Europe, sweetheart of the German government and, Lehman style, “Chief Executive Officer Josef Ackermann, who has referred to plans to control bank size “misguided,” and who will bequeath a balance sheet about 40 percent larger than in 2006, and over 80 percent as huge as Germany’s economy, when he leaves his post in May. The bank is the second most-leveraged and third least-capitalized of Europe’s 10 largest banks”. A quick Google search on ‘Deutsche Bank’ and ‘Fraud’ revealed the next fifteen links:

1. The biggest criminal tax-fraud persecution in history

2. Deutsche bank expels unethical traders to re-establish its credibility, the  unnamed employees were engaged in a profitable “tax carousel” trading systemfor carbon-emissions credits.

3. “Federal officials state that Deutsche Bank has complied with the payment of over $550 million to settle a federal tax shelter fraud inquiry.”

4. Deutsche Bank, JP Morgan, UBS and Depfa Bank Plc were charged and sentenced by a Milan court for their part in supervising fraud by their employees in the sale of derivatives to the city of Milan.

5. Welcome to Deutsche Bank Fraud Exposed. Illegal foreclosures (and evictions) are widely known as being prevalent all over the nation.

6. Pakistani family files fraud case versus Deutsche Bank.

7. German police raids offices of Deutsche Bank in connection with tax  fraud investigation.

8. Whistle-blowers accuse Deutsche Bank of massive fraud. “Three whistleblowers have stepped forward claiming that Deutsche Bank committed a $12 billion fraud to cover up the actual level of credit derivatives losses.

9. Foreclosure Theft Fraud – Deutsche Bank & Morgan Stanley Discovered in Hawaii.

10. A housing company swindle in the Netherlands: The CFO, the broker and the bank: Vestia derivative disaster appears instantly more than ‘merely a case of megalomanic trading’.

11. Deutsche Bank Derivative Aided Monte Paschi to Cover Up Losses. “I don’t comprehend why a financial firm would get involved in a practice like this for legitimate goals,” said Frank Partnoy, a professor of law and finance at the University of San Diego (85090MF) who designed derivatives at Morgan Stanley and has gone over the files. “They should never do that.”

12. India: “It is hard to imagine that a company such as Deutsche Bank would bare themselves quite unguarded against such frauds, and brags profusely about the checks and balances being undertaken, or the lack thereof.”

13. An award-winning article (by Jesse Frederik and Eric Smit, Jesse being an infrequent writer in this blog) about a Deutsche Bank derivatives fraud which cost a financially-once-more-than-stable recycling company 209 million .

14. “Deutsche Bank’s management and supervisory board were discussing provisions ranging from $300 million (247 million euros) to $1 billion, according to Handelsblatt, which cited sources in the sector.“

15. Pforzheim, a German city, sues Deutsche Bank due to alleged swindle .

According to Dutch

bank Rabobank, it has agreed to pay fines of 774m euros ($1bn; £662m) imposed by US, UK and Dutch regulators over the Libor interest rate-fixing scandal.

The bank added that its chief executive, Piet Moerland, had stepped down.

To set trillions of dollars of financial contracts, Libor rates are used.

These comprise many car loans and mortgages, and this also includes complex financial transactions around the whole world.

From the time of the year 2012 in the wake of Barclays’ £290m ($454m) fine by US and UK authorities, regulators have been investigating the exploitation of Libor inter-bank lending rates.

A thread of international banks has been concerned in the matter, while more than a few criminal charges have been conveyed in opposition to traders.

Tracey McDermott Director of enforcement and financial crime, FCA said “Traders and submitters treated Libor submissions as a possible method to make money, with no look upon for the truthfulness of the market.”

‘Extremely disappointing’

The UK’s Financial Conduct Authority (FCA) said it had fined Rabobank £105m for “serious, prolonged and widespread misconduct relating to Libor”.

The £105m fine is the third-highest on record by the FCA or its predecessor, the Financial Services Authority (FSA).

The FCA said the bank’s “poor internal controls” encouraged collusion between its traders and Libor submitters and attempts at benchmark manipulation.

Rabobank did not fully address these failings until August 2012, despite assuring the regulator in March 2011 that “suitable arrangements” were in place, the FCA said.

Tracey McDermott, director of enforcement and financial crime at the FCA, said: “Traders and submitters treated Libor submissions as a potential way to make money, with no regard for the integrity of the market. This is unacceptable.”

Ms McDermott added: “Rabobank’s flawed assurances and failure to get a grip on what was going on in its business were extremely disappointing.”

Royal Bank of Scotland (RBS) was fined £390m by UK and US regulators for its involvement in the Libor scandal in February 2013.

At the time, the FSA fined RBS £87.5m, at the same time as about £300m was paid to US regulators and the US Department of Justice.

UK broker ICAP was fined $87m for its part in the rate-fixing scandal last month.

Three of its former traders were charged in New York with several counts of wire fraud as well.

a small business. Your company will tumble down before it succeeds, if you don’t manage debt, receivables, and marketing expenses accurately.

You can keep your company by putting into practice trouble-free bookkeeping approach.

Weigh the options very carefully of bookkeeper against DIY accounting. Despite the fact that entrepreneurs could feel ready to act as head of accounting, sales, and marketing at the same time to cut costs, it may help to hire a bookkeeper. It can assist you on knowing someone with experience and has the best understanding is working on your books. To begin, you can employ someone part time or maybe as a freelancer, therefore you are not paying a full time wage for these services. As an option, the U.S. Small Business Administration offers assistance with managing expenses on your own, while free accounting software from GnuCash.org lets you crunch the numbers on your own.

Continue accounts receivable payments apart from borrowed funds. Small business owners need financial backing and/or loans for startup capital, marketing campaigns, and other initial things in the early on first days. To be certain the loans won’t appear in the receivables, make use of the software that separates income from borrowed funds. Don’t mislay sight of what is yours and what needs paying back.

Remember not to permit clients to leave with not paying balances. Observing a large amount in the receivables column is a good thing, nevertheless the money doesn’t really add up until it is in your bank account. Don’t let clients keep away from regular payments. Stand firm and not take no for an answer if you receive payment for past orders before letting them have more materials or services. The receivables department is very important in maintaining your company buoyant.

So you can budget for the coming weeks, specify daily expenses. It’s a good idea for business owners to carry records of everyday expenses they gain in the company. As an alternative of calculating expenses every two weeks for payroll purposes, center on every day or every week. This can lend a hand so you have a better idea of where finances are each week and how much money you’ll need to budget for in the upcoming weeks.

Calculate a minimum monthly profit. When planning how much it takes to maintain a small business operating, the numbers can get complicated. Plan a precise system of expenses and regular obligations so you know accurately the minimum income you require every month. Because income can be the easiest to calculate, make an austere target you’ll need to earn. Without that exactness, accounting becomes confusing and your business can be at risk.

Read more

Plan for major expenses. You will probably overlook business opportunities or have to mix up for a loan when the expenses become inescapable.

A year in advance or, preferably, three to five years ahead, put events like a major computer upgrade on the calendar. Admit the cyclic ups and downs, something many entrepreneurs are unwilling to do.

“This helps you to be honest about the fact that it’s coming and plan for it,” says James LeMay, a director with the accounting firm Daigle & Associates in Boston.

Track expenses. You or else could fail to spot some tax write-offs and might lose out on others.

A credit card that you use solely for business can be a basic accounting system, says Raffaele Mari, an accountant in Newport Beach, Calif., who teaches a financial course for entrepreneurs at Pepperdine University.

For you to be able to see which outlays relate to which business activities, most card statements categorize expenses. If you always use your business credit card for business expenses you’re less likely to pay cash.

Additionally, Mari says, routinely jot down business trips, lunches, coffee dates and other events with cash outlays in your electronic or paper day planner. This habit can go a long way toward substantiating those items for your tax records in the event of an audit.

“Often on tax returns, those numbers are too round. No one drives exactly 5,000 miles for business in a year, so the IRS knows this is an estimate,” Mari says. “In an audit, if you can’t substantiate those numbers, the whole category [of write-offs] can get thrown out.”

That data, along with a day planner recording the trip, are usually enough record keeping to satisfy the IRS, Mari says.

Record deposits correctly. You may be less likely to pay taxes on money that isn’t income.

Implement a system for keeping your financial activities straight. Business owners normally make a diversity of deposits into their bank account through the year, counting loans, revenue from sales and cash infusions from their personal savings. The trouble, Mari says, is that at the end of the year, you or your bookkeeper might erroneously record some deposits as income, and consequently pay taxes on more money than you’ve actually made.

Set aside money for paying taxes. The IRS can charge penalties and interest for not filing quarterly tax returns on time.

Thoroughly put part of money aside throughout the year for taxes. Next, note tax deadlines on your calendar, together with prep time if you need it, to be certain you in fact make payments when they’re due.

Payroll taxes that go unpaid can be especially problematic, Mari says. He often sees cash-crunched entrepreneurs get through a down cycle by dipping into employee withholdings that they should have sent to the IRS.

Keep a close eye on your invoices. Late and unpaid bills harm your cash flow.

Hand over someone in your organizations to monitor your billing. After this, put a process in place for issuing a second invoice, making a phone call and perhaps charging penalties like extra fees at definite deadlines.

“You want to have a plan for what happens if they’re 30, 60 or 90 days late,” Mari says.

Some entrepreneurs believe that once they’ve sent out an invoice, they’ve taken care of billing. Not so, Mari says. “Every late payment is an interest-free loan and hurts your cash flow.”

Like everyone else, you probably also would like to make

more money – which is totally alright. We all know that there is no such thing as a free lunch and that building wealth requires a lot of perseverance and diligent work.

You might have already taken a look at some stock market systems or subscribed to highly-reputed tip sheets and realized they just don't cut it. There are many scammers out there, whether online or offline -- who will give worthless advice to individual investors. This is merely one of many reasons I do not give advice – just my own personal insight founded on statistical analysis and conservative intrinsic assessment.

At Deep Blue Publications Group LLC, we show you how we are creating wealth for the long-term, a single day at a time, by following simple stock market investing principles. If you already have an operating portfolio, we do hope that our track record – gains as well as losses – can aid you attain your goals.

If you have not invested in the stock market investing but just now planning on doing so, you can see what it is all about, what you can derive from it and find out what it takes to make proper decisions on your own without risking any money: follow Deep Blue Publications Group LLC without having to constantly check for updates as you will be notified by email whenever new content is uploaded.

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A global survey showed that consumer confidence in the United States reached a six-year high in the third quarter, as prospects for jobs and personal finances improved, and also rose sharply in Europe.

In a quarterly survey by global information and insights company Nielsen, Americans were among the majority optimistic consumers, this reflects rising confidence that the world’s leading economy is a on a continuous growth path. U.S. stockmarkets have lifted record highs, generating a wealth result that has also made consumers more enthusiastic to spend.

Released Wednesday last week, the survey was taken before a 16-day partial government shutdown early this month which economists expect will hurt U.S. economic growth in the fourth quarter.

“In the United States, the labor market is slowly healing, and low interest rates are helping the housing market come back and bringing up the stock market, which is perhaps especially beneficial to higher-income consumers with more assets,” said Venkatesh Bala, chief economist at The Cambridge Group, a part of Nielsen.

“It’s still going to be a slow climb – we’re not going to see huge growth rates – but this improvement is recurring and it is sustainable.”

Indonesia continued to be the most bullish consumer market worldwide, next are the Philippines and India, as in the preceding quarter, but confidence levels in all three up-and-coming markets hollowed. It also dipped in Brazil.

From the previous three months at 94, up 2 points from the same period a year earlier, the Nielsen Global Consumer Confidence Index was unchanged in the third quarter. A reading below 100, yet, signals still comparatively low consumer morale.

Portugal saw the biggest leap in consumer confidence worldwide in the third quarter, by a hefty 22 points, while Ukraine saw the biggest drop, by 13 points.

Portugal’s bounce back led a pick-up in consumer attitude in peripheral euro zone countries that have been wrestling with tough soberness measures as they required cutting heavy debt levels.

While the recovery is encouraging and tied with other latest economic data signifying the euro zone economy has curved the corner, Portugal, Italy, Greece, and also as France, were still among the most miserable consumer markets globally.

“In Europe, we’ve seen a change in mindset as policymakers have moved away from austerity measures and toward growth policies,” said Bala.

“While recovery is still uneven, many consumers – especially in countries such as Germany and the United Kingdom – are feeling that the worst is behind them, and their confidence is improving as they sense growth returning.”

Non-euro zone member Hungary was the one thinking the most negative market globally even though it illustrated a development from the third quarter.

Non-euro zone member Hungary was the one thinking the most negative market globally even though it illustrated a development from the third quarter.

Source

Eurozone recovery fades as growth stalls

Source

Europe’s revival from 18 months of recession caught up in the third quarter as exports slowed and the region’s second-biggest economy turnaround.

Over the preceding quarter the 17-nation eurozone’s initial estimate of GDP demonstrated growth of just 0.1%, when the economy grew by 0.3% subsequent to the contracting for six successive quarters through the depths of the region’s debt crisis.

Analysts were foreseeing growth would deliberate as one-off factors like a seasonal bounce back in German construction dull, but the regional figures were getting frailer compare to some had expected. Germany’s rate of growth more than halved to 0.3%, while the French economy shrank by 0.1%.

The numbers verifies doubts that the eurozone is currently under pressure to generate any actual momentum, as record levels of unemployment, weak investment, tight credit conditions and government austerity are weighing on demand.

In September, industrial production and retail sales both drop, and price rises plunged to 0.7%. That encouraged the European Central Bank to slash interest rates to a fresh record low preceding week in an attempt to stop the region falling into deflation and stagnation.

And ECB President Mario Draghi said the bank was ready to take further measures, including another rate cut, if the move fails to have the desired effect.

Unemployment won’t start falling until 2015 at the earliest, according to recent EU forecasts. The European Commission has trimmed its estimate of GDP growth next year to 1.1%, and said it was too early to declare an end to the region’s crisis.

Domestic demand in the eurozone is still very weak with 19 million out of work and wages hardly rising.

“While there’s not much difference between the second and third quarter GDP figures, the deceleration is, psychologically speaking, a major setback for the eurozone,” said Nicholas Spiro, managing director of Spiro Sovereign Strategy.

German domestic demand was accountable for most of the thin growth, with a recovery in exports from countries like Spain and Portugal also helping.

Italy’s economy had a constant decline, while by much less than in prior quarters, but France was weaker compared to what was anticipated.

In the previous week, ratings agency S&P downgraded France on fears the government will be not capable to reinstate the economy’s competitiveness, and the Organization for Economic Cooperation and Development weighed in Thursday, influencing the country to be more determined with its reforms.

It emphasized reasonably high tax rates, insufficient research and development, strict product market regulation and barriers to competition in business services.

The uncertain temperament of the eurozone recovery compares strongly with speedy growth and a surge in confidence in the U.K., where the topic is now concerning when the Bank of England will move to constrict monetary policy.

The central bank raised its growth forecasts on Wednesday and said it expected unemployment to fall much faster than expected just a few months back. Governor Mark Carney said he would be prepared to raise interest rates before May 2015 if it was the right decision for the economy.

Source

Europe’s revival from 18 months of recession caught up in the third quarter as exports slowed and the region’s second-biggest economy turnaround.

Over the preceding quarter the 17-nation eurozone’s initial estimate of GDP demonstrated growth of just 0.1%, when the economy grew by 0.3% subsequent to the contracting for six successive quarters through the depths of the region’s debt crisis.

Analysts were foreseeing growth would deliberate as one-off factors like a seasonal bounce back in German construction dull, but the regional figures were getting frailer compare to some had expected. Germany’s rate of growth more than halved to 0.3%, while the French economy shrank by 0.1%.

The numbers verifies doubts that the eurozone is currently under pressure to generate any actual momentum, as record levels of unemployment, weak investment, tight credit conditions and government austerity are weighing on demand.

In September, industrial production and retail sales both drop, and price rises plunged to 0.7%. That encouraged the European Central Bank to slash interest rates to a fresh record low preceding week in an attempt to stop the region falling into deflation and stagnation.

And ECB President Mario Draghi said the bank was ready to take further measures, including another rate cut, if the move fails to have the desired effect.

Unemployment won’t start falling until 2015 at the earliest, according to recent EU forecasts. The European Commission has trimmed its estimate of GDP growth next year to 1.1%, and said it was too early to declare an end to the region’s crisis.

Domestic demand in the eurozone is still very weak with 19 million out of work and wages hardly rising.

“While there’s not much difference between the second and third quarter GDP figures, the deceleration is, psychologically speaking, a major setback for the eurozone,” said Nicholas Spiro, managing director of Spiro Sovereign Strategy.

German domestic demand was accountable for most of the thin growth, with a recovery in exports from countries like Spain and Portugal also helping.

Italy’s economy had a constant decline, while by much less than in prior quarters, but France was weaker compared to what was anticipated.

In the previous week, ratings agency S&P downgraded France on fears the government will be not capable to reinstate the economy’s competitiveness, and the Organization for Economic Cooperation and Development weighed in Thursday, influencing the country to be more determined with its reforms.

It emphasized reasonably high tax rates, insufficient research and development, strict product market regulation and barriers to competition in business services.

The uncertain temperament of the eurozone recovery compares strongly with speedy growth and a surge in confidence in the U.K., where the topic is now concerning when the Bank of England will move to constrict monetary policy.

The central bank raised its growth forecasts on Wednesday and said it expected unemployment to fall much faster than expected just a few months back. Governor Mark Carney said he would be prepared to raise interest rates before May 2015 if it was the right decision for the economy.

Source

Europe’s revival from 18 months of recession caught up in the third quarter as exports slowed and the region’s second-biggest economy turnaround.

Over the preceding quarter the 17-nation eurozone’s initial estimate of GDP demonstrated growth of just 0.1%, when the economy grew by 0.3% subsequent to the contracting for six successive quarters through the depths of the region’s debt crisis.

Analysts were foreseeing growth would deliberate as one-off factors like a seasonal bounce back in German construction dull, but the regional figures were getting frailer compare to some had expected. Germany’s rate of growth more than halved to 0.3%, while the French economy shrank by 0.1%.

The numbers verifies doubts that the eurozone is currently under pressure to generate any actual momentum, as record levels of unemployment, weak investment, tight credit conditions and government austerity are weighing on demand.

In September, industrial production and retail sales both drop, and price rises plunged to 0.7%. That encouraged the European Central Bank to slash interest rates to a fresh record low preceding week in an attempt to stop the region falling into deflation and stagnation.

And ECB President Mario Draghi said the bank was ready to take further measures, including another rate cut, if the move fails to have the desired effect.

Unemployment won’t start falling until 2015 at the earliest, according to recent EU forecasts. The European Commission has trimmed its estimate of GDP growth next year to 1.1%, and said it was too early to declare an end to the region’s crisis.

Domestic demand in the eurozone is still very weak with 19 million out of work and wages hardly rising.

“While there’s not much difference between the second and third quarter GDP figures, the deceleration is, psychologically speaking, a major setback for the eurozone,” said Nicholas Spiro, managing director of Spiro Sovereign Strategy.

German domestic demand was accountable for most of the thin growth, with a recovery in exports from countries like Spain and Portugal also helping.

Italy’s economy had a constant decline, while by much less than in prior quarters, but France was weaker compared to what was anticipated.

In the previous week, ratings agency S&P downgraded France on fears the government will be not capable to reinstate the economy’s competitiveness, and the Organization for Economic Cooperation and Development weighed in Thursday, influencing the country to be more determined with its reforms.

It emphasized reasonably high tax rates, insufficient research and development, strict product market regulation and barriers to competition in business services.

The uncertain temperament of the eurozone recovery compares strongly with speedy growth and a surge in confidence in the U.K., where the topic is now concerning when the Bank of England will move to constrict monetary policy.

The central bank raised its growth forecasts on Wednesday and said it expected unemployment to fall much faster than expected just a few months back. Governor Mark Carney said he would be prepared to raise interest rates before May 2015 if it was the right decision for the economy.

Source

The stock market is an online trader.

Centers of finance, such as London and New York, have their own stock exchanges – that is, their own retail shops or venues where investors, whether they are private individuals or banks or pension and hedge funds, can purchase and sell shares of stock.

Remember: One share is a part-ownership of a company.

At present, stocks and shares can be more commonly acquired on the Internet through a stockbrokers' website, in the same way that Amazon conducts sales through its website.

You can acquire or sell shares in businesses from the US, UK, Europe, India, Japan and other nations over the stockbroker's website.

The Stock Market – The Traditional View

When people mention the stock market, they often refer to the stock exchange (retail outlet) in their own country. For instance, my stock market is the London Stock Exchange.

Through my stockbroker's website, I gain access to exchanges globally and buy and sell shares on the London Stock Exchange as well as The New York Stock Exchange, The NASDAQ and The American Stock Exchange.

Like Amazon, a stock market is a venue where buying and selling takes place but the only goods available offers are shares.

As you can see in particular, the stock market and stock exchanges are retail shops for the acquiring and trading shares.

How You Can Profit From the Stock Market

Customarily, people earn from the stock market through their membership of a pension plan either privately or through a company they work for. In the US, this is traditionally done through the 401(k).

At times, people will invest money into mutual funds to make money off the stock market and assign somebody else do the job of selecting stocks. The advantages of stock picking by mutual fund managers have not been that commendatory.

And this is not merely a phenomenon that occurs in the US.

The UK pension industry has been often criticized for making profit, not from the stock market, but from the fees they charge their clients.

The only way to earn from the stock market is to take ownership and control of your involvement in it. Allowing others to do it for you will lead to an erosion of the wealth you have worked so hard to create.

What Is The Stock Market? The Real Answer Deep Blue Publications Group LLC

Deep Blue Publications Group LLC provides the investor the potential to earn from the folly of other stock market players. In short, stock market is basically composed of the participants in it, such as private persons and institutions like hedge funds, pension funds, banks and mutual funds, who acquire and sell shares.

The stock market, ultimately, is not the millions of share-price figures flashing across the display monitors of day traders.

The "folly of others" simply refers to the stock markets' strange capacity to drive up and shrink the values of companies – they undervalue and overvalue them.

You can earn from their folly by:

·  Purchasing shares in businesses when they are undervalued and;

·  Selling them when they reach their full value and

·  Keep away from the stock market when and if they are overvalued.

·  This is entirely in contrast to the gamblers mentality of attempting to buy in bear markets and attempting to sell in bull markets.

Source

Book value can mean various things to various people. For instance, book value on the invest pedia blog, at the time of writing, has three meanings.

As an investor, the one meaning that matters is the second definition:

"(Book value is) the net asset value of a company, computed as the total assets minus intangible assets (patents, goodwill) and liabilities."

This definition is fine if you like jargon. Let me illustrate it using a different approach.

Book value is computed from the balance sheet. The balance sheet is one of three sets of financial statements that investors assess as part of the evaluation process before investing in a company.

The other two remaining financial statements are the income statement and the cash flow statement.

How the Price-to-Book Ratio Can Make You a Successful Investor

Is the price-to-book ratio the closest thing to a holy grail?

Judge for yourself: Tweedy, Browne Company LLC reported that a successful stock market strategy (page 3) based on the price-to-book ratio with exceptional results. The Deep Blue Publications Group LLC utilizes the price-to-book ratio in the valuation process.

What Is The Price-To-Book Ratio?

The price-to-book ratio is the first financial ratio I view when analyzing a business for prospective investment.

The price-to-book ratio is a gage of how much the shares are trading as compared to its book value.

As a tip, a handy method to compute book value is to find the total equity figure (or total stockholders' equity for the US) found right at the bottom of the balance sheet and subtract (minus) goodwill and intangibles, found at the top of the balance sheet under non-current assets.

To round it off, I have presented the Tesco balance sheet below. You can compute book value for yourself. If you do not have time, keep going; you can try it anytime in the future.

Market Share and Economies of Scale

Since studying stock price movements provides very little help in predicting long-term results, I prefer to talk about two very closely connected things that are intrinsic in business which I consider in order to guide investment decisions:

The first: high variability – is something that is existing in businesses that my partnership, more often than not, will try to avoid.

The second: economies of scale – is a key characteristic we search for in companies that we eagerly seek to be a part of.

Before the year 2008 ended, 36% of cell phones purchased around the world were made by Nokia.

Samsung was a far second holding 15% of the market share; but the difference between the two companies was much greater when it came to a unique category of cell phone we now know as smart-phones which were designed as portable mini-computers with Internet capability.

At the same period of time, Nokia had an even more commanding 41% market share of smart-phones than Samsung which had a pitifully small share of 2%.

By 2012, just less than three years later, smart-phones had become the ruling kings and what previously was known as regular cell phones are rapidly becoming ancient relics with practically no profit margins left to show.

Today, business schools ordinarily teach us that "economies of scale" often means that there is an inherent benefit in being the company with the biggest market share because that company has the advantage of having the lowest operational cost.

Market leadership can be utilized to undercut competitors in price (or get a price premium without sacrificing volume), create better product features, increase budget for marketing and distribute products over a wider marketing network.

In short, economies of scale make it very difficult to outpace a market leader.

Obviously, the opposite is just as true.

Nokia's market share in smart-phones has dipped to 5%, while Samsung is now the global leader at over 30%. What happened? Why was Nokia overtaken? And, perhaps, equally as vital, why was Nokia outclassed so overwhelmingly within a short period of time?

The simple answer is that during this period, Samsung opted to build up their phones based on an exceptional computing platform created by Google, called Android, while Nokia did not.

While this is essentially true, it is a partial explanation.

Since a smart-phone basically means the addition of a many more computer features to one phone, there are now far more obstacles that you have to hurdle simultaneously to keep on selling phones.

At present, the operating system, the graphic interface, the screen resolution, the hardware design, the camera resolution, the energy efficiency, the computing power, and the support of the service provider are all equally essential to a new phone buyer.

Even if you obtain a 95% chance of getting each of these eight features right for any particular phone, this still leaves you with about a 34% chance of market failure (1 – 0.95^8), if we considered all variables as equally important.

This does not even take into consideration variables not related to the product itself, such as marketing and retail strategy.

To complicate the matter, the average length of time of ownership of a cell phone is only 20.5 months, meaning to say that a cell phone company has to not only be consistent in getting all of these many variables right every time, they also have to hope that new features are not introduced by other players and that they can better predict the right mix of delightful variables year after year.

At the same time, the prices of previous year's products decrease by 50%, removing all margins for error for new products.

In contrast to this is a product like Coca-Cola, which customers actually demand to remain constant decade after decade even though they drink it on a daily basis.

It comes as no surprise then that the consumer electronics industry is littered with many past market leaders that are now radically weaker like Nokia, Sony, Motorola, Nintendo, HP and RIM, while the beverage industry continues ever more to be dominated by Coca-Cola and Pepsi.

You have probably noticed that the general media are often overly thrilled to cover high-variable industries, such as consumer electronics, consumer internet services, video gaming, teen fashion retail, hotels, restaurants, airlines and motion pictures. The reason is that these industries are continually evolving, thus creating so much hype, intrigue and anticipation for the public at large.

These industries can always be depended upon to create breakthroughs into fresh innovations that can determine the fortunes of the various participants in an instant.

Naturally, this is the exact opposite of what we desire to have.

As long-term investors, we are on the look-out for businesses with high degrees of predictability. We want companies that can dependably remain dominant over the long-term.

One of the best ways to pinpoint such companies is to find those that do possess economies of scale.

Hence, it follows that to possess a sustainable advantage of scale; a business must have very few variables to consider.

The cost structure of the business should also be inclined towards having fixed expenses (e.g. electricity, factory overhead) that do not rise in proportion to rising sales. In short, there should be few variables that will affect both the revenue side and the cost side. And if you look at industries where these two conditions exist, the winners are quite often expectedly the same and new players hardly ever appear.

SMALL companies will now acquire funding from Germany at 50% the interest rate charged in Ireland under a program certified by Chancellor Angela Merkel.

The German Chancellor has told her state investment bank to coordinate closely with Irish officials to enhance loans for the economy, to include availability to funds for small and medium businesses.

But funds may also be provided for investment, for construction and for bigger companies.

The development is designed to allow Irish businesses seeking capital at a lower interest rate than the one provided by Irish banks.

At present, the average interest rate applicable for a small Irish business is approximately 4.5pc – over 100% more than the rate for a similar business in Germany, where loans are provided at merely 2pc.

SUPPORT

The plan to provide further loans at lower rates is likewise seen to motivate more businesses to invest.

“The need for loans depends on the affordability. There will be higher demand for funding if we can reduce the rate,” a Government official said.

The arrangement came as a result of negotiations between Taoiseach Enda Kenny and Chancellor Merkel regarding steps to aid the economy.

The German development bank, KFW, will determine possible steps to provide the loans.

The funds come at a lower rate because KFW is a triple-A rated bank; hence, it can acquire money at a lower rate and pass on the benefit to its clients.

The credit will be channeled through the National Treasury Management Agency and the new Strategic Investment Fund or the state-operated banks, AIB and Permanent TSB.

The Taoiseach said Ms. Merkel personally promised to coordinate hand-in-hand with Ireland to enhance funding processes.

In a report, Ms. Merkel said the German development bank will work with the Irish officials “rapidly, so as to fulfil its goals on this program as quickly as possible”.

After the announcement, the Irish Bankers Federation (IBF) released a report pointing to a marked decrease in lending to companies in the first part of this year; but banks insist this is a result of companies being reluctant to take out loans.

IBF director Felix O’Regan stated that any improvement in credit availability should be encouraged.

However, he said financiers operating here are suffering due to falling demand.

Driving business activity, by encouraging consumer spending, is the best means for achieving that, Mr O’Regan said.

Bank of Ireland head of small business, Gerry Prizeman, stated that firms are wary of fresh loans.

Business owners only took out half of the €3.6bn of funds the bank had intended to provide in 2012, for instance. Those who have availed are presently utilizing below 40pc of the cash accessible on their overdrafts.

Source

Europe’s revival from 18 months of recession caught up in the third quarter as exports slowed and the region’s second-biggest economy turnaround.

Over the preceding quarter the 17-nation eurozone’s initial estimate of GDP demonstrated growth of just 0.1%, when the economy grew by 0.3% subsequent to the contracting for six successive quarters through the depths of the region’s debt crisis.

Analysts were foreseeing growth would deliberate as one-off factors like a seasonal bounce back in German construction dull, but the regional figures were getting frailer compare to some had expected. Germany’s rate of growth more than halved to 0.3%, while the French economy shrank by 0.1%.

The numbers verifies doubts that the eurozone is currently under pressure to generate any actual momentum, as record levels of unemployment, weak investment, tight credit conditions and government austerity are weighing on demand.

In September, industrial production and retail sales both drop, and price rises plunged to 0.7%. That encouraged the European Central Bank to slash interest rates to a fresh record low preceding week in an attempt to stop the region falling into deflation and stagnation.

And ECB President Mario Draghi said the bank was ready to take further measures, including another rate cut, if the move fails to have the desired effect.

Unemployment won’t start falling until 2015 at the earliest, according to recent EU forecasts. The European Commission has trimmed its estimate of GDP growth next year to 1.1%, and said it was too early to declare an end to the region’s crisis.

Domestic demand in the eurozone is still very weak with 19 million out of work and wages hardly rising.

“While there’s not much difference between the second and third quarter GDP figures, the deceleration is, psychologically speaking, a major setback for the eurozone,” said Nicholas Spiro, managing director of Spiro Sovereign Strategy.

German domestic demand was accountable for most of the thin growth, with a recovery in exports from countries like Spain and Portugal also helping.

Italy’s economy had a constant decline, while by much less than in prior quarters, but France was weaker compared to what was anticipated.

In the previous week, ratings agency S&P downgraded France on fears the government will be not capable to reinstate the economy’s competitiveness, and the Organization for Economic Cooperation and Development weighed in Thursday, influencing the country to be more determined with its reforms.

It emphasized reasonably high tax rates, insufficient research and development, strict product market regulation and barriers to competition in business services.

The uncertain temperament of the eurozone recovery compares strongly with speedy growth and a surge in confidence in the U.K., where the topic is now concerning when the Bank of England will move to constrict monetary policy.

The central bank raised its growth forecasts on Wednesday and said it expected unemployment to fall much faster than expected just a few months back. Governor Mark Carney said he would be prepared to raise interest rates before May 2015 if it was the right decision for the economy.

By AMI

KASSAR

Searching for Capital

A broker evaluates the small-business financing market.

Source

When small-business owners plan to acquire business capital, the usual primary issues expected would be: How much is the interest rate? What is the size of the loan? How much are the monthly amortizations?

But another concern hides at the back, more often than not, and gets neglected. What collaterals will the lender require and what will that mean to the owner’s capacity to borrow in the future? At times, the answers to these questions can be adversely critical.

When a lender submits a lien, it gives the lender the potential to acquire a borrower’s assets in the event of non-payment. Occasionally, additional liens are provided by other creditors in line with the lender’s initial lien — but these creditors take subordinate positions and would be able to avail of proceeds in a liquidation only when the holder of the first lien has already been paid off.

Obviously, lenders would opt to be in the first lien position. If a lender does take a second or third lien position, the debt is more unstable — and usually involves a much higher interest rate. Hence, paying very close attention to the lien is vital. When you surrender a first-lien position on some or all of your assets, you certainly want to guarantee that you are getting the money you need at the right price — because additional loans tend to be either higher-priced or very difficult to acquire. Regrettably, many small-company owners do not take this issue seriously.

My loan brokerage company recently assisted a fast-growing customer that had overreached its credit line with a bank. It was growing rapidly; but it was not viable enough for the bank to provide additional funds. Instead, the company opted to acquire money from an accounts-receivable factoring firm. We informed our client of the higher cost related to factoring; but considering the firm’s comparatively high margins and growth potentials, the owner was open to shouldering the higher cost for faster release of capital.

Within the procedure of establishing the factoring relationship, we learned that the company’s present lender had put a blanket lien against all assets of the firm, including the accounts receivable. We consulted with the customer to assess the avenue of utilizing some of the proceeds of factoring to cover the outstanding bank credit line. The factoring arrangement was still reasonable, and our client negotiated to settle the existing line of credit at closing, at which point the bank would take out its lien on the receivables, to be substituted by a fresh lien owned by the factoring firm.

But as we approached closing, we were stunned to learn that the firm had entered into a purchase-finance deal for a small equipment item several months previously, and the equipment seller had put a blanket lien on all of our client’s assets, including its receivables. Without removing this lien, the deal could not progress because the factor, obviously, insisted on having the first position on the asset they were attaching with the loan. Surprisingly, the equipment company would not give in, and the customer had to make the hard decision to settle the equipment loan with funds from the factoring contract at a much higher rate and on less affordable terms.

We are also presently trying to assist a borrower that is running two franchises and plans to initiate a third. Thus far, this small franchisee has coped to prop its business with just a single loan – a relatively small Small Business Administration loan for the purpose of buying a trailer truck for its events.

While the loan covered merely 20 percent of the amount needed for the new site, the business was now stalled because the new lender required a blanket first position lien, which the Small Business Administration would not agree to. In this case, the customer is liable to refinance its equipment at a higher rate with a lender that will take a lien only on the equipment and allow the business to pursue its business expansion.

Hopefully, these illustrations will exhibit how vital it is to consider seriously the lien and collateral requirements of your lender to assure yourself that when you are giving up first lien position on some or all of your assets, you expect the highest possible loan benefits.

Have you ever gotten entangled by a lien? Let us know your story and how you handled the situation?

Ami Kassar established MultiFunding, which is based near Philadelphia and assists small companies who seek the appropriate sources of funding for their business needs.

The Goldman analysis attempts to calculate the effect of the forthcoming “qualified mortgage” regulations, these were part of the 2010 Dodd-Frank financial-regulatory repair. The law altered lending rules hence the mortgage lenders will be lawfully responsible for ensuring a borrower can pay back a loan. For writing rules for a “qualified mortgage”, the Consumer Financial Protection Bureau was assigned the task, the rules sates that lenders could make that would automatically satisfy the new ability-to-repay mandate.

Not until next month, the “QM” rules will not take effect. Lenders are allowed from making loans that are not from the QM rules but they could encounter greater legal liability on those loans. Tuesday’s WSJ examined how some banks had come into a decision where they will offer some “non-QM” loans on one occasion that the rules start next year, primarily by making loans to affluent customers that will stay on banks’ balance sheets.

The Goldman study presupposed that whichever loan that wasn’t a QM wouldn’t have been made. Nontraditional loan products are not incorporated from the QM definition, which means loans with interest-only terms, an instance is, which don’t necessitate instant principal payments, wouldn’t qualify.

Loans from between 2005 and 2008, almost 47% of loans that defaulted had at least one product feature that isn’t allowed under the QM rule while nearly 59% of loans created 2007 that entirely defaulted had at least one nontraditional product feature that doesn’t congregate the QM standard.

However the study demonstrates that approximately 25% of mortgages made between 2005 and 2008 that didn’t default might also have been disqualified from the market, including 30% of loans made in 2007.

Loans with those nontraditional product features were focused in the “sand states”. These states had some of the bubbliest housing markets. There were nine out of ten interests only loans in 2006 were in those states, together with almost seven in ten so-called “option” adjustable-rate mortgages. These require low minimum payments before resetting to sharply higher levels.

Adding up to limiting QM to entirely amortizing mortgages, lenders have to show that borrowers’ total debt payments are not exceeding 43% of their pretax income.

The debt-to-income cap could restrain lending for borrowers looking for “jumbo” mortgages that are excessively large for government support and who have uneven incomes or harder-to-document incomes.

“Self-employment income is harder to underwrite than is wage income, and lenders may become incrementally less willing to make loans to such borrowers given new legal obligations,” said the Goldman report. Borrowers that make a noteworthy share of their wages from unstable sources of income, like bonuses, tips, commissions, and investment income, could also stumble upon greater difficulty.

Shipping Notification Scam

Possible targets were sent an email that encloses fallacious shipping information, frequently from a well-known delivery company such as DHL, UPS or FedEx, or a major retailer like Amazon. There are a small number of differences to this holiday scam, like as a “delivery failure notification” message that says that a company attempted to deliver a package while you were out.

It is more often to contain a file attached to the message. A file attached is an indication that you’ve just received a fraudulent phishing email.

Unwary recipients click on the file, opening a virus download that aims to “phish” (i.e. scan) through their computer. Throughout this phishing stage, sensitive information like bank account numbers and passwords were then all gotten. Worst is that even some viruses even go so far as to hijack access to your computer. Then, it can only be returned after a payment is made. The FBI reports that this type of “ransomware” has experienced resurgence of late.

Mobile App Scam

Malicious mobile apps are produced with a technology known as “near field communication” (NFC) encoded into the app. This permits two NFC-capable devices to share data with one another; the trouble is that various credit cards have built-in NFC technology.

The tainted app maintains to scan for credit card information in the background, despite when the phone is not being used. What happens next is as soon as the compromised smartphone is put in close proximity to a wallet; it collects credit card credentials and emails it to the perpetrator.

Criminals will use this information for purchases online and even in stores that have a tap-and-go payment device. To prevent yourself from becoming a victim of this online identity theft, make a research about the developer beforehand by confirming that their website is legitimate and reading through user reviews.

Text Message Scams

This particular ploy disguises in many different shapes as it operates. Some recommends that you’ve signed up for a service that will cost some amount of dollars while the others ask for the identity of your bank and ask you to “verify your PIN” to reactivate your debit card if you don’t cancel the subscription by clicking through to a link in the message.

In the end, victims then gave up their information to perpetrators, or downloading a Trojan that tracks and stores all activity on the device. .

Delete the message at once subsequent to when the time you’ve reported it, but be certain not to respond to any prompts like “text message STOP” to end the messages. Because by doing these the scammers will get the confirmation that the number is active. Better yet, call your bank to alert them of the incident.

Charity Scams

Fraudsters wait until someone will fall for their bait, this bait is the unsolicited email they sent out. Usually the message will appear as a narrative of how the alleged traveler got caught up in midst of the Typhoon and is in immediate distress without access to his funds. And of course the email will end to the sender requesting a temporary “loan” from the would-be victim, with the promise to repay it as soon as the sender gets home.

Recipients are asked to send out money thru Western Union or MoneyGram, then finding out later that the one the recipient is dealing with just got away with their cash. This emotional appeal also takes the form of an email soliciting donations under a well-known charity organization, like the Red Cross.

Gift Card Scams

Rip Mason, CEO and director of LegalShield, a legal services and identity theft protection provider, explained how thieves get away with this scam. “The way these scams work is that a lot of retailers will display their gift cards at the checkout aisle or leave them out in the open for consumers to browse through,” said Mason. “This makes them vulnerable to thieves who take the cards, obtain the pertinent numbers listed on them, and then place them back on the store rack.”

“Afterwards, the thieves electronically track the gift cards and wait for money to be activated. Once a customer adds money and activates the card, the thieves promptly drain the funds electronically, leaving the person receiving the gift card with a balance of zero and dismay at the checkout aisle.”

To keep away from having you and your gift recipient become a victim of this unknown holiday scam, Mason recommends the following tips:

1.Be suspicious of and avoid buying any gift cards that are in packaging which appears to be tampered with.

2.If a retail outlet keeps its gift cards out in the open and not in any packaging, ask the clerk or manager if they have any gift cards behind the counter or in the back of store.

3.Only purchase gift cards from trusted retailers or their websites; avoid purchasing them from a third party vendor you aren’t familiar with.

The 2013 tax filing season opens on Jan. 31, but it’s not just the IRS that is ready for your returns--so are scammers.

Tax-related scams are becoming more popular and complicated, making it hard for filers to stay protected. The IRS offers the following warnings to help spot potentialfraud and reduce your exposure:

1. Be wary of any unexpected communications claiming to be from the IRS at the start of tax season. If you receive any tax notices, take them to the person who prepared your income tax return to determine their validity and to create a necessary course of action if the notice is legitimate.

2. Don’t talk to anyone claiming to be from the IRS on the phone. The agency will not call you on the phone. Identity thieves will pose as IRS collection personnel or a customer service representative offering you a refund—all you need to do is provide your personal information. Don’t fall for it.

3. The IRS does not send emails to taxpayers. Never! If you receive an email supposedly from the IRS forward it to phishing@irs.gov. And do not open any attachments.

4. The IRS will never ask you for your bank account PIN number, passwords or other similar confidential information such as mother’s maiden name for bank accounts or credit card accounts.

To help keep your personal information safe, the IRS suggests taking the following actions:

1. Don’t carry your Social Security card or any documents that include your Social Security number or Individual Taxpayer Identification Number. Keep them stored in a safe place away from the eyes of others.

2. Don’t give a business your Social Security number or ITIN just because they ask. Give it only when required. If you are self-employed providing services to other businesses, you may be required to provide this information on IRS Form W9 for 1099 purposes. For this reason, it may be prudent to apply for a Federal ID number to further ensure the security of your Social Security number.

3. Secure personal information in your home in a safe place.

4. Check your credit report every 12 months to make sure there’s no unusual activity or illegitimate credit lines.

5. Protect your personal computers by using firewalls and anti-spam/virus software, updating security patches and changing passwords for Internet accounts.

6. Don’t give personal information over the phone, through the mail or on the Internet unless you have initiated the contact and are sure of the recipient.

7. Be careful when you choose a tax preparer. Most preparers provide excellent service, but there are a few who are unscrupulous. Refer to Tips to Help you Choose a Tax Preparer for more details.

Salespeople as well as customer service reps and contact center staffers need to always remember that customer care and providing a positive customer experience are their top priorities. Aside from that basic understanding, they need to be given the tools and authority to get the job done right.

 Fail. Fail. Fail. That's what plenty of customers had to say about their shopping experiences this past holiday season. And, poor customer Relevant Products/Services service is just as big a problem in the B2B world of business Relevant Products/Services-to-business, where even more dollars can be at stake with each interaction.

How often have you tried to get help and couldn't? How often have sales and service people been too busy to answer your call or assist you in person? How often have you been disconnected in the middle of a service call, leaving you frustrated and needing to call back and start the whole loop again?

Outstanding customer service doesn't just happen. It requires firm policy at the top, starting in the C-Suite, followed by clear procedures for management and staff. And, above all else -- it requires careful, consistent, and ongoing training and monitoring.

Undercover Boss

There's a great reality TV series running in the U.S. and U.K. called Undercover Boss, where CEOs of nation-wide corporations are filmed going undercover as entry-level employees to see what's working and what's not in their own companies.

Time and time again, they find front-line staffers quoting "company policy" as the reason they can't give better service or accommodate customer requests. Outstanding customer service and a true dedication to customer care starts at the top, but can't stop there.

Salespeople as well as customer service reps and contact center Relevant Products/Services staffers need to always remember that customer care and providing a positive customer experience are their top priorities. Aside from that basic understanding, they need to be given the tools and authority to get the job done right.

Managing the Customer Experience

In 2013, we started to see a major shift toward focusing on "customer experience management" (CEM) along with "customer relationship management" (CRM Relevant Products/Services). "Customer engagement" also became a key focus for marketers and salespeople alike.

Indeed, social media has opened up a whole new realm of possibilities for engaging customers, building customer loyalty, and ultimately, boosting sales through repeat business and referrals.

But even the most sophisticated marketing Relevant Products/Services and engagement programs can be undermined by one bad experience with a customer service rep or sales person. And when a disgruntled customer takes his or her complaints to social media, it can set off a firestorm of negative consequences and a PR nightmare.

What if one of your parents needs assisted living and the other doesn’t want to leave their spouse’s side? Read our tips on finding AL for couples.

There are a lot of how-to guides out there to help you through the senior care process; most of them focusing on what it’s like to place one loved one into assisted living. But what if you are faced with finding a place for both parents?  As life spans continue to increase, this situation is becoming more and more familiar to those caring for aging parents. According to the U.S. Census Bureau, the percentage of those aged 60 and over who reported being married has increased over the past several decades, while the number reporting widowhood has decreased. Many of those couples find it necessary to look for assisted living as they age – and they want to do so without being separated.

Of course, this presents a number of challenges beyond those involved with searching for senior housing for one parent only. What if one partner has drastically different health care requirements than the other? How can you ensure that both of your parents’ emotional and social needs are met? Recently, researchers have begun delving into the topic of married life in assisted living, and there are a few tips you can follow to make the process run smoothly for both you and your loved ones.

Guidelines for Placing Couples in Assisted Living

1. Research Facilities Ahead of Time

Health transitions are one of the most common reasons prompting individuals or couples to begin the search for assisted living, according to a study by Candace Kemp, Ph.D., an Associate Professor in Gerontology and Sociology at Georgia State University. The key to not getting caught off guard by a sudden health change is to start the planning process ahead of time. Being proactive in this way is associated with greater satisfaction in the long run, because it allows families and seniors to take the time to find a facility that’s a good fit and it gives everyone more control over the decision-making process. If you’re not prepared and there’s a crisis situation, it limits the facility options available to you.

2. Have a Financial Plan in Place

Especially for those without a family that is able to contribute to long-term care, the prospect of putting both members of a couple into assisted living can be financially daunting. Some facilities are very expensive, especially for those with differing health status or those requiring memory care, and in many cases assisted living facilities do not work with Medicaid. Properly planning for long-term care can be the key to stretching the resources you do have and enabling your aging parents to continue residing together.

3. Prepare for The Realities of The New Space

While more and more couples are entering older age together, couples are still the minority in assisted-living settings, and most facilities are designed with a single occupant in mind rather than two. When there are two-person apartments available, they are often more costly. Beyond the personal space issue are the realities of living in a community environment. “Although each couple had a private room of varying size,” says Kemp’s study, “the comings and goings of care staff, the regulation of daily life, and the public nature of assisted living meant, according to one husband, that ‘no one has privacy.’” Being aware of the differences between your parents’ current environment and an assisted living facility can help everyone prepare better for the transition.

4. Consider Both Individual and Shared Needs

Different couples have different relationship needs – and, likewise, individuals within a couple may have different social and health needs. If one member of a couple is healthier, more mobile, and/or more sociable, it will help with their day-to-day well-being if the assisted living facility offers leisure activities that are appealing and fulfilling for both parties. If the healthier partner wants to take a fitness class, will they feel comfortable leaving their spouse in the care of staff? Can both parties get their social needs met? Be sure to research the amenities and care provided by an assisted living facility ahead of time, to ensure that it will offer a pleasant quality of life for both members of the couple.

5. Make Arrangements for Future Health Changes

Monitoring not one, but two parents in assisted living can be an added challenge when you throw in the very real likelihood that one or both of them may have unforeseen health changes in the future. In another study, Kemp found that adult children often take on a greater magnitude of responsibility when overseeing two parents in AL, a particularly challenging task when the two parents had differing levels of infirmity, or different needs at different times. One way to minimize stress in this situation is to familiarize yourself with the facility’s policies regarding resident retention in the face of health changes. If you’ll need to pay for additional outside services, or move your parents to a different facility such as a nursing home, be well aware of that possibility in advance.

One last bonus tip: arranging senior care for a couple can be hard, requiring families to consider individual and shared needs of both spouses – but don’t forget to consider the needs of the caregiver, and don’t be afraid to ask for help from a Senior Living Advisor, financial planner, or other expert when it comes to finding the best fit for your loved ones.

If you are struggling to make sense of the cost of investment shops, use our tool to cut through the detail and find the cheapest.

If you are struggling to work out whether you would save money by switching your self-managed pension to another provider, we have just the help you need.

Rather than wade through pages of numbers from each company, or type all your details into an online comparison tool, just take a look at the image, above.

At a glance, it will show you whether your existing investment shop is cheap (green), expensive (red) or somewhere in the middle. This table shows your costs in pounds and pence; the one below displays them as percentages.

As you can see, the results vary greatly according to how much money you have invested. Very few companies – iWeb, part of Halifax, seems to be the exception – are cheap for small and large amounts alike.

While the tables, which were compiled by Lang Cat, a specialist consultancy, offer an instantly understandable guide to the cost of running your Sipp, they do rely on certain assumptions, which are shown on the graphic, so you may need to dig a little deeper to uncover the full costs that apply in your own circumstances.

They also assume that the management fee on a fund is the same irrespective of which investment shop you use, whereas some, such as Hargreaves Lansdown, have negotiated special discounts. However, some experts expect such differences to narrow or disappear as competition hots up.

Sipp charges from major fund shops shown as percentages of the amount invested

Assumptions for all tables: charges deducted by the fund management company are excluded – only charges levied by the fund supermarket are covered. The table covers ongoing annual costs, so any initial charges are excluded. All investments are assumed to be in funds. Where there is a charge to buy or sell funds, we have assumed that there are five fund switches – or 10 trades – a year

Hargreaves Lansdown makes no charge to set up capped drawdown but starting a flexible drawdown plan costs £354. Each recalculation of the maximum income you can take under capped drawdown costs £90 and the company charges £12 to change a payment amount.

Alliance Trust Savings charges £240 to set up a capped plan and £300 for the flexible variety, with an annual charge of £90 for either. Buying an annuity costs £180 and processing of a death claim will cost £240.

At AJ Bell Youinvest, formerly Sippdeal, you pay £180 to set up either kind of plan and an annual administration charge of £120 (£60 if you take no income in a year); a review of capped income costs £90.

There is no charge at Charles Stanley Direct to set up a capped plan but a flexible one costs an initial £300. Income reviews cost £120.

Barclays Stockbrokers charges an initial £90 and annual £120 for either type of drawdown.

There is no initial charge at Fidelity to set up either kind of plan but annual charges are £100 (capped) or £300 (flexible).

iWeb loses some of its low-cost aura when it comes to drawdown: it charges £150 a year up to the age of 75 and £250 a year from your 75th birthday.

How to ensure a smooth switch for your DIY pension

No one wants to pay unnecessary costs, especially if they are coming out of your pension income. So if you want to start saving into a self-managed pension alongside a work scheme, it makes sense to choose the cheapest provider.

Start on the right foot

Look down the column for the amount you are planning to invest (or are likely to have in future) and look for the green boxes. Our tables assume that you invest exclusively in funds, so you may need to do some sums yourself if you make use of shares and investment trusts as well.

Small business tax expert Robert Stone, of Ilminster, shares his tips on what Somerset's new business start ups need to know about working from home

Micro and small businesses account for 95% of all UK companies and employ more than seven million people.

"The majority of new business owners will be working from their own homes," said Chartered accountant Robert Stone who knows only too well what it is like setting up a business from home. He started Robert Stone & Co 20 years ago with a desk sandwiched between a freezer cabinet and a washing machine, but now employs four people at his office in Ilminster. "With a young family, working from home meant that I could put plenty of hours in, but still see my two boys growing up."

As a tax expert specialising in small businesses, Robert Stone has advised many entrepreneurs on the practical issues of working from home, whether they are in a spare bedroom or a garden shed. Here he shares his top tips in a simple guide to starting out in business.

Robert Stone's 2014 guide to working from home

1.  Inform HMRC. One of the first things you must do is inform HM Revenue & Customs that you have started a business. This is to ensure that you are paying the right amount of National Insurance and are prepared for Self Assessment.

2.  Check with your Mortgage lender or landlord. Whether you decide to use a spare bedroom, a corner of your dining room or your garage, you must first ascertain whether there any restrictions on your mortgage. If you are a tenant, you must check with your landlord.

3.  Consult your local planning office. Depending on what business activities you will be carrying out at home and whether customers will be visiting you there, you may need planning permission for change of use.

4.  Change your insurance. Your home insurance policy won't cover your business activities or business equipment within the home, so speak to your insurer about upgrading your policy to ensure you are fully protected.

5.  Business rates eligibility. You may have to pay business rates if you use a building or part of a building specifically for non-domestic purposes. Check with your local council whether you will be liable. However, the following reliefs are available and should be applied for as appropriate: small business rate relief, rural rate relief, business rates deferral scheme, enterprise zone relief. Some councils provide an additional hardship relief.

6.  Be organised. You need to keep the right records and that includes receipts, even if you are just selling items on eBay. HMRC can impose a penalty of up to £3,000 for not keeping proper records, so it is worth your while investing in suitable storage, such as a filing cabinet, storage boxes or shelving with box files, to keep all your paperwork in order and readily accessible.

7.  Keep work and home life separate. As well as having a dedicated work space it may be worth while investing in a separate phone line for your business. Try to structure your working day properly, with fixed working hours and have a proper lunch break at a set time each day. It will help you focus better. Make sure friends and family respect your working hours and don't just drop in.

8.  Claiming expenses. All businesses have expenses that can be claimed legitimately and it's a good way of reducing your annual tax bill. Even though working from home is a cheap way of starting a business you will still need to claim for items such as office furniture, a separate telephone line or broadband. Split your household expenses between business and personal use and divide them into two categories: fixed costs and running costs. Remember you are allowed to claim a standard mileage rate for business use of cars or motorcycles and a flat rate business expense for your home.

9.  Don't become isolated - remember to socialise. It's vitally important if you are working from home on your own that you keep in touch with other people. Rather than just communicating by email, remember to pick up the telephone and have real conversations. Also get out and network. There are numerous networking organisations for small businesses and you can choose whether to attend breakfast, lunch or evening sessions. Networking will stop you stagnating as well as helping you make fresh business contacts and even win new business.

10.  Health & Safety. If you intend to have customers and employees at your home, then you will need to carry out a health and safety check and have public liability as well as employer's liability insurance. If you don't want customers visiting you at home, then find a local meeting place or café where you can meet them in comfort.

11.  Keeping accurate accounts. Unless you are already an accountant or a bookkeeper, then it is far better (and quite likely cheaper) to outsource your accounts, VAT returns or monthly payroll to a qualified accountant. They will ensure that you are claiming for everything you should, as well as alerting you to any changes in legislation that may impact on you or your business.

DEAR SAVVY SENIOR: Can you give me some tips on how to choose a good financial planner or adviser? My wife and I are five or six years away from retiring and could use some professional help to get us on track.

DEAR SEEKING: With all the different financial advisers and services available today, choosing a trusted professional that can meet your needs can be a bit confusing. Here are some suggestions that can help.

A good place to start your search is by asking friends or relatives for recommendations. If you don’t know anyone who can give you a referral, and you’re looking for broad-based financial advice, hire a Certified Financial Planner, or CFP. CFPs are considered the “gold standard” in the industry. To get the CFP credential, they must have a college degree and be educated in a wide range of personal finance subjects, pass a two-day exam, have at least three years’ experience, meet continuing-education requirements and abide by a code of ethics.

CFPs are taught to look at the big-picture view of your finances, talking you through your goals, as well as advising you on the details of your financial life.

You’re also probably better off hiring a CFP that’s a fee-only planner, verses one who earns a commission by selling you financial products. Fee-only planners charge only for their services – for example you might pay $150 to $300 an hour for a financial tune-up, a flat fee per project or an asset-based fee.

To find a fee-only planner in your area, use the Financial Planning Association (fpanet.org) or the National Association of Personal Financial Advisors (napfa.org), which has online directories. Or try the Garrett Planning Network (garrettplanningnetwork.com), which is a network of fee-only advisers.

If your needs are more specific, some other financial professionals to consider are a Registered Investment Adviser who is registered with the Securities and Exchange Commission or a state securities regulator to manage investment portfolios; a Chartered Financial Consultant, specializing in insurance and estate planning; and a Certified Public Accountant, who can help with tax planning.

Be leery of many other financial advising titles, designations and certifications that are out there, like the Certified Financial Consultant or the Wealth Management Specialist. Many of these require no more than a few courses at a seminar or online, which means they’re not worth much. You can read more about nearly every certification or designation at finra.org/investors – click on “Tools & Calculators,” then on “Understanding Investment Professional Designations.”

After you find a few candidates in your area, call them up and schedule an appointment to meet and interview them. Find out about their experience, expertise and the types of services they provide; how they charge and how much; their investment philosophy; and how will they handle your ongoing questions or financial needs. Look for someone whose clients are in situations similar to yours and who’s available as often as you need him or her.

It’s also wise to do a background check on your potential adviser. You can look up firms and individuals at finra.org or sec.gov, and even check state financial regulation departments (see nasaa.org for state contact information) and Better Business Bureau records at bbb.org. Also, ask to see the adviser’s ADV Form, part 2. This is a form on which the SEC requires advisers to list their education, services, fees, disciplinary actions and conflicts of interest.

At the end of your meeting, ask yourself: Do I like this person? If you have any reservations, move on. There are plenty of qualified advisers out there who can help you.

There are some rules of thumb to adopt. I can't promise to make you rich but in time, you should be a bit better off. If you are investing for the long term – 10 years or more – these eight tips might help:

1 How much risk are you truly willing to take? Peace of mind is priceless. If you can't bear losing a quarter of your money in a year or two, don't invest in shares. They canplummet.

2 Many people do not realise they need to save a good chunk of money over a significant period of time to end up with a decent nest egg. Magic shares that go up 50 or 100 fold are extremely rare. Compound interest is your best friend and will multiply your money over time, preferably feeding it through regular savings or top-ups if your income is variable. Saving €50 to €100 per month might feel virtuous but is it enough for your investment goals?

You need a fund of approximately €350,000 to give you an income of €18,000 per annum (half the average industrial wage) at the age of 65.

Even €200 a month over 30 years wouldn't get you to a €350,000 target. If you saved €200 a month into an average managed fund from January 1984 to January 2014, you would have built up a fund of €268,000 at the start of this year – that's assuming the fund made a return of 9.4 per cent a year and had an annual management fee of 1.7 percent.

3 If you're a taxpayer, don't forget that long-term investment is a no-brainer. Saving through a pension gives you a tax break of either 20 or 41 per cent, depending on how much you earn. Why give the taxman 20 or 41 per cent of your hard-earned money?

4 Don't try to time the stock market. Many people won't have the time or the money to seize opportunities, so regularly drip-feeding your money into stock markets eliminates worries about buying at market highs or selling at lows.

5 Read widely. Money journalists tend to be very knowledgeable and bang up-to-date for investors, with insights on good value for money, latest trends, hottest products, things to avoid and so on.

6 Diversify – don't have all your money invested in a handful of stocks, one country, one sector and so on. Many unfortunate Irish investors were heavily, if not entirely, weighted in Irish banks – with hazardous results. Don't miss out on exposure to different returns – include small companies as well as large, emerging markets in your investment porfolio.

7 Don't buy because the fees are cheap or the investment has performed well in the past. Charges are definite – future performance is not. The most expensive investment provider is not always the best. Active funds can out-perform or under-perform passive funds; the issue is not choosing one approach or the other but using both.

8 Good professional advice is invaluable if you're not financially literate enough to make prudent investments decisions. for the longer-term This is particularly the case as you get older and need to decide on the timing of moving out of shares into safer assets.

P.T. Barnum knew how to make money. By the middle of the 19th century, the master showman had become America's second millionaire, and his estate was valued at over $10,000,000 prior to his death in 1891.

Fortunately for us, Barnum – who is still remembered today for his "greatest show on earth" -- shared his secrets for getting rich. In the short work "The Art of Money Getting" published in 1880, he laid out his rules for creating wealth. After reading them, I was struck by how applicable they remain today. Here are nine golden rules for making money, according to Barnum.

1. Spend less than you earn. Barnum writes that the key to wealth is quite simple: "it consists simply in spending less than we earn." Despite the simplicity of this maxim, he notes, "more cases of failure arise from mistakes on this point than almost any other."

The problem is that we need to be focused on both our expenditures and our income. Barnum shares an instructive story about a woman who cut her expenses by refusing to burn candles in the evening. She may have saved five or ten dollars by doing so, but she lost out on the knowledge she would have gained by reading during those hours. That benefit would have outweighed "a ton of candles." The bottom line for Barnum is that "true economy consists in always making the income exceed the out-go."

2.  Take care of your health. Good health is the foundation of success in life and is also the basis of happiness, according to Barnum. Without good health, a person is very unlikely to accumulate a fortune – he'll have "no ambition; no incentive; no force." He recommends avoiding alcohol and tobacco, while also making other healthy choices when possible.

Barnum was ahead of his time on this important issue. Health is a key component of personal finance. A University of Michigan health and retirement study in 2002 supports that view: it found that the mean household wealth of married couples reporting excellent health was approximately three times that of married couples reporting poor health (an average of $500,000 compared with $164,000). Living a healthier life is one of the easiest steps we can take on the road to building our wealth.

3. Persevere. To illustrate this rule, Barnum shares a line from Davy Crockett, "This thing remember: when I am dead: Be sure you are right, then go ahead."

Everyone must actively cultivate a sense of "go-aheaditiveness," according to Barnum, and must not become overwhelmed by the "horrors" or "blues." He found during his business career that many men gave up right before they would have reached their goal. Everyone will encounter difficulties and challenges – it's how you respond that determines whether you'll succeed or not.

4. Be cautious and bold. This one appears to be a paradox, but it is not, writes Barnum. He believes "you must exercise caution in laying out your plans, but be bold in carrying them out." A man who is all caution won't take on the risks necessary for success, while a man who is "all boldness, is merely reckless, and must eventually fail."

This rule is particularly relevant for the investing world. The very act of investing in stocks is a risky endeavor, as anyone who lived through the recent financial crisis of 2008-2009 knows all too well. And yet, stocks have delivered great returns for investors over the long term, and have been a tremendous way for ordinary people to create wealth for their families.

5. Use the best tools. Barnum believes that workers must always have the very best tools to do their work. As a businessman, he feels there is no tool he should be, "so particular about as living tools." When looking for employees, therefore, one "should be careful to get the best."

Barnum observes that good employees get more and more valuable each year, and that retaining them should be a priority. Recognizing the importance of your human assets – which Costco (NASDAQ: COST  ) and Starbucks (NASDAQ: SBUX  ) , for example, certainly do in today's marketplace – is an often overlooked strategy for creating long-term value.

6. Be focused. Barnum urges the aspiring entrepreneur to focus on "one kind of business only, and stick to it faithfully until you succeed, or until your experience shows that you should abandon it."

This rule is related to persistence in that sometimes we have to keep at just one thing until we're successful. Barnum warns that "many a fortune has slipped through a man's fingers because he was engaged in too many occupations at a time." As Steve Jobs realized, focus sometimes means "saying no to the hundred other good ideas that there are."

7. Advertise your business. Barnum was a remarkable pioneer in the field of advertising. For one of his promotions, he was able to transform a five-year-old dwarf named Charles Sherwood Stratton into "General Tom Thumb, Man in Miniature." Tom Thumb eventually became a gigantic hit in Europe, and was received by Queen Victoria and numerous other crowned heads-of-state.

Barnum believed strongly that you had to let the public know if you have something that will please potential customers. Without promotion, you will receive no return, even if the item in question is potentially quite valuable. When it came to advertising, Barnum was always willing to invest heavily upfront whenever he knew he had something people would enjoy. Nowadays, each of us should be willing to invest in ourselves or our business whenever we believe doing so will deliver larger rewards down the road.

8. Be polite and kind to your customers. P.T. Barnum actually never said "there's a sucker born every minute." Instead, he had great respect for his customers. He writes, "the man who gives the greatest amount of goods of a corresponding quality for the least sum (still reserving for himself a profit) will generally succeed in the long run."

He didn't think you could get away with not providing quality and value to customers, saying "people don't like to pay and get kicked also." Instead of thinking his customers were suckers, he thought they were deserving of respect and tolerance, since the customer is the man "who pays, while we receive."

9. Preserve your integrity. Barnum concludes his work by saying to all men and women, "make money honestly." He sincerely believed that the desire for wealth is laudable as long as the "possessor of it accepts its responsibilities, and uses it as a friend to humanity."

This final rule, in relation to Barnum's career, requires some context. In a lot of his promotions, he was known to bend the truth somewhat, so "integrity" might not have been the first word that came to the mind of his contemporaries. For example, he once exhibited an African-American woman who was supposedly 161 years old, and was formerly George Washington's nurse. When challenged about the truth of this promotion, he replied, "the story seemed plausible."

Despite Barnum's occasional "humbug," Brenda Wineapple, author of Ecstatic Nation: Confidence, Crisis, and Compromise, 1848-1877, points out that he had a keen sense of civic duty, and truly wanted to educate and delight his customers. In the end, Barnum believed that "money-getters" were benefactors for mankind. In his particular case, I think he was right.

Valentine’s Day is all about hearts, flowers, chocolate, maybe some bling. What it’s typically not about: credit cards, credit scores and anything as crass as cash.

Except lately. Whether it’s because recession-rattled consumers are still focused on their bottom lines or whether personal finance experts are trying to capitalize on Valentine-y sentiments, there’s been lots of attention recently on romance and money.

“Love and money cannot be separated,” said Gail Cunningham, spokeswoman for the National Foundation for Credit Counseling in Washington, D.C . Because money is “intertwined with just about everything we do, it can impact a relationship – even before it gets off the ground.”

With Feb. 14 just days away, we thought it’d be romantically responsible to share a few gems:

Money heart-to-hearts

Too many couples never talk seriously about their finances. Financial experts say that’s a major mistake, whether it’s a new romance or a years-long marriage.

“It really is an act of love to share your finances with your significant other,” said NFCC’s Cunningham. “The more you’re on the same page (financially), the less trouble you’ll have down the road.”

Without a clear financial picture, the first time you go together to rent an apartment, buy a car or take out a home loan, it could be potentially embarrassing – and costly. If one partner has an iffy credit history, it likely will mean much higher interest rates or even having a loan denied.

Schedule a time for a serious talk in a casual setting, suggests Cunningham.

For new couples, it could be looking together at income (yes, bring out the pay stubs, she says), existing debt (credit cards, car loans, etc.), investments and even credit reports. Being honest about your financial past and current situation can put a relationship on a healthy financial footing.

For established couples, it might be having a talk about retirement readiness, how to share financial tasks more equally, understanding the family investments or checking beneficiaries on life insurance and bank accounts. Or review your goals for some of life’s big-ticket items, like a new house, kids’ college or special vacation.

For tips on what questions to ask and how to initiate a money talk with your romantic partner, check out sites as diverse as investing’s Fidelity.com, dating’s eHarmony.com and lifestyle’s RealSimple.com.

Avoid ‘financial infidelity’

Money squabbles are often cited as a major cause of marital tension and divorce.

Last week, in its annual Couples Retirement Study, Boston-based Fidelity Investments said 51 percent of U.S. couples admit that they “frequently or occasionally” fight about money.

Especially for couples just starting out, being reluctant to share your financial history can be a sign of potential trouble.

“It’s a form of financial infidelity to hide negative financial information from someone you’re considering having a serious relationship with,” said Cunningham. “If someone is unwilling, it sends a red flag.”

Insure the bling

Valentine’s Day is the second most popular day for marriage proposals, according to a survey last December. (The most popular? Christmas Eve.)

For those putting a ring on it, there’s one aspect that’s frequently forgotten: insurance. An engagement and wedding ring are often the first sizable investment a couple makes together. But you don’t want to leave it uninsured in case it’s lost, stolen or damaged. (And the same goes for fine jewelry, a perennially popular Valentine’s Day gift.)

“Jewelry is one of the most common insurance claims that pop up,” said Tully Lehman, spokesman for the Insurance Information Institute in Walnut Creek.

Be prepared against loss: Keep your store receipt showing what you paid. If it’s an heirloom piece, have it appraised. Keep the paperwork in an insurance file, so you can easily file a claim if the ring is chipped, lost or stolen.

If you’re a renter, look into low-cost renters’ insurance, which covers the contents of your apartment or rental property.

Be sure to check your insurance policy limits. Most standard homeowners’ policies will cover against theft for individual items up to $1,000 or $2,000. If your ring or other pieces are worth more, you’ll need to look at purchasing a separate “endorsement,” sort of a mini-policy that covers higher-priced pieces or can protect against chipped or lost stones. A “floater” premium on your existing policy will protect you beyond theft, such as when you leave jewelry in a hotel room or accidentally drop an earring down the sink.

“You may already have enough insurance coverage and don’t it. But it always pays to check,” said Lehman.

Flirting via credit card?

Pulling out your credit card on a first date could affect your love life, says NerdWallet, a San Francisco-based personal finance website.

While flashing an American Express card might be expected to impress, it’s not always so, according to NerdWallet’s recent online survey of 500 never-married adults, ages 25-59.

Given a list of 13 credit cards, respondents were asked which they’d find most “impressive” when a date pulled it out to pay for dinner. Not surprisingly, an American Express Platinum and a Visa Black card ranked second and third, scoring roughly 28 percent each. But the most popular choice? A “local credit union” credit card, which was favored by 39 percent.

“That surprised us,“ said Jelena Ewart, a NerdWallet credit/debit card analyst. While the flashier cards might mean a date is a big-spending, high-income, globe-trotting professional, that’s not always appealing. While admittedly a “khaki-pants” kind of choice, a local credit union card might indicate your date has a “well-researched, responsible, well-thought-out” approach to money, Ewart said.

Given the findings, “We were pleasantly surprised that people were in touch with financial responsibility,” said Ewart. “It’s quite heartwarming.”

Not so charming on that first date is having your credit card declined by a restaurant or merchant. Half of all singles – and 63 percent of women – said they are “somewhat” or “much less likely” to go out again with someone whose credit card is rejected. No explanation needed.

Is a credit score sexy?

In some cases, especially among women, it appears so.

In NerdWallet’s survey, 40 percent of singles say they are “somewhat more likely” or “much more likely” to date someone with excellent credit, defined as a FICO score of 750 or above. And single women apparently value a high score more than men, roughly 52 percent to 29 percent. The survey also found that 9 percent of 30-to-44-year-olds – the highest of any age group – admitted to “snooping” into their dating partner’s credit history.

There’s actually an online dating site, CreditScoreDating.com, that lets singles plug in their credit score to find a compatible match. Finding someone with a credit score above 750 means “Take him/her home to mom,” according to the site.

The emphasis on creditworthiness is especially strong among 20-somethings, according to Ewart. “This age group came of age during the recession,” she says. “They were coming out of college or getting jobs at a time when creditworthiness was really important. Their older peers may have entered adulthood when it didn’t matter as much.”

Love is cheap

Perhaps the easiest piece of money-and-Valentine’s advice: It doesn’t have to cost a fortune to be heartfelt.

For instance, want to send your sweetheart a message that’s a mashup of cash ’n’ cupid The MintGrad.org, a financial literacy website aimed at 18-to-24-year-olds, offers a series of free Valentine’s e-cards to send your significant other. Dubbed “a financial twist on the traditional cheesy Valentine’s card, the e-cards bear such messages as: “Love makes the world go round, but money pays for the ride.” “Let’s spend more time and less money together.” “You had me at no debt.”

For other ideas, sites like Pinterest.com, LearnVest.com, TheArtofSimple.net and even Bankrate.com or MSNMoney.com are bursting with low-cost ways to say “I love you.” Here are a few:

1. Tell your partner why you love him/her, in words or on paper.

2. Create a handmade card (or lots of little notes sprinkled throughout the day).

3. Make something (breakfast in bed, a CD of favorite tunes, a framed photo).

4. Make peace. (Resolve a nagging disagreement: Write down your promise, wrap it up, deliver with a flourish.)

5. Give your time. (Offer him/her a night out with friends, or time off from household chores, which you pick up in return.)

6. Surprise ’em. (Pick a new destination for a hike or drive; return to a favorite place.)

7. Just listen. (Give your partner your undivided attention and really listen.)

8. Create a memorable meal. (Whether it’s bundling up for a cold-weather picnic outdoors or a candlelight spread of hors d’oeuvres at home, simple can be sweet.)

Love is priceless.

Like every investor, you want to choose investments that will provide the growth and income you need to meet your financial goals. To do that, it’s important to understand yourself as an investor. That’s because a portfolio that’s right for someone else may not be best for you. The factors that make a difference are stated below.

Your risk tolerance

Both your age and your time frame for meeting specific financial goals play a role in determining your risk tolerance. If you’re young and have a long time to meet your goals, you may have a higher risk tolerance than someone who is nearing retirement and is counting on investment income to live on for two or three decades.

But other factors may also affect your tolerance for investment risk. Your personality, personal experiences, and current financial circumstances also come into play. For instance, if you’re a single parent, are responsible for the care of a sick or elderly relative, or have lived through a period of economic upheaval such as a major recession, you may be a more risk-averse, or conservative, investor. On the other hand, if you have a promising career, a generous salary, and little in the way of financial responsibilities, then you may be more comfortable in assuming greater investment risk.

Above all, you need to feel comfortable with the risk you’re taking. If changes in the value of your portfolio keep you tossing and turning at night, or your instinct is to sell your investments every time the market drops, then you may want to consider shifting to a more moderate investment mix, with a greater emphasis on predictable, income-producing investments, such as bonds.

Or, if you’re a risk taker by nature and have at least 15 years to meet your goals, then you may be comfortable allocating most of your assets to a diversified portfolio of stock, stock funds and certain fixed-income investments that have the potential to provide the strongest returns over the long run.

Keep in mind that investment risk doesn’t mean staking your life savings on highly speculative investments like a new company that a friend is starting. (The only money you’d want to put in investments like that is money you can afford to lose.) But it does mean getting used to the fact that virtually all investments that have the potential to provide substantial returns will drop in value at one time or another—sometimes significantly.

Using asset allocation

When you allocate your assets, you decide—usually on a percentage basis—what portion of your total portfolio to invest in different asset classes, usually stock, bonds, and cash or cash equivalents. You can make these investments either directly by purchasing individual securities or indirectly by choosing funds that invest in those securities.

As you build a more extensive portfolio, you may also include other asset classes, such as real estate, which can also help to spread out your investment risk and so moderate it.

Asset allocation is a useful tool in managing systematic risk because different categories of investments respond to changing economic and political conditions in different ways. By including different asset classes in your portfolio, you increase the probability that some of your investments will provide satisfactory returns even if others are flat or losing value. Put another way, you’re reducing the risk of major losses that can result from over-emphasizing a single asset class, however resilient you might expect that class to be.

For example, in periods of strong corporate earnings and relative stability, many investors choose to own stock or unit trusts. The effect of this demand is to drive stock prices up, increasing their total return, which is the sum of the dividends they pay plus any change in value. If investors find the money to invest in stock by selling some of their bond holdings or by simply not putting any new money into bonds, then bond prices will tend to fall because there is a greater supply of bonds than of investors competing for them. Falling prices reduce the bonds’ total return. In contrast, in periods of rising interest rates and economic uncertainty, many investors prefer to own bonds or keep a substantial percentage of their portfolio in cash. That can depress the total return that stock provides while increasing the return from bonds.

While you can recognize historical patterns that seem to indicate a strong period for a particular asset class or classes, the length and intensity of these cyclical patterns are not predictable. That’s why it’s important to have money in multiple asset classes at all times. You can always adjust your portfolio allocation if economic signs seem to favor one asset class over another.

Investors fearful about the impact of the emerging-markets crisis on their portfolio may be shocked to discover they have more exposure to a meltdown than they think.

Blue-chip companies listed on the FTSE 100 have poured into China and other emerging markets in recent years in a bid to grab the exciting growth opportunities on offer. As the sentiment toward those regions sours, these companies’ shares are being hit.

If you have an emerging markets fund, you have a pretty good idea what your exposure is. But plenty of big-name British companies and funds are also in the firing line, given that FTSE 100 companies now generate 33pc of their profits from emerging markets.

Companies on the American S&P 500 Index, by comparison, generate only 5pc of their revenues from emerging markets.

This leaves investors with FTSE 100 stocks, index-tracking and actively managed funds with a much higher exposure than they may think.

Last week, investors in spirits company Diageo were feeling punch-drunk after its share price fell more than 6pc in just two days, on slowing sales in China and Nigeria. As a result, Goldman Sachs dropped Diageo from its “buy” list and downgraded it to neutral.

Profits at Unilever, which makes a vast range of goods from PG Tips to Peperami, have been hit by slower demand and weaker currencies in Brazil, India, Russia and Indonesia. A fall in local currencies means the sales made there result in fewer pounds being bought back for British shareholders.

HSBC and Standard Chartered, two FTSE-listed stocks with hefty exposure to Hong Kong and mainland China, have also struggled. The crisis came to head this week with investors withdrawing billions of dollars from emerging-market funds in the biggest sell-off since August 2011.

Markets have been hit by fears of a China slowdown, and the US Federal Reserve’s decision to scale down “quantitative easing” (QE). Instead of flowing into emerging markets, money is being attracted back on the hope of improving rates in America. Brazil, India, Turkey and South Africa have raised rates to protect their currencies.

The FTSE 100 has shed £93bn of value since January 21, with much of those losses down to emerging markets, said Elaine Coverley, head of equity research at wealth manager Brewin Dolphin. “Emerging-market headwinds show few signs of dropping. We have been bearish for some time and continue to be so, although we don’t see the current correction turning into a full-blown crisis.”

Some FTSE 100 stocks could be hit hard, she said. “Global brewer SABMiller is one of the most exposed stocks of all because it generates a mighty 85pc of its sales from Eastern Europe, Latin America, Africa and Asia.

“I’m a bit more bullish about Diageo [which makes 50pc from emerging markets]. Falling sales in China and Thailand have been offset by a 5pc rise at its US spirits division, which is the largest part of its business.”

Deep Blue Publications Group LLC - Tips from an expert on long-term investing

I have frequently emphasized the importance of a diversified portfolio and of having a significant portion of common stocks in your portfolio, even in retirement. Although I have been retired for 18 years, I still maintain about half of my portfolio in some form of common stocks -- either the shares themselves or mutual funds or exchange-traded funds (ETFs).

In a prior column, I recommended "Stocks for the Long Run" by Jeremy Siegel (McGraw-Hill) for investors who wanted to invest in common stocks. Siegel is a professor of finance at the Wharton School of the University of Pennsylvania. He has revised and updated the book now in its 5th edition. I have reviewed the latest edition, and I believe it contains valuable information for investors who expect to continue to invest in the stock market.

In this edition, Siegel analyzes the economies of China and India, and provides information that will provide guidance for investing in these economies. He devotes a lot of attention to global markets, discussing the nature and size of these markets and sharing his long-term projections. He also emphasizes the importance of including global investments in your portfolio.

The most important chapter for most investors takes up the subject of structuring a portfolio for long-term growth. Siegel specifies guidelines for successful investing, which requires maintaining a long-term focus and a disciplined investment strategy. Here are some of the principles he recommends, with my commentary.

--Keep your expectations in line with history: Over the last two centuries, stocks have returned between 6 and 7 percent after inflation, including re-invested dividends. Furthermore, stocks have sold at an average price/earnings (P/E) ratio of about 15. In the future, he points out, there may be reasons that the stock market may rise to a higher P/E ratio than 15, such as lower transaction costs and lower bond returns. A good rule to remember when you are projecting the future is "the rule of 72." If you divide 72 by the expected total return, the result is the number of years for your investment to double in value. Thus, an 8 percent return will double your investment in nine years.

--Stock returns are much more stable in the long run than in the short run: Investments in stocks will help you compensate for future inflation; bond investments will not. There will be years in which the overall stock market will be negative. That should not prevent you from maintaining a significant portion of stocks in your portfolio following a fall in stock prices. Investors who bailed out of stocks completely following the stock market fall in 2008 found it very difficult to get back in the stock market, and as a result they missed excellent returns in the last few years.

--Invest the largest percentage of your stock portfolio in low-cost stock index funds. This may be one of the best recommendations, especially for investors who don't have a huge portfolio. In this way, even if you have a small portfolio, you have the same diversification as a large investor in the same fund. A good example of this principle in action is the track record of a broad-based fund such as Vanguard's Total Stock Market Index Fund Investor Shares (which I have invested in for many years) which returned approximately 30 percent in 2013.

--Invest at least one-third of your equity portfolio in international stocks, specifically those not based in the United States. Siegel cautions investors not to overweigh your portfolio in high growth countries whose P/E ratio exceeds 20.

--Tilt your portfolio toward value stocks by buying passive indexed portfolios of value stocks. Siegel points out that value stocks, which have lower P/E ratios and higher dividend yields have had better results and lower risk than growth stocks. I agree completely. I have consistently invested in this type of index fund, and the results have been very good.

--Establish firm rules to keep your portfolio on track. Siegel devotes a chapter to discussing the common psychological pitfalls that cause poor market performance. It is too tempting to buy when everyone is bullish and sell when everyone is bearish.

Worried that the stock market is due for a correction? Siegel offers the following guidance for 2014: "This bull market is not over, although gains won't be as large as 2013. Stock returns likely to average 6 percent to 7 percent over the next three to five years."

(Reuters) - Europe's and Asia's industrial health will be closely watched in the coming week for an indication of how solid - or weak - a footing the global economy was on at the start of the year.

With China's leaders seeking to rebalance the world's industrial powerhouse more toward consumer spending, and with bad weather distorting most United States data since the start of the year, some clarity would be helpful.

After private sector business surveys suggesting services activity around the world is on the up, investors and policymakers will shift their focus to industrial production figures for the euro zone, Britain, Japan and China.

Industrial output growth in China, the world's second largest economy, is likely to have slowed further in January from 9.7 percent in December, hurt by weaker local and foreign demand.

Economists in a Reuters poll forecast a decline to a 9.5 percent annual pace, which is still strong and would not yet show the kind of rebalancing policymakers are looking for. Those figures are due on Thursday.

"China's export growth is likely to have softened in February after the surge in January due to the front-loading of exports before the Lunar New Year," said David Mann at Standard Chartered.

Beijing says it is aiming for economic growth of about 7.5 percent this year, compared with last year's actual expansion of 7.7 percent, as it seeks to revamp a maturing economy and move it towards slower but better-quality growth.

Germany, whose export-driven economy has been the driving force behind the 18-member euro zone's very slow recovery from recession, will also publish trade data this week.

"Last year, the German trade engine spluttered, already suffering from weaker demand from some emerging economies," said James Knightley, senior economist at ING.

"Ongoing problems in emerging markets combined with the winter weather in the United States could make the German export soft patch last longer than expected."

Selling more goods to a swelling global consumer base in Asia and elsewhere may be just the mix required. But as long as unemployment in the bloc remains high, there is little prospect for a strong rebound in euro zone consumer spending.

Industrial production figures for the euro area are expected to show a healthy rebound in January from December's 0.7 percent decline, according to the latest Reuters poll.

The main Markit Purchasing Managers' Index rose to its highest in more than 2-1/2 years last month, which may help explain why the European Central Bank decided to leave policy unchanged at its March meeting and signal it is content to wait and see.

After the ECB appeared to rule out any middle-of-the road options, hinting the bank would either do nothing or else take bold policy action should the outlook deteriorate, there are a host of its policymakers speaking during the week, possibly offering further guidance.

In the United States, where jobs growth was better than expected in February, there is much more certainty about the trajectory of monetary policy.

For the Federal Reserve to alter the pace at which it is winding down its massive bond-buying program - 10 billion dollars per month - the U.S. economic outlook would have to change dramatically, top Fed officials said last week.

One, Atlanta Fed President Dennis Lockhart, told Reuters in an interview that even a third month of below-par U.S. jobs growth would not be enough to warrant such a move.

After employers added 175,000 jobs to their payrolls last month, having already created 129,000 new positions in December, any talk of a change will have been muted.

If anything, U.S retail sales data due on Thursday are expected to show a return to growth in February after unseasonably cold weather took its toll the month before.

That could solidify expectations that the Fed will wind down its bond purchase programme by the end of this year and consider raising interest rates some time in 2015.

Japan will announce revisions to its fourth quarter GDP data on Monday - something it is prone to do heavily. Tokyo said last month the economy expanded 0.3 percent in the fourth quarter, well below the median estimate of 0.7 percent.

The disappointing data poses a challenge to Japanese policymakers as unprecedented stimulus efforts have showed few signs of sparking momentum in consumption and exports. Inflation also remains dangerously low there.

Central banks in Korea, Indonesia and Thailand all meet this week, and are expected to leave policy unchanged.

Thai consumer confidence tumbled to a 12-year low in February, highlighting the toll that prolonged political unrest, now in its fifth month, is taking on Southeast Asia's second-biggest economy.

But the Reserve Bank of New Zealand, well ahead of most developed nations, is nearly certain to lead the way with a rate hike at its policy review to choke off growing inflation pressures in its rapidly-growing economy.

Asian stocks slipped in early trade on Monday and the dollar stepped back from its recent highs as disappointing Chinese trade data and uncertainty over the crisis in Ukraine kept risk appetite in check.

MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS lost 0.2 percent, and Australian shares .AXJO shed 0.5 percent.

U.S. stock futures fell 0.2 percent from their record closing high on Friday.

The euro remained near recent highs, with bulls still heartened by the European Central Bank's reluctance last week to take further policy action.

Investors greeted the new week in Asia on a cautious note after data released on Saturday showed China's exports unexpectedly tumbled in February, swinging the trade balance into deficit and adding to fears of a slowdown in the world's second-largest economy.

The soft Chinese data put a damper on risk sentiment, which had been temporarily boosted by stronger than expected U.S. nonfarm payrolls released on Friday showing employers had added 175,000 jobs to their payrolls last month, up from 129,000 new positions in January.

"While non-farm payrolls surprised significantly to the upside on Friday, disappointing China data, escalating Russia/Ukraine concerns and the missing Malaysian aircraft have all contributed to a somber mood," IG market strategist Stan Shamu wrote in a note to clients.

Russian forces tightened their grip on Crimea by seizing another border post and a military airfield, fanning tensions ahead of a planned Moscow-backed referendum on Sunday on whether the Black Sea peninsula should join Russia.

Diplomatic efforts to cool the crisis in Ukraine calmed markets toward the end of last week, but rising tensions over Russia's intervention in Crimea have kept investors on edge.

Meanwhile, a Malaysia Airlines flight with 239 people on board vanished enroute to Beijing from Kuala Lumpur in the early hours of Saturday.

The U.S. dollar index .DXY, a composite of six currency pairs dipped 0.1 percent to 79.682 after touching a high of 79.847 on Friday after the U.S. jobs data.

Against the safe haven yen the dollar stood at 103.235, pulling away from a six-week high of 103.77 hit on Friday.

The euro traded at $1.3880, within striking distance of a 2-1/2 year peak of $1.3915 reached on Friday.

The Australian dollar, usually used as a liquid proxy for China plays, fell in the wake of the soft Chinese data. It dropped to $0.9060 from $0.9065 late on Friday.

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U.S. stocks declined with emerging-market equities while base metals drove commodities lower as an unexpected drop in Chinese exports fueled concern that growth in the world’s second-largest economy is moderating.

The Standard & Poor’s 500 Index (SPX) fell less than 0.1 percent from a record close, while the Dow Jones Industrial Average lost 0.2 percent. The MSCI Emerging Markets Index was down 1.2 percent by 4:52 p.m. in New York, the steepest drop in a week. China’s CSI 300 Index fell to a five-year low. Copper posted its biggest two-day drop in 28 months, while lead and zinc also retreated. Corn prices sank the most in three months while 10-year U.S. Treasuries rose for the first time in five days.

China’s exports dropped the most since 2009 in February, underlining the challenge faced by the government in achieving the 2014 growth target of 7.5 percent with lawmakers meeting in Beijing on economic policy. Japan’s economy grew less than estimated in the fourth quarter and the current-account deficit widened to a record in January. In Crimea, Ukraine began army drills as Russia’s Foreign Ministry warned of “lawlessness” in the former Soviet republic’s eastern provinces.

“We’re just waiting to see what goes on overseas with geopolitical situations and developments,” Stephen Carl, principal and head equity trader at New York-based Williams Capital Group LP, said by phone. “We need to keep an eye on overseas because we’re still waiting on a concise agreement in the Ukraine, but markets, as we saw last week, continue to grind higher despite that.”

Market Anniversary

The S&P 500 has surged more than 177 percent since falling to a bear-market low, reached five years ago as of yesterday. The measure rose 1 percent last week, buoyed by improving U.S. hiring and manufacturing data. The S&P 500’s valuation rose to almost 16 times member companies’ projected earnings, the most expensive level of the year.

Industrial stocks paced declines today among U.S. equities. Boeing Co. dropped 1.3 percent after a 777-200 plane disappeared with 239 passengers and crew during a Malaysia Airline System Bhd flight to Beijing March 8. Cliffs Natural Resources Inc. slid 3.8 percent and Freeport-McMoRan Copper & Gold Inc. lost 2.5 percent, among the biggest declines in the S&P 500.

Chiquita Brands International Inc. soared 11 percent after the owner of the namesake banana label agreed to buy Dublin-based Fyffes Plc in an all-stock transaction that values Fyffes at about $526 million.

China Trade

China’s overseas shipments plunged 18.1 percent in February, customs data showed March 8. Economists surveyed by Bloomberg predicted exports would rise by 7.5 percent. Premier Li Keqiang announced this year’s economic-growth goal at the opening of the annual meeting of the National People’s Congress in the capital last week, a target unchanged from last year.

“China is moderating but only very modestly,” Donna Kwok, a Hong Kong-based senior China economist at UBS AG, said in a Bloomberg TV interview. “Ultimately you need to wait for March data to really get a true sense of the underlying outlook. The PBOC is very consciously guiding the recent volatility. We see the default as a risk, as a shift in investors’ mindset.”

The Shanghai Composite Index (SHCOMP) fell 2.9 percent, the most since June and the lowest close since Jan. 20, to pace losses in emerging-market indexes. The Hang Seng China Enterprises Index of mainland companies listed in Hong Kong slid 1.8 percent to a one-month low.

Commodities Slump

Malaysian Airline System fell 4 percent in Kuala Lumpur after the disappearance of its jet.

Brazil’s Ibovespa fell 1.5 percent to the lowest level since July as commodity exporters including iron-ore producer Vale SA tumbled. China is Brazil’s largest trading partner.

The S&P GSCI Index of commodities slid 1 percent. Copper futures dropped 1.7 percent in New York after touched the lowest level since June. The metal has fallen 5.8 percent in the past two sessions, the biggest two-day slump since October 2011. Lead retreated 0.6 percent and zinc fell 0.8 percent. China is the world’s largest consumer of industrial metals.

Gold for April delivery rose 0.2 percent to settle at $1,341.50 an ounce in New York, trading near a four-month high. West Texas Intermediate crude oil fell 1.4 percent to settle at $101.12 a barrel.

Corn futures for May delivery fell 2.2 percent to close at $4.7825 a bushel on the Chicago Board of Trade, the biggest drop for a most-active contract since Nov. 18.

Soybean Futures

The U.S. Department of Agriculture raised its outlook for world corn inventories before the 2014 Northern Hemisphere harvests by 0.7 percent to 158.47 million metric tons, topping analyst estimates.

Soybean futures for May delivery fell 2.7 percent to $14.1875 a bushel, the biggest decline since Jan. 21. Futures have climbed 9.8 percent this year.

The MSCI All-Country World Index dropped 0.4 percent today after completing a fifth weekly gain, the longest run of weekly advances since August.

Investors are also watching developments in Ukraine. The country’s armed forces are testing the combat-readiness of troops, the Defense Ministry said today on its website, reiterating the government’s desire for a peaceful end to the standoff in Crimea.

Russia has vowed to defend the ethnic Russians that dominate the Black Sea region. Crimea’s local government may use a March 16 referendum to leave Ukraine and join Russia.

European Stocks

The Stoxx Europe 600 Index fell 0.5 percent after posting its first weekly decline since January. Rio Tinto Group, the world’s second-largest mining company, fell 1.9 percent in London and BHP Billiton Plc lost 1.4 percent. A gauge of mining stocks in the Stoxx 600 decreased 2.2 percent for the biggest decline among 19 industry groups.

Iliad SA (ILD) surged 11 percent after Bouygues SA (EN) said it is in talks to sell some of its mobile-phone assets to the operator of the Free brand. Bouygues jumped 8.7 percent.

The Australian dollar depreciated 0.5 percent to 90.19 U.S. cents after advancing to 91.33 cents March 7, the strongest level since Dec. 11.

The People’s Bank of China weakened the yuan’s reference rate by 0.18 percent. The currency declined 0.2 percent to 6.1385 per dollar, according to China Foreign Exchange Trade System prices.

Spanish 10-year bonds advanced, pushing the yield six basis points lower to 3.30 percent, the least since January 2006. The yield on similar-maturity Portuguese securities tumbled for a fifth day to 4.45 percent.

Taper Pace

Yields on U.S. 10-year Treasuries fell one basis point to 2.78 percent, the first decline in five days. Economists projected U.S. payrolls would rise by 149,000 last month, with the bigger-than-expected 175,000-worker increase in data March 7 indicating the economy is starting to bounce back from frigid winter weather.

Federal Reserve Bank of Philadelphia President Charles Plosser, who votes on policy this year, said recent encouraging economic reports aren’t enough to change the pace of reductions in the central bank’s monthly bond purchases.

“The hurdle rate for change is pretty high in either direction,” Plosser said in a Bloomberg TV interview with Manus Cranny in Paris, referring to the Fed’s tapering of its stimulus program.

Fed Bank of Chicago President Charles Evans said in a speech today that he expects the U.S. economy to expand at a rate of 2.5 percent to 3 percent in 2014. Fed Chair Janet Yellen said last month the economy is robust enough to withstand measured cuts to monetary stimulus.

Source: http://www.theaustralian.com.au/business/latest/iron-ore-futures-an-accurate-guide/story-e6frg90f-1226869331145

(Article Source: http://www.thestreet.com/story/12559571/1/market-may-have-found-a-bottom.html)

Today I'll answer some tax questions-but first some tips for people who can't file their returns by Tuesday.

For federal taxes: If you can't file your return by Tuesday, request a six-month extension by filing Form 4868 electronically or by mail. See the form for instructions. If you file this form by April 15 and your tax return by Oct. 15, you will avoid a late-filing penalty.

However, if you owe additional federal tax for 2013, you must pay it with this form by April 15 to avoid interest and possibly a late-payment penalty.

You can avoid this late-payment penalty (but not interest) if at least 90 percent of your total 2013 tax liability is paid by April 15 through payroll withholding, estimated tax payments or payments made with Form 4868.

If you haven't completed your return, "the best thing is to pay in about 10 percent more" than you expect to owe, says Michael Gray, a San Jose certified public accountant.

For California taxes: There is no need to request an extension; you automatically get one until Oct. 15. However, as with federal taxes, you must pay at least 90 percent of what you owe by April 15 to avoid a late-payment penalty.

You can make this payment online from your bank or savings account without a fee using the Franchise Tax Board's Webpay system-or with a fee by using your credit card. Or you can mail a check with Form FTB 3519. (Certain high-income taxpayers must make this payment electronically.)

Q: Don M. asks, "We sold our income property in 2013. Now we owe a substantial sum for the 3.8 percent Obscure tax! We are learning that since we were active owners, materially participating in managing the property, we may not have to pay the tax. We have checked IRS publication 925 and get mixed messages. We find that the hours needed to qualify for ' active, material participation ' range from 100 + hours to 500 hours. Can you enlighten us? "

A: Don is asking about the new 3.8 percent tax on net investment income that took effect Jan. 1, 2013.

It applies to people who have net investment income and adjusted gross income over a certain limit ($250, 000 married filing jointly and $200, 000 for singles). It is also known as the Medicare surtax or the Obscure tax because it was part of the Affordable Care Act.

The tax applies to income from investments such as interest, dividends, capital gains, rents and royalties. The 3.8 percent tax is applied to either net investment income or the amount that a taxpayer's modified adjusted gross income exceeds the thresholds stated above for their filing status-whichever is less.

The tax generally applies to income and capital gains from rental property, with a few limited exceptions. Don "would probably have some pretty significant hurdles to overcome to avoid the 3.8 percent tax on net investment income for the sale of the rental property," says Mark Luscombe, principal analyst with CCH Tax and Accounting.

He would have to meet two separate tests.

First, he would have to qualify as a real estate professional under the passive activity loss rules (spelled out in Publication 925.) To qualify, more than half of the personal services he performs in a year would have to be in a real estate trade or business in which he materially participates. And, the hours engaged in such services would have to total more than 750 per year. He could group various real estate activities together to meet this test, but it seems this might be his only real estate activity, Luscombe says.

Second, he would have to meet a 500-hour test under the net investment income tax rules (spelled out in the instructions for Form 8960). Under these rules, he must participate in rental real estate activities for more than 500 hours per year (or more than 500 hours per year in five of the last 10 years).

Madrid Q1 office investment quadruples year-on-year

According to Savills, approximately €200 million of transactions were carried out in the Madrid office investment market during the first quarter of 2014, against a volume of €50 million recorded in Q1 2013. The international real estate advisor highlights that this figure represents almost 53% of the total office investment volume recorded in Spain in this period, which reached approximately €350 million.

The firm attributes this partly to increased activity from international investors with its research showing that overseas buyers have increased their market share in Q1 2014 accounting for 66% of the Madrid office transaction volume in this period, against 54% in Q1 2013.

Luis Espadas, head of capital markets at Savills Spain, comments: “The improved economic outlook has caused international investors to turn their attention to Spain, and particularly Madrid, and take advantage of low capital values, high yields and potential rental growth in the short to medium term. In fact, due to a lack of product on the market, the increased turnover in Q1 does not fully reflect the extremely high demand we are seeing. This demand is making the sales process highly competitive.”

In terms of yields, Savills records prime CBD office yields at 5.5% and predicts that going forward these may contract to 5% for prime product in prime locations.

On the occupier side, the firm notes that total office take-up in Madrid reached approximately 105,000 sq m in the first three months of the year, representing a 35% year-on-year decrease. The research shows that this is due to a particularly strong first quarter in 2013 with several very large deals, including a 50,000 sq m letting by Vodafone. However, in terms of the number of deals Q1 2014 recorded an 8% increase and the firm predicts that going forward take up should total more than 400,000 sq m by year end, exceeding 2013 levels.

Gema de la Fuente, head of research at Savills Spain, comments: “We expect Madrid office take-up to pick up going into Q2 14 with occupiers looking to benefit from low rental levels. These have reached the bottom of the cycle in a number of areas and tenants will want to take advantage of this before they return to growth once again.”

Savills research shows that average vacancy rates on Madrid’s office market remain stable at 14%, in line with Q4 2013, and top CBD rents in the city remaining unchanged quarter-on-quarter, at €24.75 per sq/month.

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The above article is a repost from Property Magazine.

In April, the government has said that companies engaged in defence manufacturing will not be allowed to further increase foreign portfolio investment beyond August last year level.

Industry body Assocham today asked the government to review foreign investment policy, particularly related with FIIs, in the defence sector.

In April, the government has said that companies engaged in defence manufacturing will not be allowed to further increase foreign portfolio investment beyond August last year level.

This condition "goes against the principle of a stable policy framework which is needed to attract large investments in this sector", it said.

It also said that the April decision has brought the entire process of issuance of industrial licenses to domestic private sector companies to a standstill and, "therefore, be amended,", it said in a statement.

Several domestic companies have applied to the DIPP for industrial licenses to manufacture a wide range of defence products and shares of most of these companies are listed.

FIIs inflows should be encouraged in order to boost country's foreign exchange reserves, it said.

"FIIs are in no position to exercise any control over management of the affairs of Indian companies. Further there are adequate checks and balances within the existing policy framework to protect our strategic interests," it added.

The chamber said that "there is urgent need to review the existing foreign investment policy applicable to the defence sector" on the issue of FIIs investment so that the matter of industrial licenses to several Indian companies which has come to a grinding halt can be restarted and clearances can be expedited.

Speedy implementation of projects in this critical sector of the national economy will contribute in reducing country's dependence on imports, it added.

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This Article is fromMoneyControl

(China Economic Review)

State-owned enterprises, or SOEs, have made a remarkable contribution to the growth and development of the Chinese economy over the past 30 years. They have provided a stable long-term environment for investmentand encouraged the development of the state enterprise sector in line with public as well as private interests.

But SOEs are in retreat. Between 1998 and 2010, the share of SOEs declined from 37% to less than 5% by number of firms, and from 68% to 44% by assets. Calls from inside China are getting louder for further downsizing and corporate governance reforms of the still very substantial SOE sector. Under the new administration of Xi Jinping, policymakers have proposed reforms of government-backed enterprises. The question that remains to be answered is what should take the place of state ownership in the future.

A decade or more ago the answer would have been easy. The investment banks in New York or London would have advised the Chinese government to sell its stakes via secondary offerings to a mixture of banks, financial institutions and private investors, preferably foreign as well as domestic. The objective would have been to use this opportunity of state sales to create an Anglo-American type of capital market characterised by dispersed ownership and high levels of liquidity.

It is far from clear today that this strategy is right for China. A former Minister of the UK government, Paul Myners, has characterized the UK stock market as comprising ‘ownerless corporations.’ The origins of this description can be traced to the highly dispersed nature of ownership in UK stock markets, where institutions such as domestic and foreign mutual funds, pension funds and insurance companies dominate the market. Most of these investors hold too small stakes in companies to be active investors and lack the skills to understand the companies they invest in. The result is that control is vested in the company’s board members who have little ownership and often manage the business at high cost and with poor performance.

Operating as a publicly listed company is also becoming less attractive. Harvard professor Michael Jensen predicted ‘the eclipse of the public corporation’ in 1987, well before the wave of ‘going private’ started around 15 year ago. The Economist in 2012 reported that the number of listed American companies had fallen by about 37% from 1997 to 2012, while in the UK the decline was even more dramatic, at 43%. Many of the companies that have been delisted have been taken private by management and private equity funds tired of the perceived short-termism of the stock market.

It is therefore not obvious that the Chinese government should try to emulate the Anglo-American model of ownership and control. It simply may not be the best one. There is however, another reason not to follow this route and that is, in order to function effectively, the Anglo-American model is dependent on a complex set of institutions, including markets for corporate control and well-developed systems of corporate law and enforcement. China does not have many of these institutions, or rather has different institutions, and grafting Anglo-American stock markets onto the Chinese institutional structure will simply not work.

Japan’s experience of attempting to emulate US capital markets when its institutions were simply not ready for such a task is instructive. When Japan was defeated in the Second World War, the American Occupying Authority sought to dissolve and sell-off Japanese family dominated companies, the ‘zaibatsu,’ which had been implicated in Japanese militarization. Shares in the zaibatsu were sold to employees and investors in local communities. The result was that Japanese share ownership in the mid-1950s was more dispersed than the stock markets of the UK and the US. Laws were passed, including a Glass Steagall Act separating commercial and investment banking, and bankruptcy legislation and security regulation were introduced modelled on the US system.

The experiment failed and had substantial unintended consequences. Shares held by individuals were sold, and gradually accumulated by banks and other financial institutions resulting in a system of “insider” corporate cross-holdings that has only recently begun to be unwound.

Why did Japan fail to develop its capital markets along Anglo-American lines when seemingly all the ingredients were in place? The answer is that Japanese institutions were simply not developed to support the outsider system of ownership. An example is the emergence of investment funds, which have been important in both UK and US capital markets, and at one point comprised about 10% of the Japanese market. Institutions created these funds in Japan to dispose of unwanted stock and sell them to private investors but insider dealing and breaches of trust in combination with other scandals led to the rapid disintegration of this market and instead the emergence of a market dominated by corporate insiders.

What are the alternatives to Anglo-American systems that China could pursue? There are several. Oversight of SOEs could be extended through state asset management companies managing China’s sovereign wealth and state pension funds. Employee share ownership and employee-owned enterprises could be increased and the rights of workers enhanced through their representation on the boards of companies, as is widely observed in many central European corporations in Austria and Germany. Private and public pension funds similar to those found in Canada, the Netherlands and Sweden could provide the engaged, long-term, sustainable ownership that China seeks.

The main message from the experience of Japan and other countries is that whatever path China chooses, it should be tailored to its particular social and cultural context and the role that is sought of enterprises in Chinese society. While there are important lessons to be learnt from other countries, it should not be presumed that their models can be transferred from elsewhere without significant adaption to the Chinese context.

A failure to implement fundamental reforms associated with encouraging competitiveness is putting job creation and Europe’s long-term economic strategy at risk, finds The Europe 2020 Competitiveness Report: Building a More Competitive Europe, released today by the World Economic Forum.

Published every two years, the report aims to assess the progress of European economies in achieving the goals set by the EU’s Europe 2020 strategy to become a smart, inclusive and sustainable society. This second edition finds a Europe that has largely successfully dealt with the macroeconomic turbulence of the past half-decade, yet is enjoying mixed success in implementing reforms necessary to return the region to the top of global competitiveness.

“Europe as a whole has made significant strides towards macroeconomic stability. Now it is time for its leaders to address the long-term competitiveness agenda by implementing the right reforms and smart investments to drive productivity growth. There is no room for complacency, even for those countries that are currently performing well,” said Margareta Drzeniek-Hanouz, Lead Economist and Director, World Economic Forum.

In terms of Smart, The report corroborates Europe’s lack of progress in building a more innovation-based, knowledge-driven economy in comparison to other advanced economies. This category, which measures countries in terms of their record in building business-friendly enterprise environments, implementing a digital agenda, encouraging investment in innovation and optimizing skills and training, also represents the widest gap between Europe’s most and least competitive economies.

While the EU fares well in providing the foundations for sustainable growth, the picture is more mixed for inclusive growth, says the report. Overall, EU countries continue to depict relatively cohesive societies, although many of them are failing to provide gainful employment opportunities for large shares of their populations.

Underlying the gap in competitiveness between Europe and other advanced economies is a deep-rooted competitiveness divide within the region that has proven stubbornly hard to narrow. This is in spite of impressive achievements by many of the more “innovation-poor countries” in adopting reforms necessary to achieve stable macroeconomic environments.

According to the report, there is no one-size-fits-all strategy for lifting competitiveness across all member states as national and regional characteristics all play a part in shaping Europe’s economic landscape. However, one common thread is the need for all nations to build institutional capacity and adopt governance mechanisms that will enable more effective implementation of competitiveness-raising reforms.

An important conclusion of the report is that in the long term, there are no trade-offs between building a competitive economy on the one hand and an inclusive and sustainable society on the other. Competitive economies tend to provide more and better opportunities for their citizens, creating more inclusive societies, and fostering further opportunities for innovation and building environmentally sustainable societies.

“Europe can create more and better jobs, support rising living standards and build economically sustainable societies,” said Nicholas Davis, Director and Head of the Europe Team at the World Forum and co-author of the report. “We hope this report will encourage business, civil society and political leaders at the European and national levels to collaborate to achieve these goals.”

By Eurasia Review

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China’s top leaders continue to struggle to get local and provincial governments to implement economic reforms. China’s government appears to be struggling to get local governments to implement its economic reform policies.

Following a meeting of the State Council, China’s cabinet, on Friday, Xinhua News Agency reported over the weekend that the State Council will dispatch eight inspection teams to visit local governments nationwide to investigate whether economic reforms are being properly implemented.

“Responsibility for poor implementation of policy measures will be investigated, accountability will be serious, and there will be verbal admonishments, criticism or even administrative sanctions according to laws and regulations,” the State Council said, according to Reuters.

The inspection teams will travel to various localities from June 25 to July 5. They have been asked to review implementation of 19 different policies the State Council has announced since July of last year. The State Council has ordered local governments to conduct their own internal reviews of implementation before the inspection teams begin arriving later this month.

According to Reuters, at the top of the State Council’s list is streamlining the administrative approval process to reduce the amount of red tape, an issue that Premier Li Keqiang has been particularly forceful in promoting.  The report said the list also includes ecological and environmental improvements, “construction of major water projects, investment policies for non-state companies, employment of college graduates, construction of affordable housing, and efforts to ensure that the financial services industry supports the real economy.”

The State Council’s announcement came after its own meeting on Friday as well as the third meeting of the new Leading Group for Overall Reform. At the latter meeting, the Leading Group announced “a framework for pilot programs of judicial reform, a work program on judicial reform in Shanghai, and a plan to set up special courts on intellectual property rights (IPR).” Judicial reforms in part are aimed at weakening the grip of power of local leaders.

The Leading Group also debated plans for reforming the fiscal and household registration systems, both of which will be particularly important for local governments in China. At the meeting, President Xi Jinping — who presides over the Leading Group for Overall Reform — said, according to China Daily, that the main objectives of the fiscal reforms are “ensuring a clear division of power [between levels of government], reform of the tax system and stabilizing the tax burden, transparent budgeting, and improved efficiency.” Xi was also summarized as saying that he expects “a fiscal system to serve the initiatives of both central and local governments while clarifying the responsibilities of the two.”

On China’s household reforms, Xi was quoted as saying, “Accelerating reform of the household registration system is an important part of urbanization and involves hundreds of millions of rural migrants.”

He also stressed that implementation would be the key to success in all areas of reform. “The success of our blue print [for reform] will be its implementation,” Xi said. He also said that leading departments should be assigned for every area of reform. “Every single issue should have specific personnel to manage, supervise, urge and implement.”

Primer Li, who is a deputy of the Leading Group on Overall Reform and heads the State Council, also emphasized the importance of reform during an economic conference last week. “To achieve the development goals for 2014, we should better mobilize efforts from both the central and local authorities” to implement reform, Li said, according to local media. At the State Council meeting, Li also reportedly said, “My only concern is that our existing policies are really implemented.”

China’s top leaders are seeking to rebalance the economy from the current model which relies heavily on state-led investment to one more dependent on domestic consumption. This has slowed growth considerably, especially in certain provinces in western and central China that are heavily dependent on government investment and certain kinds of manufacturing.

As The Diplomat expected, local officials — who benefit disproportionally from the current model — appear to be the largest barrier to implementing the necessary reforms. The South China Morning Post reports that at a State Council meeting on May 30, Li “pounded the table as he blasted local officials for inertia in carrying out central government directives.” The new inspection teams for implementation are the latest way the central government has tried to force local governments to get in line.

The Diplomat

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But in the modern era, there is little person-to-person about it.; borrowers work with institutions who have all the power; terms can sometimes be oppressive.

The Internet is leveling the playing field. Online peer-to-peer (P2P) lending platforms are doing away with the banks that act as slow-moving, costly intermediaries, bringing pools of borrowers together with individual investors. For professional investment managers, the result is an alternative—and attractive—income asset class. (Why do I say attractive? See my personal experience and returns with one such platform below.)

Tom Myers, a San Francisco-based principal at the wealth advisory firm Brownson, Rehmus & Foxworth, was an early adopter of P2P lending. With one of his clients on the board of Lending Club, the largest of the P2P platforms, Myers opened up a personal account. The more he looked under the hood, the more he liked what he saw as an option for some of his high-net-worth clients. Five years later, Myers now has about $75 million of client funds invested in the LC Advisors Fund, a professionally managed pool. “There’s decent return for some modest risk for the kind of clientele [average investable assets of $20 million] we serve,” he says.

Chris Spence of Picayune, Miss.-based Diligentia LLC is such a champion of P2P lending that he established his investment firm partly to exploit the advantages of investing in it, as well as other nontraditional asset classes. The value proposition Diligentia offers clients is also nontraditional: Clients receive a guaranteed rate of return. Diligentia profits represent the spread between its net annualized returns and the guaranteed payments to clients. Spence’s firm reserves the right to invest clients’ funds in a variety of asset classes including, but not limited to, equity instruments, debt instruments, ETFs, real estate and, increasingly, P2P lending.

Spence started using Lending Club on a personal level in 2010 and quickly became a power user. “Once I got comfortable enough with P2P lending, I took an incremental approach in bringing in Diligentia assets,” he says. “I’ve been pleased by the net annualized returns. Both (Lending Club and Prosper) do a good job pricing their loans,” he adds, and the platform’s backtested results show accurate estimations of defaults.

Marketplace Lending

Indeed, so popular is P2P lending among the professional investment classes that some of the peerness is coming out of the process. The influx of funds is less from individuals and more from hedge funds, family offices and other institutions seeking to park private capital. Although I’ll continue to refer to it as “P2P lending,” perhaps “marketplace lending” better reflects the emerging reality.

Regardless, for investors, the best thing about P2P investing is how easy it is. There are few barriers to entry; you can get started for as little as $25. The platforms offer wide options for investors wherever they are on the risk-aversity curve. For conservative investors who want to supplement their CDs, the least risky notes on the platforms offer substantially better returns than bank certificates for modestly higher risk. For investors who want to complement their junk-bond portfolio, there are notes with correspondingly higher risk profiles. “I’ve never felt more confident in the stability of the asset class,” Spence says. “P2P is coming into the mainstream.” Lending Club has filed with the SEC to go public later this year.

Jeffrey S. Buck, an Atlanta-based principal and member of the investment team at Diversified Trust, thinks of P2P investing as an alternative to traditional fixed income. For receptive clients, he typically targets 5 to 8 percent of a client’s portfolio, often shifting money from lower-return, credit-sensitive bonds. While liquidity exists, Buck nevertheless counsels his clients to think of these assets as a five-year hold. “A key benefit offered by P2P diversification is that it has a low correlation to other asset classes in their portfolios,” he says.

Buck and the investment team at Diversified Trust analyzed P2P strategy until they had a good understanding of the expected risks and returns. “Reaction from our clients has been positive; some clients who had been receiving monthly distributions have recently elected to reinvest instead,” Buck says. “With rates low and expected to go sideways or higher, P2P is an attractive income alternative and diversifier to traditional bond strategies.”

“In the spring of 2013, Lending Club began experiencing a huge surge in investor interest from a diverse group,” says Bo Brustkern, co-founder of Lend Academy Investments, a service established specifically to help advisors and family offices invest in established and emerging P2P platforms. “Since then, Lending Club has been oversubscribed, and as a result it has restricted allocations to virtually everyone, including many family offices and advisors. While Lending Club attempts to catch up with demand, the situation today is that many large investors are still significantly delayed in putting their money to work. Eventually, we believe the marketplace will re-establish equilibrium,” he says.

P2P in Operation

Online platforms such as Lending Club and Prosper Marketplace match lenders with borrowers of varying credit risks, offering net annualized returns of around 8 to 20 percent. Investors usually take fractional shares of large numbers of notes to mitigate risk of defaults. Both platforms provide profiles of the creditworthiness of the borrowers and the performance characteristics over time of the notes they issue. The platforms then offer the notes in what is essentially an auction. Once a note attracts a sufficient number of investors, the loan is originated and serviced. Platforms charge borrowers a one-time fee and lenders a monthly service fee.

P2P loans are typically funded by specific individuals lending their own money on a fractional basis at interest to specific borrowers. For example, a note of $1,000 to a specific borrower is often funded by $25 investments from 40 different lenders. As borrowers repay the 36- or 60-month notes, the principal and interest payments are distributed proportionally to the individual lenders. Lending Club loans are $1,000-$35,000; the average is $13,913. All notes are unsecured.

Lending Club has some rigid underwriting standards. It rejects applicants with FICO scores lower than 660 and a debt-to-income ratio below 30 percent, a set of thresholds that is said to exclude over 80 percent of applicants.

Interest rates are a function of the calculated risk that the borrower won’t repay the loan. The higher the anticipated rate of default, the higher the interest rate the borrower pays and the lender can expect. Lending Club groups borrowers into seven loan grades, A through G. Within each loan grade borrowers are further categorized into five sub-grades, 1 through 5. The most credit-worthy borrowers are graded A1, the least worthy G5. Where applicants fall on that risk continuum depends on Lending Club’s assessment of their credit history. Applicants graded A1 get to borrow money at the lowest rates, currently 6.78 percent APR for 36-month notes and 7.3 percent for 60-month notes. For borrowers rated G5, the rates are, respectively, 29.99 and 28.69 percent APR. Prosper charges even higher rates for borrowers with lower credit histories.

More than three-quarters of borrowers list debt consolidation as the purpose for their loans. So it’s a no-brainer for them to borrow at, say, 11 percent from a P2P lender to retire credit card debt of 21 percent or more. Other purposes for loans include home remodeling, vehicle purchases, medical costs and even vacations. Of course, there is no guarantee that borrowed funds will be used for the listed purpose.

One-Year In: My Experience with Lending Club

To better understand P2P investing, I opened a Lending Club account in April 2013. Initially, I deposited just $275 and carefully selected 11 of the most conservative, lowest-interest-bearing A and B notes I could find. Like most fledgling investors, I dreaded defaults. Within 45 days, I started receiving daily interest and principal payments that totaled $8.46 per month, which represented a net annualized return of 9 percent. After a few months of receiving such returns, I considered that my savings accounts paid interest of 0.25 percent and my three-year CDs paid 1.5 percent. The more I researched this article, the more comfortable I got with P2P. In the following months, I began transferring idle cash to my Lending Club account, first gradually, then more aggressively.

Returns are gratifying and immediate. My Lending Club notes outperformed not only all my other self-directed investments, but all of the respectable returns my investment advisor harvested on my behalf in my retirement accounts.

Spending time on the platform, I saw that most savvy investors preferred the highest-yielding notes. In fact, there’s intense competition for the most desirable notes. Historical data seems to bear this out. The significantly higher yields (as high as 15 to 25 percent) seem to more than compensate for the very real increase in predicted defaults. My own tolerance for defaults increased.

A Random Walk Through Peer-to-Peer Lending

When I started, I wanted to see if my careful selection of notes would outperform notes selected at random. As an experiment, I created a diversified portfolio of 250 notes I individually selected, one by one. At the same time, I created another portfolio filled by an equal number of notes selected at random. To this point, I can report that I’ve found no significant difference in performance.

A number of services insist they have a better way to filter out and select the best-performing notes (see sidebar). But Renaud Laplanche, the CEO of Lending Club, insists that no loan is “better” than any other. “There is no evidence that any investor has generated better-than-average returns on the platform consistently,” he says. “[Advisors] can tailor their portfolios based on their risk appetite and objectives, but that doesn’t have a negative impact on the other investors.”

Fifteen months after starting this experiment, my account had slightly more than 4,000 notes of every risk threshold (see Figure 1). I’m only about halfway through the lifecycle of the 36-month notes and even earlier for the 60-month notes. Defaults, if they happen, tend to occur later in the process. Still, as I filed this article, I had only two notes go into default. Of course, 69 notes are in various stages of arrears and many of these will almost certainly be charged off. Interest from P2P loans is generally taxed as personal income instead of capital gains.

Are retail investors’ expectations upside down–high when conditions are bad for investing, low when conditions are good? Is there a better way to anticipate what’s going to happen to your retirement savings?

Our answers: yes and yes.

There is ample evidence that popular expectations for investment returns are just about the opposite of what would come from a sober analysis of the fundamental data. In 2000, when the market was trading at absurdly high multiples of corporate earnings, funds holding U.S. stocks hauled in $288 billion. In 2002, when stocks were cheap, the inflow slowed to a $13 billion trickle.

The inflow into stock funds dried up once again after the crash of 2007-09 and stayed low for most of the next five years. Now, with stock prices at abnormally high multiples of earnings, the investing masses are putting big money into stock funds.

It’s the same with junk bonds. A rational investor would be most likely to buy risky corporate debt when the reward–the yield–is highest and least likely when it is meager. The public is doing just the opposite.

In tumultuous 2008, when junk bond prices were depressed, their yields averaged a 10% premium over safe Treasury paper. That was a good time to be buying. But retail investors were doing more selling than buying. That year junk funds saw $6 billion of net redemptions, not counting reinvestment of dividends, according to data from the Investment Company Institute.

Six years later the prices of risky bonds have recovered, and their yields are correspondingly lower. What are investors doing? They should be selling, but they are not. In 2013, when the yield premium on average was only half that of 2008, investors poured a net $54 billion into junk funds. The money is still coming in ($10 billion in the first four months of this year).

The pattern: If an asset class has done well recently, making its price high, fund buyers want it. If it has done poorly, making it a bargain, they want to sell.

The phenomenon described above anecdotally has been studied statistically. Two Harvard professors, Andrei Shleifer and Robin Greenwood, published a paper last year demonstrating that investor expectations are highest when objective models would say that expected asset returns are lowest, and vice versa.

“People react to salience,” says professor Greenwood. “Recent performance is salient.” That’s a polite way of saying that naive investors navigate with a rearview mirror.

You don’t have to make that mistake. There are better ways to come up with a forecast of future returns than to extrapolate the recent past. We’ll explore some formulas for stocks, bonds and the funds that own these things.

Experts can differ about how to come up with an expected return from an asset. But one thing they would agree on is that recent performance is a bad indicator of future results. You shouldn’t be buying an asset class because it has been going up.

The place to start is with the yield. For a bond, it’s the interest yield. For a stock, it’s the earnings yield, which is the net income divided by the stock price.

Next, investing costs have to be figured in–both the management fees and the cost impact of turning over a portfolio. If you are buying bonds, you have to allow for inflation. (Shares of stock, in contrast, are not impacted the same way because corporate earnings tend to keep up with inflation.) It’s just possible that 401(k) savers don’t pay much attention to these things.

Possessing basic money-handling and income-generating skills is important, especially with the economic crunch affecting big and small countries all over the world. The proverbial though blasphemous adage has never been truer than today: Money makes the world go round. And for thousands, it is a literal reality, as their hope of seeing another day becomes dimmer with each meal they miss.

But for the ordinary worker who gets a regular pay check each week or each month, having enough knowledge about money and how to make it work and multiply can spell the difference between a world one wants to keep going around or to make it stop so one can jump out.

Despair no more! It is never too late to learn new skills and techniques on money matters. Financial advisers are a-plenty nowadays what with Google making it a mere click away. Here are a few tips we can share here:

1. What you do not have, you can always find somewhere

Banks are not the only places to get loans from. Friends may have surplus cash they are willing to lend to someone who has the ability and diligence to make it grow. Or, cooperative groups that provide assistance to its members for a small business loan or for a multi-purpose loan. Taking the first step to look for capital for investing can produce great changes in one’s attitude and life.

2. Show your business plan

The trick to convincing people to part with their money so you can use it for your ideas is to present a simple and understandable business plan. It may not even be a written one. A verbal description of a project may already convince a relative or friend to lend you money for a venture. Of course, some may require a written contract. Your confidence in your idea should lead you to abide by their terms if that is the only way you can get capital.

3. Creativity always gives results

A friend once leased out a vacant lot and sub-leased it as a parking lot for a trucking company. He put a guard round-the-clock and provided minimal improvement and made more than forty times what he paid for it monthly. Not a bad deal for a creative guy who had a simple idea and worked his idea into reality. And anyone can do that with enough imagination and courage. The seed money may not even have to be there because if one really believes in a project, it will pay for itself. The down-payment for a lease will be enough to cover a loan you initially took out.

Keep cranking that brain of yours and you will eventually come upon an idea worth selling something valuable that you own in order to raise the capital and start rolling.

4. Get dirty

Starting a business or keeping one running will always require getting your hands dirty. Cleaning bottles for a peanut butter business or feeding pigs on a daily basis in your small piggery farm can seem menial but a necessary part in teaching you the fundamentals of running a business. Eventually, when you have other people doing the dirty work, you will have a better insight as to how the business runs and what makes for a successful operation.

Investing is not all about handling or making money; it is about thinking creatively, using your imagination, treating people compassionately and returning the fruits of your ventures back to your business and the people who keep the business growing and sustainable.

At the recent Dreamforce conference in San Francisco, I had the pleasure of appearing on a panel, "Competitive Edge in Today's Sales World,"led by sales guru Jill Konrath who is known for her innovative strategies and thinking.

Jill's latest book, Agile Selling, is a must-read for sales people looking to succeed in today's competitive landscape. She talks about how it took more than basic sales skills to be successful, and tells how she dealt with fear, mastered a "never-fail mind-set" and learned to see things from her customers' perspectives. She realized how important these traits were to her "agility" -- her ability to rapidly acquire knowledge and develop new strategies.

The panel discussion was lively and informative, and it struck a chord with me because I've long adhered to many of Jill's beliefs. We were each asked four questions on the panel, and I'll share my answers in the hope they'll help people understand how crucial agility is in today's market

Question #1: How are you staying agile? What are you focused on learning right now?

My husband likes to joke that I can't keep a job. I have had a number of roles in my career and I like to think it's because I have demonstrated the ability to be an agile learner. Whenever a new task or project is at hand, I work to come up to speed quickly and swiftly execute a plan.

As Chief Content Officer at Thomson Reuters, I seek to learn everything I can about our vast content operation, which is at the core of what we do as a business. It sometimes feel like I'm drinking from a fire hose when it comes to understanding important trends such as big data.

Whenever I take on a new role I immerse myself in a 30-day deep dive of interviews with key stakeholders, including employees across the business, customers, partners, and thought leaders. I ask lots of questions: What are our strengths? Our biggest challenges? What are the key factors affecting our customers? And perhaps the most important question (because the answer can be so informative): What would someone else focus on if they were in my role? All of this helps me learn--and respond with agility to any challenge.

Question #2: What do you view as the number one competitive edge?

We live and work in a data economy where the key to success is information and knowledge. Competitive advantage rests with companies that know how to unlock data to drive their businesses.

But taking the idea of data down to an individual level, the most important skill--one that truly unlocks the power of knowledge -- is curiosity. Curiosity about your own company's products and businesses motivates you to see resources, product briefings, information days, etc. not as a task but as a tool.

Curiosity about your customers can transform a meeting with them from a pitch session to a listening session. I believe 80 percent of the first meeting with any customer should consist of the customer talking about their business -- and what they need. I prefer to leave our product pitches for later meetings, where they are more likely to be successful because we're more prepared to respond to what the customer wants. Curiosity is at the heart of this process.

One of the biggest ways people can help themselves succeed in their investments is by truly understanding what they are investing in. Too many people throw their money into stocks without having a basic understanding of what to expect from the market and what to watch for. Regardless of what you are investing in, you should understand the terminology, latest trends, and inner workings of things like stocks and mutual funds, because that is the only way you will be able to truly prepare yourself for successes and failures. Our financial tip to beginning investors: Take the time to research your investment or find a brokerage firm you can trust to take care of the research for you; either way, ensure that you are working with the right amount of knowledge and expertise to keep your money alive.

One of the essential stock trading tips today is to make sure that your expenses do not exceed your expected profit. It’s simple: If your gains exceed your expenses, you will profit; however, if your expenses are too high, whether due to unsound purchases or a broker’s high commission fees, then you could be losing more money than you are gaining.

Whether you interested in stock trading tips or investment tips, it pays to stay on top of the latest news and trends in the industry. Looking into the facts and figures put across by a reliable investment news source is one of the only ways to ensure that you are making the most of the opportunities available to you, as well as keeping tabs on the companies you are currently invested in. Any expert offering up a financial tip will tell you that you have to watch the latest figures like a hawk to see how companies are doing and whether or not another lucrative investment is coming your way. With this in mind, InvestorPlace offers a one-stop shop for the latest news and trends offered from an expert perspective. Check out InvestorPlace today to see what we can tell you about your current investments!

Let’s imagine you know what to expect when buying a home a home for the first time, but did you know that it is the little things that can make all the difference in terms of your long-term happiness with your decision? Below are our top 10 tips for making your buying experience as profitable, stress-free, and enjoyable in the long-term as possible.

- Research Thoroughly Before You Begin Physically Looking

As an agent, I see it all the time, a buyer–or buyers–want to jump into my car with me immediately and begin feverishly seeing dozens of condos on a Saturday afternoon.

Why is this bad? Easy–the clients and I waste 5 hours running around like chickens with our heads cut off and the entire process–after 2-3 weekends of this–quickly becomes disorganized and stressful. This is the exact opposite of how the process should go!

Instead, take time to do your homework before you even involve an agent and begin seeing homes. Start with online sites like Zillow, Trulia, or Redfin and check into different neighborhoods, price points, etc. so that by the time you do actually want to physically see properties and get more serious, you have a very well-defined idea of what you’re actually looking to buy. Also consider attending a few open houses on your own–just be sure to let them know you’re working with an agent if you’ve already chosen one.

- Location, Location, Location

This is the most famous saying in our industry when it comes to the three things that most effect buyer’s purchasing decisions.

It’s wonderful that you can buy a 3,000 sq. ft. single family home for a very low price if you go out 7 miles due west of Downtown Chicago, but if no one will come and hang out with you, what was the point?

Location is such a crucial piece of the home buying puzzle because it will have the greatest effect on your overall lifestyle.

Do you love getting up early and walking a block to your yoga class and then having a nice protein shake from the juice bar across the street on your way back? If you do, then think long and hard before you decide to give up your ideal location for a few more interior square feet or some shiny new stainless steel appliances.

- Don’t Forget to Account for the Extra Small Costs

When buyers are setting up their budgets, they always remember to account for things like mortgage, tax, and insurance payments, as well as any association dues (for condos or communities with common amenities). They also remember to budget for utilities like gas, cable, and electric and most even remember things like landscaping maintenance and routine maintenance.

What most people forget about are the little extras which, when you add them up, can become not so little. A prime example- using the tip above about location- let’s say you decide to move 4 blocks farther from your ideal location which isn’t so far- no big deal, right? Maybe not…

Let’s say you’re not much of a walker or are always in a rush–that 2-minute walk for $0 just turned into a $6 cab ride.

Another simple example is a buyer who moves from a more affordable area to a more expensive one. Everyone accounts for the extra rent or mortgage they will pay, but few remember to account for the fact that there are no more $7/plate restaurants out your front door and that $35/plate restaurants have replaced them. Now you’re faced with spending hundreds of dollars more per month to feed yourself or spending money on cabs to get to more affordable options.

Always remember to really take the time to think about your overall budget and account for every penny that your new home will cost on a monthly basis, but also the ancillary income you will need to spend to conveniently live in that location.

- Scope Out the Area on Your Own for a Different Perspective

Going out with your Realtor on the weekend and seeing homes is a great start once you become more serious about your search, but if you really want to get a feel for the area you’re considering buying in, you need to do more.

Start by visiting the property and general area at 9am and 5pm so you can judge traffic volume, noise levels, and the general feel for the area. Then come back during the weekend and walk around during the middle of the day. Stop in a local restaurant and have a bite and talk to a couple small business owners in the area to get a feel for their thoughts on the neighborhood.

The trick here is to figure out the lifestyle afforded by the area you’re considering and taking the time to make sure that lifestyle will be a good fit once you’re moved in.

- Do Not Compromise on The Quality of the Professionals You Hire

We’ve all heard the saying “You get what you pay for” and this couldn’t be more true than in real estate.

I get it–your girlfriend’s sister’s mom is a Realtor and she’s going to be so so so upset if she doesn’t get the business. Unfortunately, if you let people pressure you into hiring people who aren’t capable of fully representing you, then you can run into problems.

All hiring decisions- attorney, lender, Realtor, home inspector–should be based on merit and made without regard to personal relationships. If you know just so happen to be friends with a phenomenal agent with a stellar reputation who works in the area you’re buying in, then that’s one thing, but to blindly give out business when your hard earned money and happiness at stake is foolhardy to say the least!

- Always Know Your Exit Strategies

A good businessperson always knows their exit strategy up front and you should be no exception when it comes time to buying property.

Do you have enough for a down payment so that if you needed to sell quicker than expected you could without writing a check? Can you rent the home for enough to cover your total monthly expenses as an alternative strategy if you can’t sell?

The bottom line is, you need to make a plan as if you’re going to be moving half way across the world 6-12 months after you buy. If your exit strategy is sound enough to account for that critical of a life change, you know you’ve done your job in this respect.

Buying a home doesn’t need to be intimidating, scary, or complicated- in fact it should be just the opposite- approachable, fun, and simple. Organization, planning, and careful consideration are the dominant themes for all the tips listed above and by utilizing these simple strategies you will exponentially increase the odds that your purchase will end up a success in every way.

At the request of European trade negotiators, we searched hundreds of thousands of measures issued by 39 central government agencies and five representative provincial-level governments in order to identify provisions that frame or limit market access and business activities of foreign-owned companies in China. In the process, we identified over 800 restraining provisions, which we analyzed and grouped into a number of different types and categories. The results provide a useful taxonomy for future discussion both within the BIT negotiation context and beyond.

Beyond published measures, the Covington team reviewed key trade publications and conducted interviews with industry groups to identify and catalogue administrative practices that may also have a restraining effect on foreign investment. As foreign business leaders in China are well aware, many of the biggest obstacles to foreign participation in the Chinese economy are imposed unofficially by government officials exercising legal or extralegal discretion.

A public version of the report prepared for the EU’s Directorate General for Trade is available on the EU DG Trade website. While it does not include the full database of restraining measures, the public version presents detailed descriptions of the types of restraints identified and provides supporting examples and observations.

Material for this post was supplied by Ashwin Kaja of Covington & Burling LLP.