The Price of Passion

A few bits this time, and a return to the question with prize for best / quickest / funniest answer.

Many Happy Returns.

First of all a belated* happy 30th birthday to the FTSE 100 index. Yes, on a cold 2nd January 1984, a Monday, the Financial Times and the London Stock Exchanged launched the index of 100 leading shares on the UK stock market. Leading in this context means by market value of the companies, not because they are leaders of anything; I did not want to be misleading.

The index started at 100, and as I write it stands at a little over 6,800. The highest it has been was a whisker below 7,000 on the last day of trading of 1999. I didn’t need to look this up; I lost a £5 bet that it would get over 7,000 by that year end. In simple terms, this suggests £1,000 invested on that Monday in 1984 into a pure tracker fund (not that any existed then, nor do any exist today for that matter,) would be worth £6,800 today. However this does not take into account the value of dividends received; it is simply a snapshot measure of value, and it updates every 15 seconds of the trading day. Dividends: If you are a shareholder of Lloyds Banking Group you will probably have forgotten what these are.

(*I have used this word a lot lately, so my belated New Year’s resolution is not to use it again.)

The Coutts Index: Objects of Desire.

“A rich man is nothing but a poor man with money.” W. C. FIELDS (1880-1946).

Coutts, the Private Banking arm of RBS (yes that RBS, the state owned one), has issued a press release we will all find useful I’m sure. Basically it tells us the wealthy are getting wealthier and doing this more quickly than the rest of us. Like the FTSE, the Coutts ‘Objects of Desire’ index tracks the value of assets, but those regarded as desirable objects rather than shares. Since 2005, this index has recorded that classic cars have risen in value 257%, classic watches are up 176% and overall, an increase of 77% when you include fine art, collectables and precious items as well as high value homes. The FTSE by comparison has grown by around 40% over the same period. (Edit by Alison: So if you know anyone with, say, an old Jag in the garage that has been waiting 3 years for a certain person to fix it, tell him to get on with it and stop using it as some kind of 4 wheeled storage facility.)

Inflation Falls to 2%.

The Consumer Prices Index fell to 2% in December, down from 2.1% the month before, so it is the first time it has been on the government set target since November 2009. This received much news coverage and fanfare. Less light fell on the other index of course, the Retail Prices Index, which actually rose from 2.6% in November to 2.7%.