What happens to the FTSE if the UK becomes Socialist?

Malthusian

If you want to know what you should be doing with your portfolio in the event of a socialist takeover (the event the OP is worrying about, not a centre-left party increasing the proportion of government spending to 43% from 41%), read Ayn Rand's We The Living about survival in Leninist Russia.

Basically, sell everything, and leg it. Any other action reduces your chance of successfully selling everything and legging it when you eventually face reality.

If you were actually worried about the threat of communist takeover in the UK, you would be moving nearer to the coast and preparing options for a quick escape, not p-ing about with asset allocation.

I read that more youngsters prefer socialism to capitalism. Corbyn is a socialist.

With myself and many on here investing in stocks/funds, do you think socialism could wipe out the stock market completely? It is a worry of mines as I'm relatively young so theres plenty of time for it to happen.

Maybe you should get with the programme and embrace socialism instead of being old before your time, grandad.

Youngsters are more likely to support socialism not because they are dumb but because they are more likely to escape and have more time to rebuild their lives when it goes tits up. The revolution is therefore a less irrational gamble to take (this is relative). If they get lucky then they can ride the red wave upwards and if they don't (as most people won't) they can rebuild their lives.

It is very similar to how capacity for stockmarket loss diminishes as you age. As any fule kno, if you are 30 and have 30 years to retirement then you can ride out any crashes in the stockmarket, even really bad ones. If you are 70 and rely on your stockmarket investments to live on, time is now your enemy and not your friend.

This also applies to revolutions. If you are 30 then, providing you don't get shot or permanently disabled by Stasi torturers, then the best case scenario is that you could go from nothing to living in a nice palace, and the worst case is that you can escape and rebuild your life from scratch. You have more capacity for revolution. If you are 70 and the revolution happens, then that is basically the rest of your life screwed.

Naturally this does not mean that all 30-somethings should support socialism. If you are self-aware, self-motivated and have skills useful to society, in other words your chances of prospering under capitalism are better than under socialism, it would be irrational to support socialism. But we are talking about a general negative correlation between age and capacity for revolution.

MaxiRobriguez

Malthusian wrote: »

Naturally this does not mean that all 30-somethings should support socialism. If you are self-aware, self-motivated and have skills useful to society, in other words your chances of prospering under capitalism are better than under socialism.

I think you've almost got it, but I would suggest the "self-motivated, self aware and skilled" 30 somethings who don't have parents or an inheritance to bank on are now of the opinion they will fare better under a more equal socialist society than a more unbalanced capitalist one, because the odds are stacked against their generation.

Even if they're doing well in private sector work, younger people face house prices at record highs as a proportion of salary, absolutely no chance of getting a final salary pension and will soon be asked by the governments to give an increasing amount of their earnings as tax to care for the boomer generation.

Unlike previous generations, only the very best, the very capable will be better off than a system which distributes money more equally amongst everyone, and that is the only reason Jeremy Corbyn is proving so popular.

talexuser

If I was young I would be drawn to a more socialist outlook since the so called free market has done away with the jobs for life, final salary pensions, ability to buy a reasonable house on a reasonable wage, university degrees that gave good wage jobs (at the cost of more affordable parental grants), and a social safety net as good as my parents had.

A lot of the discontent since the credit crunch is maybe the slow realisation that since the war every generation has been better off than their parents. Now for most your children will likely be worse off, even if you have the ability to equity release or cash in your pension to get them out of rent for life, into a flat or debateable university.

Thrugelmir

talexuser wrote: »

If I was young I would be drawn to a more socialist outlook since the so called free market has done away with the jobs for life, final salary pensions, ability to buy a reasonable house on a reasonable wage, university degrees that gave good wage jobs

A socialist raided the DB schemes for money in 1997. That was the nail in the coffin.

a social safety net as good as my parents had.

More benefits than ever (including for those in work) and people still aren't happy.

talexuser

Thrugelmir wrote: »

A socialist raided the DB schemes for money in 1997. That was the nail in the coffin.

Agreed Brown's dividend tax raid was a disaster. However I remember many converstaions with junior staff in the Thatcher years who wanted to cash in their final salary schemes for private stock market schemes which also turned out to be a disaster, just like their stock market linked mortgages, all heavily promoted by the philosophy at the time.

Thrugelmir wrote: »

More benefits than ever (including for those in work) and people still aren't happy.

Just not sure if that applies to the majority of the population.

MaxiRobriguez

Thrugelmir wrote: »

More benefits than ever (including for those in work) and people still aren't happy.

Probably because people work longer, for less real pay, with less security, to fund houses that require an ever greater proportion of income, which if rented give a 50/50 shot of being properly habitable, with state pension ages being pushed further back whilst decent pension schemes are closed, all of which are contributing to the fact that the younger you are the more likely you'll be less well off than your parents are/were.

I think you're one of the more seniors on here so it's not really that surprising you don't get why people are unhappy with the status quo. It's as much a feeling about being unable to get on in life as it is the actual facts about chances being reduced.

MarkCarnage

My bigger concern about a Corbyn led government would be impacts on wealth held by savers/pension funds by taxation in all forms, plus 'directed investment', capital controls etc. I'm not too bothered about the impacts on UK business, not because it might not be negative, but because as already noted, one can easily invest elsewhere. However, if you and your assets are in the UK, I suspect that there may be a few plans to get after them.

Thrugelmir

MaxiRobriguez wrote: »

I think you're one of the more seniors on here so it's not really that surprising you don't get why people are unhappy with the status quo. It's as much a feeling about being unable to get on in life as it is the actual facts about chances being reduced.

Seems to be a perception that previous generations had it easy. Far from it. Every generation faces new challenges. Achievement is born out of a personal drive to better oneself. Though inequality is a major issue that needs addressing.

talexuser

Thrugelmir wrote: »

Though inequality is a major issue that needs addressing.

I think you've highlighted a major influence that may be a factor of present dissatisfaction.

bostonerimus

The UK has had a mixed economy in my life time...ie born in 60s. It's tended away from public ownership , but I hope that certain industries like utilities, health care and transportation will be renationalized as the private model does not work for many customers.

If Corbyn gets in the FTSE will go down just on sentiment and there might well be some tax and renationalization legislation that will send it lower, but the economy will remain mixed.