Ronaldo, Housing Market, Zimbabwe and Mark Hughes.

I can't get really excited about the current news in the British newspapers at the moment. Some of the running stories have an element of inevitableness about them.

www.searchaccountant.co.uk

I can't do much about Ronaldo going to Real Madrid. Obviously, I would like to see him diving in a Man Utd shirt but I suppose what concerns the Glazers is that they know Real Madrid is not the best buyer in town. Arsenal took ages to be paid for Anelka while the Beckham deal saw Man Utd factoring the operation with the
Royal Bank of Scotland (I think). £80m is never going to be £80m amd has been denied by Real Madrid president Ramon Calderon.

The British housing market is going down if the lenders can't be persuaded to lend. Chancellor Alistair Darling says he is prepared to bring in the Financial Services Authority (FSA) amid rumours that he is going to be sacked by Prime Minister Gordon Brown. Apparently, Darling and his wife babysit Gordon's kids. Darling should spend more time on his day job and ensure that the British banks do not founder like
Northern Rock.

Zimbabwe is sad but with Mugabe, who had financed the education of South African leader Mbeki, will know that he has nothing to fear from his young charge.There is always the concern that South Africa will eventually go the way of Zimbabwe in terms of economic collapse. If the West averted its eyes with
Rwanda, then we could quite happily ignore Zimbabwe.
A friend of mine recently visited Zimbabwe and said he was really impressed by the can-do spirit of the people and how they helped each other out.

I don't lie awake thinking about Mark Hughes but I think he should improve Manchester City. He should do better than Paul Ince at his old club Blackburn, who upset a few people wearing a Man Utd shirt, when he was contractually still a West Ham player.

Nic Cicutti writes interesting article on housing market.

In Moneymarketing.co.uk, Nic Cicutti writes an interesting article saying that some parts of the media are feeding the sense of crisis about the UK housing market. However, in May the five main house price indices showed overall a 0.6 pct fall. Yet
all media organisations focused on the 2.5 per cent reduction in the Nationwide report, which grabbed the headlines.

I agree with Mr Cicutti that we can be talking ourselves into a crisis. However, the collapse of transactions and the problems of housebuilders show that there could be sufficient pain to come. I read the capital raising documentation of Bradford & Bingley and there was too many "synthetic" this and "synthetic" that.
This is going to impact on the UK mortgage bank's shareholders and borrowers. But let's hope that Mr Cicutti is right. He is very experienced and was writing about the UK housing crash in the early 1990s.

www.searchaccountant.co.uk.

The Spanish property dream revisited!!

Sorry to go on about Brits buying residential properties in Spain. I get twitchy about what do the words "escritura" and "mancomunidad" mean. Then, there is sometimes the lack of land register and the lack of transparency over prices. However, a few years ago with the peseta at 240 to the pound you could sell up in Blighty buy a better property and still have cash over. I remember a few years ago visiting the Costa Brava and being knocked by the coast's beauty. Who would not want to live there?

I am assured that the lunacy on the Spanish roads has got better and the UK health system has gone backwards in comparison with Spain. The UK has funded quite a few of the Spanish infrastructure improvements via European Union transfers. Spain is still a net beneficiary of Community funds but this should change with the increased investment in Eastern Europe.

Spain is a magical place but people should be aware of the problems. The country was always going to struggle with the euro. Inflation is at 4.7 pct and the current account deficit is over 10 pct of GDP. It is likely that Spanish housing and banking sectors will have to take quite a bit of the adjustment. Una cerveza anyone?

Don't get sucked in buying distressed properties, because they will just get more distressed. New buyers should try and rent and then make a measured decision. The possible increase in Eurozone interest rates by the ECB will strengthen the euro but the Spanish and Italian governments are already screaming at the central bank.
www.searchaccountant.co.uk

Northern Rock revisited!!

I have been reading in the Daily Mail extracts of Alex Brummer's book on the collapse of Northern Rock. It was interesting that the British government did not really want to deal with Richard Branson, who it suspected would make pots of money from any acquisition. The nationalisation option has safeguarded Northern Rock but it is becoming a smaller bank and is no longer the flagship institution of the
north-east of England.
www.searchaccountant.co.uk
I still wished I had not bought shares in the Northern Rock. I was dimly aware of the profit warning and I thought the shares were a buy, although they had come down sharply from a recent twelve quid high. However, nobody's fault but mine. I accepted there could be a loss. I don't rate the chances much of Northern Rock shareholders of getting significant compensation. Railtrack shareholders did not do at all well
with the government.
Alex Brummer says the £100bn liability of the Northern Rock rescue hits the government's fiscal rules while New Labour has allowed the economy to be
credit-fuelled.

Spanish property bust hits Brits looking for dolce vita.

I have been reading about the Spanish property bust hitting Brits looking for the
dolce vita (I know it is an Italian phrase). They have been hit by the pound falling against the euro, rising interest rates, illegal building practices and overbuilding.
The Brits have found their main market of selling to other Brits has fallen. The Costa developers have been running on high octane fuel during the last few years.
In the good times there has never been much of a second hand market in the coastal regions since it was quite easy to build new properties.
I saw a mate of mine who lives in Tenerife and he was telling me how cheap his water bills were. I said this situation was unsustainable. Higher water bills are needed to conserve water and I suppose the Sotogrande complex will be
rich enough to water its golf courses. However, I will doubt this will be true
for the rest of the south. I am surprised that the water shortage has not been priced in with the cost of houses and flats.
www.searchaccountant.co.uk
Unfortunately, a lot of people in Spain have been gorging themselves making money from unsuspecting Brits. They have been sold properties without proper planning permission. Then, you have regional governments such as Valencia changing the planning rules retrospectively by getting property owners to pay for infrastructure projects such as roads.
Quite a bit of residential property could be pulled down due to the Coastal Law (Ley de Costas), which is also going to affect quite a few
Spaniards.
www.searchco.co.uk

Gordon Brown takes it on the chin from David Cameron.

Yesterday, apparently Gordon Brown was taking a right pounding from David Cameron at Question Time. The British prime minister, who is going to have to pay British troops a decent wage, was yesterday just reiterating the same points again and again while ignoring the comments of the Tory leader. Apparently, this approach was used
by Mr Brown, when he was Chancellor but does not really work being Prime Minister.
www.searchaccountant.co.uk
I suppose there will be a British general election eventually and Gordon can fight his campaign over previous manifesto lies about being consulted on the European Union consitution, selling part of our gold reserves for a ridiculous price,
wrecking the occupational health system, expanding inequality
etc.
Obviously, if Gordon rang me at 6am my main aim would be to wrangle an invitation to
No 10!!

Bradford and Bingley - AARRGGHH

Having owned up to an interest of 250 shares in UK mortgage bank Bradford and Bingley held by my wife, I think I will share with you, my readers, the painful
consequences of this stake. The shares are trading at around the 67 pence level
after recently reaching over four pounds. Why did'nt I sell in time? One reason the shares were held by my wife and were not for me to sell. The second reason is that as she got the shares for nothing, it made some kiind of sense to hang on.
Although the share price performance is painful, Bradford and Bingley can be complimented for taking steps to avoid a funding problem, which sank
Northern Rock.
www.searchaccountants.co.ukShould B and B shareholders take up the capital raising operation? Investors have to decide in line with their individual circumstances. I hope they do take up the operation, since this would further bolster the capital strength of the mortgage bank, which has been hit by buy-to-let arrears. Long-term, it looks like U.S group
Texas Pacific will decide the future of the UK institution and they are pretty hard-nosed.
Apparently, the City is pretty annoyed by the shambles at Bradford and Bingley. I do get the sense that the whole affair has a lot more to run.