Fears of a new dotcom crash gained momentum on Friday, wiping £20.2bn off the value of the FTSE 100.

The leading index tumbled 1.2pc to 6,561.7 and the mid-cap FTSE 250 slumped 1.6pc to 15,898.37, as British investors grew increasingly concerned about being caught in a tech bubble.   Their anxieties were fuelled by a rout in the American stock markets on Thursday, when the Nasdaq stock exchange, favoured by technology companies, suffered its worst fall since November 2011.  US tech stocks continued their decline on Friday, with shares in Facebook, Google and Twitter all sliding lower.

In London, tech shares were sold-off particularly aggressively. Microchip designers Arm Holdings and Imagination Technologies lost 4.5pc and 5.8pc respectively.

Internet-based companies also fell sharply. Takeaway services group Just Eat, clothing business...

boohoo.com and white goods retailer AO World, which all floated at lofty valuations in recent weeks, were on the back foot. Both Just Eat, off 6.1pc, and AO World, down 4.4pc, fell even further below their flotation prices. Boohoo slipped 7pc to the 50p float level.

Away from tech shares, other companies that were also perceived as being overvalued, such as airline stocks, were under pressure and contributed to the FTSE 100’s biggest one-day fall since March 3 and worst week for a month.  Fears of a bubble reminiscent of the one that preceded the 2000 dotcom crash have grown the past week and also hit markets on Monday.

US markets continued to drop on Friday, with both the Nasdaq and the Dow Jones Industrial Average sliding further.

“The market is very skittish,” David Pavan, a portfolio manager at ClariVest Asset Management, said.

 

 

 

 

 

"In a speech in Washington", the IMF head, Christine Lagarde said : A slower-than-expected recovery across the global economy will keep interest rates in rich countries at historic lows for several years, the International Monetary Fund has warned in its World Economic Outlook.

Interest rates will rise gently over the next couple of years in response to higher GDP growth, but will likely be pegged back by a stuttering performance by Europe and slower growth in China, the Washington-based organization said.

The gloomy diagnosis will dismay savers, who have seen the value of their savings whittled away by inflation since the financial crisis.

Savers are seen as the big losers from the financial crash, which forced central banks to slash rates to almost zero to prevent commercial and residential borrowers from going bust in large numbers.

The IMF blamed the Asian savings glut alongside a longstanding demand for safe haven assets and a lack of investment opportunities, especially in the developed world for the persistence of low interest rates across the world.

It said that while the 2008 financial crisis had exacerbated the problem, low interest rates stretched back 30 years and many of the fundamental drivers will remain in place when the crisis is a distant memory.

It has been known for many years that the accumulated savings of Asian workers, western pension savers and the oil rich countries in the Middle East have outstripped the capacity of the world economy for investment. Many economists have highlighted how savers cannot find enough productive industries in which to invest and have increasingly come to rely on buying government bonds to supply an income. The traditionally low interest rates paid by government bonds has fallen further since the financial crash in countries seen as a safe haven, including the UK, US and Switzerland.

The IMF said low interest rates might spur risk-taking behavior by investors who demand a higher rate of return on their investments. It said: "A protracted period of low real interest rates would have negative implications for pension funds and insurance companies with defined-benefit obligations. An environment of continued low real (and nominal) interest rates might also induce investors and financial institutions more broadly to search for higher real (and nominal) yields by taking on more risk.

"Increased risk taking, in turn, might increase systemic financial sector risks, and appropriate macro- and micro prudential oversight would therefore be critical for maintaining financial stability."

The World Economic Outlook is the IMF's major analysis of the global economy ahead of its spring conference in Washington next week. The meeting runs alongside the annual meeting of the World Bank and get-togethers of G20 ministers and the Financial Stability Board, an offshoot of the G20 of nations that is attempting to bring calm to global markets.

Analysts at the IMF said a slowdown in China and many emerging markets would slow the general pace of the recovery and be another reason for central banks to keep interest rates low. It said a return to health in the US would not be enough to reignite the Asian tiger economies that did so much to propel global growth ahead of the financial crisis and in the years immediately afterwards.

The analysis ties in with predictions that interest rates will begin to rise in the UK and US next year, but only slowly and peaking at no more than 3%.

I've long taken the view that if anyone's going to make mistakes with my money, I'll be the one to do it - and I'll pay myself the management fees while I'm at it. And you should be prepared to make mistakes - everybody does. Successful investors just make fewer and hopefully smaller ones.  Yes, you can go it alone in an SS ISA. You should read up on things first though - make it a hobby, an interest. Do some research on different strategies, diversification and assessment of your goals and risk tolerance. Temperament is extremely important. Ask yourself the following question:  "If a stock or the whole portfolio drops by 10% in a single week will I be able to sleep?" Because at some point it will happen.  A popular approach is income investing, which focuses on finding solid companies that have a record for paying and increasing dividends. You then keep reinvesting the income and it all just carries on compounding up. Motley Fool UK has some good starting guides. There's a chap over there that runs an instructional Beginner's Portfolio very much along those lines.  ETFs are useful too - you can do perfectly well by choosing about 6 dirt-cheap trackers and pound cost averaging into them over time. The great Warren Buffet himself recently advised his future widow to use just trackers and treasury bonds.  You need an "investment thesis", whatever you do. "Buy and hold (preferably forever)" is a very useful principle, but obviously if they suddenly uninvent the semiconductor you might want to rethink your position in Apple...The late Fred Schwed's book comes to mind, 'Where are all the customers' yachts?' 
Schwed invited investors to ponder on why the expensive gleaming craft moored in Manhattan harbor belonged to stockbrokers and bankers.  Can I put my own stock selection in an ISA or do I have to buy funds with opaque fee structures and rely on some guy in a striped suit who will never lose money to invest for me? How do you do it and who do you go to for advice? It seems to me that those who could advise are looking to line their pockets to their advantage and not get the best deal for you.

America’s biggest banks will have to hold an extra $68bn of cash on their balance sheets under stringent new rules designed to prevent a repeat of the 2008 financial crisis.  US regulators have also signaled they would like to tighten banking rules even further, as they introduced the new rule requiring lenders including JP Morgan and Goldman Sachs to shore up their capital reserves.  Under the new legislation, approved last night by the US Federal Reserve, the Federal Deposit Insurance Corporation and Comptroller of Currency, the eight largest US banks will have to hold at least 5pc of their total assets in cash, instead of the 3pc previously required.   The rule, which will come into force in 2018, is the latest in a sweeping set of reforms designed to ensure banks have enough money to cover their losses in the event of a major financial disaster.   The change is expected to weigh on the profits of those banks affected as they will not be able to put quite as much of their cash to work. However, the Fed signaled yesterday that it may yet go further. Dan Tarullo, the Fed’s regulation tsar, said the central bank may “increase the risk-based capital surcharge for US systemically important firms to a higher level than the minimum agreed to internationally”.   Such a change is particularly serious for investment banks such as Goldman Sachs and Morgan Stanley, who do not have retail banking operations that accept cash deposits from customers.  However, all of the affected banks, including Citigroup, Bank of New York Mellon, Wells Fargo and State Street, will have to take the new capital requirements into consideration as they weigh up whether to pay dividends.

Estimates of the critical funding levels of pension plans fell 2% in March to just 85%, an unexpected trend given the strength of the markets and stability of interest rates.

The decline in the funding levels of pension, found by pension tracker Mercer, was largely the result of adjustments made by Mercer based on pension data from year-end financial statements. These new numbers show that in the universe of companies Mercer evaluated, those in the Standard & Poor’s 1500, asset values were lower than previous estimates. Meanwhile, liabilities rose as some pension plan sponsors started using more conservative assumptions in their calculations. Also looming are changes in mortality standards which might also affect funded status.

The decline in the funded level continues a distressing downward trend since the end of 2013. However, the funded status of pensions has improved dramatically since mid-2011, before stocks enjoyed the most recent leg up in their rally.

“The first quarter of 2014 has reminded us how quickly the funded status of a pension plan can change,” says Jim Ritchie, a principal in Mercer’s retirement business.

Ukraine has launched an "anti-terrorist" operation against pro-Russian separatists occupying government buildings in many of its eastern cities

Police arrested 70 pro-Russian demonstrators in Kharkiv on Tuesday, as protesters in two other cities held similar standoffs. Ukrainian authorities gave few details of the "operation that cleared the building in Kharkiv but said two police had been wounded by a grenade.

Ukrainian special forces in combat gear, helmets and balaclavas and carrying machine guns stood guard outside the building early on Tuesday. A partly destroyed sign near the main door read: "Avakov – to jail", a reference to the Ukrainian interior minister, Arsen Avakov.

Avakov made mention of the operation to clear the buildings on his Facebook page: "An anti-terrorist operation has been launched. The city center is blocked along with metro stations. Do not worry. Once we finish, we will open them again."

The Interfax-Ukraine news agency quoted the interior ministry saying those detained were suspected of "illegal activity related to separatism, the organization of mass disorder, damage to human health" and breaking other laws.

Ukraine's acting president, Oleksander Turchinov, made a televised address to the nation in which he accused Moscow of orchestrating the protests in an attempt to repeat "the Crimea scenario".

Russia has denied Ukrainian charges of involvement but warned Kiev against any use of force against Russian-speakers. On Tuesday, Russia's foreign ministry called on Kiev to stop massing military forces it said were tasked with suppressing anti-government protests in the south-east of the country.

"We call for an immediate halt to military preparations which could lead to an outbreak of civil war," the ministry said in a statement.

The pro-Russian protesters still barricaded inside official buildings in Luhansk and Donetsk demanded that referendums be held on whether to join Russia, similar to the one that preceded Moscow's annexation of Crimea.

Source EU Observer - BRUSSELS - The setting could not be less spectacular – one of the more nondescript rooms in the European Parliament's glass towers overlooking Place Luxembourg in Brussels, where a handful of officials gather with armfuls of papers.  At intervals, members of the Parliament's catering staff silently walk round the room offering tea and coffee. Unless you were involved, you wouldn't know that the meeting – one of around 1,000 so-called 'trialogue' meetings to take place in 2013 – was actually happening.  At this particular gathering to discuss plans to re-write the EU's accounting directive in March 2013, MEPs from the Parliament's legal affairs committee – Klaus Lehne, Arlene McCarthy, Eva Lichtenberger, Alexandra Thein and Saj Karim – made a breakthrough.  They secured rules that will shine a light on the payments made to governments by companies working in the controversial extractive industries – rules that should help prevent corruption and dodgy dealing between companies and governments.  An Irish government official, whose country has been tasked with leading the talks (because Ireland held the rotating EU presidency at the time), agreed that, without exception, all payments over €100,000 must be publicly disclosed. This will apply to every individual project or contract undertaken by a company.  The new reporting requirements will mark a sea-change in how the industry is regulated yet the trialogue meeting where it happened remains a closed process.  Search for any mention of trialogues in the EU treaties and you will draw a blank.  This is because despite being an accepted part of the lawmaking landscape, in legal terms trialogues don't exist.  All trialogue meetings are informal and the timing of the meetings are not known to most MEPs, let alone the ordinary public. There are no formal minutes taken. Some are over within a few minutes. Others can go on all day and well into the night.   The last trialogue on the single resolution mechanism (SRM), the final, and arguably most controversial piece of banking union legislation, lasted 16 hours through the night on 19 March as lawmakers sought (successfully) to close a deal in time for the end of the parliamentary term.  Despite the sense of intrigue that should surround a lawmaking process that few people are aware is happening, attending the average trialogue meeting would be a perfect cure for insomniacs, as civil servants and politicians drone through a bill line by line, article by article.  But they matter. If the EU's bi-monthly leaders' summits are the glamorous (in the loosest sense of the word) side of the EU, the trialogue meetings are the main engine driving the sausage factory that churns out EU laws in Brussels.

The triumph of the trialogue - In terms of numbers, the volume of legislation does not appear to have changed much in the past two legislatures. MEPs and ministers adopted a total of 447 laws in the 2004-9 parliament. By November 2013, politicians had signed off on 395 files and, even with a wild flurry of activity as they seek to conclude as much legislation as possible before May's elections, the total number of files is likely to be around 500.  But what has changed is the way the laws are agreed.

The formal structure for breaking the impasse between the institutions mentioned in the treaties is the conciliation committee.