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David Cowell: A journey around his right nostril…

I have just returned from a TV guided tour of the inside of my right nostril. It is absolutely fascinating what is up there; from a virtual forest to folds of mountains and something that looks somewhat like a mini-scrotum. In future, I shall adopt an expression of wonderment every time I sneeze.


The US economy grew at the fastest pace in two years in the third quarter, initial figures have indicated. The world’s largest economy grew at an annual rate of 2.9% in the three months to September, the Commerce Department said. Analysts had predicted growth of just 2.5%. The stronger-than-forecast rate could increase expectations that the Federal Reserve will raise interest rates before the end of the year. Consumer spending, which makes up more than two-thirds of US economic activity, grew less rapidly than in the previous quarter. In the April-to-June period, it increased at an annual rate of 4.3%, but in the July-to-September period, the rate slowed to 2.1%. However, this decline was offset by businesses spending money to restock after running down in the second quarter.


Glamour magazine has been criticised for naming U2 frontman Bono on its annual Women of the Year list. On the face of it I can see why.


A friend recently emailed the following conundrum: “I am a director of a miniscule online foreign exchange business. We have had complaints against competitors’ advertising upheld by the Advertising Standards Authority as being in breach of consumer protection regulation which is a criminal offence. We have notified the FCA of this trying to push them into regulatory action. The firms in question logically have generated income from a criminal activity. The FCA charges all firms fees and levies. Logically the FCA is knowingly in receipt of the proceeds of crime. We have therefore submitted a SARS report on the basis the FCA is engaged in money laundering. Tell me where the logic in that is wrong !!!” (Thanks Miles)


Question: Where is the capital of Zimbabwe? Answer: In a Swiss bank account


The FCA has said that it will be considering a product levy when looking at the FSCS funding. There would have been no need to even talk about funding if George Osborne had been honest with the banking fines which have raised well over £1 billion. In the days when fine revenue was much smaller, the money was used to offset regulatory costs. However, once the Treasury saw the size of the production it grabbed them all with the feeble excuse that it would be used to help armed forces members in their difficulties after the recent conflicts. We all know that that was a cynical smokescreen for a cash grab. No one would mind if regulatory costs were covered prior to the Treasury making their grab but to take it all and still ask the industry to fund everything is not only double taxation but outright theft. Treasury Select Committee please note.


Following the two-day meeting, the Bank of Japan pushed back its forecast date for hitting 2% inflation to the fiscal year 2018/19, a year later than its previous target. This marks the fourth time since the launch of quantitative and qualitative easing in April 2013 that the bank has been forced to delay the timeframe for reaching the target. They will keep on keeping on and Japanese equities will benefit.


Standard Life completed its acquisition of Axa’s Elevate platform on Tuesday while Phoenix has also seen through its takeover of Axa’s pensions and protection businesses. The completion of the two sales on the same day reduces the Axa brand in the UK to just multi-manager investment arm Architas. Standard Life spokesman, David Tiller said, “In acquiring Elevate we are entering into relationships with a whole group of advisers who have picked a different platform for different reasons. We want to understand what their reasons were, what they want, what is the most important thing to them. Clearly price is one dimension, functionality and service levels are other dimensions.” He might also have said “Ve vill tell zem vat is gut fur zem” or “Tomorrow, ze vorld!”


Finally, due to shortage of time, a quickie from the Fringe: “What’s the difference between a ‘hippo’ and a ‘Zippo’? One is really heavy, the other is a little lighter.

Have a good weekend.

David Cowell

Director

Myddleton Croft Investment Managers

0113 274 7700

www.mcim.co.uk

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