What caught my eye this week
I developed Covid on my long-awaited holiday at the end of June, its symptoms lingered for nearly four weeks, and I’m now a week into some kind of chesty-cough cold that smuggled itself in through the back door during the kerfuffle.
So maybe it was all the cough medicine and lack of sleep playing tricks with me… but wasn’t that Olympics opening ceremony in Paris last night completely bonkers?
Audacious, inexplicable, tedious, striking, cringe, and unhealthy for the rain-sodden elite athletes – and usually all at once. Probably the most French thing I’ve seen since Luc Besson’s The Fifth Element did Star Wars in haute couture.
(Well, not counting the date I had with a French girl in my early 20s who I met on a work trip who traveled from Paris to see me, greeted me with a compilation tape which turned out to be mainly women wailing against the sound of church bells, declared all the food at the trendy yet affordable restaurant I’d gingerly selected to be inedible, and who then watched me eat three courses over three untouched plates of her own food because no, it wasn’t ‘inedible’, and I wasn’t going to go without pudding.)
I have no investing angle on this to torture into shape. Life can’t be all cold rational numbers you know.
Just ask whoever did the accounts for last night’s bonkers extravaganza.
Taxing matters
One quick errata: we overlooked the revised rate of capital gains tax for higher-rate payers on property disposals in our update [1] yesterday. It is now 24%, down from 28%, as our ever-alert readers spotted. Thank you!
Although as another reader wryly observed: who knows how long anything in the current regime will survive contact with Rachel Reeves, anyway?
Something in the tax and pension system will change with Labour’s Budget in the Autumn, that’s for sure.
However I wanted to update these articles ASAP on account of all the emails and comments I’m getting that referred to the old capital gains allowance.
Much more than, say, a year ago.
To me that points to more people contemplating evasive action – shooting first, and planning to read all those The Autumn Budget And Your Finances summaries later.
Which I’ve mixed feelings about.
I took a big tax hit in 2021 on disposing of a six-figure position that had more than ten-bagged for me – just about the last of my legacy [2] unsheltered holdings.
I feared a capital gains tax hike that never came.
But then tech stocks crashed and I felt tentatively smug as the very same shares I sold would have halved in value.
I was right to be tentative though. The stock – which I never repurchased in anything like the same size – recently hit a magnificent all-time high.
The point is that absent a crystal ball, it’s impossible to know what exactly to do.
For example, you could sell a big position like I did to take the tax hit upfront and aim to use the proceeds to fuel your ISAs for a few years – but perhaps the annual ISA allowance will be cut.
Or one of a hundred other permutations.
This is why strategy always trumps tactics. Fill your ISAs and max out your pensions where possible then move to paying down your mortgage. If after all that you still have problems, maybe best to be grateful compared to poorer households still reeling from much higher prices and mortgage costs?
Well, be grateful but continue to hunt for an optimal solution I guess, but with a smile. Because the tax hit on investing returns is very real [3].
Have a great weekend!
From Monevator
Optimising the All-Weather portfolio – Monevator [4] [Members [5]]
Capital gains tax on shares – Monevator [1]
From the archive-ator: How a boring broker will make you richer – Monevator [6]
News
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European and UK investors dodged £80bn in fees over 12 years with index trackers [Search result] – FT [7]
Treasury minister says government will consider investment trust disclosure reforms – AIC [8]
Revolut’s long wait for a UK banking licence finally comes to an end – City AM [9]
Coinbase UK fined £3.5m for onboarding ‘high-risk’ customers – Coin Telegraph [10]
Why the London vs New York IPO problem is a distraction – Semafor [11]
Future of 1p and 2p pieces in doubt after Treasury orders no new coins – Guardian [12]
[13]
What happens when you add crypto to a portfolio? – Morningstar [14]
Products and services
Mortgage rate hopes as Nationwide offers rate below 4%… – BBC [15]
…but Lloyds boss warns rate cuts are mostly baked-in already – This Is Money [16]
A third of UK adults now use digital wallets [PDF] – UK Finance [17]
Open an account with low-cost platform InvestEngine via our link [18] and get up to £50 when you invest at least £100 (T&Cs apply. Capital at risk) – InvestEngine [18]
Do Kids Pass and other family discount passes save you money? – Be Clever With Your Cash [19]
Is it worth getting a student bank account? – This Is Money [20]
NatWest tweaks mortgage rules to be more Airbnb-friendly – Which [21]
Can the natural diamond market regain its sparkle? [Search result] – FT [22]
Spending abroad: the dos and don’ts – Which [23]
Grand townhouses for under £1m for sale, in pictures – Guardian [24]
Comment and opinion
The average cost of a lifetime in Britain hits £1.68m – This Is Money [25]
$656,000 worth of frugal things Mr M’Stach still likes to do – Mr Money Mustache [26]
Going back to work is hard after 12 years of FIRE – Financial Samurai [27]
Maybe she was born with money – Money With Katie [28]
Bill Perkins makes $100m a year but plans to die with zero – Noah Kagan [29]
Stay in the game, investors… – Humble Dollar [30]
…and let compounding do its work – Behavioural Investmen [31]t
The folly of certainty – Oaktree Capital [32]
Lifestyle creep is mostly a myth – Of Dollars and Data [33]
Maxims for thinking analytically – Novel Investor [34]
Aging mini-special
When work gets harder with age – Flowing Data [35]
Six lessons from six years of retirement – Humble Dollar [36]
On being 80 – Humble Dollar [37]
Naughty corner: Active antics
A time-traveller’s guide to stock market winners… – Sherwood [38]
…and a warning that even these can give holders ulcers – Baillie Gifford [39]
…plus the Bessembinder paper it’s all based on [Research] – SSRN [40]
An introduction to economic moats – Flyover Stocks [41]
The London discount is about performance, not geography [Search result] – FT [42]
A stock market return of historic proportions is taking shape – WSJ via MSN [43]
A history lesson – Optimistic Callie [44]
The rise of alternatives… – Verdad [45]
…could drive a private equity liquidity squeeze [Nerdy] – MPI [46]
Kindle book bargains
Environomics: How the Green Economy is Transforming Your World by Dharshini David – £1.99 on Kindle [47]
The Hidden Half by Michael Blastland – £0.99 on Kindle [48]
How to Own the World by Andrew Craig – £0.99 on Kindle [49]
Never Split the Difference by Chris Voss – £0.99 on Kindle [50]
Environmental factors
Earth likely just had its hottest two days in thousands of years – Axios [51]
Have wind farms gone too far… offshore? – Klement on Investing [52]
New European rules to curb deforestation have worrying flaws, scientists say – Science [53]
Robot overlord roundup
AI’s real hallucination problem – The Atlantic [54]
Putting six free AI models to the (financial) test [Research] – SSRN [55]
Off our beat
The dark protectionism of Trump and Vance – Roger Lowenstein [56]
‘Xitter’ is the CNN of social media – Spyglass [57]
Going to bed with the mafia – Klement on Investing [58]
The problem with cities – Dror Poleg [59]
Baby talk [Warning: potentially distressing historical detail] – Aeon [60]
How tyrants fall – The Garden of Forking Paths [61]
Compete in over 100 boardgames at the Mind Sports Olympiad in London – M.S.O. [62]
And finally…
“When you have to kill a man it costs nothing to be polite.”
– Winston Churchill, Churchill: Walking with Destiny [63]
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