A good start to the year here on Monevator, from my point of view at least. Lots of readers kindly chimed in on my 2010 blog goals, and I stuck to the first of them, posting four more times this week on a wider range of money-related matters: technology investing, Shopify, snow and pay, and hedge funds.
I’ve still to nail those shorter posts, though!
Continuing the good vibe theme, my post of the week is from the Psy-Fi blog, where Timmar considers happiness and its relationship to wealth (via his customary detour into behavioural finance…)
If anything, more money brings us less happiness in terms we’d really associate with feelings of contentment.
Higher salaries mean longer working hours, longer commutes, more stress, less time to stop and deadhead the flowers and socialise with our friends.
These aren’t the things we think of when we’re asked about whether more money would make us more cheerful.
I agree. While I hated earning less money back when co-founded a start-up – and it definitely made me less happy – I think that was because I felt I’d derailed my long set financial goals.
Actually having more money, before or since, has made virtually no difference to my happiness that I can tell. Perhaps I need to spend more of my money though!
Some good reads from the money blogs
- The botched Brown coup and the UK debt markets – Capitalists@Work
- Stockmarkets, volatility and predictability – Stumbling and Mumbling
- 2010: An investing odessey – iii Blog
- Was the last decade lost? – Bad Money Advice
- Country ETFs ranked by 2009 performance (in $) – Darwins Finance
- Handling two financial houses – Frugal Dad & Money Relationship
- The Four Agreements and financial freedom – Wealth Pilgrim
- I picked Monster Worldwide for Sam’s fun fund – Financial Samurai
- Investing basics (for U.S. readers) – The Digerati Life
- Orange’s new contact-less credit card – Money Watch
Financial and money articles from the UK papers
- Bubble warning – The Economist
- Nurse, my smelling salts! Banks are still paying bonuses! – FT
- UK companies to bring forward dividends ahead of 50% tax – FT
- Merryn S-W was bearish going down, now she’s bearish going up – FT
- Bad news for contrarians: Investors are taking on risk – FT
- Mark Dampier suggests its time for defensives – The Independent
- Neil Woodford: Shares “as cheap as I can remember” – The Telegraph
- We’re all Icelanders now, says Robert Peston after referendum – BBC
- Britain faces ‘toughest cuts for 20 years’ warns Darling – The Times
- Under the skin of index trackers – The Motley Fool
Like this roundup? Subscribe to get a list of great links to read every Saturday.
Thanks for the list. I live in America, so it is interesting to see your links to UK blogs.
Congrats on achieving your first goal!
Mate, thanks for highlighting the FT article on bonuses. Wow! The banks are just going to DOUBLE bonuses for their UK employees to counteract the 50% tax huh? Guess the shareholder pays.
I still think it’s absolutely Socialistic that the UK gov’t is instituting a sudden 50% tax on bonuses over US$40,000. That’s just ridiculous and in the long run, will drive hundreds of thousands of jobs away from your country and hurt the economy even more. WHY the gov’t doesn’t realize this, I don’t understand. Must be an election year lol.
Your MWW is doing well! +8.5% for the week! I put up a permanent tab to highlight all your glory. If you ever have any updates on the company or what not, please feel free to plop an update there.
Best, Sam
My view is that Tim’s Psy-Fi blog is the best written blog out there. He works it hard. He never says anything boring.
Rob
Financial Samurai,
In may ways as a UK taxpayer I take the view that what is really socialistic is that I have paid/will pay for the downside risk while the bonus-taking scum ride off with the upside.
Intellectually I agree that making populist tax policy on the hoof is worng in so many ways. I would have nationalised what I had to save, let the rest go to the wall and instigated a UK Glass-Steagall act to save the non-investment banking section. Perhaps it’s as well I’m not in charge, but at least I would have the benefit of knowing I don’t know.
As for this cheesy old bromide
“in the long run, will drive hundreds of thousands of jobs away from your country and hurt the economy even more.”
Quite frankly, I don’t give a damn. If this sort of mess is what bleeding-edge success looks like I want none of it. The City boys can whoop it up on champagne and bonuses all they like, as long as the buggers don’t end up screwing the system so hard the rest of us have to PAY for their bloody champers.
Why people don’t understand the reluctance of the common oiks of this country to sponsor the lifestyles of the so-called high-flyers with rewards for failure is something I don’t understand.
Ermine – Thanks for your response. You may be interested to know that the US public LOVES Wall St. again. How else does BOA, Citi, Wells raise $60 BILLION this past Nov/Dec from the public, to pay back the public (TARP), so they can pay themselves big bonuses?
Hence, I’m pretty sure the UK public is quite similar, and actually really loves your banks again b/c surely they will fund raise from you, and you will participate because you want to make money from them.
It’s important recognize only a minority of people in the finance industry participated in the CDO/securitization of mortgage mess. Why should we publish everyone? What did your bank teller do for example, except provide service with a smile.
The common folks are secretly supporting the high flyers, they just aren’t telling you.
FS
@Rob @ermine – I guess I sit somewhere in the middle of the debate. I recognize a lot of good comes out of the financial markets that helps capital get allocated more efficiently etc. And yes, it is very wrong to tar the whole ecosystem with the same brush. But I’m also absolutely sure the financial industry works in nobody’s interest other than its own, and so it should stop bleating when we change the rules (because it can’t self-govern).
What’s more, a distinct and not insignificant tranche of bankers/traders (lawyers/fund managers etc) have become completely detached about what a good income is, and whether what in their eyes is hard and good work is really that much harder or, socially speaking, better, than what all kinds of other professions do.
We shouldn’t believe the hype. City salaries didn’t used to be so divorced from other high-flying salaries, it’s something that happened in the last 25 years, partly as a result of the influence of US banks but much more the fact that so much money churns through the system and they take their 0.1% of billions, and then desperately seek explanations for why they’re worth it, rather than accepting they might not be (at least until you get a couple of drinks in them!)
As for the contribution to the UK economy, yes it’s massive (10% of the tax take) but there are downsides (property in London flits in and out of being the most expensive in the world, though it’s currently a lot cheaper due to the sick pound).
Taleb claims in Black Swan that US banking has been a net lossmaker for the U.S. taxpayer due to the various banking crisis over the years, though I don’t know if that’s true or true of the UK…
@Rob – Agree, he’s sheer class.
FS
We might be on the same wavelength in one respect at least 🙂
I was unaware that the American banks have repaid the TARP funds. This does not appear to be the case in the UK, as of early Nov 2009
http://www.telegraph.co.uk/finance/newsbysector/banksandfinance/6496295/Bank-bail-out-every-family-shouldering-4350-tax-liability.html
When, and only when, this has been repaid AND the boring banking sector has been split off from the racy investment banking business in a UK Glass-Steagall act, I’m in agreement with you, investment bankers can whoop it up on Dom Perignon as much as they can sting the investors for.
IMO the sort of banks that deal with wages, loans to business etc should be regulated so the implicit State guarantee needed to make us feel secure in holding pounds rather than gold bars is bounded, and can be evaluated by the limited skills of regulators. That inherently limits their sphere of activities, so wages will be lower in those banks. There is no need for the UK tax payer to underwrite “financial weapons of mass destruction” any more.
BTW the bankers tax applies to those ‘earning’ a bonus of more than £25k according to the FT http://ftalphaville.ft.com/blog/2009/12/10/88126/bankers-bonus-tax-hits-100/ Bank tellers don’t get anywhere near than much, so if they still got a job they are unaffected.
I promise you Monevator, that the UK’s life support government assistance banks will start paying back the gov’t by end of this year. The US gov’t made a great return from their TARP money.
On 25K, 50% bonus tax, what about the managers, or the marketers, or the hundreds of thousands of people who had nothing to do with mortgage debt collaterlization?
.-= On Financial Samurai: The Katana: Performance, Income Poll, Winners, Good Reads 1/10 =-.
Sam – I agree, and have a big percentage of the Monevator-folios direct equity investment in Standard Chartered and HSBC because I believe/d banks will recover. Standard Chartered in particular is sheer class. I also traded Lloyds over 2009 for good gains.
I’ve benefited from the bank bailout, and I think too the UK could even make a profit on the banks it has semi-nationalized, let alone avoid the unseen and unthinkable costs of the banking collapse that was averted.
What I don’t agree with is bankers make millions out of this extraordinary State support, when they’d all be bust without it. It’s hypocritical socialism for the rich.
I don’t think only those who worked on CDOs were to blame for the near-collapse, either. CDOs were what blew up in 2007, but if they hadn’t, something else from the ultra-lax approach to risk banks were taking in their well-documented hunt for yield would have soon enough.
Hi,
interesting thoughts!
I believe it’s not possible to make a general statement on whether money makes people more or less happy. Money comes with a whole set of new elements that may have good or bad impact on our happiness, and depending on how susceptible we are to every one of them, the conclusion will go one way or the other (i.e. different from person to person).
I recently made an effort to provide a more comprehensive picture of what these ad- and disadvantages are. I invite you to have a look at Money and Happiness and tell me what you think!
Thank you,
Nick