Posts Tagged ‘money’

Bank Charges – What did the Law Lords Say?

November 26, 2009

Mouths appear to have dropped open everywhere at the decision of the law lords on bank charges. Certainly it is difficult to understand on what basis the decision was made.First let us be clear what they – appear, anyway – to have said. This is only that the Office of Fair Trading does not have legal power to investigate value for money.

What they have NOT said is whether the charges were, or were not, value for money. Nor whether the charges were fair or unfair.

Indeed, their decision is correctly being described as a technicality. In other words, no matter what the case itself is about, the manner of conducting either the case, or the matters contributing to the case, were incorrect on procedural grounds. At least their opinion is that it is incorrect in that way.

I am not a law lord; evident as it may already be to you, I want it to be clear!

But I have great difficulty in seeing how the Office of Fair Trading is not empowered to investigate value for money. This has been at the heart of trading rules and laws for as long as recorded history.

From the standards for weights and money itself, to the arcane details of contract, value for money has been at the heart of legislative process. How can fairness be expressed without reference to value for money?

I am not even sure this is in keeping with the new Lending Code!

My advice is to move your accounts away from the big banks. Many of the building societies have much more reasonable approaches. And the Co-op Bank may be another good repository for your current account. Certainly you are going to have to spend time and though reading the terms and conditions.

Perhaps we should look to a funny little comment by a correspondent on TV tonight. This was to the effect that the cost to the banks would be billions of pounds, and that was concerning the highest ranks of government.

Perhaps once again we are seeing the unreasoned triumph of the banks over the people. Welcome to the new feudalism.

A very saddened  Joseph Harris – Debt Control Man

Author: Control Your Debt Crisis on Your Own Terms


Is This Just a Financial Crisis?

September 20, 2008

Of course I ask the question because my answer is no! It is a crisis that has been gestating a long time and fingers in to every corner of activity. It all seems very arcane, very distant, and hard to understand how things can change so suddenly – in just a couple of years – from euphoric good living to threats of disaster.

The answer of course is that it has been going on a lot longer. Add to that that we are experiencing rapid changes in many aspects of life. There are many situations and conditions that have never been experienced before. And that means we have no prior understanding of how they fit in.

One of the effects has been that there has been credit sloshing around all over the place. And that is where we have come in. Debts of all kinds have boomed and one way or another we have all been caught up in the credit crunch.

The serious question has to be what effect the current crisis will have on that. And the best way I can give an answer is to give a broad idea of what has happened and what might put it all right.

It is my belief that the current text books of economics are not – cannot be – up to the new task. It is not that fundamental laws have changed, but that the complexities have become too great for easy understanding. In essence though, like a group of climbers ascending an icy sheer rock face, all nations are now tied together; each time one loses footing we all feel the strain and risk losing our own footing.

On top of this we are, like Atlas carrying the world, burdened with the great bubble of arcane derivatives that is the financial world, and overspent in the great debt crunch; as we should really call the credit crunch.

And our biggest problem is that, rather than pass out better quality pitons to hammer into the ice for safer footing, our oh-so-wise leaders and civil servants are trying to preserve the heavy weights of the derivatives. They might just as well be throwing sacks of money into a fast flowing river.

In fact the volatility of the exchanges round the world is a sign of the fast flowing river and the spinning boats caught in its flood. So far as I can see the only people benefitting from this are the crooks and gamblers who have already milked the system dry.

There are hard decisions to be made and part is to cut out the financial sector as one would throw away a barrel of apples that have gone rotten to the core. Hard? Of course. Possible? In the current climate probably not. But if it is not done, then a little way down the road the decision will be bigger and harder.

The actual mechanics of doing it are not obvious, but the first essential step is to stop throwing good money after bad. And that should be today’s resolution for Mr Paulson and Congress in America, and for Mr Brown and Mr Darling in Downing Street.

I do not paint a pleasant picture. And like the Cassandra you are already calling me, I forecast that it is not likely to get better. But the reason I am putting all this in this blog is because I believe that everyone, and in particular those worried about debt, should be keeping a constant eye on the situation and making their decisions about their own best route through bad times.

Normal blog service will be resumed as soon as I have stopped spitting tacks.

Joseph Harris
Debt Control Man

How’s Your Financial Competence?

July 19, 2008

I ask not out of nosiness, but because tomorrow various arms of the financial great and the financial good are gathering together in Cambridge [Money Guidance Pathfinder conference] and in three days will, it seems, work out how to teach us all better money management.

Well. No. I’m being unfair. This process started here in 2006 when the Treasury declared it would happen. And they did this because the OECD decided it should [though you will hear the government take the credit as though it was all their own work!].

And what it seems they are actually discussing is the detail of a pilot progamme in the north-east and the north-west of England to start next year.

The idea behind it is to give much more, and much more readily available, information on what credit in particular and money management in general is all about. And I think we have to applaud the idea, and the fact that it is making progress – it may even be that the UK is moving faster than any other country on it.

The conference includes banks as well as existing free information providers like the Citizen’s Advice Bureax, so there is a chance it really will deliver good advice.

But why, whenever I see the word stakeholder in these announcements, do I feel about to be in need of the guidance of Caveat Emptor[let the buyer beware – or look for the small print – or hold tight to your purse]?

At least we can watch and wonder with the hope that in a few years most people really will be made more aware of the dangers of bad money decisions, without the need to have been through the nightmare of bad debt first – as so many of us have been.

I am writing a blog page on the Money Guidance process, but I will take a few days to put it together.

Joseph Harris