It is arguable that the biggest news of last week concerned the cost of living. We know that most advised clients will have accumulated enough money to have significant protection against bouts of inflation such as this but they are not going to be fans of it.
They are also likely to remember periods of higher inflation as well, but it is not exactly going to be a particularly pleasant experience for younger clients still accumulating wealth on relative tight budgets nor for older clients with smaller retirement pots.
So here are a few links regarding the situation reflecting different media perspectives.
This is the Telegraph suggesting taxpayers face a £9bn hit to rectify the energy situation though I would say it is likely to be the bond market taking the strain for now.
The Guardian does a straight report on the help available and another on soaring energy company profits. Martin Lewis suggests ways to mitigate the situation though interestingly says he recently had a call with the Chancellor. Quite an influential Money Saving Expert.
In terms of the overall cost of living situation, the Bank of England’s Andrew Bailey’s remarks about interest rate rises and pay restraint have been shot down by Downing Street. An interesting battle to watch by two clearly embattled figures, the governor and the PM.
To quote CityAm – “Downing Street stressed this afternoon Boris Johnson fiercely disagreed with Bank of England Governor Andrew Bailey over his call for workers to show “restraint” over pay rises amid high inflation.
“The Prime Minister’s official spokesman said: “It’s not something that the Prime Minister is calling for. We obviously want a high-growth economy and we want people’s wages to increase.”"
The former head of Which? Richard Lloyd is to act as interim chair of the FCA as the search continues for a permanent appointment amid talk of the Treasury’s desire to find someone who will agree with their agenda. There is a lot of debate about the merits of the FCA increasing its focus on competition.
The FCA warns investment firms to seek legal advice before using social media influencers in its latest regulatory update.
The FCA reported a 10 per cent increase in reports received about illegal financial promotions by unauthorised persons last year and said it had reviewed 1,686 promotions, of which only a minority (5 per cent) came through its own monitoring.
A lot of this is surrounded by regulatory language. We have stats as above that may or may not refer exactly to influencers.
Advisers may also ask about Money Bloggers too, where I have heard some concerns raised about how they are financed.
‘Swap bonds for dividends’ says Sarasin’s CEO Guy Monson with an element of ‘he would say that wouldn’t be.’ But I think it is always worth a listen to views when underlying investment conditions are clearly changing.
EV’s founder Bruce Moss asks “How do you solve a problem like income drawdown?”
To quote a little more: “We need to understand what a failure to meet their objectives might mean for them: the risk. And the degree to which a failure to meet the objectives can be tolerated: the capacity for loss. The two are inextricably linked.”