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The Financial Ironmonger Blog No 21/2017

The Financial Ironmonger Blog No 21/2017

Every week our guest blogger, David Oakes of Mosaic Money Management (aka The Financial Ironmonger), shares with us his take on some of the major UK and overseas macro and political events that shaped the previous week.

Please be reminded the value of investments, and the income from them, may fall or rise. The views expressed in this article are those of the author at the date of publication and not necessarily those of Chelverton Asset Management Limited or Mosaic Money Management. The contents of this article are not intended as investment or tax advice and will not be updated after publication unless otherwise stated.


No sooner had I published the last blog, predicting trouble ahead for Theresa’s social care policy, than came the sound of a screeching U turn, in Wrexham of all places. Mind you, if you have ever been to Wrexham, you would have some sympathy for the manoeuvre. Unconfirmed reports suggest that local shops were asked not to sell eggs and flour, traditional ammunition for the peasants against the tribunes, but it is hardly the sort of place that would have suffered from the proposed highly regressive pre-death tax.

Whatever your views on this proposal, it now lies in the ditch, along with the credibility of some of her senior colleagues, none of whom knew of the original proposal, (a cornerstone of their manifesto), nor of the complete change of tack on Monday. Now there is to be a cap on the total amount charged, as yet unspecified. When ITV’s Robert Peston was asked if they could possibly get to the election without declaring a number, he replied “no bloody chance”.

The strong and stable image, so carefully crafted, is beginning to look anything but, which only goes to prove the old adage that it takes thirty years to build a reputation, and thirty seconds to destroy it. Compared to the opposing forces, the choice is clear, but that does not mean that her team are much better.

The election of Emmanuel Macron, as French President, will cement, or at least repoint, the relationship with Germany, which can only spell trouble for the Brexit negotiations. The German economy is roaring along, and the ECB should be looking to put up interest rates, but that would kill off any recovery in the marginal states, and drive them closer to bankruptcy. The only answer seems a full federal solution, if they want to hold the Eurozone together, which they have to, having invested so much in it.

With less than two weeks to election day, these kind of issues should be at the forefront, but the events of Monday night, in Manchester, have obviously stalled the whole process, and given how shocked people are, I doubt that the cut and thrust which would be expected in a normal campaign will return. The whole thing is too recent, and raw, for any sensible debate, but I suspect that the answer is that we will have to have a much more authoritarian approach, from now, to sort out the damage caused by the liberal tendencies of the post war years.

Getting control of our borders might be a start, where the Americans have much to teach us. The alleged Manchester bomber is said to have visited various hotspots of terrorism in Europe in recent weeks, and yet was still allowed back in to the UK. It is for each country to find their own solution, but I do hope that this targeted murder of innocent girls marks a turning point, even if our trains are now to be patrolled by police with machineguns.

A poll for today’s Sunday Telegraph shows the Conservatives on 44%, and Labour 38%, marking a dramatic tightening in support for the later. To the extent that the UK has suffered from austerity, (which it really hasn’t compared to many European countries), the effects have been felt disproportionally by the least well off. So, it comes as little surprise that they like what they hear from Labour, a wish list of uncosted promises, including free tuition fees.

More than 2mn people have registered for a vote since the election was called, the vast majority in the 18 to 34 age group, although to put this in context, there were 45.7mn already registered at the end of March. Turnout, of course, is key, but this is a large number of people for which the pollsters have no history, by definition. Previous “non-voters” proved decisive in the outcomes of both Brexit and the US elections, and if there is to be a wild card, that is where it will come from.


David joined Manchester stockbroker Henry Cooke, Lumsden in 1977 and after becoming a member of the London Stock Exchange in 1984 held a number of senior positions within the firm including Managing Director of the in-house fund management company and member of the Executive Committee.

After senior appointments at Cazenove Fund Management and latterly Mercater Capital Management, David joined Mosaic Money Management in 2013. He has successfully managed private client and fund portfolios for over thirty years and has particular expertise in providing a multi manager service to his loyal client base.

The Financial Ironmonger is a hat-tip to Ironmonger Lane, the location of Chelverton’s London office.