BC FINANCE
Saved by @WebbDarrrel

Weird feeling. After 10.5 years and roughly £21,000 of debt- I finally paid off the last instalment of my student loan today.

Next month, for the first time- I’ll receive my full post tax salary, for the first time since I graduated.

 Sharing as an example of how the system works in practice. In truth I only seriously started paying off the capital in the last few years, when I started to earn a good salary, paying roughly £400 a month off. I suspect many will never significantly eat into the capital.
That’s especially the case for those those under the new regime, who have over £50k of debt. I was lucky in a) lower fees (3k not 9k) and maintenance grant (not loan) still existed.

Indeed IFS forecasts that 83% of students from PST 2012 reforms won’t fully pay back their loan.
Of course those who don’t pay off their fees, the cost will eventually have to be absorbed by the Treasury. Having 17% pay back all and the rest some will still be cheaper for HMT than no loans at all. But we should recognise the a) odd conceit that we have a system of loans...
...which the vast maj will never pay back and that instead b) that graduates are paying in effect a topped up rate of income tax for many, many years.
There are two other things to say about the system 1) the fact of this topped up income tax is another burden for graduates trying to accumulate capital for buying a house/save for a pension etc 2) there is an inequity issue. Wealthier students often receive support...
...from family to reduce (or eliminate) their loans. With George Osborne’s abolition of the maintenance grant (and replacement with another loan) that inequity has become greater. Poorer students start working life as poorer graduates...
...taking home less of their salary than their more privileged counterparts.

Of course, HE has to be paid for and graduates pay according to their ability to do so (as their salary goes up). But as I say, important to see the system for what it is and how it works in practice.
Graduates graduating today will often have over £50k of debt. An enormous figure especially when one considers their experiences of late and labour market they’re graduating into.
Even when things get better and *some* get good salaries it will take them many, many years- paying a big chunk of their post tax salaries to get into any position of paying it off.

The rest will likely have it hovering over them, in one form or another, until their 50s.
I have no complaints. I have a good job and benefitted hugely from my degree. That said, for the present cohort and that of the last few years there remain questions about a) intergenerational equity b) equity within their generation (for reason identified above)...
...c) sustainability of the student loan book long term. Truth is many politicians have in effect simply deferred the long term cost to the public purse to the decades hence, when many fail to repay. And who will have to deal with that? Ah yes- the grown up students.
To expand on this point for those asking- effectively we have created a system where the same two graduates, earning the same salary, in the same job might have quite substantially different take home pay. And that will most likely be as a result of their family background. https://t.co/nArHkMdQl0
And I should mention something about interest. I paid a lower rate of interest than current students. For those starting in 2020 in England and Wales their rate of interest is 5.6%. So a third year student who owes £30,000 will have £1,680 added to their debt this year.
Therefore, many students will find the capital they owe, even when in work, going up, not down.
You might ask whether that on top of the de facto graduate tax the Plan 2 students are paying, the very large capital sums they must repay, whether an interest rate of 5.6% makes any prospect of repayment, for all those outside the very top jobs, remotely credible.
As a result of the interest, many graduates work for years while their stock of debt goes *up*

So let’s take a graduate on Plan 2 with a debt of £50k and a v respectable starting salary of £28,500.

Despite a good, rising salary their debt *never goes down*. Rises to £113k.
The system I was on (Plan 1) I think can (just) accurately be called a student loan system. The fees were much lower, the maintenance grant still exist to leaven some inequalities and the interest was lower.

For Plan 2 (since 2012) those things are no longer the case.
I’m not saying whether the contributory principle is right or wrong, that’s for others to argue about: what I’m saying is that in particular, post-2012, we in fact have a de facto graduate tax. There’s no realistic prospect of many graduates paying back the stock of debt...
...and so it is, in effect, an extra income tax levy which will exist on graduates for 30 years. The debt will simply escape them and payments continue. I suspect older generations are ignorant of how the system operates in reality simply because they’ve never experienced it.
The fact that it is a de facto graduate tax generates all sorts of policy questions and it’d be better for the graduates and for policy makers to recognise it and treat it as such.

End.

More from Lewis Goodall

Lewis Goodall
Lewis Goodall
@lewis_goodall
More study aids and generous grade boundaries for 2021's exams will be welcomed by many teachers and students. But doesn't address a fundamental problem of the next exam season: equity. Because there's great variation in how different schools have been affected by self-isolation.

Let's take the most recent attendance stats which I still don't think have really registered.

Most recent data- attendance rate across England of 83%

In secondary schools it's 78% (!)

So more than 1 in 5 secondary pupils are off school, largely for Covid related reasons.

But that’s just an average. Some schools’ attendance are at levels where they can’t really function, or certainly provide the quality of education they normally do.

Teachers’ are split between trying to run online lessons and those in schools.

Whole year groups are off.

Some students are in isolation, return to school and within days are in isolation again.

As I’ve reported before, IT provision is still patchy. Lots of reports of kids not doing work at home either because they get of the swing of it or they don’t have the IT resources.

And that’s before we get on to staff isolation, which is also proving a nightmare in many places.

In other words, you have to have everything go right for your education not to be impacted by Covid right now. And that’s affecting some places more than others.
EDUCATION
Lewis Goodall
Lewis Goodall
@lewis_goodall
Overheard in a Newcastle cafe, two very despondent students, clearly not long arrived in the city: “I might as well just go home. What is the point in being here? I told my Mum last night, I just feel so lonely. Wish I’d taken a gap year.” The other nodded, in sad agreement.

More cafe conversations-a woman who has recently gone back to work and is now facing down the barrel of imminent unemployment again with the hospitality shutdown which is prob coming here: “I was so buzzing to get back to work. I can’t believe it’s back. Don’t know what I’ll do.”

A local bar owner who has popped in for a coffee: “up to now we’ve just about been making enough money on Saturday to survive and make it through the rest of the week. Depends what the government does. But we’re on the edge.”

And the cafe owner, been here 19 years: “things had been a bit better but this week trade has fallen off a cliff. I came in yesterday and the day before and I just closed because there was no point. Whatever they announce I’m praying it isn’t for long or they extend furlough.”

This cafe btw is a cracker, when I lived in Newcastle came all the time. If you’re ever in the area (restrictions permitting) @QuayIngredient is where you need to go.
SOCIETY
Advertisement
Lewis Goodall
Lewis Goodall
@lewis_goodall
Trump’s doctor: “This morning, the President is doing very well.”

Conley: “the team and I are extremely pleased with how the President is doing.” Says that Trump’s symptoms are now improving.

Second doctor says that President’s kidney function, heart function are both normal. Says that he’s not on oxygen and in “exceptionally good spirits.” Says that Trump said “it feels I could walk out of this today.” Says he’s walking around the medical unit.

Doctor is repeatedly asked about whether Trump is on oxygen. Says he’s not on oxygen “now” or “today”. Sidesteps question about whether he’s received it up to now.

Doctor says “since Friday morning” Trump hasn’t had a fever
TRUMP
Lewis Goodall
Lewis Goodall
@lewis_goodall
Hancock: "It's your actions now which can make a difference."

Plays down prospect of immediate introduction of new restrictions.

Few doubt the public must play its part. But legitimate questions about whether the govt has made/is making public's task harder in two key respects:

1) For some there's still a major economic disincentive apropos self isolation. Sick pay still poor. Savings for many exhausted.

Imminent prospect of Universal Credit cut would make this worse. Some people have fallen through the gaps of government support throughout. Though government support for (effectively) laid off people, a full economic bargain to universally support self isolation still...

...does not exist. Rishi Sunak just made a statement to the House which offered nothing new on any of these fronts.

And 2) The job for individuals is now made harder as a result of prevalence as a result of the delay in full lockdown in most of the country between the...

...point ministers were informed that the new variant had greater transmissibility (December 18th) and full lockdown (early January). We can't interrogate the micro decisions of the public alone, we must look at the macro decisions of ministers too.
ECONOMY
Lewis Goodall
Lewis Goodall
@lewis_goodall
Earlier when asked about why the govt didn't act earlier the PM said “I think we were told about the new variant and the way it was taking off on 18th December and we went into T4 across the vast bulk of the country pretty much in the next 24 hours.”

This isn't entirely correct.

The new variant was identified in early December after genome data was paired with a curiosity that the rates of infection in Kent were not falling despite national restrictions and then T3.


So there was indicative sense that the variant may be playing its part as early as that and perhaps sport greater transmissibility.

On December 14th Matt Hancock informed the Commons, saying the new variant was in at least 60 local authorities already.

He told MPs in that over that week, there had been sharp, exponential rises in coronavirus infections across London, Kent, parts of Essex and Hertfordshire.

He said they couldn't be sure whether that was due to the new variant but that caution was required.

As a result, London and several other places in the South East were moved to T3.

On 18th December NERVTAG reported that they believed the new variant was indeed more transmissible.

On the 19th, the govt acted. This is the action I assume the PM referred to today.
GOVERNMENT

More from Finance

Shaan Puri
Shaan Puri
@ShaanVP
If you're a college student who wants to pay off all your loans... here's an idea for you:

It takes ~$5k to start and will make ~$30k a year of profit

It won't get you rich, it'll pay for college.

(..and will teach them more about business than they’ll learn in school)

The idea isn’t sexy. But it works:

**Plastic Moving Bin Rentals**

Everyone knows moving sucks. The worst part is being stuck with 400 cardboard boxes at the end of your move.

Instead - @benmlevy told me about Gorilla Bins. They dropoff plastic moving bins, & pickem up later.


Let’s break it down. Our goal is to pay for college (~$30k profit per year).

To do that, I think we’ll need $50k in revenue.

The avg move (a 2 bedroom apartment) is $180

To hit our goal, we need do ~5.5 moves per week

COSTS?

How many bins do we need to buy up front?

5.5 moves a week x 50 bins = you need 275 bins. Let’s round up to 300 to be safe.

Ok let’s hop over to @uline to see how much these bins cost

Bingo. Bins cost about $15 a piece.

$15 x 300 bins = $4,500 initial startup costs.

Time to beg your parents or a rich aunt to lend you money to get the biz rolling (...or just take $5k of student loan money and invest it here…)
FINANCE
Kostas \U0001f468\u200d\U0001f4bc \U0001f4c8 \U0001f4b8
Kostas 👨‍💼 📈 💸...
@itsKostasWithK
If you want to become financially independent and don't know where to start, here is a thread that will help you get started

/THREAD/

1. Review your expenses and make a budget

It will help you see where you overspend, make a plan to save, pay down debt and start


2. Set your investing and retirement goals

How much do you need to support yourself in retirement and when do you want to


3. The earlier you start investing, the better.

Here's why and how time and compounding can become your


4. Invest in an index fund

It's easy, safe, cheap, and the best choice for a beginner in investing, with not much time for
FINANCE
Advertisement
Naval
Naval
@naval
How to Get Rich (without getting lucky):

Seek wealth, not money or status. Wealth is having assets that earn while you sleep. Money is how we transfer time and wealth. Status is your place in the social hierarchy.

Understand that ethical wealth creation is possible. If you secretly despise wealth, it will elude you.

Ignore people playing status games. They gain status by attacking people playing wealth creation games.

You’re not going to get rich renting out your time. You must own equity - a piece of a business - to gain your financial freedom.
LIFE , STARTUPS , NAVAL1
John Hayward
John Hayward
@Doc_0
One reason the Left hates Rush so much is that he was so effective at skewering their pretensions to moral and intellectual superiority. He made it okay to laugh at them, to judge the failure of their policies without ritually celebrating their alleged good intentions.
FINANCE
Chris Hladczuk
Chris Hladczuk
@chrishlad
I devoured 50 years of Warren Buffett shareholder letters.

The result?

12 timeless principles from the greatest investor in the world.

Here are the golden nuggets🧵

The Orangutan Effect

"If you sit down with an orangutan and carefully explain to it one of your cherished ideas, you may leave behind a puzzled primate, but will exit thinking more clearly yourself."

Teaching others actually teaches yourself.

2022

The Faulty Premise Framework

“A horse that can count to ten is a remarkable horse - not a remarkable mathematician.”

Beware your comparison set.

Are you judging crappy relative performance or absolute results?

1985

Pick the Right Business Boat

The business boat you get into is more important than how effectively you row.

“When a brilliant management team tackles a business with a reputation for poor fundamental economics, the reputation of the business usually stays intact.”

1985

A Rising Tide Doesn't Lift All Bonuses

"Good performance should be rewarded whether Berkshire stock rises or falls.
Average performance should earn no special rewards even if our stock soars."

Judge for individual performance or risk free riding on group success.

1986
FINANCE , BUFFETT

You May Also Like

Quinn Cummings
Quinn Cummings
@quinncy
Gather round, Gentle Readers. It is time I tell the story of the worst decision I ever made in an office. Some of you have heard this. Some have not. Whatever you do in your office today, this week, the rest of this year, you can console yourself by recalling this tale.

A long time ago, I was a talent agent. I worked for a woman named Susan Smith, who had her own small boutique agency. She was known for three things:

1. She had fantastic taste in clients. If there is someone you admire, odds are good that at some point, she was their agent,

2. She could negotiate a deal like few who have ever trod the earth. Casting would give her all the money they had budgeted for that part, plus a little more, plus promising to get her dog Barnaby groomed. She was magnificent to watch.

3. She was insane.

I'm sure you're thinking, "Quinn, it's the entertainment industry, they are all insane." Yes, many are. So consider this; if you told someone you worked for Susan, people who worked for insane people would look and you and whisper, "I hear she's insane."
LIFE
\U0001f1fa\U0001f1f8I Support Our Military & Law Enforcement\U0001f1fa\U0001f1f8
🇺🇸I Support Our Milita...
@TheWiseOwl_AZ
1. There are more people added on the list of arrests and executions of famous people but no further intel is available at this time.

ARRESTS and EXECUTIONS OF FAMOUS PEOPLE 2020 UPDATED
Explanation of the latest military tribunal arrests and executions of famous people in 2020.

2. The tribunals are arresting these people in plain clothes. We saw the Obama’s arrest, although we didn’t know it was an arrest at the time. The arrest was done nonchalantly so as to not get noticed by the public.
All arrests of these famous people were done this way.

3. If the person is convicted of child sex trafficking, crimes against humanity or treason, they will be executed.
If the person arrested has evidence on someone else to help their prosecution, or is willing to help Trump, & they want to cooperate, they may be allowed to do so.

4. A sentence of execution down to life in prison may be accepted if their evidence is worth anything.
When a plea deal is done, the defendant must present evidence they have to make their sentence lighter. This information is given to the prosecution, defense, and to the judge.

5. If evidence is accepted, they are presented the plea deal. They will have to make a guilty plea to the crime with a video confession & written statement. That is how all plea deals work.

All famous people arrested were either treasonous or involved in satanic worship rituals.
CRIME
Advertisement
Filippo Valsorda
Filippo Valsorda
@FiloSottile
“We don’t negotiate salaries” is a negotiation tactic.

Always. No, your company is not an exception.

A tactic I don’t appreciate at all because of how unfairly it penalizes low-leverage, junior employees, and those loyal enough not to question it, but that’s negotiation for you after all. Weaponized information asymmetry.

Listen to Aditya


And by the way, you should never be worried that an offer would be withdrawn if you politely negotiate.

I have seen this happen *extremely* rarely, mostly to women, and anyway is a giant red flag. It suggests you probably didn’t want to work there.

You wish there was no negotiating so it would all be more fair? I feel you, but it’s not happening.

Instead, negotiate hard, use your privilege, and then go and share numbers with your underrepresented and underpaid colleagues. […]
LIFE
Vibhu Vashisth \U0001f1ee\U0001f1f3
Vibhu Vashisth 🇮🇳...
@VIBHU_Tweet
VEDIC COSMOLOGY, also known as Hindu Cosmology, and cosmography are both interesting and inspiring. Today’s “modern” Vedic texts originated around 3,000 B.C.E. This is the oldest scientific and the oldest religious doctrine known to the human race.


Our current astronomy of the solar system and universe has its roots in Vedic knowledge. It only shows that man had advanced knowledge of astronomy way before our current civilization came into existence.
We are here to talk about the Vedic version of the planetary system,

starting at the top from the eternal planets to the temporary planetary system within innumerable universes in the material world.

Talking about “cosmic manifestation,” we need to incorporate both spiritual and material existence.


The spiritual realm of the planets is everlasting, and this will forever be beyond what the material universe can encapsulate. The spiritual realm belongs to the “super dimensional” or “anti-material” dimension. It means that it is beyond what we can perceive,


beyond time as a linear dimension, and the space of our vision and perception.

There are innumerable planets, all indestructible and forever lasting. That is what the Vedas say about the spiritual planets. Our concentration here is more towards the material side of things.
ALL
Anu Satheesh \U0001f1ee\U0001f1f3
Anu Satheesh 🇮🇳...
@AnuSatheesh5
Agastya Muni & Kaveri River
#story
This is a story which describes how River Kaveri was brought on earth by Agastya muni. There was a king named Kavera lived in the Brahmagiri hills who prayed to Brahma for a child. He was blessed with a daughter whom he named Kaveri.


Agastya muni married her. A demon, named Shoorapadma, wanted to trouble people so he prevented rain from reaching South India. As a result famine occurred in South India.
Agastya Muni who came that way was very sad seeing this. He started to pray Mahadeva for a solution.


Shiva gave him small amount of Ganga water in his Kamandalu (small pot) and said wherever you spill this water the river will flow from there. Agastya Muni travelled lot of places to find a suitable place to pour water. Feeling tired he kept his Kamandalu and took rest.


At that time Ganesha took a form of crow and perched on the Kamadalu and made a hole that water began to flow as river Kaveri. This place is now called as Talakaveri (Karnataka), located in the Brahmagiri hill.


Tala Kaveri has temple for Agastheeswara, which denotes the story between Kaveri and Agasthya muni. Kaveri is a part of Ganga, thus, also called Dakshina Ganga.
🙏🕉🙏
ALL