Why She Buys

Interesting tips from a book Why She Buys, by Bridget Brennan, posted on the Amazon Payments blog:

• don't hide your customer service number


• simple checkout process


• use trusted payment methods, confirm orders/shipment immediately by email


• have a decent returns policy


• recommend complementary items


• show examples of gifts


• allow zoom on product shots


• keep your site clutter-free


• be transparent about shipping costs

Reminds me of some research that challenged the idea that women aren't comfortable with technology. As others have pointed out that, sure it should be stylish, but it also has to work simply. That means minimising the need for instructions and cables like spaghetti.

Intel also found that women are very influential when it comes to the gadgets guys buy, and even spend more time online gaming than young men.

Oh, and check out GeekSugar, 'where geek is chic'. Hat-tip to AllWomensWeekend.

FSA Chairman Shocks City Along Change Curve

Lord Turner has reiterated his assertion that much activity in the City is ‘socially useless' and 'of no real use to humanity’. Why? Because he knows it draws blood:

'Quite honestly I am appalled, disgusted, ashamed and hugely embarrassed that I should have lived to see someone supposed to be held in high esteem and who already commands a senior and crucially important position as effective head of the UK regulatory regime making such damaging and damning remarks.' Howard Wheeldon, senior strategist, BGC Partners, 27 August 2009.

And so it's clear that such remarks from the City's regulator are just the sort of shock the City needs to begin its journey along the curve towards the cultural change the taxpayer wants to see. The anger exhibited by Mr Wheeldon, a 30 year City veteran, is merely a step in that journey. The chart says 'Depression' is next, which may be right in more ways than one...

Gordo Got You Down? Try Power 2010!

If you aren't thoroughly disillusioned with UK politics and hell-bent on doing something about it, I don't know how much more mayhem it will take.

The good news is that even Gordon Brown admits he has to unwind his vast public sector binge of the past twelve years. The chips are really down.

But as the great HST himself said, "when the going gets tough, the weird turn pro".

So now is the time to ensure we get to keep and invest in what's important.

Enter Power 2010, a campaign chaired by Helena Kennedy and funded by the Joseph Rowntree Charitable Trust and the Joseph Rowntree Reform Trust.

Like MySociety, Power 2010 uses the internet to enable you to share your thoughts in a way that politicians cannot ignore without being called to public account. It doesn't matter whether Parliament is sitting or not. The internet is always on, 24-hours of disinfecting sunlight shining into the Westminster pit.

So please share your ideas now, at http://www.power2010.org.uk/page/s/yourideas.

Diversification Challenge

Some of us have been discussing the need to diversify more.

There are numerous tips on how to make sure that not all your eggs are in one basket. But they all assume that you have a great deal of time and a pretty sophisticated understanding of finance and financial services.

Like it or not, even with plenty of time on his/her hands, the 'man on the Clapham omnibus' is no financial giant.

So most people need diversification explained as simply as possible, and in a way that enables them to achieve it easily and conveniently.

What is diversification? The eggs in one basket idea is pretty simple, but needs some numbers: you are less likely to have all your eggs broken if you have 10 eggs in each of 10 baskets, rather than 100 eggs in one basket. Following this principle, you become automatically better off every time you add another basket for the same number of eggs. So you’d be much better protected against egg breakage if you had 5 eggs in each of 20 different baskets.

An interesting challenge would be to start with what a truly diversified portfolio of assets looks like, based on using a small amount of money. For argument's sake, one could start with a figure of £10,680 - the most the government allows you to salt away without locking it up til you're 98 years old, or paying tax on the returns.

But such government policy actually prohibits diversification, yet heavily subsidises regulated investments at the expense of alternatives.

That’s because most people with surplus cash should use up their tax-free allowances first, and few will have anything left over. Research cited by the Guardian in June 2011 suggests the average UK person can afford to save £97.10 per month.

The list of asset classes is long, yet the money allocated to those tax-free allowances can't be invested in the full range of potential assets, even by putting their money in the hands of managers who can invest more widely. Generally, you may only invest your tax-free allowances in regulated investments. And all sorts of rules, policies and other restrictions limit the types of assets in which regulated fund managers can invest. So even regulated fund managers are unable to adequately diversify the investment pots they manage. This must necessarily affect the value and performance of the funds they manage. Such effects may be market-driven and/or behavioural.

Then there's the tricky subject of asset correlations: if all the assets you've invested in behave the same way at the same time, then you aren't diversified. Apparently the correlation in the performance of assets has been increasing of late, but may be about to unwind in some cases.

First step along the way to meeting the diversification challenge should be to figure out a reasonably detailed list of asset classes. Then we should modify the regulatory framework to enable people to invest at least their tax free allowance in each of them. The list of assets can divide and divide, but I don't think we start out with a sufficiently granular picture. In reality, I think such a list might look like the following - note that I include different types of 'funds', and separate regulated from unregulated, because their performance can be affected by the differing levels of regulation and permitted classes of investments they can make. However, I'm not including instruments like spread bets, contracts for differences or futures, since these are merely contracts that get you exposure to the various assets. Am I right or wrong?

1. cash
2. savings accounts
3. fixed interest savings/bonds - government, corporate
4. person-to-person loans
5. shares listed on a regulated or 'recognised' exchange
6. shares not listed on a regulated exchange
7. exchange traded funds (ETFs) listed on a regulated exchange
8. ETFs not listed on a regulated exchange
9. regulated managed funds
10. unregulated managed funds
11. regulated hedge funds
12. unregulated hedge funds
13. venture capital funds
14. venture capital trusts
15. regulated funds of funds
16. unregulated funds of funds
17. commercial property
18. rural property
19. residential property (owner occupied)
20. residential property (buy-to-let)
21. perishable commodities (e.g. cocoa, wheat)
22. non-perishable commodities (e.g. oil, gold and other precious metals)
23. art
24. classic cars
25. fine wine
26. currencies

At Last A Bank That's Fair?

At long last one bank has broken ranks with the gang that's trying to avoid having their overdraft fees assessed for fairness by the OFT.

RBS has announced it will halve its fee for paying an item when overdrawn to £15 per day(!), and slash the fee for returning a cheque, direct debit or standing order to £5 (from £38!).

Why it's taken so long to at least make this concession, and why other UK banks with substantial state ownership continue to delay, is anyone's guess. But it's a great start.

Will RBS now refund to affected customers the difference between the revised fees and what it has been charging them to date?