IFAs bemused by the wisdom of Mr Bean

Mr Bean

I seem to recall that in every episode of Mr Bean I've ever seen, he is a completely tight individual who rarely spends a penny if he can help it..... So it seems that he has changed his attitude and his appearance since the TV shows were cancelled, but maybe not his grasp of reality!

Posted by: Mike Inkley

Lack of commonsense

Mr Bean's remarks do seem unwise and divorced from reality. One can see, however, a superficial logic. People spend money these days on goods and services which usually originate from abroad (imported manufactured goods, holidays overseas and so on). They do not benefit this country except by providing tax revenue and perhaps the financial "services" bodies if credit is used. If the government pursues a policy of increasing investment here from which British owned companies (with employees here) will benefit in the medium term, then there may be residual standstill in tax revenues and unemployment may take longer to come down (or may not) but the position will be better eventually. As we have been going in the last few decades, we'll be finished as an independent economy in another generation. It's really no good at all selling off our companies (and other assets) because the revenue and profits from our work then go elsewhere. It is only a question of time before we price ourselves out of existence (as we have been doing since 1945 - trade unions please note) and we'll be facing civil unrest as a result. Mr Bean might usefully have focused on these more important factors.

Posted by: James de la Mare

Is that not advice?

Is this not advice and is he regulated !!! If people lose money as a result who pays?

Posted by: Michael Fallas

Makes sense to me`

Mr Bean has provided some insight into one of the reasons why the BOE is keeping rates low; to stimulate spending and in turn growth. Of course borrowing used to play this role but that died with Leamans! His reasoning makes perfect sense (at last someone is being candid) and also provides me with a useful indicator of what will stimulate the MPC to begin rate rises! Property once again needs to become an attainable reality (and not a pipe dream for middle age) for many more ftb - through realistic and sensible credit facilities - we will see rates steadily rise; until then I will keep spending my money on my business waiting for that day!!

Posted by: Chris R

Mr. Bean

Well put James - We have seen industry after industry be smashed by the likes of Mr. Bean over the past 40 years Motor Bikes, textiles, Coal, Mass Car production, all these and many more all gone we are now a consumer country not a producer country and all we can do is borrow and spend to stand still one one side and sell assets Water, electric, Gas, Nuclear, Chocolate you name it Even biscuits are on their way out on the other. And all Mr. Bean can suggest is spend spend spend. They are cutting the services today we will have no navy (shared ships with the French) just a few planes left operating less than Saudi are ordering new this year, but we have more civil servants in MoD than soldiers in the Army.

Posted by: John whipple

Charlie Bean says spend not save

I trust this a personal view and not a precursor to weakening resolve of the MPC or for that matter the Coalition. There is no easy solution nor should one be sought and revived spending now will lessen the pain but only temporarily. Failure to address the profligacy of the past with austerity measures will see even bigger problems further down the track. The UK needs to go through its own 'RDR' by transitioning from being too dependent on consumption and yes financial services and start competing with the rest of the world by becoming more export driven. We will continue to deleverage until we are comfortable with personal indebtedness and we cant let the banks rebuild their balance sheets by ripping off the retail customer. Given that all this will take at least the rest of this parliament to work through I would consider it strange if people were not hanging on to their savings however derisory the interest rate. Furthermore who knows how the cuts to be announced on 20th October will play out.

Posted by: Duncan Jones

A Bean counter

Now you have it – the truth at last. All our Governments are a bunch of disingenuous charlatans. They bleat about getting us to save and look after our retirement on the one hand. On the other you have daft statements from this half baked Bean. You have youngsters put into debt even before they start work and if Cable has his way, kept in debt as long as possible. Thos who really do want to save are then given a carrot (Pension simplification) and when it is seen to be effective it is then withdrawn PDQ. We can’t have the proles getting too well off after all. The Government then moans about those living on State Benefits, while encouraging fecklessness. Maybe thy just want us actually to rely on the State so that they have us where they want us. It seems to me that if you want a measure of self reliance and solvency you should do exactly the opposite of what anyone in Westminster tells you. Now perhaps you can see the value of the sainted Maggie. Look after yourself first – no one else is gong to give a stuff about you.

Posted by: Harry Katz

simples...

The government, the BoE have not got a plan to recover the mess we're in so they ask everyone to spend and help the economy, when they have spend all their money tuff. What a stupid comment, we must all plan for the future and savings are crucial to this....the lunatics are running the asylum now, i'm going for lie down,i can't cope with this stupidity....

Posted by: Fraser Brydon - IFA

Bleeding obvious

Savings is a long-term goal; spending is a short-term cure. The point of lowering interest rates is to make saving less attractive, at a time when we need something to kick-start the economy. In time interests rates will return to a 'neutral' level, and if inflation/spending starts to boom, then they will rise to make saving more attractive. Its page 2 of an economics book. Doesn't say much for IFAs if they can't even get that far!

Posted by: David

Savings paradox

The economic pyramid collapsed a couple of years ago when the economy pretty much ran out of capacity to borrow any further. While I can follow Mr Bean's reasoning, I can't agree with it. Joe Public needs to retrench and BIG Government definitely does (which is why Mr Bean wants us to compensate). I can't help wondering if low interest rates will simply make us all work harder to save since interest rates aren't going to alleviate the strain for us. What I am pretty sure of is that it's absurd fantasy to imagine that people will go out and spend out of some patriotic duty to the economy when the economic and employment outlook is depressed and uncertain. If low rates are effective at putting people off saving, Mr Bean shouldn't kid himself that the public is following his script. Paying down the mortgage and taking a punt on the markets look more likely outcomes to me.

Posted by: @sipphound

Oh Really!

I'm getting more than just a bit concerned about some of the people that carry influence in this country. Last week we had Lord Newry and now we have the proverbial Mr Bean spouting off about spending our way out of a problem. The reason that many of us are keeping capital on deposit is because we don't trust those people running the country to act prudently and so we feel that we need a safety net, just in case. Here's a radical thought, reduce my tax bill by 10% and I'll spend every penny of the saving in the UK to boost the economy. Until you are capable of running the economy as efficiently as I run my own and my clients personal finances don't lecture me!

Posted by: Ken Kirkpatrick

Savers must remain cautious

The recession should have signalled the end of the binge borrowing and excessive spending culture – so it is worrying that cautious individuals who have put some money aside for a rainy day, or their later years, have apparently been advised to throw caution to the wind and dip into those savings in an attempt to prop up an ailing economy. For years we have witnessed unprecedented borrowing levels by individuals. This – and the consequent spending that took place – was largely to the benefit of the High Street, but also contributed to record levels of personal insolvency. We have also seen unprecedented levels of public sector borrowing. In the same way that the Government’s Comprehensive Spending Review (CSR) will cut spending to ensure the state reduces its debt levels, as a society we also need to learn to live within our means. Now that over-committed consumers are unable to prop up the High Street, cautious investors should not help to boost the economy by raiding their own savings pot. David Thornhill, partner, FRP Advisory

Posted by: FRP Advisory