Number of lettings costing more than 3,000 a week increased by 28% in the last three months of 2016, research shows
Number of lettings costing more than 3,000 a week increased by 28% in the last three months of 2016, research shows
There is a growing minimalism movement that puts less emphasis on buying things, and more on people, places and happiness
Geoffrey Szuszkiewicz told his family he didnt want anything for Christmas. But when he opened his stocking to find a roll of duct tape, some cling film and tin foil, he relented. I was ecstatic. I could use everything, he says
The 33-year-old dancer from Canada was in the middle of a buy nothing year when he opened his present, and had managed to cut out spending on anything except a pre-defined list of basic groceries and necessities for 12 months.
Szuszkiewicz is part of an anti-consumerist movement, known as minimalism or mindful consumerism, that has been sweeping across the globe via blogs, self-help books and social media. This move towards buying less often attracts new converts during the festive season when people balk at the scale of Christmas spending.
According to the Nationwide building society, people on average spend roughly half their monthly pay on Christmas. One in three, meanwhile, pay for Christmas using a credit card or overdraft.
Mark Boyle bought a smallholding in the west of Ireland with the proceeds of his book, The Moneyless Man, after spending three years living entirely without money. I generally dont spend anything at all at Christmas now and Im much, much happier, he says.
I didnt buy or spend anything for those years Id grow or forage my food. Now I let people come and stay for free in my home, and run a moneyless pub. At Christmas, everyone from round here brings a bottle and we get together and have a shindig. For me, thats what Christmas is about meeting up and sharing food and drink. I avoid shopping at this time of the year in any way I can.
Westminster council accepts plan to build 137-room hotel in Grade II-listed building in Grosvenor Square
The Qatari royal familys property company has won approval to turn the US embassy in London into a luxury hotel.
Westminster council agreed Qatari Diar Real Estates plan for the Grade II-listed building in Grosvenor Square, Mayfair, on Tuesday. The nine floors, three of which are underground, will include up to 137 hotel rooms, shops, restaurants and bars.
The US state department agreed to sell the building to Qatari Diar in 2009 to fund a new embassy in the Nine Elms regeneration project south of the Thames. Estimates put the Grosvenor Square sites value at 500m before it was made a listed building, which would have reduced the value because of restrictions on development.
Qatari Diar, part of the Qatari Investment Authority, has snapped up several high-profile London properties including the former Chelsea barracks, the former Olympic athletes village and most of Canary Wharf. Qatari investment interests also own Harrods and substantial stakes in Heathrow airport, Sainsburys, Barclays Bank and IAG, the parent company of British Airways.
Delaying repairs to save money and dehumanising your tenants … Adam Forrest becomes a virtual landlord and learns some interesting and depressing lessons
Building my first high-rise tower wasnt too difficult. I threw up some studio apartments, hooked them up with power and phone lines, arranged for a rubbish collection, and welcomed my first tenants. I packed the people in, stacked the units, and the profits soon began to pile up nicely.
Its fun being a virtual landlord. Ive been playing Project Highrise, a PC and Mac real estate management simulation, since the games release in September. It gives cash-strapped renters like me a chance to indulge the wild fantasy of owning property. It also offers members of Generation Rent some insight into how real-world landlords and larger developers actually do business.
Despite its cutesy appearance, the game is surprisingly detailed and utterly unsentimental. You begin the game by managing the costs of building infrastructure, and trying to avoid taking on too much bank debt before your tenants can provide a steady revenue stream. Before too long, youre hiring consultants to lobby city hall for a metro station and wondering whether prestige artwork in the hallway might attract higher-paying residents.
In becoming a digital Donald Trump, I learned some interesting, if slightly depressing lessons. For one thing, its costly to lose tenants. You dont want a day to go by without any rent; and you dont want to have to reach into your pocket to refurbish an empty flat to make it rentable again. So its best to keep all current tenants happy, if you can. But fixing up occupied flats that have turned grimy is also expensive, so its worth trying to hold out as long as possible without doing repairs.
I just owe more money every month regardless of what I pay. When will this ever end?
Source: College, credit card
Estimated years until debt-free: Unknown
Every credit card rejection letter I get looks the same to me: a form letter, written without care or thought, releasing a new sense of failure as the paper unfolds. Its not that my credit is bad far from it, actually. Its just that Im incredibly in debt. Which is also why I cant buy a new house, get approved for a rental or get a new car. I owe more than four times what I make in a year, and I have my education to thank for it.
I knew when I started school that college was expensive, so I applied for scholarships and loans. My first year, I had three scholarships and almost no loans. But then I changed my major, transferred schools, started a new path. I didnt get any more scholarships. I applied for more loans. I expected I would get enough money in federal loans to cover school and I would be set, but the government had other plans.
Good old Uncle Sam denied most of what I needed. Apparently my family made too much money for me to qualify for full federal funding never mind the fact that my mom recently got laid off and my dads business wasnt doing so hot, or that they had two other kids in college at the same time that needed help. The government didnt care. I was forced to apply for what I didnt know then were predatory private loans to make up the difference. And I repeated that process every year, all the way through my masters degree.
That six-month grace period when you get out of school goes fast. Suddenly I owed $2,000 in student loan payments every month. I got three jobs to try and alleviate the cost; I worked at my dads office during the day, a pizza place at night and a fine dining restaurant on the weekends. I didnt want to defer my loans, but once I started missing my stop on the train because I was too tired, I knew I needed a change. I deferred all but one of my loans for six months while I found a corporate job that would pay me the same as the three jobs, but on a regular schedule.
Another six months went too fast, and soon I was paying for the original loan amount plus all the interest that racked up while I tried to better my situation. By this point, I was $100,000 in debt. That was 10 years ago.
Some things have changed in my life since then. I no longer have that corporate job (I have my own business now), I am married and we own a home. My loan debt has changed, too its gone up to almost twice what it was, thanks to interest rates and another couple of deferrals while I was laid off.
My husband has no student debt, thankfully, but it tortures me that hes now saddled with mine, with me. Then add in credit card debt from some plastic I got just out of college that was my fallback during unemployment, and my debt is more than $200,000.
Were lucky we got this house. The debt-to-income ratio was way higher than what the mortgage company would accept, but I was able to cash out an old 401K and use that to offset the mortgage cost. The home was abandoned for three years before we got it, so it came in at dirt-cheap.
Were paying for that now: we cant use the water from the tap because we need a new well that we cant afford. We cant fix the plumbing because its too expensive. Our basement floods when it rains because we cant afford waterproofing. And its not just the house.
I need a new car, but I cant get approved for a loan nor would I be able to afford payments because of my debt. Forget putting anything we need on credit cards, either. Theyre all maxed out from emergencies and I havent been able to get a new one in years. We can barely make the payments we have because I owe so much to my loans every month. I was at least able to get the payments down with income-based repayment, but still.
Its not like it matters, anyway. I truly dont know why I continue paying. With the interest rates (already refinanced to the lowest percentage) and the total I owe, I just owe more money every month regardless of what I pay. I thought about filing for bankruptcy, but student loans dont apply.
Weve wanted to move for two years. But we cant. Instead, I can only sit here, watching my mass of debt grow like a cancer, applying for credit cards Ill never get. All for an education.
For the first time since 1999, the three major US stock market indices have scored records simultaneously but big personal gains depend on big risks
You dont have to look as far afield as Rio to find all-time records being smashed to bits in the last two weeks.
The US stock market has been celebrating Team USAs string of gold medals by posting a string of new highs, having staged a decisive recovery from its Brexit swoon, after Britain voted to leave the EU in late June. The three major indices Standard & Poors 500-stock index, the Dow Jones Industrial Average and the Nasdaq Composite even scored new records simultaneously for the first time since 1999, the height of the dotcom boom.
So why, amid all this market ebullience, do most ordinary investors feel downright glum?
The problem is that though stock markets bounced back to life rapidly following the 2008 financial crisis, the typical investor waited until 2013 to return, missing out on the earliest and biggest parts of the post-crisis rally.
Most people remain deeply wary of stocks not surprising, after they saw the equity portion of their retirement shrink by 40% or more within a single year. A professional investor isnt worrying about needing to retire in four or five years with a much, much smaller 401k plan. He can afford a long-term view.
The average woman in the street, however, is in a much different position. Not only are her savings smaller, but the collapse in interest rates part of the Federal Reserves repeated attempts to jump-start the economy has left her fixed income investments yielding almost nothing.
Her house, which represents a larger share of her net worth than that of a more affluent investor, may have lost value. Or at least she probably cant count on its value at the same rates as before 2008, when the housing market cratered and left only San Francisco and New York City as real estate exceptions.
Her job may be less secure, as companies cut costs. Her salary, which also is more important to her financial wellbeing than her investment income, is almost certainly flat, and she pays a higher proportion of the cost of the benefits she receives.
To profit from the markets record highs, she would have to be willing to take on more risk in her investment portfolio if she has one at all and load up on stocks. And for many Americans, that feels like its asking too much. They probably arent wrong.
The last bull market in stocks ended brutally when the dotcom bubble burst in the spring of 2000, but it wasnt followed by a chasm opening in wealth inequality, as in the crisis of 2008. If that late-1990s boom gave birth to equity culture the idea that stock investing can go mainstream then the 2008 crisis may have handicapped the idea.
Too few Americans have profited too little from the stock market rally, while a handful of the countrys wealthiest have taken the lions share of the profits, simply because they have the spare capital to invest.
Rises in the stock market have persistently accompanied increases in income inequality from 1979 to 2011, according to a report by the St Louis Federal Reserve. Even middle-income families are less likely to expose their savings to the higher risks of the equity markets, the report concluded.
And the reason those stocks have climbed? Well, its as much due to interest rates as corporate profits. As long as bond yields are at their current basement levels, even anemic profits look attractive to investors,relative to bonds. Its growth! And bonds arent going to be delivering that any time soon. So what else is an investor to do? As the old saying goes, in the kingdom of the blind, the one-eyed man is king. And that one-eyed man, right now, would be US stocks.
The truth is that the stock markets records may be fragile. Corporate earnings have declined for the fifth straight quarter, and those companies that have managed to post higher profits have done so by cutting costs rather than generating higher sales. That should be bad news for stock prices, which typically trade as a multiple of a companys earnings.
The only thing thats keeping the party going for now is super-cheap money, AKA low interest rates. As long as thats happening, well, the only place to park your spare cash if youre an investor is in stocks.
But its interesting to look at just where those investors are choosing to put their money. By far the strongest performers of the S&P 500s 10 sectors are the telecommunications and the utilities sectors, both crammed full of stocks that pay out big dividends to their investors every quarter. In other words, investors are flocking to the safest companies out there, and the ones that will behave the most like bonds, paying them dividends instead of interest . There just arent very many cheap stocks left another reason to feel gloomy as the market has hit highs.
Perhaps it wouldnt matter as much if more of us had managed to capture more of the gains. But we havent. But when this geriatric bull market eventually gives up the ghost, all of us who have any kind of investment portfolio, however small, will share the pain. The smaller our portfolios, the more significant those losses will be.
Ultimately, the only thing average Americans seem able to count on is financial insecurity. Their increased productivity has gone to higher profits for corporations, and companies have paid those profits to shareholders in the form of higher stock prices, rather than to employees in the form of higher compensation. Only if that is reversed will we all be able to truly celebrate a bull market that profits everyone.
The Consumer Financial Protection Bureau, a brainchild of Elizabeth Warren, celebrates its fifth birthday as it faces a Republican threat
Almost, but not quite, lost in all of the noise surrounding the back-to-back presidential nominating conventions in Cleveland and Philadelphia in July was the fact that the Consumer Financial Protection Bureau (CFPB) celebrated its fifth birthday.
What does this have to do with election day? Well, depending on who wins, it might not get a sixth.
The CFPB, the watchdog agency charged with ensuring that the financial markets work for ordinary consumers and to police financial institutions, was the brainchild of Elizabeth Warren, then a law professor at Harvard.
Her advocacy of the financial interests of ordinary, middle-class Americans, and her understanding of the situation in which they found themselves even before the financial crisis wreaked further havoc on their personal balance sheets, catapulted her to political stardom, even as it won her a host of enemies among bankers.
Today, a sizable group of Democrats still quietly mourn the fact that Warren, now a Massachusetts senator, wont be their standard bearer in Novembers election, and wasnt chosen as Clintons vice-presidential candidate. Regardless of her official status, she may wield as much influence as the Vermont senator Bernie Sanders.
But while most Democrats celebrate Warren and her accomplishments, the Republicans deplore both the senator and the CFPB. Warren seems to have gotten under the skin of the Republican presidential nominee, Donald Trump. The two have traded barbs on Twitter.
And as for the CFPB, well, Republican language turns downright Trumpian. Ted Cruz dubbed it a runaway agency that doesnt do much to protect consumers; the Republican partys platform described it as a rogue agency that should be abolished or overhauled if those consumers are really going to be protected.
I interviewed Warren in July 2009, when the CFPB was still merely a proposal, and I doubt that any of these reactions or overreactions would come as much of a surprise to her today.
The big banks want things to go back to the way they were, she said then, in the immediate aftermath of the financial crisis, and only a few months after the stock market had begun to struggle back to life. They made billions of dollars from consumers who didnt fully understand the products these banks were selling. That whole process brought this economy to the brink of collapse and must be changed. We all have an interest in a safer consumer credit market.
And while hardball Washington politics meant that when it came time for Barack Obama to nominate the first head of the CFPB, he tapped Richard Cordray, the former attorney general of Ohio, rather than Warren, who stood beside the president and Cordray at the Rose Garden ceremony. It had been made very clear that, if Obama had nominated her, the Senate would never have confirmed her in the role.
That didnt stop the CFPB from becoming what Jennifer Lee, a partner in the banking and financial services practice of Dorsey and Whitney (and herself a former CFPB enforcement attorney) describes as one of the most powerful and aggressive agencies in the country. Its accomplishments, she argues, are voluminous for a baby agency.
Lee says one of the reasons the CFPB has been successful is the way it has responded to its track record. With each successive new development, the agency gets emboldened to do more, she explains. The current appetite for increased enforcement is not going to change.
Thats clearly true. Even as the Republicans were rattling their freshly sharpened sabers, the agency announced a new line of attack. This time, it plans to crack down on abusive debt collection practices, tightening the rules that govern the industry. The goal is to ensure that debt collectors are pursuing those who actually owe the debt, that they arent harassing debtors, and that they abide by statutes of limitations barring them from trying to collect on older debt. That would make a significant difference to the estimated one in three Americans who have an a debt that has reached the stage where its in the hands of a collection agency.
So far, the CFPBs pursuit of financial institutions, from banks to payday lenders, that have relied on a lack of financial sophistication or understanding on the part of consumers to take advantage of them has resulted in the payment of about $11.7bn to more than 27 million of those consumers directly. Another $500m or so has been generated in penalties. The largest of those settlements was with Ocwen, the countrys biggest nonbank mortgage loan servicer, under the terms of which the company refunded $2bn to 185,000 borrowers whose mortgages were underwater. Ocwen took advantage of borrowers at every stage of the (mortgage) process, Cordray said at the time.
This is pretty much what Warren hoped the agency would accomplish when she drew up the blueprint for it following the financial crisis.
Any market in which a credit card agreement is more than 30 pages long and mortgage documentation runs into the hundreds of pages none of which is designed to be easily read and understood by the consumer is a broken market, she said. Not all banks suffer from this: smaller banks, for instance, that offer more straightforward products get drowned out by multimillion dollar advertising campaigns for credit cards and mortgages by bigger institutions that may not offer consumers such favorable terms. She saw part of her mission as levelling the playing field. Its not a surprise that the biggest banks with the most powerful lobbyists seem ready to declare all-out war on a readable contract and other minimal consumer protections.
Unsurprisingly, the same groups are still at war today with the CFPB, which carries on Warrens mission.
Even before the November election, warning lights were flashing. Jeb Hensarling, the Republican member of Congress who chairs the House financial services committee, has declared he wont rest until he tosses post-financial crisis reforms like the Dodd-Frank Act on to the trash heap of history. Hensarling is also a fierce opponent of the CFPB, which has calls a dangerously out-of-control agency.
Hensarlings plan to repeal Dodd-Frank and replace it with a patchwork quilt of lightweight, bank-friendly rules, unveiled in June, would gut the CFPB. It would deprive the agency of the right to scrutinize some kinds of lending altogether (such as auto loans), and it would politicize the entire process. Right now, the CFPB is about as independent as any Wall Street agency can be: its head is appointed by the president and left to get on with his job, with independent funding received from the Federal Reserve.
If Hensarling gets his way, the CFPB would become completely accountable to Congress, having five commissioners appointed by party leaders, and having to fight for an annual budget. In other words, the same politicians who receive lobbying funds from Wall Street would be deciding who runs the agency that protects consumers from Wall Street and how much money that agency should get. That hasnt always worked out terribly well for the SEC, which has battled for its budget, and which is still waiting for the Senate to confirm two nominees to its five-member commission.
So lets celebrate the CFPBs fifth birthday, and its success in fighting for the interests of the ordinary borrowers and debtors against the big financial institutions that seem to have the decks stacked in their favor.
Lets also hope that the Republicans remember that there is tremendous bipartisan support for financial regulation, and for the agency in particular. Turning it into a scapegoat to make the banks happy could prove to be a very costly error for all concerned.
Property developer Geoffrey Palmer has made his fortune building luxury fortresses in LA microcosms of Trumps vision for a sealed, affluent America
Even on balmy days in downtown Los Angeles, Americas second-biggest metropolis, the sidewalks around the Da Vinci luxury apartment complex are deserted.
You can tramp around the entire perimeter of the 75,000 sq ft, seven-storey complex, which promises a unique lifestyle in the heart of Americas most dynamic city and encounter not a soul.
The medieval brick buttresses which ring the complex, combined with the absence of shade or anywhere to sit, plus the forbidding black-tinted glass doors, all locked, suggest the absence of people of outside people is a design feature.
By his own admission, the builder, a tycoon named Geoffrey Palmer, is in the fortress business. He has erected half-a-dozen similar faux-Italianate citadels across LA, all facing inward, acting as bulwarks against outsiders.
The central bank of Zimbabwe issued $100,000,000,000,000 notes during the last days of hyperinflation in 2009, and they barely paid for a loaf of bread. But their value has shot up
Whats been one of the best-performing investments of the past seven years? Shares in Facebook? London property? Bitcoin? Up there with the best, believe it or not, are Zimbabwean 100 trillion dollar notes.
A trillion, by the way, is a million million. There are 12 zeros in a trillion. Add another two to reach the total on the Zimbabwean 100 trillion dollar bill, the note with the most zeroes of any legal tender in all recorded history. The bills circulated for a few months in 2009 at the zenith or, more precisely, the nadir of one of the most terrible instances of hyperinflation in history, before Harare finally abandoned the Zimbabwean dollar in favour of the South African rand, the US dollar and several other foreign currencies.
At one stage a hundred trillion dollar note would not even cover a bus fare. You needed a bale of notes just to buy a few household essentials. However, its thought that only a few million of them were ever printed.
I remember buying one on eBay. It is on the wall in my office. John Wolstencroft, a private investor, bought a batch of them to give away. I always found they were a good conversation starter, he says.
In 2010-11, Wolstencroft was living in New Zealand where he joined an investment club, made up mostly of locals and US expats. At the time, the great central banking experiment of quantitative easing and a 0% interest rate policy was making a lot of people nervous. He brought a handful of the Zimbabwean notes along to his first meeting to give out as a way of saying thank you for letting him join the club, but there were more people there than he was expecting.
I didnt have enough notes to go round, he says. People started offering me money for them. I tried to explain they were just a gift, but they just upped their offer. I realised then these notes were going to become a collectors item.