BEWARE! THE BANKS ARE OUT TO GET YOU!

[chinatyke]

China (the country) is way ahead of us as a cashless society and it's also setting up its own cryptocurrency.

You are already using 'cashless electronic money' every time you do a bank transfer on line. There is no real cash involved, just the electronic record of bank balances of payer and payee change. Because of advances in technology and low costs, this has spread to payments being made by smart phones for low price things like bus fares. I still use cash for most transactions and make calls with my mobile phone!

[Stanley]

As far as is possible I avoid 'Internet Banking'. I still communicate with my bank by post as they have closed our local branch. As for crypto currency , include me out!!

[Tizer]

China: first in - first out.
Cash - Chinese coins

They invented the banknote too, in the Tong dynasty which was from about 600 to 900AD.

[Stanley]

"They invented the banknote too, in the Tong dynasty which was from about 600 to 900AD"

So much of our modern world was first discovered in the Fertile Crescent and the Far East and Western scholarship completely ignored any mention of credit for it. Our history when I was at school was essentially West is Best!

[Whyperion]

Did you know that banks charge a bloody fortune for converting a US $ cheque to Sterling?

Yes,

Most though are endorsable, living in London we have better currency exchanges and I use one that has branches in victoria and the strand, I think they just pay them into a Dollar account they own in the states (presumably the easiest). With the normal banks charges (for negiotation or recourse from memory - I used to teach forex in Business Studies years ago ), it was no wonder the rise of Western Union and similar and later paypal (did Google every go to google pay?) , all they needed was to shave a bit off the banks charges and they would still be cheaper (cheaper even than a postage stamp or for UK internal payments the Giro(bank) system Harold Wilson set up with the GPO). Though I dont think international direct bank payments using an IBAN number are so expensive - but the US in particular with routing codes and sub-banks are difficult to pay into )

[Tizer]

More on the leasehold scams...
`I'm being charged £42,000 to extend my lease' LINK

[Stanley]

I always hated the principle of leases even when they were peppercorn rents, today they are a scam and it's high time they were abolished. But, looking back to 1910, Lloyd George found out then what huge vested power the landowners held when he tried to introduce a Land Tax. It nearly brought the government down!
Later, reports that 2019 was the worse year ever for retail sales.

[Stanley]

See THIS BBC account of a TUC report on household debt which says that it is higher now than before the crash in 2008. Government argues that they have included the wrong things but the message is clear particularly ""skating on thin ice by relying on household debt to drive growth", adding: "Our economy is not working for workers."
This is a timely warning and should be heeded, it's a serious threat particularly in the present circumstances.

[Stanley]

Debenham's shut six High Street stores today in their effort to survive. The remaining Mothercare shops close today, the brand is extinct.
This coupled with the report that High Street retail had the worst year on record last year adds up to gloomy economic news. Not the best start to 2020.

[Stanley]

PE has been digging... What the egregious Andrea Jacqueline Leadsom failed to tell us when she slipped the Cobham affair out at the last minute before Xmas is that the 'guarantees' she obtained from the US hedge fund time out after 5 years, about the same time they hold an asset before stripping it.
Increase to Shapp's £88billion on HS2 is down to pay to consultants going up. Any bets on whether the noble lord was closer at £108billion?

[Stanley]

I have referred to the effect Universal Credit is having on rent arrears in the politics topic. One common theme in the heart-rending stories uncovered my BBC Panorama is the maxing of credit cards to pay rent and avoid eviction so the actual total of affected families must be higher as these won't show up in the statistics on arrears.
This is a cruel trap. End of austerity? In a pig's ear......
Rail Pension schemes.... Assets £24billion liabilities £35billion reported. This all depends on what valuation is placed on the assets and there is a big difference between what the government estimates it as (Hence the deficit I quoted) and what the Trustees argue is the case.
It's being reported this morning that the airline FlyBe is yet again in deep financial trouble.
For more bad news about High Street traders see THIS BBC report that Beales with 22 stores, mostly in the West country are seeking administration.

[Stanley]

Re. credit cards. Barclay's have said I qualify for a card loaded to £3,000 credit and zero interest on balance for a year. Is it any wonder people get into and stay in debt? Binned of course.

Today in You and yours it was revealed that some card providers, when you log in to your balance, add a £1,000 high interest overdraft loan to your balance giving the impression that you have a thousand pound plus to spend.
Again, how easy it is to get into irretrievable debt!

Keep the economy going at all costs!!
By the way, speaking of the economy, news comes in. See THIS BBC report. Growth readjusted downwards and pound drops as BofE seems ready to drop interest rates to support the economy. Even the best estimates are a long way short of the 3% that is necessary just to tread water. Not a good start for an uncertain year.

[PanBiker]

Re. credit cards. Barclay's have said I qualify for a card loaded to £3,000 credit and zero interest on balance for a year. Is it any wonder people get into and stay in debt? Binned of course.

My current credit rating is just below the top level of perfect. This means that I can have any credit card I want, or a loan or whatever. This is brought about because we don't owe anyone anything. We use our credit card regularly, shopping, petrol stuff like that but always pay it off fully each month.

This is brought about via our family accountant (Sally) being thrifty as that's how she was brought up, don't buy it if you can't afford it. The reality of course is that we are just bobbing along with our heads above water on my pensions. Sally having been robbed of around £48,000 by our illustrious government.

As you say though, shows how easily you could get into debt. Our current credit card has abut £8,000 limit on it as we use it all the time. We have another one with about £5,000 available if we want to spend it, we don't!

I could spend £12,000 tomorrow on plastic, could we pay it back, no.

[Big Kev]

I got rid of my second credit card, I'd used the 0% balance transfer option to do a couple of jobs (paid for on one card then transferred to the 0%). Effectively an interest free loan, with the exception of the 2.5% transfer fee, for 6 months.
I use the current credit card to book holidays or any online purchases. If the travel agent wants to charge a cc supplement I just pay the bare minimum, the full cost is still covered by the card company

[Stanley]

Ian and Kev, I do the same and pay off each month, I even add extra if I know something has gone through and isn't on the account. I know, an economist or accountant would say I ought to take advantage of the free credit but it does no good if the bank doesn't give any interest on a positive balance.
This country is being run on expensive credit!

[Stanley]

A lot of critical comment this morning about the precedent that seems to have been established yesterday by the government in changing the tax system to benefit the air travel industry, triggered of course by the FlyBe problem.
Question is, can we expect this to be a cure? The basic problem is too much competition leading to low prices. This at a time when, on environmental grounds fares ought to be going up.

[Stanley]

Thinking later about Willie Walsh writing angry letters about FlyBe it struck me That this a bit rich. BA has its own tax fiddle. It makes a profit each year but this is not taxed in the UK because the parent group (Heathrow is owned and operated by BAA Limited, which also owns/operates six other UK airports and is itself owned by....) an international group led by the Spanish Ferrovial Group lends Heathrow money at exorbitant rates and the interest payments on the loans are set against profit thus reducing the UK tax burden.

[Stanley]

Remember me doomsaying about Beales department sore? See THIS BBC report of the collapse into administration on Monday.

[Tizer]

Businesses and auditors seem to have gone into meltdown....

`Ted Baker investigation finds £58m phantom stock' BBC
`Fashion retailer Ted Baker has said it overstated the value of its stock by £58m, double previous estimates. Last month it said the figure was up to £25m. The new estimate comes after a review by accountants Deloitte. Last year, former boss Ray Kelvin stepped down over misconduct claims, while sales and profits have tumbled. The company did not elaborate on how it came to miscalculate the stock's value, which it has previously said is mainly clothing. The issue was also mentioned in Ted Baker's last annual report based on information from its auditors, KPMG. The news from Deloitte's investigation will be embarrassing for rival KPMG as it had said it had uncovered mis-statements but concluded they were too small to affect the fashion label's accounts...'.

`Dixons Carphone gets its sales figures the wrong way round' LINK
Dixons Carphone has had to reissue its Christmas trading figures to say sales went down, not up over the period. The retailer - which owns Currys PC World - had earlier reported a rise in sales, but later said it had made a "clerical error". It issued a fresh statement for the last 10 weeks of the year, saying sales had fallen by 2% rather than risen by 2% as the firm had earlier reported...'.

[Stanley]

Is it any wonder that trust is being lost in so many areas? The track record of the big accountants is terrible. Think of the number of massive failures after a clean bill of health in the audit.
The thing that strikes me is that there is no good news coming out of retail. I get the impression that many of them are keeping quiet and crossing their fingers!

[Stanley]

I can't find anything on the web about this but BBC ran a news item this morning on the rise of interest free loan schemes being offered to customers which are proving very popular and increasing sales. On the face of it this is a good thing but beware, these loans are not regulated because they don't carry interest. There is a hidden trap, whilst not carrying interest, there is a penalty clause in them for late payment. In effect this could lead to higher debt than a normal credit card purchase. In addition, being liable for payment of this penalty can have an effect on your credit rating.
It looks as though this might be a cunning wheeze to take advantage of a loophole in the regulations and any non or late payment could be extremely expensive. Buy now and pay later was always a minefield, this looks as though it could be a bear trap!

[Tizer]

That's been going on for a while now and it's especially affecting young folk buying clothes. They don't realise what they're getting into until it's too late. Trouble is, they've been brought up thinking debt (sorry, credit) is normal!

Another dodgy trend that's re-appearing is mortgage loans that take into account not just monthly salary but bonuses too. It was going on back before the credit crunch but then the banks had to ban it. Now they've quietly started again. Where are the regulators?

[Stanley]

I remember well the howls of outrage from the mortgage providers every time self certified applications were criticised as inflating the market. They don't appear to have learned do they.

[Tizer]

I can't find anything on the web about this but BBC ran a news item this morning on the rise of interest free loan schemes being offered to customers which are proving very popular and increasing sales....

Here's more news on that topic this morning....
`The rapid rise of 'Buy now, pay later'' LINK

And here's another scam, this time one that house buyers need to watch out for...
`Home sellers risk losing money over quick sales' LINK

[Stanley]

It all reminds me of what a lady in Kansas told me many years ago. She said that the Three Great American Lies were; "One size fits all. The cheque's in the post. I'm from the Government, I'm here to help you."
For the last one substitute any commercial organisation saying they can make things easier for you. It's obvious that you are going to contribute to their profit. I heard one case yesterday where a woman had her offer price dropped by £20,000 and she wasn't even informed.
Notice that the latter includes loan sharks and the tragedy is that a combination of austerity and the failings of Universal Credit are driving poor families into their hands. Every time a question is asked about this there is the usual flood of bluster, dodgy statistics and aspirations but no concrete help for the families involved.
I wonder how much UC has saved the state in benefit payments.... (Never admitted but that's the core reason driving it.)