1st September 2010

"Let them eat cake"

IFA letter of the week

Production without sales (profit) equals scrap! The only groups that fail to understand this are those removed from the reality of profit and the need to make a return on outlay i.e. government departments, local authorities and regulators!

"Let them eat cake", a phrase commonly attributed to Marie Antoinette upon learning that the peasants had no bread.

RDR is what the regulators say in the face of the worst market conditions in 30 years! Well let's hope the same fate befalls the regulator as did Marie Antoinette - the guillotine!

So how will the industry cope with the FSA RDR requirements in 2012? The simple answer is they won't and they can't and it is because of this that the Conservatives will bin most of the RDR requirement because they will have no option. This is not a hope it is a fact of life! The only ones that don't know it are the discredited regulators in their Ivory Canary Wharf Tower and perhaps Mark Hoban MP who is yet to wake up and smell the coffee.

Cancer and regulation (as defined by the FSA) are the only growths that are exponential but also terminal & it is the death of independent advice we are taking about!

Consider the post RDR independent sector standing at just 10,000 advisers, the predicted number remaining. Canary Wharf has 3000 staff, and growing!

That means for every 3.33 IFA's there will be 1 regulator to support. Can we afford this level of regulation churning out yet more regulations to occupy every waking moment of the beleaguered IFA! Quite simply this is a ludicrous situation that could only be allowed to happen by an institution removed from reality and that is out of control! An even more ludicrous situation when the same FSA has failed every "real" regulatory test put before it.

I for one will be in the grandstand as the heavy blade descends having willingly sharpened the blade beforehand. Make no mistake if we are not rid of this regulator then even those who survive past 2012 will surely buckle under the weight of the regulatory parasites that we are obliged to support and compensate for their failures!
Best regards

Simon Mansell
Temple Bar IFA

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