Member Info for Love_You

Fuel in the UK costs circa £1.25 per litre.

Back in 2008 when oil was trading over $100 per barrel the petrol/diesel price was about £1.25.

So now crude oil is half the price ($50 per barrel) the price of petrol at the pumps is the same as when crude oil was more than double the price (over $100 per barrel).

Ergo I can only conclude that taxes on fuel in the UK are far higher than justified by the economic fundamentals.

Ergo if UK government want to be re-elected in 2021 they would improve their chances by reducing taxes on fuel by 50%. This would lower the petrol price at the pumps to circa 90p per litre. Even that is double the price of fuel in the USA.

Fuel in the UK costs circa £1.25 per litre.

Back in 2008 when oil was trading over $100 per barrel the price at the fuel pumps was about £1.25.

So now crude oil is half the price ($50 per barrel) the price of petrol at the pumps is the same as when crude oil was more than double the price (over $100 per barrel).

Ergo I can only conclude that taxes on fuel in the UK are far higher than justified by the economic fundamentals.

Ergo if UK government want to be re-elected in 2021 they would improve their chances by reducing taxes on fuel by 50%. This would lower the petrol price at the pumps to circa 90p per litre. Even that is double the price of fuel in the USA.

Petrol is £1.21 per litre, and diesel is £1.29 per litre.

Back in 2008 when oil was trading over $100 per barrel the retail price at the pumps was about £1.25 for petrol.

So now crude oil is half the price ($50 per barrel) the price of petrol at the pumps is the same as when crude oil was more than double the price (over $100 per barrel).

Ergo I can only conclude that taxes on fuel in the UK are far higher than justified by the economic fundamentals.

Ergo if UK government want to be re-elected in 2021 they would improve their chances by reducing taxes on fuel by 50%. This would lower the petrol price at the pumps to circa 90p per litre. Even that is double the price of fuel in the USA.

Petrol is £1.21 per litre, and diesel is £1.29 per litre.

Back in 2008 when oil was trading over $100 per barrel the retail price at the pumps was about £1.25 for petrol.

So now crude oil is half the price ($50 per barrel) the price of petrol at the pumps is the same as when crude oil was more than double the price (over $100 per barrel).

Ergo I can only conclude that taxes on fuel in the UK are far higher than justified by the economic fundamentals.

Ergo if UK government want to be re-elected in 2021 they need to reduce taxes on fuel by 50%. This would lower the petrol price at the pumps to circa 90p per litre. Even that is double the price of fuel in the USA.

Hi TakingMyTime,

Well I can see your point of view. It seems to come down to trust. We can't trust the Zimbabwean clients to pay for their oil so BP will only sell it to them for money upfront.

So how come anyone trust's America then? Fed has debt of $8 Trillion and the US government debt is now $21 Trillion. People are taking an awful lot on trust when they deal with America when it has those levels of debts.

Also,

Petrol is £1.21 per litre, and diesel is £1.29 per litre.

Back in 2008 when oil was trading over $100 per barrel the retail price at the pumps was about £1.25 for petrol.

So now crude oil is half the price ($50 per barrel) the price of petrol at the pumps is the same as when crude oil was more than double the price (over $100 per barrel).

Ergo to give an example involving a smaller UK-listed company - one can see the poor performance of Enquest shares is mostly due to the UK's taxes on petrol/diesel being far too high.

Ergo to see Enquest's equity valuation increase you would really need to see the UK government reducing taxes on petrol/diesel in my opinion.

Petrol is £1.21 per litre, and diesel is £1.29 per litre.

Back in 2008 when oil was trading over $100 per barrel the retail price at the pumps was about £1.25 for petrol.

So now crude oil is half the price ($50 per barrel) the price of petrol at the pumps is the same as when crude oil was more than double the price (over $100 per barrel).

Ergo one can see the poor performance of Enquest shares is mostly due to the UK's taxes on petrol/diesel being far too high.

Ergo to see Enquest's equity valuation increase you would really need to see the UK government reducing taxes on petrol/diesel in my opinion.

Yes but it's also a market failure because people wouldn't sell their shares in 2010-2012 meaning that the equity became over-valued. Hence the people who did sell were able to achieve a much higher price than they would of been able to if other people had behaved rationally. Ergo they took more out of the market than they should of. Ergo everyone who still holds the shares has to suffer because the central bankers just see current equity holders as the easiest people to screw for money. It would be much harder for them to get money off the people who were wise enough to (A) Push up the share price too high, and then (B) offload the shares to someone else at this 'over-inflated' valuation.

However, there is an argument that those people who sold out at 'over-inflated/manipulated' market prices are the ones who perhaps should be contributing something back into the financial system now. Otherwise you end up with central banks trying to get blood out of a stone (i.e., trying to get cash out of people who only have debt). Ergo they will realise in about 6-12 months this is not possible. Ergo another financial crisis possibly?

Regarding shale oil - was always going to happen - costs in north sea had become ridiculous. Now it has swung the other way - too much unemployment abd people on benefits who can't afford to run cars/have holidays. Ergo past investment in new oil fields now appears too much. Ergo another reason to suspect another financial crisis may be coming in the next few years.

Just market swinging from one extreme to another. I suppose that is what markets do due to the typical herd behaviour of humans as a 'social species' and the way ideas spread between people (which is predictably to those with a good understanding of human behaviour and decent access to statistical models and large amounts of computing power).

Although, despite being somewhat predictable for some reason central banks still lurch from one crisis/humanitarian disaster to another - that's what I don't understand?

I ask that question because they do nothing to ensure that share prices in any way reflect the fundamental value of the company they relate to. This is a massive problem in markets as it makes share prices meaningless as a factor which directors should look at when considering take-over prices etc. The people who regulate equity markets need to seriously employ some people who can value companies using multiple techniques (including fundamentals and not just by growth metrics) and these people should be given the power to intervene in equity markets when speculators try to push share prices to ludicrous values (in the hope of taking money from people who expect markets to have a vague semblance of reasonableness or rationality about them).

Also, see below for some relevant info linking policy to banking.

Britain's banks and building societies will have to charge the same amount for all overdrafts from April 2020, the Financial Conduct Authority (FCA) said on Friday, in a radical change that will raise questions about the future of free in-credit banking.

The watchdog has already capped interest rates for payday loans and prices of rent-to-own goods after pressure from lawmakers to tackle the high cost of credit for vulnerable consumers.

It said the changes would make overdrafts simpler, fairer and easier to manage, protecting the millions of consumers, and particularly the more vulnerable ones, who use overdrafts.

"The overdraft market is dysfunctional, causing significant consumer harm," FCA Chief Executive Andrew Bailey said in a statement.

https://uk.finance.yahoo.com/news/1-uk-watchdog-shakes-dysfunctional-063804490.html

Britain's banks and building societies will have to charge the same amount for all overdrafts from April 2020, the Financial Conduct Authority (FCA) said on Friday, in a radical change that will raise questions about the future of free in-credit banking.

The watchdog has already capped interest rates for payday loans and prices of rent-to-own goods after pressure from lawmakers to tackle the high cost of credit for vulnerable consumers.

It said the changes would make overdrafts simpler, fairer and easier to manage, protecting the millions of consumers, and particularly the more vulnerable ones, who use overdrafts.

"The overdraft market is dysfunctional, causing significant consumer harm," FCA Chief Executive Andrew Bailey said in a statement.

https://uk.finance.yahoo.com/news/1-uk-watchdog-shakes-dysfunctional-063804490.html

I thought the dividend had been cut and instead the money was being spend on the buyback?

I agree it's completely unfair to the people who invested in Lloyds for income.

Who's to say a few institutional investors won't use the buyback as a chance to sell out their entire holdings. Then perhaps it would be in their own self-interest to undermine Lloyds and argue that Lloyds do not have enough capital to pay a dividend for the next 5-10 years.

In short I have seen a similar thing happen before at another company. Lots of people just believe that company is not in perilous position because it's not in the BOD's self-interest to tell the truth. However a few American institutional investors have a much better idea of how perilous the company's position really is. Ergo they convince the BOD to do a share buyback and use this to sell down their holding completely. Then once they have sold out they start talking the company down and point out how little capital they really have and how they need to raise more - people at BoE only look at capital levels and not good at spotting market manipulation. Ergo enough people agree that more capital needs to be raised and the company then sees more sellers and the share price falls. Ergo they issue more shares to raise capital at a much lower share price - maybe as much as 80% lower. Then the American institutional investors use the money they received from selling their shares into the earlier buyback to take up the new shares at the much lower price. Ergo long-term holders massively diluted and American Institutional Investors now have far larger stake despite not having to come up with a penny of new cash to invest in the business.

I suppose to be fair the only thing you can't argue with is that the other shareholders should have taken more notice of who was selling into the buyback and given the perilous position of that company's finances they should of also started selling their shares themselves.

All you needed to have done was go short anywhere between £12 and £16. Tullow was way over-valued on fundamentals - oil was high and had been too high in price for consumers for years.

America had financed Petrobras in 2010 with $100 billion in dollars at only a few percent interest to boost Brazilian oil production.

Hence there was not going to be people willing to pay $15 Billion for Tullow's equity when there was no real shortage of oil. However, maybe there was a blinkered perception in a few corners of the market that there was a shortage of oil - but to think these belief would be strong enough to cause a larger company to overpay for Tullow's equity by a factor of five-fold was rather naive to say the least.

Even China weren't stupid enough to fall for the City of London's spivs trying to palm this company off on them for $13 Billion plus Tullow's existing billions in debts.

Why would you waste that amount of dollars on buying Tullow when you had already seen the FED in 2008-2010 giving unlimited dollar liquidity to Brazil, Saudi Arabia and Iraq to increase oil production to the absolute max. asap - this was what QE1, QE2 and QE3 was really about - the banking system could only be bailed-out by a massive investment in new oil production around the globe (which is what happened and makes the politicians look completely stupid when they talk about global warming and going green).

I always thought the market was mad and the share price of Tullow back in 2010-2012 proves it beyond reasonable doubt.

The only annoying this is that politicians actually think the market is some sort of wise guru which sets prices in some sort of rational or evidence-based manner and hence it can't be argued with in public.

Overall, I conclude that Jeremy Corbyn has all the ammunition he needs to prove to anybody capable of rational thought that the market's prices do nothing to aid a country's path to economic prosperity and inclusive growth.

All you needed to have done was go short anywhere between £12 and £16. Tullow was way over-valued on fundamentals - oil was high and had been too high in price for consumers for years.

America had financed Petrobras in 2010 with $100 billion in dollars at only a few percent interest to boost Brazilian oil production.

Hence there was not going to be people willing to pay $15 Billion for Tullow's equity when there was no real shortage of oil. However, maybe there was a blinkered perception in a few corners of the market that there was a shortage of oil - but to think these belief would be strong enough to cause a larger company to overpay for Tullow's equity by a factor of four fold was rather naive to say the least.

Even China weren't stupid enough to fall for the City of London's spivs trying to palm this company off on them for $13 Billion plus.

Why would you waste that amount of dollars on buying Tullow when you had already seen the FED in 2008-2010 giving unlimited dollar liquidity to Brazil, Saudi Arabia and Iraq to increase oil production to the absolute max. asap - this was what QE1, QE1 and QE3 was really about - the banking system could only be bailed out by a massive investment in new oil production globally.

I always thought the market was mad and the share price of Tullow back in 2010-2012 proves it beyond reasonable doubt.

The only annoying this is that politicians actually think the market is some sort of wise guru which sets prices in some sort of rational or evidence-based manner and hence it can't be argued with in public.

Overall, I conclude that Jeremy Corbyn has all the ammunition he needs to prove to anybody capable of rational thought that the market's prices do nothing to aid a country's path to economic prosperity and inclusive growth.

It makes no sense how you could have Carillion and Interserve go bankrupt and yet Kier still can not seem to lower costs - or else with all these 'unemployed contractors' around perhaps Kier can lower costs and in a few years investors will look back and say well we could/should/did fill our boots at £1.60 a share and now they are worth £10 per share.

Clearly we don't live in a free-market economy.

All I'm saying is that yanks have this idea that you need to approach every situation armed to the hilt. They spend $750 Billion per year on their military (from the Treasury website). Yes that is 750 billion (each billion is one thousand lots of one million).

To finance all of this military spending they have artificially lowered the price of oil in my opinion. A fair price for oil would be about $95 per barrel and there would be no reduction in oil demand if dollar liquidity was maintained or increased and banks were allowed to offer new debt to existing clients as well as people looking to set up their own businesses as well as to entrepreneurs.

Just my view. Lots of people probably disagree.

https://uk.finance.yahoo.com/news/zimbabwe-owes-200-million-foreign-104754948.html

Zimbabwe owes $200 million to foreign fuel suppliers

Anyone who really cared about making the world a better place would spend at least part of their time focusing on reducing fuel poverty in Africa. Easiest way to do this - inject enough dollar liquidity into African banking systems to allow them to pay Enquest more than the yanks for shipping oil to them. Yanks offering $65 per barrel - why can't Africa offer us $85 as they are prepared to grow fruit and veg to be shipped to UK. What does USA offer us except for an ideological view of the world which includes ideas which I disagree with such that you need to arm your country to the hilt just incase peaceful villagers in Tajikistan somehow manage to build themselves a nuclear missile (what would they build it with - where would they get the technology from - would peaceful villagers even wish to do any harm to the UK for no reason?)

https://uk.finance.yahoo.com/news/zimbabwe-owes-200-million-foreign-104754948.html

Zimbabwe owes $200 million to foreign fuel suppliers

Anyone who really cared about making the world a better place would spend at least part of their time focusing on reducing fuel poverty in Africa. Easiest way to do this - inject enough dollar liquidity into African banking systems to allow them to pay Enquest more than the yanks for shipping oil to them. Yanks offering $65 per barrel - why can't Africa offer us $85 as they are prepared to grow fruit and veg to be shipped to UK. What does USA offer us except for an ideological view of the world which includes ideas which I disagree with such that you need to arm your country to the hilt just incase peaceful villagers in Tajikistan somehow manage to build themselves a nuclear missile (what would they build it with - where would they get the technology from - would peaceful villagers even wish to do any harm to the UK for no reason?)

https://uk.finance.yahoo.com/news/zimbabwe-owes-200-million-foreign-104754948.html

Zimbabwe owes $200 million to foreign fuel suppliers

Anyone who really cared about making the world a better place would spend at least part of their time focusing on reducing fuel poverty in Africa. Easiest way to do this - inject enough dollar liquidity into African banking systems to allow them to pay Enquest more than the yanks for shipping oil to them. Yanks offering $65 per barrel - why can't Africa offer us $85 as they are prepared to grow fruit and veg to be shipped to UK. What does USA offer us except for an ideological view of the world which includes ideas which I disagree with such that you need to arm your country to the hilt just incase peaceful villagers in Tajikistan somehow manage to build themselves a nuclear missile (what would they build it with - where would they get the technology from - would peaceful villagers even wish to do any harm to the UK for no reason?)

Thanks Oppa.

Can I just say a £7-8k annuity per annum from a pension pot of £250,000 seems pretty poor to me.

It would have been pretty difficult to have built up a pension pot of £250,000 unless you owned your own business or made good investment decisions. If someone just worked in a salaried job then after paying for house, cars, food, utilities, children, entertainment, holidays etc. then how much could they have realistically saved into a pension pot per year?

Also it sort of makes a mockery of the salaries and pensions of directors. They are increasing their salaries into the millions per year whilst still expecting to find staff prepared to work for £8.50 per hour? I don't know how their brains haven't fallen apart because it is not a belief system that would make any sense to me. How can people be so greedy to think that they should be paid the most for having the easiest job of them all, CEO.

I guess with hindsight I should of moved to Canada a decade ago. Always a country with a lower population density has more economic potential. And when you add in their massive oil reserves and the fact their oil production has gone from 2.8 million barrels per day to 4.5 million barrels per day then it explains their much higher standard of living in Canada.

Hi BruceJamieson,

The pound is getting weaker against a basket of global currencies every decade - it suits the people who sell out of the UK and put their wealth abroad. Just saying how I honestly see the long-term trend.

However, I'm glad the current pound-euro exchange rate suits you - whatever that means for you.