Time to tackle the rentier economy.

growstuff

Do people really understand by what is meant by a rentier class? And on the total effect on the economy of having people who can earn more by "playing" with money than the majority of people can ever hope hope to earn in their life time? That's the problem. Life really is like a huge Monopoly game to them. They don't produce anything, distort the money flow and suck resources away from others.

Life really is like a huge Monopoly game to them.

You mean 'games' like this nice little earner, growstuff?

www.bloomberg.com/news/features/2018-06-25/brexit-big-short-how-pollsters-helped-hedge-funds-beat-the-crash

An explanation of 'shorting'

The investor (speculator is probably a better word) borrows, say, 10,000 BP shares and promises to return them at a fixed time – let’s say in a month. The speculator instantly sells the BP shares at the going market price – say 500p, giving them £50,000.

In a month’s time, when they have to return the shares to the pension fund, the shares have fallen to, say, 400p. So the speculator goes into the market, buys 10,000 shares for £40,000 and hands them back, making a profit of £10,000 along the way. But if the shares have risen to 600p, they will make a loss of £10,000

From:

www.theguardian.com/business/2019/sep/30/short-selling-hedge-funds-fortune-no-deal-brexit-boris-johnson.

I t really sounds to me as though it should be illegal, making that profit from borrowed assets.

Thirty plus years ago it was much easier to play with money overnight for extremely good returns in the UK.

With interest rates almost in the negative and volatile stock markets worldwide the only relatively safe place to invest is in property.

Anyone who thinks curtailing the actions of the mega rich will magically produce social housing is in my opinion mistaken.

Many valid points posted above.

We have always saved for our retirement, and now finding that the interest rates on our cash savings are rapidly diminishing. I think that savers are being punished enough.

Also, people with young families seem to receive more benefits if they have low savings in the bank, which doesn't encourage saving these days.

We want enough money to fund potential care in our later years.

Although nowhere near 'wealthy', I feel that any extra taxes would stop many people saving. It would depend where the bar would potentially be set.

I don't think we will ever see a wealth tax brought in by our present government as there are a significant number of them who would stand to lose financially as a result.

Many of the 'vote leave' contingent were keen to leave in order to protect their overseas investments in tax havens which would have been affected by new EU legislation.

There was a time when there were major incentives for companies to relocate to the poorer parts of the country with 'Enterprise zones'. I don't know if these still exist, but I think covid may have brought about a re-focussing away from everything being London centred. It may be a good thing for tourism too if less people work in offices there.

Some attempts to reduce profits from buy to let have come about through changes to the stamp duty payable on buy to let properties and changes to taxation. It was thought that this would make more properties available to private buyers and make property investment less attractive but I'm not sure that much has really changed as a result.

I was helped onto the property ladder by a relatively small gift from my mother for a deposit on my first property. Now as I approach retirement I hope to downsize to offer a similar 'leg up' to my own children. I'm also aware I may need to keep funds for future care but I see all this as prudent use of resources. Increases in the IHT allowances in recent years have made it easier for ordinary families in the SE to leave homes to family members but if more elderly people living in huge properties were prepared to downsize this would release money into the wider economy rather than simply being tied up in property.

Sorry a bit of a disjointed post but just my thoughts having read the whole thread.

Do people really understand by what is meant by a rentier class? And on the total effect on the economy of having people who can earn more by "playing" with money than the majority of people can ever hope hope to earn in their life time? That's the problem. Life really is like a huge Monopoly game to them. They don't produce anything, distort the money flow and suck resources away from others.

pen50

At the time that Jackie Stewart moved to Switzerland he would have been taxed at - in fact - 98%, made up of 83% income tax and 15% investment income surcharge. This was the cause of the brain drain which incentivised a vast swathe of high earners to get the hell out of the UK. The IIS was the first to be dropped, then Mrs T's governments reduced the top rate of tax to 60% and then 40%. The total tax take increased dramatically with both those changes.

That was a long time ago. Are you seriously claiming that Jackie Stewart was part of a brain drain?

I would say the UK has retained quite a lot of its brains.

Agree Lyndie

Politicians love nothing better than to direct rightly felt anger and frustration away from their own actions. Our government, of whichever party, has as its primary duty action to ensure the well being of all citizens. Successive governments of all political persuasions have failed to make this their priority - the example of failing to top up the state pension fund which then meant pensionable age had to be altered is a perfect example. The fact that many far from wealthy people will leave money to their children in the form of their home is the result of the crazy inflation of house prices over the years over which they had absolutely no control. As we are all living longer and will, in all likelihood, need to provide our own care in our later years this nest egg is more likely to be used in this way. The erosion of state funded elder care is yet another example of poor governance. Yes, there are huge inequalities of wealth but it is governments who should be held accountable for their complete failure to address the issue of demanding that excessive wealth should make a meaningful contribution to the betterment of all.

Any savings I had have been used for deposits for housing for all 3 of my children. Since tgen any of the meagre amount I manage to accumulate I often give in small sums to them and they always find a good use for them eg repairing property or replacing equipment. I am nit one if those who hoard with glee. My parents couldn't afford to give me a penny, this I think is why I do try to help my family out. Wiukd agree with one contributor about the selling off of Council housing especially with huge discounts. Definitely created a shortage for those who couldn't afford or acquire a mortgage. Know this is long but when I see those property programmes when people declare they have about 20 properties they rent out, a lot ex Council property, makes me so annoyed.

pen50

I work for a charity which has seen its normal sources of income completely disappear in lockdown. But an appeal to keep us going has raised quite large sums from various members of the rentier class. So whilst I have sympathy with the idea of redistributing their wealth, I'm nevertheless deeply grateful for the fact that a couple of members of the idle rich were able to stick their hands down the back of the sofa and fish out hundreds of thousands for us, with little fuss or form filling. It's a tricky and conflicted state of affairs.

I should imagine that a fair few rentiers donate / support charities and projects without the need for gratuitous publicity

Saying all mega rich are bad has similarities with people assuming all poor are scrounging!

I am pleased to hear that your charity has been helped, many charities have suffered over lockdown, fundraising events and dinners cancelled for the foreseeable future, very worrying.

At the time that Jackie Stewart moved to Switzerland he would have been taxed at - in fact - 98%, made up of 83% income tax and 15% investment income surcharge. This was the cause of the brain drain which incentivised a vast swathe of high earners to get the hell out of the UK. The IIS was the first to be dropped, then Mrs T's governments reduced the top rate of tax to 60% and then 40%. The total tax take increased dramatically with both those changes.

I work for a charity which has seen its normal sources of income completely disappear in lockdown. But an appeal to keep us going has raised quite large sums from various members of the rentier class. So whilst I have sympathy with the idea of redistributing their wealth, I'm nevertheless deeply grateful for the fact that a couple of members of the idle rich were able to stick their hands down the back of the sofa and fish out hundreds of thousands for us, with little fuss or form filling. It's a tricky and conflicted state of affairs.

Is should be are. Sorry.

What I think is unfair, is huge global companies paying their staff minimum wage but making huge profits and the tax payer topping up the minimum wage so the workers can live. It’s bonkers. These global companies hunt the world for cheap labour but make billions.

Every company will find a solution which works best for them, but from the evidence I've seen of communicating with many people since lockdown (and staying in lockdown myself), it seems that many companies will continue to work remotely and will adapt.

Even before the pandemic, many companies were starting to work more remotely and finding it efficient. Many companies had already adopted "hot desking", which meant the traditional office and structures were dying anyway.

As for high streets, they were dying before this all kicked off and councils need to rethink what happens to them. That's not good news for owners of commercial property or snack bars, which won't cause me to shed too many tears. It's also going to have repercussions for the kind of work available.

If property prices in London fall, it might possibly mean that many areas become affordable for more people, which is a good thing. Too many parts have become investments for the super rich.

You assume there will be money left for children to inherit after care home fees!

One of my DS has worked from home for several years. He too has set work times and logs on and off. Other DS working from home during lockdown and still now because of childcare says he gets a lot more done because he isn't constantly being interrupted by people asking him about little things. They only contact him if it is really important. He also doesn't miss the commute.

Grandad1943 we have one staff member who will now work from home apart from one day a month.

Not ideal but better than losing a valued member of our team.

New buildings , conversations, and safety infrastructure work has continued in the City of London, Docklands and surrounding hubs throughout Lockdown

I would hate to see London implode it is the heart of the UK, maybe the Councils of these other cities should do whatever’s in their remit to regenerate and attract business.

High Streets Countrywide will struggle post COVID as a large proportion of the population is still to nervous to use them preferring on-line

J52, in regard to your post @08:11 today, many companies inclueding our own had to allow staff working from home to adopt flexible time working. Children were not in School and child care facilities were also closed which necessitated the foregoing

Employers who were not shut down (such as our own) have had to allow staff to work when they could, which was often late evenings or very early mornings.

Should it be that all children restart school in September then working from home may become more efficient for some categories of office staff.

As it was we had eight admin staff working entirely from home, four Legal Secretaries working between the office and home on different days according to the work situation.

We are are all now back to fully working from the office and very glad to be back in that environment.

The assignment teams are normally out on the road but they have always carried out paperwork on phones, tablets or laptops from wherever they are working or from home or hotels when they arrive there on an evening.

Very interesting link MaisieD

I think they need to rethink high streets completely, I couldn't tell you the last time I shopped on a high street. We seem to have created a culture where shopping is seen as a pastime ( aimed predominately at women I would say) and I dont think that's a great concept. I cant tell you how much time I have now I am not popping to the shop to get something. I obviously spend it productively on GN .
High streets probably need to refocus on leisure or residential, I cant see what else will rescue them.

Meant to add that Our high street is almost non existent now MazieD . All the big names long gone.

It would be so easy to solve too MazieD but of course they won’t .

Just STOP anymore big businesses from setting up or expanding in the capital and STOP building more homes. STOP investing in more infrastructure which is just feeding the beast and encouraging more overpopulation and greed .

Instead they would do well to offer incentives to companies to set up /expand outside the wealthy belt and even better incentives to set up/expand in the poorer areas such as here in the North East .

They could do all of these things but they won’t . Of course they won’t they need to keep the wealth all in one place .

It's an interesting 'derail', Galaxy. As retiree I like its insights into how WFH is functioning.
How long ago was it that we were being told that technology would make working in offices redundant? Inertia seemed to stymie that notion but covid has forced that change.

Like gillybob, I don't shed any tears over the desert of central London. The place has been like a leech, sucking the blood from the regions for many years. Our local town is so dead that even the Poundsaver shop couldn't stay viable (that was before covid hit)