Wednesday, November 26, 2008

Credit where it's due...

I am proud to announce that my council, Tower Hamlets has come out bottom of a recycling league table.

Good for them.  I hope they don't succumb to pressure and increase their spending in this area.

I've never understood why we should spend effort processing waste into products that have a lower value than the resources consumed performing the recycling.  

For all their faults, I'm glad that Tower Hamlets appear to share my reasoning.

Monday, November 17, 2008

Psychopaths take over the tube

And no, I'm not talking about the RMT.

What on earth have the morons at London Underground done with Bank/Monument?

Until this morning, my trip to and from work was completely unaffected by the escalator works at Bank.

On the way there, I would take the DLR to Bank and then take two escalators up to the Waterloo and City Line.   On the way back, I would avoid the W&C as there was no easy way back down to the DLR.  Instead, I would take the District line from Blackfriars to Monument, take the escalators down to the Northern Line and then follow the handily placed stairs straight down to the DLR. Completely painless.

Imagine my outrage when I alighted at Monument this evening.  I was prevented - by Tube staff, backed up by a menacing police presence in the background - from taking the short stroll from the District platforms to the Northern Line.

Instead, I was forced to leave Monument, walk to Bank and then re-enter the system. I thought the queues to enter Bank were bad until I reached the Northern Line platform, where I had to queue to get on to the platform.

Of course, I was at the wrong end now so had to walk two-thirds of the full length to reach the DLR stairs.

What an utter farce.

Thursday, November 13, 2008

Arbitrage Opportunities

So, interest rates may soon drop to 0%.

This creates an interesting opportunity.

Let's imagine two people:

Person A: Has a mortgage at a fixed rate of interest (say 6%)

Person B: Has some money to save.

If the savings rates on offer are low - say 2% - it would benefit person B to lend the money to person A instead.

Person A could offset this money against their mortgage and avoid paying the 6% interest charge on that money.  They could, therefore, afford to pay person B a competitive rate of interest - perhaps 4% - and still come out ahead.   One might imagine that there could be lots of people like Person "A" out there (mentioning no names...). I'm sure they'd be interested in such a scheme.

There are three problems, all of them solvable:

1) Person B is likely to be liable for tax on this income so interest rates may have to fall quite far for it to be an attractive deal

2) Person B will worry about the possibility of default by Person A

3) Persons A and B have to find each other.

Problems 2) and 3) could be solved by the introduction of some sort of intermediary. Let's call it a bank.

The bank will wrap up the default risk with their fee for providing the matching service and other administration and capture it as a spread between the rate they'd pay to person B and the rate they'd expect from person A.

So this idea would actually only work if rates fell so far that unsecured bank *lending* rates fell below 6%.

Does anybody see that happening any time soon?