Investors get real-time view of UK bond market activity for the first time
fca.org.uk73 points by monkeydust 7 hours ago
73 points by monkeydust 7 hours ago
I spent the entire day yesterday trying to set up some automated monitoring of my investments, only to discover most UK market information is locked behind stupid-money APIs.
Anything that improves that situation is a positive.
That's normal in markets and it even makes sense.
Think about it: shouldn't the market be funded by charging fees to the extremely wealthy participants? The alternative is that it's taxpayer funded, which is a tax subsidy to extremely wealthy participants.
Seems like a bit of a false dichotomy- other alternatives are regulatory requirements or taxes that force or allow the api to be provisioned
You can force markets to make an open API funded by participants, but you can't make it fully open (open API and open participation) if you don't want tax funding because then there's no funding source left. Maybe you decide a fully open market is worth being tax funded, though it's still mostly going to benefit very rich people.
Why is "no tax funding" a hard requirement? I would think the lowest cost to get that market information publicly shared and forthcoming (and thus increasing the efficiency and effectiveness of the market), would be for a government dept to operate the frontend distribution, but require regulatory submissions of transaction within reasonable latency windows. It's just a modern form of say US SEC document submissions and EDGAR to distribute.
Several such APIs include the equivalent data for US markets in their free tier, for personal use.
Only the extremely wealthy participate in the UK? That is most certainly not the case in the US, where your average salaried employee has most of their retirement invested in the market
Ehh to be clear even in the US certain markets like bonds are not always that transparent.
I love that it's a 'tape' - I assume in reference to the early telegraph tapes/tickers: https://collection.sciencemuseumgroup.org.uk/objects/co33749...
Whether the data will actually be affordable and usable enough for smaller participants or whether it mainly improves tooling for institutions that already had decent access
Disappointing that it seems difficult to actually sign up for – "real-time view" hidden behind layers of legalese and licensing, although it's pleasing to see the fees are effectively nothing for individuals or small firms. They're not exactly in the SaaS-era of live demos or trivial sign-ups for immediate access, are they?
Why do we insist on actually useful interfaces into the economy and banking system being hidden behind such bureaucratic complexity? It's like the Open Banking gift that keeps on giving – if it were truly "Open", I'd have an API I could actually use to talk to all of my banks, rather than what feels like a closed shop (certainly for the average retail individual who just wants a feed from their bank).
There’s also a lot of bureaucracy involved in participating in the gilt market directly, rather than using an intermediary.
https://www.dmo.gov.uk/investor-information/retail-investors...
I don’t think the Treasury really wants to deal with amateurs.
No, but you can hold them through the standard range of intermediaries and still get the tax advantage.
NS&I offer a range of retail products - https://www.nsandi.com/guaranteed-returns is a good option but does NOT come with the tax exemption.
the tax exemptions make it very attractive place to hold cash versus bank accounts - if your a UK citizen google (or AI) - low coupon gilt investing.
Eh, for most people it's simpler to just use a cash ISA which can provide almost the same rates. Most people don't want or need to carry a huge cash float as opposed to other kinds of investment.
Well, yes, but after maximizing an ISA that's still an option. Also the government is clamping down on cash ISA.
I think they're clamping down on cash held in Stocks and Shares ISAs, not Cash ISAs.
As the government wants to encourage people to be invested and not hold cash, from '27 you'll only be able to add 12k in Cash ISA. They are planning to also change the limit on cash held on S&S ISAs to avoid an easy workaround for this limit
That only works if the capital is already in an ISA or you want to invest less than £20k (soon to be 12k) though. It is common to use gilts to build a gilt ladder to have some level of guaranteed income for older/retired people. This allows you to build your own cheap annuity.
This is the frustrating pattern with a lot of "open" financial infrastructure
Will this help us see how badly Burnham bungs bonds in real time? I jest I jest
Burnham being PM is already pretty well priced in. When he walked back comments a few weeks ago they corrected and my sense is that the market understands that unless there until actual laws or budgets are promulgated, what is said by Burnham isn't really market moving.
What is he going to do without the bond markets - the UK is in so much debt we basically need to jump however high they tell us to, unless he plans to default which would destroy the global financial system and destroy the UK for decades. The only way I can see out of this is to absolutely frack the crap out of the UK and push for more North Sea oil drilling. But we definitely won't do that so maybe we'll try a bit of fascism instead? I'm very unconvinced taxing rich people is possible (unless it is a global agreement) - most of their money can be moved into tax havens and other jurisdictions where HMRC will struggle to tax them.
The irony is the top three tax havens are overseas territories of the UK and subject to legislation which should curtail their tax-haven status but which the UK is unwilling to enforce
https://taxjustice.uk/blog/worlds-top-tax-havens-are-british...
And London is the money laundering capital of the world. It's some ridiculous percentage of their GDP.
I think ...or hope...he ends more right than left and manages to do what Starmer failed to do a year ago which is to make major reforms to the Welfare system. Its just not sustainable.
There really isn't a lot of slack in the welfare system unless you're prepared to be very short sighted and go back to "tent city" levels of homelessness. Which is partly why all previous attempts to cut it have failed. Maybe declaring certain areas of high rent off-limits for housing benefit, but then you have to raise the salaries of NHS staff and teachers living in London so they can afford to work there.
Maybe if the Miliband reforms pay off and certain critical things get built and gas prices return to normal, Labour will be able to take credit for lower electricity prices? Unless it's all spent on datacenters, which would be even worse political doom.
Personally I'd go with the "mansion tax" but that requires ignoring the well-connected screaming. They did manage that with VAT on private school fees.
Yeah but the VAT on school fees meant a load of those children had to go to state schools so we ended up paying for it anyway.
A rough calculation: £8,580 funding per child at state school, ~90,000 less in private schools and in state schools so about £770 million more required for state school funding and this measure is supposed to bring in about £1.7 billion a year...
So it looks like it would pay for itself?
Edit: We don't charge VAT on private healthcare - so charging it on private education looks a bit inconsistent to me.
Wasn't it something like a 3-4% reduction in private school pupil numbers? And some of those would have ended up homeschooled rather than state.
I just feel like no matter what any government does the ultra rich will find a way to get around it. Look at the US gulf south: they are in a race to the bottom when it comes to tax breaks and just giving everything away to businesses/high income earners, yet they are poorer than ever. Texas and Florida are the exceptions here to a certain degree but they are also massive states with lots already going for them. Their neighbors collect a fraction of the taxes they should and get nothing out of it except aggressive resource extraction and cancer.
Then look at the other end: are wealthy people and businesses really fleeing New York and California in droves like conservative media is portraying? Do we really see a meaningful wealth exodus occurring because of their corporate and personal tax laws? A cursory search says no. High housing costs, remote work, and just general pandemic shifts explain basically any changes there (and the number of people/businesses leaving isn’t particularly abnormal)
All of this is to say I don’t really know what the solution is for the UK. I just don’t think businesses and the super wealthy respond 1:1 to these policies in the way that politicians claim they do. They are so rich they are ultimately going to live where they want and do what they want. They aren’t going to relocate themselves due to tax policy. They will just “be rich” their way through the problem.
The ultrarich just don't matter. There are so few of them. And they might avoid personal tax, but they generate insane amounts of other taxes that they are still huge contributors. The people who net don't contribute are going to be state/federal employees, benefits recipients, state pension recipients, that sort of thing.
How do they know what he will do to the economy before even he does? That's impressive
I wasn't referring to his becoming PM but what he does during the premiership, you know, the more important part
How much a politician will make wealthy people wealthier probably correlates pretty well with their left-right axis position multiplied by their amount of power.
Potentially, the raising interest rates because investors don’t trust the long term stability of the UK economic system (more spending on pro-war activities, sluggish economic growth, and higher than expected government borrowing) will crash their financial system.
I hope I don’t sound too selfish but I am a USA citizen, and I would rather worry about my own country’s medium-term financial future.
The UK's financial system made it out battered but bruised in the 70s which were a magnitude worse than what we have right now (double digit unemployment, inflation double digit, interest rates at like 15%, an IMF bailout...). Any talk of the British financial system collapsing is as realistic as the S&P500 dropping 50% in the near future: sure it can happen but the chances are so statistically small you have a better chance of winning the lottery.
National debt to GDP was much lower in the 70s.
You might be right that near-term disaster is unlikely, but comparing to a lottery win is ridiculous. Orders of magnitude off.
Let's play a game
> Potentially, the raising interest rates because investors don’t trust the long term stability of the [Guess the country] economic system (more spending on pro-war activities, sluggish economic growth, and higher than expected government borrowing) will crash their financial system.
>I hope I don’t sound too selfish but I am a USA citizen
The rest of the world is getting tired of worrying about the US's economical situation, whether it the dotcom bubble, the sub-primes, or now the potential AI bubble.
So apologies for being blunt here, but yes it does sound selfish to me
Yes, I do sound like a jerk. Difficult though to not worry about local bullshit a lot more than other country’s bullshit. While I care for every person on our planet, I spend more time thinking about the future of my children and grandchildren.