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Weekend reading: Thicker than The Thick of It

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Warning: Brexit before the links. As ever, please feel free to skip if it’ll make you cross.

What happens when a farce turns into farce? Is there a negation, and then rationality reigns?

If so we’re not there yet with Brexit.

Government ministers voting and whipping against their own motions – and still losing. Brexiteers in Parliament voting down Brexit, while those outside deny the contradictions of their own marketing that make it impossible for MPs to “deliver what the people voted for”.

See this tweet for a taste of the antics.

Meanwhile we have Labour sitting on its hands for an (admittedly ill-timed) vote calling for a second referendum – a referendum that is supposedly Labour party policy.

As Theresa May’s undead deal returns for a third showing next week, the leader of the opposition – who has been screwing with us for two and a half years – is now doing the same to a corpse.

I visited College Green in Westminister this week to hang out with the hardcore Leavers and Remainers. It felt like history in the making. Thing is, when history is still being made you don’t know where it’s going.

Were all our national meltdowns – 1066, Henry VIII, Cromwell, Dunkirk, Suez – quite so lunatic? History repeats itself – first as farce, and later as Monty Python. Or perhaps the Tour De France.

I’m reminded of an addict who can’t quit. You watch through your fingers as they are confronted again and again by their terrible life choices. Everyone outside can see the thrill is gone, grim reality reigns, and that they’re just making themselves sick. But given a chance to make a new choice, they spurn it and stumble on.

Brexit. Just say no, kids.

The investing angle? See my previous table. Hard no-deal Brexit has become less likely, but so has a second referendum and no Brexit. We’re coalescing around a middle, which is probably where we should be given the result of the referendum.

Everyone’s not a winner!

From Monevator

Good books to help you stay the course to financial independence – Monevator

Tax efficient saving for children and grandchildren with JISAs and SIPPs – Monevator

From the archive-ator: 10 lessons learned from accidentally starting a business – Monevator


Note: Some links are Google search results – in PC/desktop view you can click to read the piece without being a paid subscriber. Try privacy/incognito mode to avoid cookies. Consider subscribing if you read them a lot!1

FCA plans to ban or cap exit fees – Guardian

AJ Bell and Hargreaves hail wider reach of exit fee ban – Portfolio Advisor

Brexit shambles “damaging confidence in the housing market”, says RICS… – ThisIsMoney

…as the Chancellor offers £3bn fix for Britain’s “broken housing market”Guardian

…while we’re at it, the fastest double-your-money years for UK property [Search result]FT

Meet the billionaire behind Wish, the world’s most downloaded e-commerce app – Forbes

Philip Hammond’s Spring Statement at-a-glance – Guardian

Rates to stay ultra-low, and five other forecasts from the Spring Statement – ThisIsMoney

Products and services

Understanding and navigating ETFs’ premiums and discounts – Morningstar

The problem with wealth managers like St James’ Place – The Evidence-based Investor

Yorkshire offers 2.01% five-year fixed rate mortgage with a 15% deposit [Beware fees]ThisIsMoney

Ratesetter will pay you £100 [and me a cash bonus] if you invest £1,000 for a year – Ratesetter

Are solar panels still a good investment? – ThisIsMoney

A review of the six leading technology investment trusts – IT Investor

Homes in areas of outstanding natural beauty [Gallery]Guardian

Comment and opinion

Compounding boredom is simple, but not easy – Tony Isola

Brexit, Game of Thrones, and the Investment Platforms Market Study – the lang cat

Nothing happens, and then everything happens – Of Dollars and Data

Is it worth being a famous fund manager anymore? – A Wealth of Common Sense

Top tips for getting your partner on the journey to financial freedom – Mrs YFG

Why great expectations lead to small investment returns – The Value Perspective

Case study: An indie chick escapes – The Escape Artist

Put away the birthday candles. The US bull market began in 2013, not 2009 – Bloomberg

Untangling luck and skill in investing [Research]Flirting with Models

GARP Investing: Golden or garbage? – Enterprising Investor

The case for selling Centrica shares – UK Value Investor

Inspiring video special

We all need a break. I’ve swapped this week’s Brexit links for this inspiring video from a man who earned a lot, saved most of it, then buggered off in his 30s to roam the world on a boat:

(3652 Days, this is especially for you. Get over that hump!)

Kindle book bargains

Narconomics: How To Run a Drug Cartel by Tom Wainwright – £1.99 on Kindle

The Complete Guide to Property Investment by Rob Dix – £0.99 on Kindle

Winners and How They Succeed by Alistair Campbell – £1.99 on Kindle

The $100 Startup by Chris Guillebeau – £0.99 on Kindle

Off our beat

How the modern office is killing our creativity [Search result]FT

The mind behind Minority Report is giving PowerPoint an overhaul – WIRED

Low-cost 3D printed homes are coming – Fast Company

The surprising secret of web headlines – Seth’s Blog

What kind of person fakes their voice? – The Cut

Old money: The curse of the invisible women [Search result]FT

California is blooming – Quartzy

And finally…

“I had been breastfed for the first six months of my life. Did my mother not realize I was a vegan? Did she even care? Either way, this was abuse.”
– Titania McGrath, Woke: A Guide to Social Justice

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  1. Note some articles can only be accessed through the search results if you’re using PC/desktop view (from mobile/tablet view they bring up the firewall/subscription page). To circumvent, switch your mobile browser to use the desktop view. On Chrome for Android: press the menu button followed by “Request Desktop Site”. []
{ 29 comments… add one }
  • 1 ermine March 15, 2019, 6:43 pm

    > farce turns into farce

    Why, it turns for a f…up of course 😉 The markets seem to regard the whole thing with total sangfroid, I guess they are trying to parse the events for a signal and find only…noise.

  • 2 Sam March 15, 2019, 7:06 pm

    Interesting article regarding SJP. I recently completed my DipFA and after applying for a large amount of jobs, I had an interview with a SJP linked firm.

    First impression was that the ‘adviser’ screamed ‘sleazy salesman’ to me. He spent a large part of the interview making mean comments about a person from a prior interview.

    Actual quote from him: “I don’t actually know much about financial advice, but I can sell it well”.

    I must have given off the wrong impression, because I didn’t hear back from them. No shame.

  • 3 Algernond March 15, 2019, 7:17 pm

    Titania (not Tatiana). Better check your privilege, or at least your spelling.

  • 4 The Investor March 15, 2019, 7:20 pm

    @ermine — Situation is de-escalating, from a market perspective. In fact I think the biggest risk to most investors in 2019 from Brexit is/was a pound bounce.

    @algernond – Cheers!

  • 5 Indecisive March 15, 2019, 10:21 pm

    Yes the response of the markets, particularly currency markets, to the current Brexit s****how is puzzling me. May’s deal is still not good for the economy, so do not get why any movement away from No Deal is greeted by an improved exchange rate w USD/EUR. Either the markets are missing something, or I as a Brit am missing something and have swallowed too much about the economic damage.

    Then again I look at no provision for services in May’s agreement, the lack of CU and Common Market access as now, and think “Markets should be down”.

  • 6 The Investor March 16, 2019, 12:43 am

    @ermine @indecisive — While I would never be surprised to see markets do anything in the short to medium term for any reason, I am *not* surprised by the lack of reaction you guys say you’re feeling. (In truth there has been a market reaction over the past few weeks to Brexit developments — for starters as I say the £ has risen).

    There are numerous reasons for my lack of surprise.

    Firstly, while I’d love to claim to be a savant when I was chiding Leave voters already bored of the difficulties of the Brexit they’d voted for when they said we should “move on and get on with it” about three weeks after the result in 2016, the reality is plenty of people who actually understood what had just (potentially) been voted for realized this would be a *very* long-running saga.

    We’re now nearly three years into this liberation/farce being daily news (with at least the same ahead, barring a revoking or crash out).

    That is a good length of time for everyone who has a view to express about Brexit via market pricing to express it. What matters now are changes to the state we have *already* decided we’re going to end up in, not the state we’re in per se.

    You may remember the markets threw their toys straight out of the pram in June 2016. That was when the damage was mostly done, and to an extent it’s all been rowing a bit forward and a bit back since then, trying to reflect latest jiggles.

    Exception: A hard unplanned particularly stupid no-deal Brexit because someone has lost at Russian Roulette was never priced in (and would be hard to price in) so as that has seemed more or less likely, it’s still had a bit of an out-sized effect. But generally the financial wisdom of the ‘vote to leave a prosperous economic free trade area of 700 million that is right on our doorstep to satisfy Barry Blimp’s 1950s daydreams’ factor was reckoned with a long time ago.

    As I’ve also long argued, outside of Hard Brexit the price of the stupidity (I’m speaking from an economic perspective, as we’re talking about markets, I understand some/many people voted Brexit for other reasons, which they feel to be anything but stupid) of leaving the EU will likely be paid slowly over decades. Trade will be a bit harder, growth will be a bit slower, smart candidates a bit tougher to recruit, the population a little less flexible and dimmer and older, year after year after year.

    I’ve previously *guessed* this might have an annual toll on GDP of say 0.25% to 0.5% a year for a couple of decades. It’s a number pulled out of the air; the main point is ‘soft’ pointless Brexit is a whimper, not a bang. But it all eventually adds up.

    Given prices adjusted to reflect Brexit reality back in 2016, this whimper — in as much as it can be estimated — will mostly have already been factored in. When Britain is poorer than it would have been in 20 years, people will blame other stuff.

    (Evidence for how bad people are at caring about small change can be seen in just the past 30 months. It’s true, the Brexit decision didn’t produce the sudden shock slowdown many — including me — expected. Perhaps it was the delay to Article 50, perhaps the pound collapse, perhaps the interest rate cut? But over the longer span since 2016, the UK has indeed slammed the brakes on, going from fastest growing G7 nation to slowest. From memory, it’s thought the economy is now running 2% smaller than it would have been if we’d voted to stay in (and we’d be out of austerity, too.) Yet Brexiteer politicians still dine out on “the experts were wrong” and nobody really challenges them. Slow change is far harder to get stirred up about, just the same as people slow down to look at a car crash but don’t think about the 30 years of air pollution they drive through on their commute.)

    Next, remember that May’s “deal” isn’t really a deal, just an agreement to reach one nicely. Sort of like agreeing to divorce arbitration rather than burning the house down. There’s years of wrangling ahead, which could have various impacts on different companies depending on how it goes. (Many contentious factors are irrelevant, though — e.g. The vaunted and much fought over fishing industry is about the same size as bike and repairs shop Halfords.)

    Finally, remember the UK stock market has only a nodding acquaintance with the UK economy. Something like 75% of revenues are earned overseas. Mostly it’s the small subset of UK banks, domestic retailers, builders, and leisure companies (e.g. restaurants) that show up the Brexit effect (ignoring currency) and if you look at their prices they’ve moved a lot on Brexit news over the past 30 months.

    I guess you might retort that UK politics has been revealed to be a bit of a joke and that this should cost us something, irrespective of economic outcomes. I don’t disagree but (a) I think that was revealed in June 2016, I don’t really blame MPs (outside of May, her aides, and the Brexiteers) for struggling with this impossible mission and (b) it probably shows up most in the exchange rate, and exchange rate moves are *wicked hard* to read.

    This all sounded pithier when I was composing my response in my head on the tube, but I think I’ve covered the main bases.

    Bottom line: Markets move quick, discount early, think 2-3 steps ahead, and spot things you might never see in headlines. This is why it is hard to beat the market, part gazillion. 🙂

    I linked to it at the end of the post above, but anyway more thoughts on some of this in my previous post from November on the subject:


  • 7 The Investor March 16, 2019, 8:35 am

    p.s. After sleeping on it and re-reading, I’d stick an IMHO in there (“in my humble opinion”). I don’t proclaim soothsayer status! The movements of markets are ever confounding, that’s their nature.

    (I don’t mean that mystically, I mean that it is the very things that surprise/confound the current positioning that move prices! 🙂 )

  • 8 Ben March 16, 2019, 9:02 am

    @TI You’ve suggested a referendum has become less likely.

    I’m not convinced, my guess always was that a referendum would come after there was a deal on the table. That would have the advantage over the previous vote of actually being a fully formed question. Also given that any deal is going to be disliked by >50% of the population, is any party going to actually want to take responsibility for it?

    Ps “2019 from Brexit is/was a pound bounce” I’ve heard of dead cat bounces, any suggestions for this? (turds just splat)

  • 9 Gentleman's Family Finances March 16, 2019, 9:28 am

    I have been down at Westminster too – a few weeks back in January. It was a bit of a carnival and entertaining. Now it looks like the frrakshow that brexit is. So much anger from the LEAVErs.

    Everywhere i go and everyone i speak with talks about Brexit.
    The stereotypes of who is pro-EU and who is pro-Brexit are stronger than ever!
    It was a lot better when we all had different views on Big Brother (we had Nick then but now it’s Nigel that is hated by half the country – i wonder where they both are these days….)

  • 10 Vanguardfan March 16, 2019, 9:31 am

    I think there is hardly any chance of a referendum, particularly since the UK will not want to take part in the European elections in May. Much higher chance of an early general election imho.

  • 11 Ben March 16, 2019, 9:52 am


  • 12 Ben March 16, 2019, 9:55 am


    Do you think that MPs will vote to accept the MPs deal next week then? My understanding was that if that deal was accepted then there would be a shorter delay (June I thought). And if it were rejected again, there would be a longer delay.

  • 13 Vanguardfan March 16, 2019, 10:11 am

    I’ve always thought it quite likely that the WA would go through, but I’ve been wrong so far! Like everyone else, I don’t really have a clue.
    I do find the fact that it’s the Brexit supporters who are stopping it going through somewhat baffling. And that the WA keeps being described as the deal, when it is merely the gateway to negotiations.

  • 14 Far_wide March 16, 2019, 10:30 am

    Tend to agree with TI, my biggest fear in markets this year is a double-dip global recession and £ strengthening combo. That could really hit £ returns (in fact it already has since the end of Jan, it’s just that markets have also gone up to hide that a bit)

    @TI what with this aspect and high CAPE valuations, I’m struggling to mentally take myself over 50% equity allocation despite my capital otherwise withering away on the vine in 1 year cash fixes. (I’m mid-30’s, FIRE-type person). So, a good time for a ‘should i still be investing in a market that’s high type article maybe?

  • 15 ZXSpectrum48k March 16, 2019, 10:53 am

    I find it odd that on retail finance forums there is still the tendency to want to move assets into foreign currencies based upon Brexit risks. To me that feels like fighting the last battle.

    Clearly on a cliff-edge Brexit, GBP would devalue by a decent amount in the short-term. The market may well be underpricing downside risks in GBPUSD in my view. A 5th April 1.25 GBPUSD digital put is priced at a 3.75% probability (current GBPUSD 1.33). I don’t really see how anyone can think any scenario is less than a 10% probability at this point. The cheapness of tail options can be explained by the fact that the global price of volatility has collapsed this year. The market is very much thinking in terms of global secular stagnation / Japanification. In that scenario, volatility falls (and risky asset prices, like stocks, consequently rise). One of the places where investors were long volatility was the UK so invetors are stopping out. Recent local political developments have reinforced that process.

    Notwithstanding that, however, then most other scenarios would cause GBP to appreciate. On a trade-weighted basis, GBP is still only 6% above it’s weakest level (1985, 2008,2016) but 24% below it’s strongest level (2007). I suppose out of all the scenarios (there are too many) a variant of “can-kicking” is the most likely, so perhaps GBP only goes a little stronger on that. Get a good outcome, however, and another 5-10% seems likely. Add in some USD weakness and suddenly that could be 15-20%.

    I suppose what I’m saying is people still seem very focussed on the downside tail but the upside tail could be just as big and might now be more probable.

  • 16 Haphazard March 16, 2019, 11:19 am

    One interesting thing is how the rhetoric has shifted since Brexit day. Pre-Brexit, it was not uncommon to hear Brexiteers extolling the virtues, say, of being like Norway or Switzerland. But since Brexit, we have been told that we won’t have “properly left” unless we leave the customs union, the single market, etc… In the early days, this option, which Theresa May went for, was described as a “hard Brexit”. Abandoning services, 80% of our economy apparently, seems pretty hard to me.

    But now the term “hard Brexit” is sometimes used for “no deal”, and the Withdrawal Agreement/Political Declaration are somehow the “soft” option. They’re not really a middle ground, as I see it. I don’t remember much talk specifically about what a customs union was, or what the single market was, during the referendum campaign.

  • 17 Ben March 16, 2019, 12:06 pm


    Yeah that’s why it annoys me when Brexiteers start complaining how we voted to leave so get us out now, and ‘democracy’ and such. The PMs deal is the hardest option seriously mooted pre Brexit.

    Ps look up the ‘Overton Window’.
    Brexit for me is the best example of just how far and fast it can move.

  • 18 Indecisive March 16, 2019, 1:37 pm

    @ZXSpectrum48k, post #14: I am still trying to get my head round currency movements and the effect on shares priced in a currency which take most of their earnings in another (as I understand it, this is a lot of the FTSE100).

    This is my current understanding – please pick holes in it:

    If I buy GBP-denominated shares or funds and GBP appreciates – I see no benefit because the price was in GBP and the asset(s) haven’t changed in value? But for companies with their earnings overseas, the earnings will be less due to the stronger pound, making the earnings less, and pushing the value of the shares down?

    Conversely say the FTSE250 with more UK exposure: if GBP appreciates they become more valuable.

    If I bought USD-denominated funds holding FTSE100 companies… ah stuff it I doubt I’d do that and my brain’s hurting already 🙂

  • 19 Matthew March 16, 2019, 2:51 pm

    Every time May loses she gets a little closer, so in a few votes time she could lose her way to victory!

    Perhaps it’d be easier to dredge up a new sea barrier between northern Ireland and the republic

    Maybe a normal hard border would be less troublesome than it used to be as religion wanes

  • 20 Jonathan March 16, 2019, 5:00 pm

    Farce indeed!

    Until this week I thought a second referendum would be the only sensible route out of the mess (making the naive assumption that the government and MPs would act sensibly). Of those who currently oppose May’s deal, I guessed that there would be a large number who think it is flawed but nevertheless feel an obligation to honour the previous referendum result; they would be prepared to accept a deal they don’t personally like if it had public support. It would still probably be the surefire way to get some sort of parliamentary agreement.

    But I now wonder whether May might actually succeed in her bizarre scheme of arguing two things simultaneously. She seems to be trying to frighten the ERG hardliners to support her deal as being better than the alternative of a referendum, while at the same time frighten those who feel any form of Brexit yet proposed is disadvantageous to the country into voting for her deal as better than the no-deal cliff edge. Two weeks might not be long enough to convince sufficient MPs though, and I can’t see why the EU would provide an extension for more arm-twisting if there hadn’t been at least some sort of agreement on a way forwards.

    In a way it has been May’s hope all the way through that she could get different groups to support her for opposite reasons. After all her “deal” doesn’t define the future UK-EU relationship, all it does is achieve the fact of withdrawal with a bit of breathing space. She actually wants extreme Brexiters to think it will lead to total divorce, and Remainers to think it will lead to a continuing close relationship.

  • 21 The Investor March 16, 2019, 6:50 pm

    @Indecisive — Have a look at this article: https://monevator.com/currency-risk-fund-denomination/

  • 22 Jimmy brown March 17, 2019, 12:18 pm

    One way out of this impasse is to draw a line down the middle of the country.

    The west side of the line is the brexit enclave. To the east will be the remain enclave. Build a wall between the two enclaves.

    If you are a brexiter you move to the brexit enclave and vice versa.

    Maybe in the future we can be reunited like Germany or we stay separate like north and south Korea .

    East UK will be free to pursue trade deals with the rest of the world and west UK can remain part of the EU.

  • 23 Jonathan March 17, 2019, 12:53 pm

    I like that Jimmy Brown. My wife had suggested a similar solution except north-south, dividing “Greater Scotland” remaining in the EU (and including Northern Ireland to solve the border) from “Lesser England” leaving. She reckoned the border on a 52:48 basis might be a line from the Humber to the Mersey which would just about allow us to be on the remain side.

    But more seriously, there is a fantastic piece from Will Hutton in today’s Observer summarising the difference between Remainers and Brexiters. It certainly puts into words the reason I am on the Remain side despite having in the past criticised significant aspects of the EU. https://www.theguardian.com/commentisfree/2019/mar/17/until-brexit-is-a-done-deal-lets-continue-to-resist-our-economy-and-values-at-stake (hope the link works).

  • 24 phil March 17, 2019, 8:45 pm

    Off topic, does anyone have a link for most relevant article on here for a reliable income option?

    I’ve looked through a few articles, assuming basically options are bonds ( very poor return), Investment trusts, or a dividend portfolio or index fund?

    I basically want to achieve an income around £10k a year ( inflation linked) and trying to figure out best strategy for this, capital growth not the target, but obviously don’t want it decimated!

    I assume a moderately less risky long term option is an index fund with approx 4 to 5% yield and £200k account? but all these have to be prepared for 50% capital haircut in a recession/crash…



  • 25 Tim March 17, 2019, 11:57 pm

    @phil Monevator’s Greybeard did several thought provoking pieces on taking an income from ETFs: https://monevator.com/a-retirement-income-from-smart-etfs/ , https://monevator.com/can-etfs-dependable-income-for-deaccumulating-investors-part-one/ and https://monevator.com/income-portfolios-passive-etfs-retirement/

    L&G has some interesting multi-index income funds (not to be confused with the Inc units of their regular multi-index funds). OCF 0.4%, several risk levels available 4/5/6, but only yield 3.3-3.8% as you move up the risk levels (but even the highest risk level is less than 60% equities).

    I think these days anything that comes with 4-5% yield will surely involve significant risk to your capital, either suddenly in a crash or slowly as it burns it up paying it out as an unsustainable income.

  • 26 Gizzard March 18, 2019, 12:37 pm

    With reference to the This is Money article on the economics of solar panels. They quote an installation cost of £6,200 and an annual electricity bill saving of £210 (for someone at home all day) and £90 (for someone out until 6pm) and conclude an annual return of 3.4% and 1.45% respectively. At that rate of return, it would take 29 years and 68 years respectively to cover the cost of installation. Assuming the panels were still operational after all that time, you’d never get your original £6,200 outlay back. This gives an annual return of nothing at all (in fact, you’d probably lose money because your house would sell for less than it would have done if not adorned with the beautiful panels).

  • 27 Tony March 18, 2019, 1:26 pm

    The Dubliner’s letter is the most brilliant sum up. So ironic the referendum was Cameron’s attempt to silence his Eurosceptics. Worked well didn’t it. And per post 6, totally agree, the oft expressed “just get on with it”- means what Brexit future relationship exactly? What precisely did the binary Brexit vote authorise beyond giving the A.50 notice? The public were so misled and even now, there’s no honesty. Which is why you’d ideally want a multi option referendum. An informed consent. Although I wouldn’t be surprised if it’s a bloody minded vote for a no deal exit. What most of the UK population doesn’t realise yet is this is just the end of the beginning. Years of complex negotiations and trade offs. Because no politician is admitting that. And for what no one even knows. What we do know is immigration is unlikely to reduce, other than voluntarily by EU citizens not feeling welcome. And the increase in non-EU numbers have compensated.

  • 28 Tim March 19, 2019, 12:33 am

    @Gizzard Interesting to compare those numbers with investing in a renewables company…

    For example looking at TRIG’s last annual report (end 2018), each share represented ownership of about 1.7kWh of power generated in 2018 (that’s actually generated, not just theoretical “capacity”). Sinking £6200 into TRIG shares at say 115p buys you ~9200kWh/year of renewable powerplant output (assuming the weather cooperates)… quite a bit more than the 3400-4200kWh/year that article reckons the domestic solar system gets you. And the TRIG shares should yield ~£300pa if the ~5% divi is sustainable. I know where I’d rather put my cash, but maybe panels on the roof have some “virtue signalling” value for some folks.

    Not looked into how various other options like UKW (or others) compare. But the first player in this space (Thrive Renewables – originally Triodos Windfund – launched 1997) is quite interesting… it’s unlisted and has been trading in monthly auctions at ~£1.50/share (significant discount to directors’ recommended £2.28, which presumably is some sort of NAV). £6200 in 4133 shares of that would, according to the calculator on their front page, get you a whopping 30,000kWh/year of generation. I note Thrive have recently been “taking advantage of current high market valuations for operational projects” and flogging off some assets.

  • 29 hosimpsom March 19, 2019, 8:36 am

    Thanks for the video, TI 😀 I’m hoping the top of the hump comes into view soon.

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