Christine Lagarde starts second five-year term as head of IMF
The head of the International Monetary Fund (IMF), Christine Lagarde, has been nominated for a second five-year term. The former French farm and then finance minister was the only nominee. She received support from the UK, Germany, China, and France, among other countries, has led the IMF since 2011, and was its first female director.
The IMF is an organisation of 188 countries. Its main job is to ensure the stability of the world’s monetary system, via exchange rates and international payments, that allows countries to transact business with each other.
Lack of success on pitch fails to halt Man Utd’s earning prowess
Manchester United is on track to become the first British football club to earn more than £500 million in one year, despite its lack of success on the pitch. Second-quarter revenues rose by 27% to a record £134m, with commercial revenues up 43% to £66m. Broadcast income rose by almost a third to £37m. Sponsorship income also rose, but revenue from ticket sales fell, perhaps reflecting the cost of tickets and the team’s poor performance. The team currently lies fifth in the Premier League and has been knocked out of the lucrative Champions’ League.
Farm workers among best at meeting tax return deadline
Women are slightly worse than men at submitting their tax return on time, with 303 out of every 10,000 sending their form in late, compared with 294 men. The HMRC figures also show that young people are worst at completing their self-assessment forms, with almost one in 10 of 18-20 year olds submitting their form late. These young taxpayers were self-employed, contractors and those with extra income.
Workers in administration were the worst at submitting returns, those working in agriculture, fishing and forestry were the best. This is perhaps because after a grim year in farming, many were keen to secure tax refunds on past payments via balancing charges. Older people are the least likely to submit a late return.
Regionally, Londoners were slowest and Northern Irish the best at hitting the 31st January deadline. A record 89% of self-assessment taxpayers did so online. Those that missed the deadline will be fined an automatic £100, and then £10 a day after three months.
Vinyl revival means old records can earn cash from the attic
Start looking in the attic and under the stairs – vinyl record sales are enjoying a resurgence and some oldies are valuable. This year vinyl sales will top two million for the first time in 30 years and that has created a huge growth in the value of collectable old records. It may lack the technology of online music and CDs, but the claim is that vinyl offers a warmer, more personal sound quality.
The first pressing of a record is usually the most sought after, closely followed by limited edition coloured vinyl or picture discs. Records by The Beatles, The Rolling Stones, Pink Floyd, Led Zeppelin, The Who, The Smiths, David Bowie and Marc Bolan is highly collectable as they attract interest across all generations.
Banks’ shares slump hits pensions savers
More than £40 billion has been wiped off the value of the UK’s biggest banks since the start of the year, in a blow to millions of investors and pension savers. While eyes have been on the rout in the mining sector, banking stocks have taken the biggest hit over the past few weeks. Lloyds, the most widely held stock in Britain, has slumped by around 15%. HSBC has lost a similar amount of value in percentage terms, but RBS is down 20% and Barclays has dropped 21%.
The huge losses will affect everyone who has money tied up in the stock market, including pension savers. Banks are also an important source of dividends for income seeking investors. UK banks paid out £10.8bn in dividends last year, equating to £12 in every £100 paid out by UK plc companies. Banks have been hit by wider fears about the global economy, but their shares have tumbled more sharply than other businesses exposed to the same global problems.
Business rate hikes put many companies at risk, says CBI
Small and medium-sized companies are struggling to survive under the burden of a huge rise in business rates, while the Treasury’s income from corporation tax has fallen, according to the Confederation of British Industry (CBI). The organisation has urged the Government to reform business rates and scrap the tax for more than a million small firms. It says the Government can’t put business rates reform off forever and wants more frequent valuations and a system tied to the Consumer Prices Index.
Figures compiled by the CBI, using statistics from the Office for Budget Responsibility, show the revenue raised from business rates has soared by 28% in the past seven years. This is faster than any other tax. Corporation tax revenues, in contrast, have fallen.
Business rates rise with inflation, but take no account of profitability or the massive change in shopping habits because of online shopping.
Interest rates on hold as growth slips back
Interest rates are set to remain at their record lows well into 2017, according to the Bank of England, which has lowered its growth forecasts. The committee that advises the bank is now unanimous in its opposition to a rate rise in the foreseeable future. The Bank said the UK economy is set to grow by 2.2% this year, down from a previous estimate of 2.5%. It has also cut next year’s outlook to 2.45 from 2.7%.
The Bank’s quarterly inflation report said the outlook for global growth had weakened. It is suggesting that inflation will remain below 1% until the second half of next year, reflecting the impact of lower energy and food costs. It also says that thanks to the slowing economy, UK wage growth has fallen back.
EC plans to make multinationals come clean on tax and earnings
US multinationals such as Google, Facebook and Amazon, could be forced to publicly disclose their earnings and tax bills in Europe, under legislation being drafted by the European Commission. The plan will be published in April.
An impact assessment has reportedly found in favour of forcing large corporations to reveal their profits and the tax they pay in every country in which they operate within the EU. The Commission president, Jean-Claude Juncker, is said to be in favour of the initiative. Public country-by-country reporting is seen as important because without it large companies can make secretive deals with governments on where and how they declare their profits.
Tax legislation in the EU requires the agreement of all 28 member state governments, but the new rules could be treated as an amendment to current directives and passed by a qualified majority vote.
UK rigs to be scrapped due to oil price slump
Almost 150 oil platforms in UK waters could be scrapped within 10 years, say industry analysts. This would represent around a quarter of the current total. The North Sea has been hit hard by plummeting oil prices with the industry body, Oil and Gas UK, estimating 65,000 jobs have been lost in the sector since 2014.
Decommissioning pressure reflects the high number of ageing platforms in the UK, where platforms have an average age of over 20 years. These are uneconomic at current oil prices, due to high maintenance costs and the expensive production techniques required for mature oil fields.
Super Bowl final was a four-hour ad bonanza
The Super Bowl clash between the Carolina Panthers and Denver Broncos was, to casual observers of that uniquely American game, an advertising extravaganza interrupted by a little sport. A game of American football lasts 60 minutes, split into four quarters, but Super Bowl 50 took four hours of peak airtime, including a 30-minute half-time show. The rest was advertising and, with a US television audience of over 110 million, just 30 seconds of advertising cost $5m – a $500,000 increase on last year.
Companies have spent $5.9bn on commercials since the first Super Bowl in 1967, one of the best for agriculture being And God made a farmer for Chrysler trucks, which is worth looking at even now on YouTube.
China spends $420bn to prop up the yuan
China has been running down its vast foreign currency reserves in an attempt to boost the value of its own currency and stem a flow of funds overseas. At $3.23 trillion, China still has the world’s biggest reserve of foreign currency holdings, but that has declined by $420 billion over the past six months and now stands at the lowest level since May 2012. The Chinese authorities fear a rapid devaluation of their currency, as it could destabilise the economy.
Many Chinese businesses hold debt in dollars and managing those debts with a severely weakened yuan could cause some big companies to fail. This is why China has been trying to engineer an ordered devaluation of the yuan by selling US dollars to buy up its own currency, but that aim is proving hard to deliver.
New year sees fruit and veg sales rise
Strong sales of fruit and vegetables gave the UK grocery market a health kick in January as it returned to growth after a difficult Christmas. Sales rose 0.2% to 31st January, reversing previous falls. Fresh fruit and vegetable sales rose by about 5% while fish, poultry and nuts saw similar growth. This reflected good intentions after seasonal over-eating and drinking. The discounters, Aldi and Lidl, both of which have been pushing deals on fresh fruit and vegetables, were the main beneficiaries of the healthier eating trend.