Wednesday 14 January 2009

Why we have a recession - Lesson 1

I received the following text from a colleague who runs a retail finacial services advisory business.

I agree with Steve. I wonder what would happen if we as a firm asked for this concession from HMRC?
When we have to complete our Gabriel return becuase of course the liability would still remain, even if deferred, we'd fall below our capital adequacy requirement and then the FSA would remove our authorisation and we'd beunable to work to repay the money owing to HMRC!
We've just taken the decision to cancel our intended IT spend, training for potential new adviser (internal development) and my own revision courses for Diploma exams as spending all this reduces our capital/cap ad. On top of that whilst we'd taken on a new part time admin last summer and had just started an 18 yr old as part time whilst he does some colleg courses too, I gave them both their notice today as if there earnings and NI will form part of expenditure based Cap ad, getting rid of them and getting my wife to do more hours for the same basic wage, keeps cap ad needs down!
Do they think ANY of this through? We've got work and business coming out of our ears, but I don't want to tie anymoe of my capital up in a business where the biggest part of a SWOT analysis comes out with the FSA and regulation as the THREAT!


This illustrates two things. FS regulation is bonkers and inhibits trade. And taxes on business inhibit employment.
So, cut taxes and regulation and you get more jobs and more wealth creation.
I mean, how hard can it be?

2 comments:

Bill Quango MP said...

But we are following the Third Way. The one Tony told us about remember? What was it again? I can't seem to recall the details. Was it something about economic growth through technology and eating more fruit and having more consultants?

Actually, I'm not sure he ever explained what it was all about at all..

Lola said...

The third way sounds to me like something out of a, not very good, porn film.

Well, that fits. Blair Brown have royally F****d us.