Mohamed El-Erian is second in command to Bill Gross at PIMCO, he is an excellent commentator and extremely insightful, well worth checking out.
Who gets the best deals on insurance? (depends who you ask!)
The Financial Regulator regularly does ‘cost surveys’ to help the Irish public determine what the best deals are on the market, it would seem that in some cases they are actually driving people directly to certain insurers because they don’t survey the whole market! Indeed, as this weeks Sunday Times article by Niall Brady shows, Brokers were able to beat the ‘best price’ quoted by the regulator in almost every example, and it wasn’t only by a few cent either! In one case it was about €500 per annum, and in many others it was €100 p.a. – now on the other hand, if a broker went and made a person pay that much more than they had to then they’d be lynched, but when the regulator does it’s just an ‘oversight’… Quis costodiet ipsos custodes? Click on the picture below if you want to see a larger more readable version of it.
The US obsession with home ownership
This is an interesting clip from the Cato Institute and it covers the various vectors of the financial crisis. In this video the speaker talks about the ‘7 steps to failure’ – the basis of the talk is well covered ground at this stage but the addition of the Cato presentation is meaningful and offers some angles that are not commonly considered.
Johan Norberg is a senior fellow at the Cato Institute and a writer who focuses on globalization, entrepreneurship, and individual liberty.
How much of a deposit do I need?
When making a mortgage application this is a question that many first time buyers want to know, how much money do I must I have for a deposit? Well, that kind of depends on which bank provides the mortgage finance!
Lending criteria is different for every bank/building society/lender, this goes for rates, the general underwriting criteria as well as the ‘loan to value‘, the deposit you need is 100% minus the Maximum LTV and that will give you the deposit amount you require. For instance, ICS have a maximum LTV of 92% so the deposit you need – if you are obtaining finance through them – is 100% – 92% = 8%.
What is interesting in that example is that when you go ‘sale agreed’ on a property the estate agent will ask for a security deposit and the balance of 10% at the signing of contracts, this is an example …
The Financial Regulator Report
In Ireland each staff member of the regulator costs 23% more than the international average, their cost to the taxpayer is 88% greater and yet they have responsibility – as a ratio toward population- which is only half that of other countries (to be exact its 96% less).
If that isn’t enough, our regulators deal with 15% fewer firms in terms of the number of actual regulated firms per employee, yet it is 26% more expensive to regulate a company in Ireland than elsewhere, and in terms of regulator staff to financial services staff they are dealing with 17% less than in other countries.
We are overpaying for under-service, in fact, in only one other country does the tax payer foot more of the cost of the bill than in Ireland, and for that we get the statistics above based on the figures below. Angry? You should be.
Cost per employee: In Ireland it is c. 23% more expensive for every staff member of our regulator than the international average
Banks are not competitive?
Roger Bootle notes that markets do quite well at the end of a recession and at the start of a recovery by drawing the benefits of the future down into the present. Roger has a lot to say on the topic of banks, in particular that of banker bonuses – he states (and we agree) that when banks become ‘too big to fail’ they essentially are oligopolies and hence they are able to pay so well. From an Irish perspective the domination of AIB and BOI put some stock in this theory.
Irish Mortgage Brokers on Primetime
We made an appearance on Primetime last night to comment on the property market and the issue of negative equity in ireland.
Buying stocks to protect yourself?
Marc Faber makes some salient points to Yahoo! tech-ticker on where he feels the markets and world economy are going and he strongly disagrees with Ken Fisher about the USA having ‘too little debt’. He is strongly anti-cash and feels that commodities and stocks (despite what many believe is simply a bear market rally) are the place to be for the next 2-3 years. An interesting point made on tech-ticker was that the world economy doesn’t need as many people any more, it makes for compelling reading.
‘House of Cards’ the fall of Bear Stearns
This is a video on the fall of Bear Stearns, it is based upon the book ‘House of Cards’ by William Cohan, it is a six part interview so rather than post them all on our blog, if you want to watch the rest go here. Minyanville is also a site worth bookmarking!
Property Tax 2009: non-principal private residencies €200
The Local Government Act 2009 introduced a €200 annual charge for owners on non-principal private residences
The charge applies mainly to owners of private rental property and holiday homes. It also applies to vacant residential property unless newly built but unsold (handy if you are a developer, lousy if you are the owner of a newly un-lettable gaff). Liability to pay the charge is assessed by the owners themselves. Ownership of a non-principal private residence on the ‘liability date’ (31st July 2009) determines liability to pay the €200 charge.
Payment is due by 30th September 2009. A €20 per month late payment fee will apply from 1st November in respect of each month for which payment is overdue. This bit is interesting – because normally surcharges and penalties for any unpaid tax are much much lower, this amounts to an ongoing 10% fine for every month – while €20 may not seem excessive, it is certainly (when viewed in percentage terms) extreme. Especially given that there is not much being published …