There are times when I forget I’m a Libran.

Most of the time I’m on-brand for my star sign:  Mr On-The-One-Hand-On-The-Other-Hand, that’s me.  But there are times when I see only one hand, and looking at the health warnings on TV commercials is one of them.

A commercial break during the football earlier delivered a particularly infuriating double whammy.  The first was a title towards the end of an innocuous ad for something or other reading “Subject To Availability.”  How stupid is that?  What is the point of it?  If this commercial had to carry this title, why don’t all commercials have to carry it?  All products and services are, by definition, subject to availability.  If they’re not available, then they are, how can I put this, not available.  In what possible way is the interest of the consumer served by making the advertiser put this stupid message on the commercial?

And then another golden oldie, getting increasing exposure now that mortgage advertising is on the up and up again:  “Your home is at risk if you do not keep up repayments on a mortgage.”

This one’s actually doubly ludicrous.  First, although I spend half my life giving talks about consumers’ lack of understanding of many aspects of the financial world, I don’t believe there are many who believe that they can borrow the money to buy a home, make no repayments and face no negative consequences.  Is anyone that stupid and in need of such an entirely obvious warning?

But the second point is that even if they are, a TV commercial is NOT THETIME OR PLACE TO DO IT.  Before the borrower signs on the dotted line, it may well be that it would be a good thing if a real live person, or alternatively a little admonitory online video, as well as a written document, highlighted all the risks they’ll be running if they choose to proceed.  But there is no need whatever to give such warnings during a TV commercial which even the most enthusiastic borrower will be seeing weeks before completing the transaction.  As I think I’ve said before on this blog, including this message in a TV commercial is like running a poster for a luxury hotel and including a caption saying “Our trifle may contain nuts”:  if you’re in the dining room and making a pudding choice this message may be crucial, but while you’re standing on Weybridge station admiring the picture in a 48-sheet it really isn’t something you need to worry about.

Anyway.  I suppose it’s bad to be repeating not only rants from previous blogs, but even the same analogies that I used last time to illustrate the rant.  But then again, that’s how life is – we’re infuriated on a regular basis by the same things, and the same analogies come to mind to help illustrate our infuriation.  I expect I’ll cover it again in a year or two.

Sorry, sorry, have drifted way off-topic here

Apologies to everyone – anyone? – who ‘s come here  for a light-hearted piece on some aspect or other of financial marketing:  today I’m doing Syria. Normal service will be resumed from my next blog onwards.

I don’t really have any justification for doing Syria in a financial marketing blog, but I have two small excuses:

1.  Being partly Palestinian and having family spread all over the Middle East, I have an interest in the region.

2.  So much of what is written and said about Syria is rubbish.

Here’s a sort of executive summary of where we are today:

In early 2011 the US and other Western powers, having accepted or at least tolerated the Assad regime (father and son) since 1961, decided that Bashar al-Assad had to go.  By saying this, and taking some actions like imposing sanctions, we gave encouragement to a mixed bag of opponents to escalate their activities from street demonstrations to violent uprising.  Unsurprisingly, Assad, with Russian support, has chosen to resist this uprising.  And with the army remaining loyal to him, he has been able to inflict far more violence upon his opponents than they have been able to inflict on him and his supporters.  However, the uprising, and the violence, continue, and despite the current fracas about chemical weapons there is no serious plan on any side at the moment to resolve the situation.  Meanwhile, in the West, opinions about intervening against the Government are divided.

I think most people in the West understand most of this, although some may not fully recognise how much Obama’s intervention in May 2011, effectively calling for regime change, escalated the situation.  But what is much less well understood is how we got here.

Apologies again, but we have to go back to the aftermath of the First World War, and the Anglo-French Sykes Picot agreement – which carved up the Middle East after we brought about the end of the Ottoman Empire which had controlled the region for centuries.

The key thing to understand is that in this agreement, we carved out “countries” that made no sense.  Iraq, Syria, Lebanon, even Jordan were all just lines on a map, drawn up as a result of horse-trading between the British and the French without any consideration of the make-up of the populations who actually lived there.

In this respect these artificial countries were not unlike others created by colonial powers to serve their own interests – for example, Yugoslavia, Libya, Zimbabwe, pre-partition India, Northern Ireland, Rwanda, Congo.  And if history teaches us two things about these countries, they are:

1.  When their populations consist of large ethnic and/or religious minorities with a history of hatred and bitterness towards each other, they are always on the brink of civil war.

2.  Civil war seems to be prevented most effectively by strong and unpleasant dictators who suppress all protest and opposition (Assad, Saddam, Gaddafi, Mugabe, Tito etc.

Maybe there’s a third point too:

3.  The only reliably successful way out of these dictatorships and towards anything we would recognise as a democracy involves the break-up of the countries into smaller and much more homogeneous ones (for example the partition of India into Hindu and Sikh India and Muslim Pakistan, the break-up of Yugoslavia and fairly soon, by the look of it, the re-partitioning of Libya).

This is emphatically NOT to say that civil war is inevitable and never-ending in these artificial countries unless dictators suppress all protest.  Various factors can prevent this, including:

–  Benign and not-too-dictatorial leadership, the most obvious example being Nelson Mandela

–  Strong economies and a sense that everyone is (more or less) benefiting, as in Spain over the last 35 years or so since the fall of Franco (although not so sure about the next 35 years…)

–  And perhaps most commonly a sense of complete exhaustion after a long period of civil war, with participants simply lacking the energy and conviction to fight any more (eg Northern Ireland and Lebanon).

But I don’t think anyone can deny that these disunited countries, even when at peace, still have the capacity to lapse into civil war horribly quickly.  Who, frankly, would be surprised to hear that hostilities had been resumed in Northern Ireland, or had broken out post-Mandela in South Africa?

What’s not a viable solution in these artificial countries, just for the avoidance of doubt, is Western-style democracy.  In sophisticated countries and in peaceful times it may just about be possible to maintain something that looks like democracy by imposing (non-democratic) power-sharing agreements on top of a democratic outcome (Northern Ireland again, and currently Iraq, just about) but for one thing by definition these aren’t really democratic, and for another they’re not stable enough to survive a major challenge.

Unless somehow the populations of these countries can  choose to overcome tribal, religious or ethnic hatreds which in many cases go back over millennia, the only viable solutions in the medium to long term are a) to leave them in the hands of repressive dictators, or b) to see them break up into smaller and more homogenous entities.

Which brings us to our current problem in the West:  we don’t like either of these options much.  We don’t much like repressive dictators, or at least we don’t much like them when they’re closer to the Russians than to us (we’re pretty OK with them when they’re close to us – Pinochet. Franco, Mubarak, the Shah of Iran etc).  But we don’t much like either the process of break-up (lots of violence and ethnic cleansing, as in the collapse of Yugoslavia or the separation of India and Pakistan) or, very often, the consequences – especially when one or more of the new mini-states is run by a confrontational Jihadist government.

When people say we need an “end-game strategy,” this is ultimately the choice we have to confront.  For as long as we don’t, the danger is that we’re supporting an untenable worst-of-all-worlds outcome, installing weak and vulnerable governments who can’t survive the secessionary threats within their own countries without massive military support (as currently in Iraq, Libya and Afghanistan).   I suppose that this kind of strategy can postpone the inevitable, though only at vast expense and with heavy continuing loss of life resulting from continuing low-level confrontation between communities.  But it can never resolve the situation and provide even a medium-term solution, because the fundamental instability is too great:  who can doubt that the Taliban will be back in power in Afghanistan,. albeit facing continuing harassment by drug-money-fuelled warlords, within three years of the West’s final exit?

So, against that background, what’s your strategy for Syria?  Is it:

a)  To do what the West has usually tried to do with these artificial, fragmented countries which we drew on the map in the first place, and install a dictator who is friendlier to us than to the Russians?

b)  To encourage the insurgents to overthrow Assad and win the war, with the strong probability that the country will then break up into a number of mini-states at least one of which will be ruled by jihadists?

c)  To play for time and install a puppet regime, as in Iraq and Afghanistan, that can’t survive without massive ongoing support?

You say you don’t like any of those options much?  You say you don’t think any of them is worth spending billions of pounds and maybe hundreds or thousands of Western lives on?

Well, in that case, my advice is to fucking well stay out of the fucking place.  People like you, trying to run other people’s lives for them,  have caused quite enough trouble in that unhappy country – and indeed in most of the world that we once carved up so casually – already.




Who’d have thought “goodwill impairment” could be so expensive?

Both my regular readers will know that I’ve been growlingly bearish for ages on the potential for financial trade press titles to maintain their advertising sales revenues.

Basically, I’ve been saying that product providers just don’t want to reach the broad mass of financial advisers any more.  They recognise that the product selection decisions are increasingly taken upstream – as far as investments are concerned, by a whole bunch of specialists called things like multi-managers, model portfolio managers, DFMs, investment research departments, investment platforms and a bunch of others.

This all sounded like an interesting but potentially totally mistaken argument – until the leading trade press media group, Centaur, announced their 2012 financial results a few days ago.

The trading performance was far from brilliant, especially as far as advertising revenues were concerned.  But the figure that really jumped out was the exceptional item in respect of “goodwill impairment” – which, as far as I can understand it, puts a value on the group’s assets related to their future revenue-generating potential.

In a total “impairment” across the group of just about £40 million, the financial division alone took a hit of £14 million – reducing its goodwill value by over half, from around £26 to around £12 million.  That is a lorra lorra impairment, especially in the space of a single year.

I’m sure it’s taken a lot of beanies a lot of hard work with their calculators to get to that figure.  I suspect there could have been an easier way.  A simple measurement carried out with thumb and forefinger says that the thickness of Money Marketing is down by just about exactly the same proportion, a little over 50%, year on year.

On the upside, they don’t trust anyone else either

Some friends with a uni-age daughter came to stay in the summer.  I can’t say it was my best-ever conversational gambit, but one breakfast-time I picked up a pot of yogurt and wondered aloud what something called bifidus, apparently a key ingredient, actually is and does.

“Don’t pay any attention to that,” said the teenager.  “It’s just some bullshit invented by the company to make you pay more.”

I know nothing about yogurt, and she may well be right.  But her total and unhesitating certainty that the company was lying and it was all just a con did make me think that it’s not just financial services providers that have trust issues these days.

Oh good, our violent neighbours have bought large new clubs

Just back from a CSFI event about the use of social media in financial services.  On the whole a rather desultory and badly-structured affair, but with a good deal of comment on the familiar theme of how social media put a lot of new power in the hands of the customer, and how this is a trend that we in the industry should welcome and encourage.

All this put me in mind of a person living next door to a house occupied by a large and violent family, and discovering that they’ve recently bought a bunch of heavy and frightening-looking wooden clubs.  Every time this person emerges through his front door, a large group of these neighbours spring out and beat him about the head with their clubs until he is bleeding profusely.  However, for reasons not explained by the analogy, our protagonist’s reaction is to express pleasure that these neighbours have the use of such powerful clubs, and to wish that more people would get some too.

Not for the first time, I reflect that we in the world of financial services do have quite exceptionally strong leanings towards masochism.

I’m back, I’m back, hope you haven’t forgotten about me. Oh, you have. Right.

Got back from my ever-longer summer stay in France a couple of days ago to find our two cats looking blankly at me – well, not really looking at me at all, to be honest.

Have a nasty feeling that it may be the same with blog readers – once they’ve gone, they’ve gone.  Still, I shall resume writing stuff.  I do it for me, not you, anyway, truth be told.