Many foreign fighters likely to stay in Syria, Iraq – U.S. official

ASPEN, Colo. (Reuters) – In a new assessment, the U.S. intelligence community judges that large numbers of foreigners fighting for Islamic State in Iraq and Syria likely will stay to defend what is left of their self-declared caliphate rather than return to their homelands, a top U.S. counter-terrorism official said on Friday.

from Reuters: Top News

Hammond told Goldman Sachs he wants long Brexit transition – source

LONDON (Reuters) – British finance minister Philip Hammond told the board of U.S. investment bank Goldman Sachs that he was pushing for a lengthy transition period after Britain leaves the European Union, a source familiar with the talks said.

from Reuters: Top News

Weekend reading: Caveat emptor needs to make a comeback

Weekend reading: Caveat emptor needs to make a comeback post image

What caught my eye this week.

I mentioned the other day that I’m getting increasingly grumpy about the supposed victims of financial misdeeds seeking redress for shooting themselves in the foot.

Not a popular stance for a personal finance blogger to take, but the truth.

Paul Lewis for instance on Radio 4’s MoneyBox reliably turns me to the Dark Side like a neophyte Sith Lord as he rails against – oh, I don’t know – Tesco having the temerity to sell apples at ‘rip-off’ prices of more than what it paid for them.

And a more serious example came this week in the Financial Times [Search result] in an article about interest-only mortgages.

The FT is not the first publication to warn of a looming crisis from interest-only mortgages. The charge is that borrowers have not saved up enough money to repay the capital at the end of the term.

And to be fair, the FT didn’t quite headline the mis-selling angle in this piece, though it did raise the juicy prospect.

But a victim narrative was certainly foreshadowed in the angle it took and the quotes it used.

The article led by painting a picture of a son being denied the inheritance of the family home because of his mother’s decision to take out an interest-only mortgage:

Linda needs to have a difficult conversation with her son. The expectation was that one day, he would inherit the family home in London where she still lives. But her decision to take out an interest-only mortgage of £182,000 nearly a decade ago has effectively cost him his inheritance.

Well, no.

I don’t know Linda’s circumstances, obviously, but from as much as we can tell here it was her decision not to save up to repay “a penny of the underlying debt” that has cost him his inheritance.

Alternatively. if she would never have been able to find the money to pay for what she bought, then she shouldn’t expect to own it.

That’s not a scandal. That’s shopping.

Later on we have Gary, who claims “we didn’t have things explained to us”. This might point a way forward to the sort of compensation windfall enjoyed by the PPI-paying masses, except that Gary immediately adds “Anyway, our hands were kind of tied at the time — it was more or less our only option.”

I don’t mean to dismiss the issues faced by these people, or make fun of them; I’m sure they have their worries. But they are in the victim role as portrayed by the FT, and it’s a role that needs to be challenged.

Why not a piece saying that the rest of the banks’ customers or shareholders – or the State – will need to bail out these kinds of individuals if they’re not to be turfed from their homes entirely because of their own decisions? Somebody always pays.

As for mis-selling, happily this kind of mortgage’s purpose is made pretty clear slap bang in the name itself.

We’re not talking about a Property Financing Multi-Year Upkeep and Retention Vehicle, or some other financial nonsense.

It is an Interest-Only mortgage. As in – slowly now – you only pay the interest.

Enough already.

From Monevator

The FCA is avoiding the elephant in the room – Monevator

Global tracker discussion sprang to life this week [Note: “Next Comments”]Monevator

From the archive-ator: Know your own risk tolerance – Monevator


Note: Some links are Google search results – in PC/desktop view these enable you to click through to read the piece without being a paid subscriber.1

UK state pension age rise brought forward by one year – BBC

Global shift into alternative assets gathers pace [Search result]FT

House price growth continues to slow, especially in London – Telegraph

US tech sector passes its dotcom era peak [Search result]FT

Online fund platforms surge in popularity [Search result]FT

Products and services

Atom Bank’s 5-year fixed rate mortgage charges just 1.59%; remortgages only – ThisIsMoney

Fixed-rate savings bonds’ interest rates rise 36% since January – Telegraph

Nationwide pulls insurance for cyclists who won’t wear helmets abroad – Telegraph

All charges for paying by debit and credit cards to be banned – Guardian

Comment and opinion

Why index funds are one of the 50 things that made the modern economy [Podcast]BBC

Costs are a key part of the investing equation, but so is time frame – The Value Perspective

What’s your track record? – A Wealth of Common Sense

You probably don’t have what it takes to beat the market – MarketWatch

What does an investment portfolio need? – Oblivious Investor

Betting on things that never change – Morgan Housel

Finding the active in low-cost passive investing – Barry Ritholz

A recipe for disastrous stock picking returns – Investing Caffeine

Why Josh Brown bought his first Bitcoin – The Reformed Broker

Thoughts on 20 years in work […in finance, but universal]Principles and Interest

Retirement dread is replacing the American dream – Bloomberg

The real value of a financial advisor [US but relevant]The Backcourt Report

Todd Wenning on competitive advantages and moats – Compounding Snowballs

Given the reviews, I’m glad we turned down the How To Retire at 40 people’s overtures – Early Retirement Guy and SexHealthMoneyDeath

Off our beat

The battle for the moon begins – Bloomberg

Boring Elon Musk update – Bloomberg

And finally…

“The conventional investor is in awe of those who have a deep understanding of ‘what the market thinks’. He should be: he is typically paying enough for the privilege.”
– John Kay, The Long and the Short of It

Like these links? Subscribe to get them every Friday!

  1. Note some articles can only be accessed through the search results if you’re using PC/desktop view (from mobile/tablet view they bring up the firewall/subscription page). To circumvent, switch your mobile browser to use the desktop view. On Chrome for Android: press the menu button followed by “Request Desktop Site”.

from Monevator

Putin says yet to decide whether to run for president again

MOSCOW (Reuters) – President Vladimir Putin said on Friday he had not yet decided whether to run for re-election in 2018, but promised not to change the constitution to allow him to keep on running for Russia’s top political post indefinitely.

from Reuters: Top News

Exclusive – Moscow lawyer who met Trump Jr. had Russian spy agency as client

MOSCOW (Reuters) – The Russian lawyer who met Donald Trump Jr. after his father won the Republican nomination for the 2016 U.S. presidential election counted Russia’s FSB security service among her clients for years, Russian court documents seen by Reuters show.

from Reuters: Top News

Tips to Help Young People Get on the Property Ladder 

People aspire to own their own property for a variety of reasons, from financial investment in their future to the mere satisfaction that comes with the title of homeowner.

It seems, however, that we are constantly being told these days how difficult it is for young people to get on the property ladder. Prices are up, wages are down, and things can seem pretty bleak, but amidst the doom and gloom there is in fact some good news; the number of first time buyers reached its highest level since 2007 at the start of this year, meaning new initiatives to help young people are working and there are indeed several ways you can make owning your own home that much more achievable. Here are just some of them:

  1. Start saving as soon as possible: It’s never too early to start preparing for your future, and one of the best ways you can do this is to start accruing a healthy deposit, since it’s this hefty initial down payment that is so often the first and biggest stumbling block between young people and the keys to their own home.
  1. Consider location carefully: The reality is that where you choose to live can save (or lose) you tens of thousands of pounds. London, for example, has long been known for its soaring house prices. Central areas of the city are so expensive in fact that it has caused a ripple effect of rising prices spreading outwards as prospective buyers are pushed out of the market. Spotting trends and changes like this in your desired area can make it much easier to identify the cheapest time/place to buy.
  1. Shared ownership: This is a scheme which sees you pay a smaller mortgage on half of a house, and rent the other half from the government. As and when your income/savings increase, you can buy a higher share of the property, until such time that it belongs entirely to you.
  1. Joint mortgages: If you’re in a relationship and on the lookout for a home in which to live together, it may be worth exploring a joint mortgage, under which you could pool your resources and split costs 50/50. This, as with any financial agreement, should be entered with caution however, as things could get ugly if the relationship were to end and one of you wanted out of the property.
  1. Help to Buy: There are two types of Help to Buy scheme available from the government; an Equity Loan, where they lend you a percentage of the cost so that you can pay a significantly smaller deposit, and an ISA from the bank, where they will boost your savings by 25%, up to an additional £3000, helping you on the way to that all-important first payment.
  1. Family support: A lot of people don’t like feeling like they’re relying on the bank of Mum and Dad, but in many cases the financial support of family can be invaluable. Be it living at home for a while to facilitate saving up, borrowing money interest free to help with the deposit, or asking them to be a guarantor on your mortgage so that lenders are more likely to take you on; there are many practical ways they can help.

from Finance Girl

UK sidelined as Europe looks beyond Brexit in aerospace

PARIS (Reuters) – Britain risks losing clout in the aerospace industry, one of its largest skilled employers, due to concerns over its departure from the European Union, a corporate overhaul at Airbus and a new Franco-German push on defence, industry insiders say.

from Reuters: Top News