Worldwide Financial Planning

Central banks have come under criticism for supporting the housing market and equities with their interference with Quantitative Easing (QE), so it seems very strange to me that the selling of assets aren’t expected to create a downward pressure on the same assets they have inflated upwards – what goes up must come down.

This week we had the spectacle of Theresa May being given a P45 while the set fell apart around her during her Conservative Party conference speech.

QE is normally introduced after interest rate stimuli fails. For example, the Bank of England lowers rates which lowers your, and companies’ mortgages and loans and might encourage you to borrow to spend.

Furthermore, with poor interest rates you believe you are better doing something with your cash, so you buy ‘stuff’ or stock market equities, or a house to achieve a better yield.

While a proposal to introduce rent controls was widely criticised, other measurers such as a land tax have long been pushed by policy experts to boost house building.

Another call to tax big business and spend more on public services will likely go down well with the country at large as well.

In June, the regulatory body governing pension transfers (FCA) scrapped the starting position for transferring a company pension (Defined Benefit Scheme).

The starting position used to be that it was always unsuitable.

In simple terms, your company pension is guaranteed by your company. The company invests its money (a fund) to provide the best returns and meet its liabilities to you. If it doesn’t do well enough, it has to make up the shortfall, unlike a personal pension (where you are transferring to) where YOU have to make up the shortfall.