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Budget 2023: An Overview

The Budget 2023 is one of the most significant budgets in years. The significant tax surplus received
by the exchequer this year is being used to ease the cost of living crisis for those who need it most.

Welfare

Weekly Social Welfare payments will increase by €12 for all recipients, as well as
those with a State pension. There has also been an increase in the number of Lump Sum
payments, such as double child benefit being handed out in November as well as an increase
in Christmas payments for those on the Disability allowance and Living Alone allowance.

Tax

The government has increased the level for paying 40% income tax from €36,800 to
€40,000. This move will help middle income earners take home more money, to alleviate
some of the cost of living pressures. The second USC bracket (2%) has also been increased
from €21,295 to €22,920.

Energy

In a direct response to the energy crisis, the government has committed to giving
out €600 in electricity credits during the winter months. The first instalment will be handed out
before Christmas, with the other two coming in the New Year.

Housing

The government is set to introduce a tax credit worth €500 for renters; as rents
have continued to rise significantly in the country. They have also introduced a Vacant Home
Tax, to be placed on residential property that is occupied for less than 30 days in a 12
month period. This policy will hopefully encourage more efficient land use.

Education

College fees will be cut by €1000 in a once-off reduction to help alleviate
inflationary pressures, as well as the SUSI grant being increased by 10-14% in September
2023.

Health

Free contraception will be available for all women between the ages of 16-30.

The Implications of Tech Giant Microsoft’s Acquisition of Blizzard

Earlier this year, Microsoft announced its acquisition of Activision Blizzard, a leading company in “game development and interactive entertainment content publisher,” for $68.7 billion – which is the biggest gaming industry deal to date. Microsoft’s motives in this deal lie in the gaming industry being “the most dynamic and exciting category in entertainment across all platforms today,” and its participation in developing metaverse platforms. After Facebook transformed into Meta Platforms to increase its efforts in virtual reality, other tech companies have now followed suit in placing bets on the metaverse. Microsoft acquiring Activision plays a key role in its involvement in the “metaverse arms race.” It will also bolster Microsoft’s venture to grow its gaming business across different platforms such as mobile, PC, console and cloud. 

Phil Spencer, the CEO of Microsoft Gaming, states that together with Activision, they will be able to “build a future where people can play the games they want virtually anywhere they want.” Activision has released some of the most successful and well known games on the market, including Candy Crush, Call of Duty, and World of Warcraft. Bobby Kotick, CEO of Activision Blizzard, notes that Activision’s “world class talent and extraordinary franchises,” married with “Microsoft’s technology, distribution, access to talent, ambitious vision, and shared commitment to gaming and inclusion will help ensure [their] continued success in an increasingly competitive industry.” 

            Although the prospect of furthering the metaverse and making games more accessible to individuals on more platforms are positive in the advancement of the tech sector, there are antitrust and competition hurdles that Microsoft must jump in order for this acquisition to succeed. The Competition and Markets Authority (CMA), Britain’s antitrust regulator, acknowledges that Microsoft is disposed to be successful in cloud gaming given its leading cloud platform in Azure, PC operating system in Windows OS, and Xbox. However, these strengths combined with ownership of Activision’s games “could damage competition in the nascent market for cloud gaming services.”  If Microsoft refuses competitors’ access to Activision’s games, the gaming industry could be struck with serious damage – which is why the deal requires approval in several major jurisdictions including the United States, China and the EU. 

            The antitrust concerns lie greatly in how the deal would impair game console creators such as Sony and entrants to the new market of gaming subscription services and cloud gaming. Open competition would be severely harmed if Microsoft gains the ability to refuse rivals access to Activision games or provide them on worse terms. The Phase 1 investigation conducted by the CMA requires Microsoft to address its concern over the control the company would gain over popular games post-acquisition. If Microsoft fails to offer remedy solutions, the CMA would initiate its Phase 2 wherein an independent panel would carry out an in depth analysis and examination of competition implications. 

            In response, Microsoft released a statement in an attempt to appease regulators by saying that Call of Duty would not become an exclusive Microsoft Xbox game and would continue to be available on other companies’ game consoles. The company wants to remain committed in its mission to provide people with “more access to games, not less.” Analysts believe that Microsoft should provide specifications around these exclusivities in writing to demonstrate more credibility and legitimacy in its pledges. 

            Microsoft has painted a very exciting picture of its desire to “embrace choice,” for games to “reach the billions of players where they are and no matter what device they play on,” through this expansion. Their Game Pass subscription option and cloud game streaming technology to bring more games to mobile platforms would allow the company to “open up mobile gaming, create new distribution opportunities for game developers outside of mobile app stores and deliver compelling and immersive experiences for players using the power of cloud.”  However, the stricter antitrust regulations, especially on tech giants, stretches out the period of time between the announcement of a deal and its completion – thus increasing the threat of the transaction disintegrating. Microsoft’s response to the antitrust concerns over its acquisition will set an important example and no doubt offer guidance to future mergers and acquisitions, especially in the tech industry where monopolies are scrutinised to prevent giants from gaining and abusing unfettered power. 

Truss’s first act as UK Prime Minister promises to save the public, but she threatens the value of the pound

Lizz Truss enters no. 10 Downing Street during high-stakes wars; both within her party, and on the Eastern borders of Europe. However, her first battle as prime minister will be tackling the energy bill crisis. This daunting task is made ever more difficult by Truss’s commitment to a low tax economy.

The cost of a cap on energy bills depends largely on its form. A targeted plan to help the most vulnerable households, such as £650 for those on means-tested benefits, would be cheaper. However, it would be difficult to implement quickly and effectively and it would leave families just above the threshold in a precarious position. A blanket tax break would benefit richer households with disposable income, and would cost substantially more.

Furthermore, the cost of the energy cap will likely be increased by factors outside of Truss’s control. Putin has taken a stance against western sanctions by extending the closure of Nord Stream 1. This will increase the price of gas as well as the cost of Truss’s relief plan. As well as this, a relief package of this scale will increase public spending in a demand charged inflation spike, spurring a further rise in interest rates.

With a public debt to GDP ratio of 96%, investor confidence in the UK is low. Couple this with extensive high-interest rate borrowing, Truss will need to provide extensive assurances on payment plans in order to attract foreign investment. However, as of yet all she has done is ensure that taxes will be slashed.

If Truss decides to increase taxes, either approach will be politically difficult. A general tax would be a rejection of her low-tax promise, which could be seen as a return to the laissez-faire approach to policy integrity endured during the Johnson administration. However, a long-term repayment of tax breaks could cut vulnerable households adrift, which would be detrimental to the economy.

With a worryingly high cap on costs, and no real plan to raise funds for repayments, investor confidence is at a worryingly low level. On Monday, Shreyas Gopal of Deutsche Bank claimed the UK could be on a “balance of payments crisis”. Although unlikely in a G7 economy, the risk of a balance of payments crisis is no longer negligible. Therefore, in order to attract foreign investment and fund her relief package, Truss will have to depreciate the value of Sterling substantially, with Deutsche Bank claiming that a devaluation of 30% may be required to attract foreign investment into Britain.                                                                                                                                                                      

Influential Women in Finance

Following on from the last article about growth vs value as two investing strategies, here are lessons that beginner investors can take from some of the most well-known women in the investment world on how they invest their money and their best pieces of advice. One such example is Cathie Wood, CEO of Ark Investment Management. Wood studied Economics and Finance at the University of Southern California and then began managing money all the way from analyst to portfolio manager to CIO.

Her company launched its own ETF, characterised by its non-specific sector allocation to try to capitalise on a broad range of markets. Moreover, the ETF mainly focused on disruptive technology companies, who use existing successful technologies and innovate by improving them or replacing them with better, cheaper or faster products. Wood, as an active investor, looks for companies with huge growth potential, purchasing young Tesla as a hallmark investment.

However, last year was not the most successful year for Cathie Wood and Ark Invest. Many of its holdings steeply declined and the fund lost customers as a result; this tested the strength of Wood’s active investment strategy. Wood made new investments during the tech sell off despite criticism.

A second fascinating woman in finance is Mary Callahan Erdoes, CEO of JP Morgan Asset & Wealth Management since 2009. Her work primarily involves retaining and growing clients’ assets. As a result, she has increased client assets at JP Morgan Asset & Wealth Management to over $4T.

Her advice, as she said in an interview with David Rubenstein, is that first of all you should not invest into something which cannot be explained to you in simple terms. You should also start saving early to have an impact, because only over long periods of time does investing become very successful with less risk. When it comes to risk management, people should never excessively risk the money they have worked hard for. This stress test can be carried out as a measure of portfolio diversification. If one position heavily declines in the worst case scenario, the rest of the portfolio holdings should be able to salvage a bad investment.

In finance, networking, lobbying and the influence of office politics make people like Erdoes or Wood very successful. This is not easily applicable to the average retail investor, but it is important to mention to understand top investors’ success stories. Specifically, networking is key because of the private information which might not be as available to the public. Lobbying and politics are two factors that you can only predict and incorporate into your investment strategy if you have the relevant information as an established institutional investor.

An obvious, but often easily forgotten factor that should not be overlooked is the actual product(s) the company offers, not just the company and its potentially good management. Taking a closer look at the products a company offers, as well as the product life cycle is vital. This cycle shows the development from its introduction to the withdrawal of the product from the market. The four stages are introduction, growth, maturity, and decline. If a company’s product is relatively well established and has had huge success, it is now in the maturity stage and the market might soon become saturated. If the company does not innovate a new product or add-ons, its sales will drop thus hurting earnings. Hence, this might not be the best investment.

These pieces of advice from some of the most renowned investors are invaluable as their experiences help smaller retail investors, like us, find the right investments and avoid the wrong ones. Echoing one final piece of advice from Mary Callahan Erdoes, “if something is too good to be true, there’s a high likelihood that it is”.

Value and Growth Investing Methods

For many people who start investing, it is difficult to figure out the most important criteria in making their investment decision. In addition to knowing basic investing vocabulary, it is also helpful to understand some of the basic investing methods. Star investors like Warren Buffett and Cathie Wood are famous today for their value and growth approaches to investing, respectively.

Warren Buffett is one of the most famous investors worldwide and is known for his strategy of value investing. Buffett is the CEO of Berkshire Hathaway and has more than half a century of experience. His net worth now amounts to over $115.5 billion. One of his secrets to success is that he started investing when he was unimaginable eleven years old. However, that is not realistic for most people to achieve since interest in finance often develops at a later stage. That being said, the lesson to be learned is that there is no time to lose when it comes to starting to invest. Success most likely comes in the long run. Buffett’s success also lays in his acquisition of 60 companies which now account for Berkshire Hathaway. Buffett first contact with value investing was through his former mentor Benjamin Graham at Columbia Business School. He first applied and defined this strategy.


The core idea behind value investing is to first determine the intrinsic value of a company and then compare the value of the company to the current stock market price. When also comparing the stock price to that companies’ competitors, one can see if the stock is underpriced. Then, a decision can be made as to whether a company is worth investing in.

When looking at a company from a value investing point of view, one must first look at the management and fundamental quality of a company before looking at the price. One should be able to see whether the company has a leading, experienced team, and if they have a track record of overcoming challenges. A long term strategy is key with this investment method since one must believe the quality of the business behind the stock will push up the price; short-term price falls mean value investors can buy the same business at a cheaper price.

Growth investing, meanwhile, is all about a fast approach to get to the desired price target. Obviously, like the name already predicates, the most important criterium is fast growth in comparison to the market, apparent through higher than average returns. Companies which show these characteristics are often younger firms in futuristic markets, such as electric vehicles. Because growth companies tend to be younger, investors often do not get dividends when investing in companies like this; rather, the company’s profit is used to reinvest back into the company.

Each of these investment methods offer a different way to view a business and its investment decisions. One can look for stocks selling at discounts based on a fundamental analysis, or one can look for a stock that is poised for rapid price growth. These strategies are often used by successful investors in the financial world, especially women like Cathie Wood. Stay tuned for the next finance article that will delve into inspiring women in the world of finance.

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