This is Money Blog

Soros FTSE shorting: 'No comment'

Is George Soros selling the UK short? Well-placed City sources say the financier-cum-philanthropist is convinced the FTSE and perhaps the Dow Jones are heading for a dramatic tumble and has been placing bets accordingly.

In the last few weeks, as more economic gloom has emerged, the pace of these bets has stepped up, it is said, with nephew Peter Soros taking charge of the UK arm of this operation — though that's not confirmed.

In 1992, George Soros famously bet against the pound, eventually forcing it out of the European Exchange Rate Mechanism and earning himself a profit of £500 million (it seemed like more at the time).

The word is he expects a much higher return from shorting the FTSE, though it is not clear if he is betting against individual stocks or just the whole market. Soros's man in New York, who doesn't like to be named and who speaks off the record if at all, points out that the Quantum Fund is $20 billion in size and takes any number of different investment positions at any one time.

Of course the fund will be short of some UK equities and long of others. It doesn't follow that Soros is betting on a market collapse just because he's got a few short positions.

The spokesman was sanguine about Soros being revealed as heavily short the FTSE, claiming this would be little more than "a nuisance" and arguing that we in the UK get way too excited by his activities because of all that old stuff about how he "broke the Bank of England". "He is a character in your national drama," was the phrase used.

Still, some City folk are irritated and want him outed.

Press cuttings don't quickly suggest Peter Soros is an experienced hedge investor — he's variously described as a former investment banker, a freelance columnist or the husband of Flora Fraser.

Reached by phone, Soros was far from keen to talk.

Could he confirm he was working closely with George Soros? No comment. Is he active in the market? No comment. Would we be wrong to suggest he was heavily shorting the FTSE? No comment.

Maybe he just doesn't like talking to reporters. Or maybe uncle George was on the other line screaming "sell".

- Simon English, Evening Standard

Oil price boom: 'It's different this time'

Sir John Templeton, the recently deceased super-investor, thought that those who argue 'this time it is different' in relation to the soaring price of almost any asset are fools who are bound to be proven wrong.

In the end, the price will correct and the market will rectify.

Oil bears who think the cost of a barrel of the black stuff is unsustainable have had a few good days.

Friday was the fifth day in a row where the oil price fell, tumbling from a high of above $147 to sit down as low at $130 at one point.

At that rate it will be back below $50 in no time — global energy crisis over. Climb back into your 4x4.

I bet that doesn't happen. Oil industry figures show that non-Opec nations are producing less every year. Opec might be able to pump a little more than it does now, but it certainly isn't minded to. And any dip in the price just encourages fresh buying.

The oil shocks of 1973, 1980 and 1990 were connected to specific threats to supply rather than a wider inability of supply to keep pace with demand. It is different this time.

- Simon English, Evening Standard

Web Week: Time to buy bank shares?

The most read stories focused on the property market, with buyers making derisory offers to distressed sellers, and inflation, with the official consumer price index rising faster than expected at 3.8%, further eroding rate cut hopes.

But banks were also on the agenda. Spain's Santander announce d a takeover of Alliance & Leicester, sending  the shares up 52%. That sparked a flurry of reader comments about whether other bank shares might bounce. Jon in London was bullish: 'In three or four years time, people will wonder what all the panic was about and those who swam against the tide will make a killing.'

Wise investors make their own calls measured against time-tested wisdom. Billionaire investor Warren Buffett said: 'Be fearful when others are greedy and greedy when others are fearful.'
Sir John Templeton, the legendary American stock-picker who died aged 95 earlier this month, urged investors to buy only 'when there is blood on the streets'.

Bank share prices have plunged an average 60% from their peak in April 2007.  So is it time to buy? Those willing to dive in should remember another Buffett adage: 'You only find out who is swimming naked when the tide goes out.'

- Andrew Oxlade, Editor, thisismoney.co.uk

Top 25 most read stories published in the past week

1. Sharks move in as home sales hit new low
2. Should you stick by the bank shares fans
3. Inflation at nearly twice Banks target rate
4. Diary of a house sale disaster
5. A&L bid: Shareholders urged to sit tight
6. Nationwide cuts mortgage rates
7. Tenants squeezed as rents rise sharply
8. Santander confirms £1.25bn bid for A&L
9. £64,000 is the most desired joint income
10. How to invest £300,000 for income
11. Ryanair grounds quarter of its planes at Stansted
12. Stamp duty could be cut to boost homes
13. Darling scraps 2p fuel duty increase
14. Brown rejects 50% tax on high earners
15. Sunday newspaper share tips
16. Rush for extended mortgages
18. Help: I've been paying TV licence twice
19. Banks wobble as shares nosedive
20. Banks £152 a year from each customer
21. Could Kaupthing Edge be the next Rock?
22. Santander buy-out lifts banking sector
23. Drivers win 94% of parking fine appeals
24. Midas share tips: Telecom Plus and Carrs
25. Dollar and shares dive as global worries grow

Property blame game: Kirstie Allsopp or Amanda Lamb

Property programme presenters have attracted criticism for their part in blowing up the bubble. Fair or unfair?

Kirstie Allsopp, of Location, Location, Location, fights her corner today in The Times:

'It's plain silly to point the finger at these programmes for puffing up the property market, forcing people into taking out massive mortgages or into negative equity. Blaming such shows and their presenters for the present uncertain state of the property market is akin to blaming TV chefs for the great bulge in obesity. Jamie Oliver, Hugh Fearnley-Whittingstall and the rest recommend healthy eating and responsible shopping - yet many people ignore their advice and binge recklessly. Likewise, I hope that I give sound advice rather than inveigling viewers into "get rich quick" schemes.

'In recent weeks I've been described as a "property porn queen" in the New Statesman, sniped at on the pages of The Guardian and lambasted by Panorama for excessively inflating house prices.

'I only wish that the show I present was as influential as some have been claiming. If it was, people might have taken notice of a campaign we have been running on Location, Location, Location, asking for a review of stamp duty, a tax that without doubt has contributed to the drop in the number of house sales.

'But it looks highly unlikely our pleas will be heeded. It is much easier to fire off flippant articles blaming property TV shows than properly examining why there has been a fall in transactions and - in some places, though not all - a fall in property prices. Some of the recent gloomy headlines make me suspect that all the journalists in the country have sold up and are doing everything in their power to cause a property house price crash so that they can buy at rock bottom.'

Let me add to the pile of 'flippant articles'.

I haven't sold my home in the hope of talking up a crash and buying back at rock bottom. To wrongly paraphrase Allsopp, I wish the website I run was that influential (although it does have 1.2m readers). I'm doubtful of my credentials to be able to move the property market.

Secondly, dictionary-swallowing Allsopp may not have been 'inveigling' viewers into get-rich-quick schemes, but some other presenters have. In fact, just today I was emailed an advert from Nethouseprices.com for the Platinum Partner Property Group. It tries to gain credibility with a BBC association:

'Sarah Walker, presenter of the BBC property programme 'To Buy or Not to Buy' has recently joined PPP as a franchise partner. She was so blown over by the concept and potential of PPP and in her words, "the integrity and passion of the founders and quality of everyone involved in the company", that she simply had to join.'

Steve Bolton, PPP's 'managing director', continues:

'Over the past 7 years, property has proved to be an exceptional investment for me – and continues to be so. Despite everything you might read in the newspapers or see on TV, the UK property market is providing me and my clients with excellent cashflow and return on investment.'

In a way, you have to admire such wild optimism. And, of course, you can get a piece of the action by paying a mere £297 plus VAT for a semimar. It all sounds vaguely familiar. (Our investigations into Inisde Track).  

Back to the point - some genuine TV property experts give decent advice. Sarah Beaney is clearly talented at redeveloping property; Allsopp is a skilled property scout and negotiator. But beware of 'experts' bearing property predictions. In fact, beware of former models/estate agents bearing property predictions. Amanda Lamb, from a Place in the Sun, is a presenter rather than property expert. And she's certatinly no economist. If I was given a fiver every time she said 'great investment', I'd have a get-rich scheme to rival Sarah Walker's. Lamb has been talking up the potential of European property for years, making some dubious claims about where prices will be in years to come. See our caution on her spurious hot European properties from 2006.

I think the point Allsopp should have made is that property programmes like hers - but not Lamb's - were merely a symptom of the property bubble rather than a major contributor.

- Andrew Oxlade, Editor, thisismoney

> Latest on house prices

P.S. It looks like Sarah Walker is also an expert in testimonials and endorsements. Here's another one...
http://www.fngonline.com/real_estate/endorsements.php

If you want to employ her, it's look fairly easy to just sign her up here...
http://www.womenspeakers.co.uk/speakerdetail2.asp?speakerid=133

Help with finding cheap shares: Stock screener

Stock screeners are tools investors use to filter shares given certain criteria of their choice. This is Money has one: see our stock screener

For example, you could pick the banking sector and then enter certain criteria:

- Only show me stocks with a price-earnings-ratio of less than 10 (the lower it is, the cheaper it is)
- Only show me stocks with a market capitalisation of more than £3,000m
- Only show me stocks with revenue of more than £100m
etc.

The stock screener replaces days worth of research with a few clicks.

However, treat figures with caution - it's only a guide. For example, price to earnings ratios look artificially low in the banking sector, for example, because profits are likely to be lower than estimates due to the effects of the credit crunch. And dividend yields (the opposite of p/e ratios) are mouth-wateringly and misleadingly high for the same reason.

Still, the tool serves as an excellent starting point.

Find out more about price-to-earnings ratios, yields, PEGs and much more in our Share School.

- This is Money

+++

> Share dealing: £12.50 flat fee
> All market data
> Share tips

'They'll be no bid - sell A&L at 210p!'... Opps

Abbey owner Santander's bid for Alliance & Leicester at 317p caught out more than a few analysts.

Deutsche Bank's Jason Napier, commenting before news of the A&L offer, dismissed talk of a bidder: "Though there is upside potential to our takeover value estimates for A&L, we think it too early in the cycle for acquirers to take on additional funding and credit risk."

Get out, it's worth only 210p a pop, was the Deutsche view. Panmure Gordon's normally reliable banking watcher Sandy Chen was also telling clients to get out sharpish, putting a value on the stock of just 180p. Oops.

Chen has had the good grace to admit he blundered. Following news of the Santander bid, he said: "We thought that few banks would have the capital capacity to do so [to launch a bid]…Obviously we were wrong in this assessment."

- City Spy, Evening Standard

My £25 bank charge for a £1 overdraft (and a ticking off)

One day last week I burst through my overdraft limit by £1. Two days later the bank, First Direct, imposed a £25 fee as punishment for my recklessness.

Yesterday, a customer service rep phoned me to say, without irony, that the bank is concerned about the amount of charges I am incurring as it indicates that I'm mismanaging my finances.

There was a lot of yelling at this point. I asked the rep if she understood why banks are so loathed and why many greet the idea that some of them are going broke with glee. She sort of got it, but bankers themselves still don't.

At a lunch in the City the other day, one was overheard praising David Cameron's suggestion that people should be made to take more responsibility for their actions. Jaws dropped. Cameron was talking about poor and fat people. "Shouldn't we start with you lot?" someone said.

The banker was mystified. Personal responsibility is not for him.

- Simon English (from his Evening Standard column, published on Tuesdays)

> How to reclaim bank charges
> Our campaign against unfair bank charges

Bank of England Governor sells his Jag (after turning down £100k pay rise)

Bank of England Governor Mervyn King's old motor is up for sale. The Jaguar XKR Super V8 is going for £27,995 at Sussex dealer Arun. Described as a "cracking deal", it boasts all the usual luxuries and an exciting body kit. No prangs either — Merv the Swerve presumably lived up to his name. Whether the sell-off has anything to do with news this week that King turned down a £100,000 pay rise is another matter.

- City Spy, Evening Standard

M&S and the storm in the DD cup

It was City Spy that first revealed last Thursday that curvy women are campaigning to end Marks & Spencer's mark-up on bras above a DD cup.

Fearing a backlash from the amply endowed, the retailer rushed out a statement claiming its customers are happy to pay the premium for the 'specialist work to ensure a suitable level of support, innovation and technology that goes into the bras'.

Our evidence suggests otherwise: more than 3600 people have now joined the protest group Busts 4 Justice (on Facebook).

M&S boss Sir Stuart Rose might do well to back down now.

Beckie Williams, one of Busts 4 Justice's founders, notes that she has found it rather easier to persuade people to oppose M&S' "tit tax" than the abolition of the 10p tax bracket.

And we know what an albatross around Alistair Darling's neck that became.

- City Spy, Evening Standard

> Latest on M&S shares

New starters earn £45,000 at Aldi

Is it time for a career change in the economic downturn? Cut-price supermarkets chain Aldi could receive a rush of applications after boss Paul Foley revealed his graduate trainees enjoy a mouthwatering starting salary of £45,000.

After three years in the job, that rises to £57,750, with an all-expenses-paid top-of-therange Audi thrown in. That appears around twice the going rate at all other supermarkets.

According to the websites of the other major supermarkets, graduate trainees at Tesco, Sainsbury's, Asda, Waitrose and Marks & Spencer start on a salary of between £21,500 and £25,000.

Aldi's £45k starting salary would also trump a junior doctor (circa £30,000), trainee solicitors (£35,000) and even rookie investment bankers (also around £35,000).

- City Spy, Evening Standard

> How to get a pay rise
> A full list of salaries for UK jobs