getting better faster than they have for some time. Markit’s composite PMI (or Purchasing Managers’ Index) tracks a combination of the separate PMI readings for each section of the economy – and this is at an all-time record high. Anything above 50 indicates expansion, but in July the composite measure hit 59.48. While all sectors are growing in unison according to the measure, services lead the charge last month – recording a measure of 60.2, the highest since 2006. (Financial Times p.1, City A.M. p.1, Daily Telegraph B.1, & everywhere)

Personal Finance

Two stories this morning highlight the growing split between the positive economic news and the difficulty for personal budgets. Firstly, the economic data stands in stark contrast to the latest data on wages – which have not beaten the tide of inflation since Marc 2010 (Financial Times p.2) Yesterday’s YouGov poll in The Times highlights this (reported this morning again in the FT – p.3) with 58% of workers believing their pay will be lower in real terms in a year’s time. Secondly, payday loans are still thoroughly on the agenda, with Alex Salmond weighing into the debate, promising war with “those who aim to exploit” (BBC News)

Property

Stamp duty is becoming commonplace across England and Wales, according to research by the Taxpayers’ Alliance. One in four now has to pay over £7,500, while buyers in London and the South east are “often” facing bills of over £20,000. Since the start of the recession the government has increased its annual taking from the tax by £1 billion, and the Treasury now receives £4 billion every year from stamp duty. The Taxpayers’ Alliance calls the tax “punitive” in its campaign, highlighting the inconsistency with schemes like “Help to Buy”. (The Times p.1, Daily Express p.2)

Recruitment

HSBC has vowed to increase salaries to make up for lower bonuses to its staff caused by new European proposals that could become law. The bank is worried about losing talent, with the chairman, Douglas Flint, warning that the legislation, due to come into force at the start of next year “could be damaging”. A recent survey by Mercer said that four in five European banks were planning to raise salaries to maintain total pay, while limiting bonuses to twice base salaries. However, shareholders would prefer to keep as much of the remuneration in the form of bonuses so as to keep total remuneration as closely tied to performance as possible. (Telegraph B.1)

News Headlines – Saturday 27th July 2013

Business/Economic
Two of Britain’s biggest banks, Barclays and Lloyds, are eyeing big capital markets transactions in the coming days to take advantage of resurgent investor sentiment towards the sector. Barclays is closing in on a plan to boost its capital strength with ideas to issue fresh equity, sell hybrid bonds and shrink its balance sheet. Lloyds has been priming investors for a selldown of the government’s 39% stake to begin as soon as the end of next week. Financial Times, p1

 

Property

National census statistics have revealed that of the four million migrants who entered the UK between 2001 and 2011, 469,843 were allocated council or housing association properties. The paper reports that the number of families on the waiting list for social housing currently stands at a record 1.8m. Sir Andrew Green, of the Migrationwatch thinktank, said: ‘The figures serve to underline the huge cost of mass immigration – costs often ignored by the immigration lobby. Daily Mail, p1

 

Recruitment

Over 800,000 British jobs are being offered to workers in EU. Under an EU scheme, positions advertised in UK job centres also have to be offered to workers in other European member states. Peter Dominiczak, Telegraph, p8; Brussels is believed to be offering British firms £1,000 a time to take on foreign workers. Daily Mail, p4

 

Personal Finance

As more lenders offer cheap deals, switching to a new home loan could have a drastic effect on repayments as consumers could save £15,000. The latest figures reflect the Government’s attempt to prop up Britain’s sluggish property market. Telegraph Your Money, p1

Wriglesworth Paper Summary: 18th July 2013

Economics

On the front page of the Financial Times this morning, Chris Giles analyses the latest MPC minutes as a “retreat” from the Bank of England’s “flagship” quantitative easing programme. The incoming governor Mark Carney could be going for a “more mixed strategy” according to the minutes. Kevin Daly of Goldman Sachs thinks that this could be “an increased probability of a change in policy next month”. Philip Aldrick of the Telegraph writes more on the united front in the UK and US to scale back QE. (Telegraph B.1)

Meanwhile, in fiscal news the Mail (p.6) describes the “decades of austerity” that will be necessary in order to reduce public debt in the UK, according to a report out yesterday from the Office for Budget Responsibility. This comes after George Osborne’s recent promise not to raise taxes if he remains Chancellor in 2015 – which would require extra spending cuts to get closer to balancing the books.

Personal Finance

City A.M. use the same OBR report as the basis for their front page today, but with a different focus. The OBR has announced that an ageing UK population will make public spending on social care, health and pensions unsustainable within a generation. Page 1 of the Guardian also discusses elderly care and finances – describing the coalition’s plan for new loans and insurance as a way to end the (ever-present media catchphrase) “post code lottery”. The Guardian’s Randeep Ramesh describes how some elderly people could save up to a fifth of their care costs in retirement under the plan. Back in City A.M. Allister Heath argues for urgent reform of the welfare system, saying, “I’m sorry to write about this on such a beautiful summer’s day but it’s a disturbing and crucially important story.” (City A.M. p.2)

Recruitment

Unemployment dropped by 57,000 between March and May, in figures released by the ONS yesterday. However, the Mirror (p.15) focus on the rise in long-term unemployed over the same period, with Labour’s Liam Byrne calling progress “sluggish”. Meanwhile, the OBR, in the same announcement as its analysis of the ageing population, has pressed for more skilled immigration to meet the UK’s demographic and economic needs. (City A.M. p.1, Mirror p.15)

Property

In the Independent and Scottish Daily Express, there’s cautious optimism for the property market north of the border. House prices in Scotland have risen £2,283 since December 2012 with sales 4.4% higher than May last year, according to LSL Property Services. Alan Penman of Walker Fraser Steele, part of LSL Property Services, says: “Sales are improving and mortgages are more readily available. But there is still a long way to go.”

Wriglesworth Vlog: Paper Summary for 12th July 2013

The key macro-economic, personal finance, property and recruitment stories from today’s papers read by Wriglesworth Account Executive Sinead Meckin