Member Info for TheTrotsky

You may not like it but it's standard contractual practise. It also means that he can't go and work for a competitor.

Seriously?! That's £17,500 a month VRS can't afford. Contractually VRS are obliged to pay him but if NR had any scruples he'd agree to waive his salary (after all, he made a pretty packet from his share sales when VRS was at its peak) but I wouldn't hold my breath.

I would say that, in the current environment, the AA quote looks completely out of whack with the rest of the market. Best to check the small print and ensure that you are comparing like for like; regardless of the criteria you initially enter, in my personal experience quotes on comparison websites aren't always what they seem i.e. if the insurers can't give you a quote that matches your exact criteria they'll change the excess, mileage or remove the protected NCB. Always best to double check!

spikeyj, I take it from your comment that you have all of your wealth invested in one nest egg! Why doesn't diversification apply to employees and common shareholders alike? Yes, Quentin Zentner has sold some shares but he also holds share options that have not yet vested (I'm not sure whether he holds any other shares in PHNX because he's not a director and the RNS makes no additional disclosure in that regard). Directors and employees are entitled, like everybody else, to order their financial affairs as suits their personal circumstances and should not be expected to continue to hold shares come hell or high water simply because to do otherwise is to imply that something is fundamentally wrong.

Employee and director transactions need to be taken in the round. A few outliers, one way or the other, should not be taken out of context. One person's investment is another person's income. I'm sure Quention is not hard up for the odd £ but, like everybody else, I'm sure that he has his own financial priorities, and if (for example) he's sold shares to pay down (say) part of his mortgage should he be decried for doing so? On individual does not make a trend!

What makes me "laugh" is that one of the areas of general concern is "shadow banking" (mainly hedge funds); the very same hedge funds ("the players") who are now, no doubt, raking in huge profits by shorting financial instutions and also, probably, helping to fuel market instability through their public utterances. Only in banking could one of the potential instigators of a systemic problem (if one indeed exists) be the benefector of the self-same banks' woes. It's enough to make you want to scream blue murder!

Essentially it's a company law issue. The share premium account (whenever shares are issued at an excess to their nominal value, the excess is credited to the share premium account) and capital redemption reserve (arises from the redemption or cancellation of shares) do not constitute "distributable" reserves (used for dividends and share buy backs) and, as such, can generally only be used for issues of new equity. However, it is permissible for companies to apply to court to transfer these funds to their retained earnings so that they can be distributed in the future if they so wish.

It shouldn't be forgotten that the capital redemption reserve, which currently stands at £3.8bn, in the main arose from last year's return of capital and is itself a bit of an accounting anomaly (you can't simply credit retained earnings, you have to go through this two stage process).

I wouldn't read too much into the timing of it. It's essentially a pragmatic step in conclusion of last year's capital return with the share premium account thrown in whilst they are at it (i.e. may as well do the latter whilst they are doing the former); it coverts two, more or less, unusable capital reserves into funds that can be used at a later date.

Big Short 2?! Got to love it when people talk about systemic issues rather than specific issues. SVB had a specific problem relating to the nature of its business and its need for liquidity. Everybody seems to have ignored the fact that SVB had no head of risk for 10 months, just when they needed one, and that the Fed seems to have, again, been asleep at the wheel - can't believe that the Fed wasn't consulted before SVB sold its for sale assets and tried to raise capital to plug the hole (it seems that the Fed might have decided that SVB was too critical to fail after the event and left one wondering what they were thinking aforehand - bunch of numbskulls).

As for Credit Suisse and Deutsche Bank, they have been on life support since 2008 (biggest open secret in banking if you'd ever bothered to read the financial press - Credit Suisse has literally lurched from one disaster to the next, culminating in them recently saying that their accounts could not be relied upon because of fundamental accounting issues - really not a good look for a bank at any time; what did people really expect to happen); both banks have/had specific problems which have only been exasperated by blind panic.

Bottom line, banks are totally reliant on customers remaining calm and rationale; always have and always will be. All banks generally borrow short (customer desposits) and lend long (loans etc.). They retain a certain amount of cash to meet spikes in customer withdrawals (liquidity) but that liquidity is never, ever enough if all customers choose to withdraw their cash all at once (a run). Can specific problems become a systemic problem? Yes, if people choose to panic and the current problems are allowed (or encouraged) to snowball.

The large, mainstream UK banks currently have good liquidity and it's likley to be improving as we speak (we're probably seeing a flight of cash from smaller institutions to larger ones at present). I suspect that a lot of that additional cash is on overnight deposit with the BofE and therefore likley to be earning the banks larger profits for the next 3-6 months (an extra £10bn of cash is probably currently worth an additional £75m of profit per quarter).

I'm not being naive (there are certainly contagion risks) but there's no current indication that this is another 2008. Presently we're more at risk of talking ourselves into a problem than there being a specific, general issue affecting all banks (like there was in 2008). Banks do not thrive when the herd panics; the herd reacts exactly the same whether it's spooked or mauled, so let's not speculate about a mauling when all the indicators are that the heard is simply spooked. There will always be potential problems under the bonnet; that does not mean that the engine is always about to explode!

Like Credit Suisse, Deutshe Bank has been on life support since 2008. It's a large, poorly run bank but it won't be allowed to collapse. It seems that the central banks have been ignoring some problems for far too long, hoping that they would simply go away.

SVB didn't have a head of risk for over 10 months and was in a real pickle. It was solvent but lacked liquidity and its liquidity problems were unlikely to be solved in the short term becuase, even before the run on the bank, for the forseeable future its customers would be withdrawing cash rather than depositing it. SVB therefore either needed to sell its for sale assets and crystallise a large loss (necessitating a large capital raise) or approach the Fed for help (SVB undoubtedly made errors in its initial assets selection but there's no point crying over spilt milk after the event; you deal with the problem). I'm struggling to believe that SVB didn't approach the Fed for help, in which case (having subsequently determined that SVB could not be allowed to fail because of its customer base) I am left to wonder what the Fed was thinking when they allowed SVB to blow up before acting. Some serious questions have to be asked of both the Fed and SVB's BoD; somebody somewhere made a massive miscalculation and needs to held accountable for a fundamental lack of oversight.

The final straw for Credit Suisse came just as the SVB saga unfolded when they announced that their accounts could not be relied upon because of fundamental reporting issues. The withdrawal of cash, increase in insurance costs and other banks reducing their exposure were all inevitable and only further exasperated by SVB's collapse.

It would appear that Deutsche Bank is now on the same sliipery path. I'm not sure its problems are as big as Credit Suisse's although the war in Ukraine probably hasn't helped (I believe that Deutsche Bank, along with a number of other European banks, would have had significiant exposure to Russian debt). The ECB now needs to act decisively; words of assurance are not cutting it. At a minimum, it needs to provide additional liquidity to Deutsche Bank and, if necessary, seek to insure any cross-bank guarantees. Not sure who might be in line to take over Deutsche Bank if that becomes the nuclear option; could the German state step in and take a significant share stake (like the UK did with NatWest)? Certainly feasible.

It's not a "real" loss. It's a lost opportunity but, unlike Mystic Meg (supposedly), none of us can foretell future gas prices and, unless you think Rusty should play a game of "two-up" with DEC's future, hedging is the only way for DEC to secure the majority of its future cash flows.

Some in the know might have been able to predict the demise of SVB but none of them could have predicted exactly when it was going to blow up beforehand and the impact it was going to have on the general market. Bottom line, you can't even predict the gas price next (say) Friday let alone 6-12 months time. Sure, you can can have a good stab assuming all things remain equal but, in this life, few things remain equal for long.

There will always be bumps along the way.

Falling gas and electricity prices aren't yet feeding through into the inflation figures because the prices consumers are paying are still currently above the government's price guarantee (but are predicted to fall below from July onwards). Current gas and electricity price falls are favour the government rather than the consumer (because the government is having to pay less in energy support).

On the other hand, rising food and wage costs are having a more immediate impact and probably have yet to peak before they too start to fall as falling gas, electricity and fuel prices start feeding through into lower production costs.

I'm not an expert but I would suggest that government intervention has made it more problematic to forecast inflation (the intervention has meant that inflation has peaked at a lower level than would otherwise have been the case but, likewise, is now falling more slowly than it would otherwise have done from an albeit higher level).

"All fiat currencies die"? When was the last time sterling or the USD died? Yes, inflation has eroded the purchasing power of all fiat currencies but I don't see BTC being any different in the long term. Yes, there is ultimately a limited supply of BTC, but it's not tangible and, at some point, people will ask themselves what they are buying.

I could, for example, just as easily sell people cells in an Excel spreadsheet (theoretically cells in an individual spreadsheet are in limited supply just like BTC and each spreadsheet could, theoretically, represent a different cryptocurrency). I fully accept that Excel security would leave something (a lot) to be desired but, in principle, it's not so fundamentally different from BTC (just a collection of 1s and 0s at the end of the day). Unlike BTC, fiat currencies are backed by their issuing country and their populace; that guarantee is at least worth the paper it's written upon (albeit that the purchasing power may vary) and it's that guarantee that underpins it (as a last resort the CB will always buy/sell that fiat currency; BTC has no buyer of last resort).

" I think you are mistaking crypto banks / exchanges with crypto. Bitcoin has never missed a beat all through FTX and SVB - it worked perfectly, never stopped or was suspended. It's the exchanges that are at risk. Bitcoin isn't if it's held privately with a secure private key. As for transaction speed it's not about that. it's about having some store of wealth that the governments and CB's cannot manipulate. It is always human greed and fraud that causes these issues, not actual Bitcoin itself."

It's all interlinked and you are mistaken if you think that BTC is invulnerable. Without the crypto exchanges it would become extremely difficult for private investors to buy/sell BTC and, without new money coming into the market, it's difficult to see how BTC could viably survive as an alternative to fiat currencies. If a c60% collapse in the value of BTC between its highest and lowest points in the last 12 months is working "perfectly" then your view of perfect is clearly different to mine ;-)

The risk as I see it is if the crypto exchanges get locked out of the US market on regulatory grounds (regulation will have to come if BTC et al are ever going to become mainstream), which still remains a possibility. Also, it's the USD funds that the crypto exchanges currently hold that provide the essential liquidity underlying BTC. Without that liquidity the market will collapse (if you can't exchange your coins for cash, and vice versa, then the market will cease to function).

You need to decide if BTC is an investment or a currency. If BTC is an investment then your arguments may hold some water but, unlike Tulipmania, you can't eat BTC if it proves to be the ultimate Ponzi scheme ;-) However, if as you suggest, BTC is set to replace fiat currencies then it has to be more than simply a "store of wealth"; it has to be readily transactional. It's not; there is neither the transactional capacity nor the retailer network. The latter might be fixed over time but the latter is partly due to the security features of BTC (it wasn't really designed with small, high volume transactions in mind) which might never be overcome. If you have to stand in line at the coffee shop for an additional 5-10 minutes for every transaction to be approved it will quickly lose its lustre.

I think the Swiss, like the US Fed, are going to have to guarantee all deposits held in Swiss banks (not just CS) if they want to stem some of the outflows from CS. CS's problems are unrelated to SVB's but are none the less a real s**t show (it's basically now saying that its accounts cannot be relied upon because of regulatory failings; not a good position for such a large bank to find itself in on top of everything else that's been going on there in the last 10+ years). I wouldn't be wholly surprised to see the Swiss increasing the 10% shareholding limit placed on the Saudi National Bank either (it's difficult to see who else might be willing to subscribe new capital at this juncture).

Also, if recollect, Deutcshe Bank aren't in a good condition either. Different problems again but nevertheless problems that have been unresolved for a number of years.

"Love Bitcoin or hate it, it has never failed to do what it was designed to do. i.e function in all weathers. It never gets halted, suspended, hijacked, debased, or any other scam the governments or central banks want to try and pull."

Remind me. What exactly happened to zilliqa, dogecoin, spacebit et al? Surely no longer existing cryptocurrencies are the ultimate "debasement". Also, if FTX wasn't a scam you ought to tell its investors because they are currently left with diddly squat! Sometimes it's better the evil you know than the evil you don't.

By crash, I mean hyperinflation. If you think bitcoin can survive without fiat currencies, I think you'll find you are sadly mistaken. At least fiat currencies are regulated and backed by the countries that issue them. Are you really suggesting that if people lose faith in fiat currencies (like they did in the 1920s) they are going instead to opt for an intangible, unregulated, non-asset backed cryptocurrency?!

All cryptocurrencies are (supposedly) currently backed by USD deposits if you hadn't noticed, until you find that somebody has done a runner with the cash e.g. Sam Bankman-Fried at IFX and the cryptocurrency evaporates into thin air. Also, you've missed the point I was making about purchasing power - cryptocurrencies cannot handle large volumes of transactions and all prices are fixed in fiat currencies rather than cryptocurrency e.g. if the purchasing power of the fiat currencies change, so do the purchasing powers of the cryptocurrencies (because essentially they are linked to their underlying fiat currencies).

As regards the "manipulation" of fiat currencies, you must be living in denial if you think that cryptocurrencies aren't also being manipulated. Sure supply might be limited but there's an easy "get around"; just issue a new cryptocurrency! Banks and governments may not always be trustworthy but I'd rather deal with them than cartels, gangsters, drug lords etc.

How can anybody think bitcoin is secure? As far as I'm aware, bitcoin is still unable to handle large volume transactions, still remains currency dependent (the bitcoin price of an item fluctuates with currency movements) and, most important of all, is still underpinned by fiat currencies (primarily the USD). Bottom line, if the USD was to "crash", bitcoin would likewise go pear-shaped.

Part of this recent farce is that the US Treasury has actually ended up guaranteeing the USD denominated deposits held by the crypto exchanges! One of the two US banks that have collapsed (Signature Bank) was banker to the crypto exchanges. It's perverse! Whilst traditional bank shares have been tanking, BTC has been soaring despite the fact that the whole crypto universe was very nearly on the verge of total collapse last week (without access to their funds the likes of Coin et al would likely have collapsed this week). But this farce may have a further sting in the tail; it would appear that potential purchasers of Signature Bank now have to agree to "no crypto", which then begs the question how do the likes of Coin et al continue in business. Where will they be able to deposit their USDs?

I suspect that bitcoin is currently rising on lower energy prices and short positions being unwound BUT if access is denied to US banks going forward you have to wonder how people are going to be able to buy/sell crypto (I'm not sure that the crypto exchanges are now permitted to hold the funds offshore and continue to trade in the US). It srikes me that bictoin may have a few more problems than some people realise.

Can't comment on the merits of Lloyds new digital offering but banks have longer memories than most and they remember the many technical glitches they suffered when they first introduced theeir original bank software (I didn't experience it first hand but it apparently put many of the issues that the likes of, say, TSB have had into the shade).

Their existing systems do pose challenges but, for the most part, they are stable and Lloyds is not going to do a mass switch until it has thoroughly tried and tested any new software. Plus transferring data from one system to another is never easy or straightforward (witness the transfer of Barclays' stockbroking clients to "Smart Investor"; it was an unmitigated PR disaster which probably resulted in Barclays losing a significant number of long-term, high net worth clients).

It's better to be last and get it right than be first and make a complete pig's ear of it.

Hardly a ping (yet). More like a pfft ;-)

Borrowing money to buy back shares is fraught with danger IMHO. Once bitten twice shy, that's exactly what Topp Tiles did back in 2006 and the share price still hasn't recovered; it was an absolute disaster. The reality is that despite c15.5% interest being expensive, it's still, I belive, less than that the estimated ROCE of new acquisitions and, as you allude to, the dividend can be cut if required (unlike interest on an actual loan). I don't think IFRS accounting and the question of well retirement costs aren't helping matters.

When markets decline AUM decline in tandem; it really doesn't take a degree to work that one out.

IFRS has become a joke; more often than not it penalises companies, like PHNX, who hedge their portfolio and requires you to book unrealised profits and/or losses that in reality many never, ever arise. IFRS was supposed to make accounts easier to understand but the reality is quite different; it's become invreasingly difficult to winnow the wheat from the chaff.