Has the FSA gone too far regarding bank stress tests?
As we covered in one of our earlier articles, the Financial Services Authority (FSA) has issued a new set of guidelines regarding bank stress tests which will effectively force each and every financial institution in the UK to identify its own potential weaknesses. This is a rather bizarre way in which to protect the UK economy because all the regulators are doing is highlighting weak companies and making them susceptible to potential takeovers, mergers or limited financial backing.
If a company is forced identify a potential weakness in its own business model, then what is there to stop a predator approaching the company's shareholders and claiming that they could run the company better than its current board of directors. There are no industries in the world which force companies to do the homework of their potential predators and competitors and weaken their own reputation and financial strength in the eyes of investors. So why has the FSA decided to act now?
Even though the idea of "reverse stress tests" does appear to have some merit in the current economic climate it is absolutely crazy to ask a company to research its own weaknesses and then publish these for public consumption.
Online tool finds fuel poverty 'hot spots'
A new online tool for pinpointing England's 'hot spots' of fuel poverty has been launched by the Centre for Sustainable Energy (CSE) and the University of Bristol.The so-called Fuel Poverty Indicator (FPI) highlights those areas most affected by fuel poverty - defined as expensive-to-heat abodes with badly insulation, high fuel costs and low income.Advocates of the tool say the FPI can predict the...Read More
UK advertising market is still under pressure
Despite the fact that it appears that the UK economy is consolidating at worst and possibly showing signs of recovery, Carat, a subsidiary of media giant Aegis, believes that we will not see a full recovery in the advertising industry until 2011 at the earliest. However, media moguls are starting to see evidence that the rate of reduction in advertising spending is slowing which is giving many of...Read More
Central London retail sales up ten per cent
Retail sales in central London were up 10.3 per cent on last year's figures, according to the London Retail Sales Monitor report.The report, prepared by the London Retail Consortium (LRC) and auditing firm KPMG, states that like-for-like sales were helped by a higher number of visitors to the capital even though a decrease in the number of trips made to stores was reported.LRC director Kevin Hawki...Read More
Trade deficit at ten-month high
The UK's deficit on trade in goods reached its highest level since May 2006 in March, official data has revealed.According to the Office of National Statistics (ONS) the country's overspend on goods was £7 billion in March, compared to the upwardly revised figure of £6.9 billion in the preceding month.Britain's surplus on services meanwhile stood at £2.5 billion in the third month of the year,...Read More
What happens if interest rates fall to 0%?
We have the potentially intriguing situation which could see UK base rates fall to 0% in the short to medium term as the government tries ever harder to refloat the UK economy. But if rates do fall to 0% where does this leave the financial sector? Savers? Mortgage holders?
A fall to 0% is something which has never been seen in the modern era and something which would be a drastic me...