Wednesday, 27 June 2012

Why I don't Read The Papers...

A burglar asked to be sent to gaol because his probation appointments were at 10am and they were interrupting his sleep.... Of course we're invited to hate the guy;

Shameless Batchelor told the judge he failed to attend the meetings because they were too early in the morning - despite being at 10AM.
The courtroom conversation is dutifully reported in full by the Daily Telegraph;
"I'd rather go to jail and get it out the way, come out and get a fresh start, and not have to do probation and things like that."
Mr Herbert asked Batchelor: "Have you given up on the order?"
He replied: "Yes."
Matthew Barnes, prosecuting, told the court: "He has told me that he has insufficient motivation to attempt to comply with the order.
"He is resigned to the suspended sentence being imposed."
And fair enough, he's a burglar. So my sympathy is limited. But he's got a job, working nights and doesn't finish until 6am, so he's clearly got a chance of "going straight". And under those circumstances, 10am probation seems unreasonable. Yet we, the taxpayer have to pay for gaol? Once again, the convenience of the bureaucracy trumps the convenience of those using the "service" and the costs are completely ignored. And someone who knows, agrees: probation officer and blogger, Jim Brown:
it's the supervising officer who should be being pilloried, not the client. In my humble opinion a young man has needlessly gone to prison, not as a result of any new offences, but because of piss-poor practice. In all honesty a case like this takes my breath away. I can only contemplate as to the content of the Breach Report. What on earth was the Barrister doing to earn his or her money? Why didn't the Judge use some initiative and demand to speak to the Probation Court Duty Officer? Had I been the said CDO, there is no way I would have allowed this case to proceed without intervening.
The papers lie to you, often by omission or sleight of hand. I didn't notice that he had a job until the second time I read the piece. You're being manipulated, people.

Friday, 22 June 2012

The Jimmy Carr Tax Trick.

Self-employed? Sick of paying tax? Here's how Jimmy Carr got away with paying 1% on his income.

  1. Resign from employment in the UK
  2. Establish a company based overseas
  3. Get hired by the offshore company, on a minimal salary, say £8,105 per year.
  4. Pay any earnings directly to the offshore company
  5. Receive large interest free loans from your company
  6. Declare these interest free loans as tax liabilities to reduce Income Tax payable to HMRC
It stinks so bad, I might have to try it.

Thursday, 21 June 2012

When the Law's an Ass, Try a Nudge.

The motorway speed limit of 70mph is probably the most widely ignored law in the UK. Even when there's a police car, they do 68mph, you pass them at a stately 72 or so before putting your foot down again. Almost everyone drives on a clear motorway between 70-90mph. This is because cars have got safer and faster. Brakes and Tyres are better.

However average speeds have been dropping recently (and this has led to a reduction in fatalities). The reason has nothing to do with policing, which has been reduced, and certainly nothing to do with enforcement as the Motorway network does not have fixed speed cameras. It is a combination of high fuel prices and the fact modern cars tell you how much fuel you're using as you're going along.

Does anyone else try to keep the MPG above 40 on a motorway cruise? If you realise that you double your miles per gallon by dropping from 85 to 70 mph, you're more likely to set the cruise control at the lower speed and relax. The best thing about this is there's no government campaign. Private business has given people a data point they'd previously only considered in abstract, and customers respond. The speed limit should be 80mph or higher and enforced strictly.

Wednesday, 20 June 2012

Filthy Lucre

Of course, following the bust in 2000, over a decade of poor returns means those excitable investors who got into shares following 'Big Bang' and the privatisations, got burned and left. While share ownership is a bit broader than it was pre-1986, it is being seen as increasingly the preserve of the rich or institutions which manage pension funds. Companies are increasingly eschewing a listing on public markets, preferring to tap other sources of capital. The Economist is in no doubt as to why.

The burden of regulation has grown heavier for public companies since the collapse of Enron in 2001. Corporate chiefs complain that the combination of fussy regulators and demanding money managers makes it impossible to focus on long-term growth.
I've also seen the bleat from the left about companies like Boots being taken private. Suddenly the left is reaping what it sows. If you make it difficult to raise risk-capital on the stockmarket, you cause people to seek other, less onerous sources of capital. This means the returns available to the private equity industry (which haven't been all that good) are not available to the private investor, or his pension fund. This benefits no-one except the caste of city/wall st. insiders.

In the name of equality, share transactions and dividends are taxed, further promoting debt finance over equity. Executive pay is being regulated, further weakening any incentive to go public. The left through rhetoric and regulation is destroying a means by which ordinary people can take control of their lives through investment.

It's not just at the level of the company. In the name of protecting investors, regulations ensure it's difficult to give advice, especially on small amounts of money. So the poor are vulnerable to the bucket-shop, leading to poor strategies and lost money even where there is not outright fraud. Private investors are encouraged by tip-sheets into wildly inappropriate stocks because their broker isn't allowed to point them in the right direction. Banks are the most complained-about sector on the high-street. They are also absurdly tightly regulated, selling investment "products" larded with fees with opaque performance measurements designed to comply with regulation and keep the customer in the dark thereafter. If that same person wanted me to suggest a share for him to dabble in the stockmarket, I would be breaking the law. The bank can chuck his money into a crappy fund and forget about him drawing commission every year for doing so.

The greatest engine for investment has been broken, not by excessive risk-taking (that's what the stockmarket is FOR) but by over regulation based around the foolish notion that a chaotic system can be rendered safe. What's left is the kind of big, regulated utility which doesn't offer the returns to attract the hot money (utilities) massive hype businesses whose owners want to cash out (glencore, facebook) or crappy aim-listed mining juniors whose shareholders are ultimately betting on the financial equivalent of three-legged bob in the 3:15 at Epsom. The rest are there out of habit, until they're taken over or taken private.

Regan's epithet about the Government's view of the economy is aposite:
"If it moves, tax it. If it still moves, regulate it. If it stops moving subsidise it."
Big business still needs the stockmarket. But only just, and not as much as you, me and your pension fund need it. The Government needs to let it breathe. This is how regulation makes us poorer without making us safer.

Stamp duty (our very own Tobin tax) needs to go. Restrictions on advice need to be softened. Taxes on dividends need to be cut. Share ownership is a means to the ownership of capital open to the masses and it needs to be encouraged, not tamed.

Tuesday, 19 June 2012

The Brothers Unite Against Progress.

Listening to the interchangable trot (I think it was the head dinosaur at the GMB union, Paul Kenny) the BBC dredged from the 1970's to appear on the 'Today' Program, I was struck by his repeated use of the words "private company". The background is that the Blairite think-tank, Progress, whose mission is to

promote a radical and progressive politics for the 21st century...
whatever that means, is structured as a company, not a charity, and it distributes money around the labour party, and somehow this is sinister. But it's the way the Trades Unionist apparently thought "private company" was something everyone would find as distasteful as he that I found striking.

Frankly, I couldn't give a tinker's cuss about how pressure groups, think-tanks and so on are structured. Many in the Libertarian world make much grunting about the fact that the Accociation of Chief Pig Officers is a private company. Of course what matters is the influence, and the quality of thought. And in progress's case it was founded in 1996 by Peter Mandleson, now Lord Fondlebum of Rio, to come up with an answer to the conundrum: The Tories are right on more or less everything, but they make me feel all icky. How can I get Tory policies past the Unions?

Of course Tory policies delivered by people who don't understand why they work was popular until it all blew up. The Labour party was able to win elections under Blair in a way they hadn't been before. Of course, winning elections isn't what the unions want, because they don't believe power should lie in the ballot box, but at the point of production. The Unions want their party back, so they can go back to discussions about how to bring about the inevitable end of capitalism, and when to smite the hammer-blow by calling a General Strike. And to this end, they are trying to get New Labour kicked out of the party, just as the party dealt with the militant tendency in the 1980's. Labour is moving sharply left, and towards a lumpen, municipal socialism of the 1970s. The drabness of the vision is matched only by the unpleasantness of the men who want to lead it.

The RMT's Bob Crow: the Labour party's soul looks like him.

Ultimately, whatever the polls say now, when the people come to look closely at the labour party in 2015, they are unlikley to like what they see. The polls are a mirage, Ed Miliband is a spineless fool, and Cameron's the luckiest politician in History.

Wednesday, 13 June 2012

A Layman's Guide to the Euro Crisis.

There is a lot in the news about the crisis in Europe, and a lot of the coverage is filtered through political lenses as people project their beliefs onto what’s going on. Eurosceptics are enjoying saying “I told you so!”. Left-wing parties are blaming the banks and the political right is seizing an opportunity to ‘shrink the state’. It’s often difficult to separate fact from journalistic wishful-thinking. So what’s really going on?

The EuroZone is a ‘currency union’ without a ‘fiscal union’. ‘Currency union’ means sharing the same currency. The 50 States of the USA are in a currency union with each other, and so are the nations of the UK. The EuroZone is a currency union between some European Union nations.

A ‘fiscal union’ is where a central government makes spending decisions for a currency area. Despite devolution in the UK or the American states’ tax and spending powers, the USA and UK are ‘fiscal unions’. The American Federal government distributes funds from a central pot to the individual states to spend on things, such as roads or law enforcement. In most fiscal unions, richer areas pay more tax, but don’t get more state spending per head than poorer areas, resulting in a ‘fiscal transfer’. Some ‘entitlements’, what people in the UK would call ‘benefits’ for example are paid out of a federal pot. In the UK, the greater South East subsidises the poorer areas of the UK by this method.

In the EuroZone, many thought this union would cause problems, and indeed the designers of the currency knew this too, but considered the problems would act as a driver of ever closer union, their ultimate end aim. The Euro was a political, not an economic construct.

What precipitated the crisis around Europe was the inability or unwillingness of Northern Europe to subsidise the periphery in the way London and the South East subsidises the rest of the UK. As the periphery ran out of money, and succumbed to financial crises, one-by-one the markets lost faith in the ability of these governments to meet their debts.

Governments issue debt as bonds. If investors think the risk is low, they will be willing to pay a high price, resulting in a low yield to the investor and low costs to the borrower. If the risk goes up, the price falls, and the yields rise. Countries afflicted by the financial crisis saw bond yields rise as investors sold. The money investors raised by selling this debt flooded into the good risks at the core – especially Germany, which has seen yields fall sharply as a result. The UK and Switzerland have enjoyed a similar effect, being perceived as safer-havens. This rapidly became a self perpetuating downward spiral for the bonds of the afflicted governments.

The problem with the Euro is that small countries or those which had poor track records of paying back debt, suddenly saw their borrowing costs fall when they joined the Euro. This is because the markets initially thought all EuroZone bonds ranked equal, or nearly so, to those of Germany. Because the peripheral governments’ borrowing costs fell, so too did those for business and consumers. This resulted in banks lending and people borrowing much more than they would otherwise have done. Some governments, notably Greece, fell into the same trap too.

In Ireland and Spain in particular, this very low interest rate resulted in a huge speculative property bubble as a flood of new money inflated property prices. People got rich very quickly, and numerous new developments were built. However all bubbles must burst, and the oversupply of property meant there was insufficient demand for all the new flats and houses. The market crashed. The bad loans secured on overvalued property created losses which overwhelmed the banking sector. The Irish government, despite the fact it had been ‘fiscally prudent’, by running large budget surpluses during the boom was also overwhelmed. In 2007, Irish debt was just 25 per cent of gross domestic product (GDP) – a measure of the size of an economy. Despite this, the Irish state, unlike that of the UK, simply didn’t have the line of credit to finance the enormous banking losses, and needed help from the EU and UK. Because of the banks’ losses assumed by the Irish state, debt to GDP ratio has now risen to nearly 100 per cent.

Portugal, however did not suffer such a crisis, as it lacked a big banking sector of its own, so much of its property bubble was financed from across the border in Spain. However the Portuguese government didn’t run significant surpluses in the good times, and when the economic crisis came, tax receipts fell, and the market lost confidence in the government’s ability to pay its debts. As the country was running a large deficit, when interest rates hit 7 per cent, a burden totaling 80 per cent of GDP, the market considered this unsustainable. The EU & International Monetary Fund was forced to ride to the rescue.

Spain, being a larger economy than Ireland, took much longer for the bubble to deflate. Its banks were also sounder, carrying more capital than Ireland’s. Like the Irish, the Spanish government ran a prudent surplus during the boom, but it too may now struggle to raise sufficient money to bailout its banking sector, which has suffered the same fate as Ireland’s. As a result, Spain needs a bailout. And the EU has made €100bn available. Because it is not clear whether this is from the European Financial Stabiliity Fund (EFSF) or European Stability Mechanism (ESM), existing holders of Spanish debt are unsure whether the new creditors are ahead of them in the queue for repayment. Investors fear they have been ‘subordinated’ by the new line of credit. As a result, after brief euphoria on the markets, borrowing costs in Spain and Italy rose on the news.

Italy did not have a property bubble, nor did it have a banking crisis. Instead, it enjoyed a cheerfully chaotic political system which was incapable of balancing its books. Short-lived governments had little incentive to save money, finding it easier to buy off supporters without taking long-term decisions. Their problem as a result is simply an enormous debt burden of 130 per cent of GDP. Currently, Italy is running a ‘primary surplus’, that is, it is able to meet its costs – public sector wages and so on, and would be able to balance its books, were it not for debt interest. Italy’s budget deficit is therefore a direct function of the yield on its bonds. Perversely, this is the moment countries are most likely to default, as they will not need to tap the bond-market to meet existing expenditures. As a result, investors have fled Italian debt in a self perpetuating downward spiral in their bonds and increasing the likelihood of default.

Greece’s problems can be summed up as ’all of the above’, and then some.

As a result, everyone in the EuroZone is seeing their borrowing costs rise, except the dwindling core of Northern European AAA rated countries. Even France isn’t safe – they haven’t had a balanced budget since the early 1970’s, and borrow at nearly twice the price of Germany.

The UK’s debt burden is 80 per cent of GDP or so (worse than Ireland in 2010), a deficit in 2010 of 11 per cent (the worst in the developed world) and an enormous banking sector relative to GDP. So why doesn’t the UK have a massive economic crisis like Ireland, Italy and Spain? Why is UK 10-year debt yielding a paltry 1.8 per cent when equivalently indebted countries with far smaller deficits find their debt yielding over 7 per cent? Ultimately, it’s because for the time being, the debt markets have confidence the UK can meet its obligations, if necessary by printing money. This option is not open to the EuroZone, who have subcontracted this to the European Central Bank. Furthermore, the UK’s government debt has a much longer maturity than many equivalent countries, so does not need to access the bond market to ’roll over’ maturing issues, giving the UK’s government time to bring the finances under control. Finally, and this is almost certainly the least important effect, the UK’s government is committed to gradually cutting the deficit.

The EuroZone therefore is suffering from the logic of a ’currency union’ without ‘fiscal union’. As the breakup of the EuroZone looks increasingly possible, bank depositors in Greece (most urgently), Portugal, Spain, and Italy do not want to risk waking up one morning to find they’re holding Drachma, Escudos, Peseta or Lira instead of Euros. So they open bank accounts in London, Geneva or elsewhere in currencies – Euros, Dollars, Swiss Francs or Sterling which they trust to remain ‘hard’, and where their cash-strapped governments can’t get at it.

This causes a collapse in the money supply – often a cause of deep recession. Unlike in a ’fiscal union’, this money is not replaced by transfers such a grants paid out of EU pooled funds, which are simply not large enough to do this job. As the economies of the EuroZone periphery shrink, so do tax revenues. With no corresponding shrinkage in obligations, the deficit can only rise. Spending cuts cause further short-term pain as public-sector workers get laid off, and the economy risks spiraling down. Wages, for those who retain jobs get cut and living standards fall. This is the mechanism by which ’austerity’ is accused of driving economies down.

Unfortunately, for the citizens of the EU, from an economic point of view this fall in living standards and wages is exactly what is needed. The underlying problem is competitiveness. Italian workers are just more expensive than Germans per unit of output. Italians’ wages have to fall by around 20 per cent to regain competitiveness, Spaniards by 30 per cent and Greeks by 50 per cent.

The Italian economy was never really as large as the UK’s, nor were Italians as rich as Germans. They just got access to Germany’s credit card for a decade and so thought they were. Bringing the economy back to reality will be a painful process. This is called an ’internal devaluation’. It will be miserable, and scar the people forced to endure it for life, and result in a flight of talent and capital, from places suffering its effects. An internal devaluation on the scale needed may not be possible without violence.

Devaluation of the currency means most countries overcome these effects, and make their exports and workers competitive. It’s worked for the UK many times, but for the periphery, this means leaving the Euro. A new Drachma would probably fall by 50 per cent almost immediately, achieving competitiveness with the German worker in a matter of months rather than years. This is no easy option though, either from the point of view of the Greeks who will see imports, even of staples become prohibitively expensive; or the rest of the EU. Once the market has forced one country out, the next one (Portugal or Spain) looks more likely to go too, creating a cycle of instability. It is this EuroZone policymakers fear the most.

If Southern Europe is to remain in the Euro, and yet avoid grinding recession for a decade or more sudden economic catastrophe, it is going to need vast injections of cash to pay the bills. It also needs its productivity and wealth to catch up with that of Germany and Northern Europe. For an idea of the scale of cash transfer needed, look at fiscal transfers from the North to the ex-Confederate states after the US civil war, or from West to East Germany after unification. 10-20 per cent of GDP. It is unlikely the (West) Germans can be persuaded to pay on that scale again. Nor do Germans seem willing to underwrite the deposits in EuroZone banks (a so-called banking union) or underwrite the bonds of the struggling EuroZone states (the so-called Eurobond).

People describing themselves as ’Keynesians’ think the death-spiral of austerity and internal devaluation can be averted by governments injecting demand into the economy by borrowing huge sums in order to spend. Who is going to lend to these peripheral governments? The German government seems unwilling to let the European Central Bank print enough money and the open market has already said “no”.

It is not a binary choice between ’growth’ and ‘austerity’. Even if these governments could raise the money, they may not achieve the necessary growth. There is evidence that the negative effects of increased public spending can cancel out any stimulus to the economy. Public debt often ‘crowds out’ private investment. High debt burdens may also cause people to anticipate future tax rises and rein in spending and increase their savings which will hurt the economy. These negative effects seem to become greater than the positive when the debt burden reaches 80 per cent of GDP, though this is not a hard and fast rule. Furthermore, economies seem to find any growth at all very difficult to achieve if public debt reaches 120 per cent of GDP. Thus, attempting to spend your way out of recession, an indebted Government risks fruitlessly adding to the debt burden, to no effect on overall GDP growth.

It seems the money for stimulus has probably already run out.

In my opinion, the best thing to have done is to not join the currency union in the first place! The UK’s ejection from the European Exchange Rate Mechanism in 1992 and Iceland’s experience since 2008 seem to bear this out. ’Austerity’ and the devaluation in place is painful, so ’stimulus’ is superficially attractive, but it risks creating a bigger problem for the future for little gain now. The unfortunate conclusion is what is necessary is impossible, and what is possible is unappealing. There are simply no easy answers. The Euro crisis is likely to form the backdrop to investment decision for some time to come.

Friday, 8 June 2012

An In/Out EU referendum... Not Now.

According to the Tory/UKIP narrative, the only reason that David Cameron isn't offering an EU referendum is that he's a closet (or not so closet) europhile. As part of the new elite, he's bitten completely into the grand European project, hook, line and sinker. His aim is therefore to deny, like those European politicians, his people a say in the project. This makes him (and I'm quoting from various tweets from EU nutters) a Quisling, a traitor, only pretending to be a Tory, not a real conservative and so on.

If only, so the narrative goes, Cameron offered a referendum, people would dance in the streets. We would pull out, and without our Euro-dues flooding to the continent, we would be able to spend the money, invigorating our own economy. India, Australia and Canada would welcome us back with open arms. UKIP would pack up and go home, and the Tories would romp to victory at the next General election.

This is bollocks.

The electorate is broadly hostile to the EU. But they only express that feeling when asked. Even with the Euro-crisis on the nightly news, few venture this as one of their top priorities. If anything the evidence appears to be however much the electorate agree with the Tories, there is a stronger feeling that they wish the Tories would just shut up about Europe.

The straight in/out question lacks the subtlety of both the Electorate's (and the official Tory) position. That is most people, when given the option, express an opinion supporting a middle way. Not out of the EU entirely, but certainly not part of the core federal project. If the electorate could have the free market at lower cost, and without all the Euro-laws interfering with the extradition of bearded ne'er do wells like Abu Quatada, we'd be OK. The fact that these rulings come down from the ECHR, not the EU is lost on the electorate.

So, are we "better off out"? Possibly, right now. The EU is an unattractive bureaucratic project which has got far, far too big and intrusive for the UK's comfort. It suffers an absolutely obscene democratic deficit at its core. But, and this is crucial, leaving would be disruptive and not at all helpful to the short-term pressing problems of a flat economy, which should occupy politician's minds. Asking the Question in 2014, risks the electorate asking back "why now, when you've more important things to do?". Worse, from a Tory perspective, this could re-open the running sore of "splits". Certainly the other parties will be opening up this old wound.

Leaving the EU is not without cost. The Free market is a benefit, an enormous one, of EU membership. As is often pointed out, the European nation with the most rigorous implementation of EU diktats is Norway, which isn't a member of the EU, but instead suffers from "government by fax" where it is forced to adopt the measures of the free market, while having no input into their creation. Unpicking the constitutional, legal and economic effects of EU membership is a much bigger question, and will come at much greater cost than the simplistic Eurosceptics would have you believe. The UK, as a vastly more powerful nation than Norway will certainly be able to negotiate better terms than Norway, but I would vote against any "out" proposition which lost the UK free access to the EU's single market. Leaving is a project for a stable Government with a clear mandate to do so, in good times. Ie. NOT NOW.

The UK has pursued the same foreign policy in respect to the continent since the Plantagenets abandoned the idea of an Anglo-Norman continental empire: If England (later Britain) cannot be the Hegemonic power in Europe, no one shall be. Withdrawal from the EU will cede that hegemonic power to Germany, something nearly two million Britons died in the twentieth century to prevent.

The EU is about to split into a federal core of Eurozone countries while a rump of independent countries, some of whom still say they want to adopt the Euro (but probably won't) remain in the Free market. Britain can lead this group, ensure the reformed Holy Roman Empire can't grow too big. With Britain in the Single Market, Poland and the rest of Central Europe may have the confidence to retain their currencies and act as a counterweight to an over mighty Teutonic empire.

Instead the Eurosceptics would rather stand on the white-cliffs of Dover in a Union-Jack tie shaking their fist at the dastardly foreigners over the Channel. We can look back on the summer of 1940, when Britain stood alone with pride. It does not mean we should try to recreate the feeling, especially when we're about to get what we always wanted from the project. By staying in the EU and undermining its ridiculous march towards "ever closer union" from the inside, The United Kingdom is staying true to nearly a thousand years of consistent foreign policy.

Let's not abandon that which has served us well for so long.

Wednesday, 6 June 2012

90% of Parents are worried about....

There's a "report" doing the rounds of the media this morning from The Chartered Institute of Marketing. The press association report is here, and given the utter failure of anyone in the mainstream media to apply anything approaching critical thought, I thought I'd give it a go.

Most parents remain concerned about the commercialisation and sexualisation of childhood a year after an independent review of the pressures on children growing up, a study finds.

Nine in 10 parents (90%) still think there are problems with the way some companies advertise to children...
I'd want to know how the question was asked. "Do you think sexualised advertising should be targeted at young Children" followed by "are you concerned about this?" which is clearly leading. Of course no newspaper or TV channel asks these (to me) obvious questions; this is why the Main Stream Media news is a dead-industry-walking. It's clear, though to anyone capable of abstract thought the pollsters are probably looking for the answer they've already picked.
...and 85% are unaware of the dedicated complaints and advice website ParentPort, according to a poll for the Chartered Institute of Marketing (CIM)
Did ParentPort have any input into this "report"? I think we should be told.
The survey comes a year after the report by Mothers' Union chief executive Reg Bailey, entitled Letting Children Be Children, which called on businesses and broadcasters to play their part in protecting young people from the "increasingly sexualised wallpaper surrounding them".

Parents remain most concerned about sexually explicit outdoor advertising, marketing during children's TV programmes and inappropriate products for children, such as padded bras, the poll says.
Of course if Padded bras for young children didn't sell, then companies wouldn't make them. You do, of course have the right to NOT BUY PADDED BRAS FOR YOUR TODDLER, or complain to the manager of the store where they're sold. And why is the Chief Executive of the Mothers' Union called 'Reg'?

Of course, little girls love shiny things and bright clothing. They like dressing up like adults and playing with mummy's makeup (usually with messy results - lipstick's a bastard to get out of a carpet) The "sexualisation" of kids is more about adult's view of kids than kids' views of sex. Recently, when I was swimming in a public pool, a 3-year old stripped off, squealing with delight as she was chased round the pool by a red-faced father carrying a swimsuit. This isn't sexual behaviour, she was just enjoying a game of chase. She doesn't have a view of sex, yet. It doesn't stop society seeing her as a sexual object. This is the downside of the paedo scare, and probably more harmful to childrens' development than a Rihanna video.
Targeting children on Facebook and in stores are other significant concerns.
Children should be 13 years old before they have a facebook account. This is unenforceable, but it really is up to parents to monitor what kids do online.
The CIM is calling on the Government to work directly with the marketing industry to "deal with these pressing issues once and for all".
Anyone calling on the Government to "work with them" is a demand for money, power or both.
David Thorp, director of CIM research, said: "It's clear that parents still have very real concerns about the way some companies try to sell to children. The marketing profession needs to address these concerns but we also want a dialogue between parents, the Government and industry bodies to ensure that our solutions are lasting and effective.
The advertising that parents see and worry about is only the visible tip of the iceberg. Marketing runs much deeper and touches on every part of product development, buying and placement. Our research shows parents trust and respect the Advertising Standards Authority (ASA) as a regulatory body but the ASA is only able to tackle part of the problem. By looking at the often-invisible marketing decisions which lead to the creation of products like padded bras for children, we can treat the cause of the problem, not just the symptoms.
The cause of the market for padded bras for children, who have no money of their own, is poor parenting by people who buy padded bras for children. But seeing as girls are developing breasts as young as eight or nine, are we talking about "padded bras" or "foam cups"? If your girl is developing breasts, you need to buy her a bra. This too need not be a sexualised event. That it is, says more about the adult than the little girl.
"We need to ensure that every decision that companies take about marketing to children is responsible and appropriate. Parents should never have to react to inappropriate marketing. The Chartered Institute of Marketing wants to sit down with the Government to provide clarity and leadership for the marketing profession."
"We" Who's 'we'?. Who decides what appropriate marketing? Ah... I see, the Chartered institute of marketing sees the secure funding of the Advertising Standards Authority, and wants some of that love.
The ASA said: "The work that regulators, including the ASA, continue to undertake in responding positively to the recommendations in the Bailey review (Letting Children Be Children) has been welcomed by government as well as family and parenting groups."
A bunch of nanny state ninnies have asked for more laws. A professional association has seen an opportunity to become a regulator.

A non-story. If you don't like a product, don't buy it for your daughter. If you're offended, complain to the store, or launch a boycott. Please don't ask for more unenforceable law or give a professional association statutory powers they don't deserve. Multiply the regulatory approach across an economy and you regulate innovation away, resulting in stagnation. Make parents take responsibility for their offspring, don't make me pay for the ad-men in tax as well as prices.

The current scare about 'Sexting' is likewise ridiculous. Kids aren't allowed out, mainly because of the paedo-scare. Behaviour, Dr's & Nurses; Show me yours, I'll show you mine; early-teen sexual fumbling and so on used occur behind the bike shed. It now happens over mobile and social networks. It happens earlier because the surge of hormones leading to feelings about the opposite sex happens earlier. This isn't a major danger. Some sad old men get hold of some of the pictures and masturbate. Meh. They're miles away. If you're desperately worried, don't give your kid a data tarriff on their mobile phone, and MONITOR WHAT THEY'RE DOING ONLINE. It's called parenting. It's not easy, but it's not the state's job either.

Harsh, I know. But the state is almost never the answer to this sort of thing.

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