DIY Investor Magazine
/
March 2016
47
Back in September 2013 I wrote a City Grump
entitled ‘The Cancer of Socialism is out of
Remission –Why?’ I argued ‘Socialism spreads
when it is able to feed off highly visible blatant
abuses of financial privilege and right now
conditions for its destructive ingress are near
perfect.
Why? Because there is an intolerable mismatch of
the rewards paid to managers at the top of their
particular trees and those struggling to cling to the
branches.’
I pointed to KPMG’s 2012 survey of FTSE 100
Directors’ basic salaries, which found that ‘the
average CEO was given over £800k, while other
executive directors gained approximately £500k
last year.
FTSE 250 equivalents gained a mere £450k and
£300k respectively. In all 350 companies, KPMG
recorded that when you add in bonuses, share
incentive schemes, etc, etc, these ladies and
gentleman trebled their remuneration.’
I said these people were often referred to as fat
cats, but ‘I would prefer to call them sloths. Google
tells me that ‘after consuming a large meal two-
thirds of the sloth’s bodyweight will consist of the
contents of its stomach’.
Contrast then, these enormous feasts with the diet
that the rest of us have been asked to go on for the
last five years following previous excess, then it is
plain as a pikestaff why Socialists are going to get
a hearing between now and the next election.’
That was in 2012 and nothing has changed for the
better.
Indeed we now have Jeremy Corbyn drawing
attention to the spectacular financial rewards that
are being paid out to those at or near the top of
our larger companies and other institutions.
Thanks to this excess, the hard left in the UK and
the hard right in the US (Donald Trump) are making
all the running.
Ultimately this state of affairs is much more
damaging to Western economies than any
slowdown in China.
As an old business colleague of mine said: ‘Too
many financiers and big business chiefs are trying
to live like Yussopov Princes.’ Did anyone in Davos
take note and take action?
IN THE SAME WAY AS WE ARE TOLD CHINA IS THE
GREAT GOD OF ALL THINGS ECONOMIC, IT IS AMUSING
TO RECALL IN THE 1980S JAPAN WAS DONNING THE
VERY SAME MANTEL.
Reproduced with the kind permission of
