Starting on a realistic note or in the You Couldn’t Make it Up Department - Mervyn King, Governor of The Old Lady of Threadneedle Street, (Bank of England) has had to write to the Chancellor explaining why he has missed the Government’s Two per cent inflation target. The poor guy must have felt like he was back at school and told to do 100 lines: “I must control inflation, I must control inflation….”

My guess is that the Governor is too much of a gentleman to suggest look in the mirror to the Chancellor for part of the answer (N.B. taxes on spending increase the cost of living and 65 per cent of the cost of petrol, for example is tax) but anyway the real rate of inflation is over 9 per cent http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2008/06/13/cmian13.xml rather than the 3-4 per cent the Government tells us.

On a positive note, an interesting Pension Reform introduced in April 2006 allows in specie pension contributions. This means you can use an asset like shares themselves (in specie) as a pension contribution. Selling shares and having the SIPPS buy the shares from you is another option. Doing this means that the shares are inside a tax shelter (pension) where no Capital Gains Tax is payable. Unfortunately, some SIPPS providers will not accept these so the moral as usual is get advice, even when what you want to do is sensible – pension planning using in specie contributions has advantages as well as disadvantages. But in order to make a pension contribution one has to have earned income. Investment income such as from a trust, share portfolio or buy-to-let property is not pensionable.

One sure way for an IFA to get a clients attention is to show them how to take their pension funds ALL in cash. This is possible if the pension funds are less than £16,500 and has the quaint name of Pensions Triviality. Three cases have popped up in the last two weeks. In one case, a lady with a tiny pension that was made paid up in the 1980s will find the funds very useful, another with a tiny pension is not yet 60 so cannot do this for a while, and a client who has two tiny pensions also under the £16,500 limit cannot do it just yet as he is entitled to a pension from his current employment. The funds may be paid in cash but are taxed at Emergency Rate so the effective tax rate can be over 30 per cent. This is fee-based advice where clients want me to hold their hands through the paperwork.

Masters and Wardens of freemasons lodges are supposed to attend The Quarterly Communications meetings held at UGLE in Great Queen Street and the 1,500 seat grand temple is nearly full each time. After the formalities have been dispensed with, like changing this or that rule or maybe next year’s dues, it is common practice to have someone from one of the charities supported by Freemasons into the meeting explain their work. The Royal College of Surgeons is the guest this time and four young doctors who have received Research Fellowships, give us an insight into their work (if you are squeamish, you might like to skip most of this, especially the second one..)

First, is a young lady neurosurgeon who trained at Addenbrooke’s Hospital and is now based in Homerton in East London. Neurosurgery covers the brain, spine and nerves near those areas. Operations the previous week include a 14 hour one on a child with a congenital skull deformity creating a lot of pressure on the brain. Another one is a couple of hours fixing the spine of guy who had been in a motorcycle accident at the weekend. Much of their work involves treatment of people who have had strokes. Saving the best till last, all this is combined with being a mother of three and running a happy home with two dogs, three cats and quite a few other creatures.

Next is a lady who reads out a letter from a 30 year old patient suffering from Crohn’s disease where he had had a bad day. His condition means he goes to the loo 17 times a day but at least his employer is understanding here. Sometimes the equipment or attachments do not work properly and once a colleague asked What’s that funny smell? As the patient said to his doctor later, “Sometimes I wish I had cancer. At least I could tell people about it!” The unmentionable word here of course is incontinence and up to 4 per cent of the population suffer from this, resulting in many of them being a prisoner in their own homes.

Plastic surgery which in a medical context means to remould the body, is the speciality of the next speaker where life now imitates art after two face transplants in the UK. When calculating the risks (which sounds a bit like giving investment advice) the first issue is: What happens if the transplant does not work? Transplant a hand or an arm and a prosthesis can be used. If a face transplant doesn’t work……Another example here is a guy with no lower lip which had been surgically removed as part of his cancer treatment. He can only go out with his part of his face covered and not having a lower lip means he gets mouth ulcers all the time.

Urology which covers the obvious area but also the reproductive areas in men, is the speciality of the final speaker. As prostate cancer is the most commonly diagnosed cancer in men this has some of us squirming in our seats, but as it is before lunch we are spared most of the detail. Suffice to say, lasers and freezing are two new treatments used these days as an alternative to surgery and the grants from the Anniversary Fund help with the ongoing research here.

As a postscript, we are reminded of an exhibition designed partly to dispel the myth: There are no women in Freemasonry http://www.telegraph.co.uk/core/Slideshow/slideshowContentFrameFragXL.jhtml?xml=/arts/slideshows/freemason/pixfreemason.xml&site=Arts

A 3 minute video/podcast guide to this site now is available under the heading Video on the right hand side of the blog under the Pages section, just a little way down. Thanks to Johnny Mindlin of Green-Shoot http://www.green-shoot.co.uk/ for his help and guidance here and to Julian Guppy of Zebtab http://www.zebtab.com/ for posting it.

On the mortgage front, a small welcome return of common sense. Alliance & Leicester will now allow brokers access to the underwriters saving us lots of time and avoiding having to deal with a call centre like many other lenders. Just to maintain the balance here though, C&G seem to be doing their best to ruin their good reputation. A client wanted to borrow over £200,000 and got a Decision in Principle (DIP) approved. His accountant confirmed the income figure and even gave a breakdown. Mortgage Offer is ready but C&G will not lend the client the Two-year Fixed 5.89 per cent product that he wants BUT he can have the more expensive 5 year products where the rates are 6.75 and 7.15 per cent! Interesting to see how this sort of shabby treatment fits in to the FSA’s Treating Customers Fairly initiative…. http://www.fsa.gov.uk/Pages/Doing/Regulated/tcf/index.shtml

Finally, in my search stats I find: Do Northern Rock have obligation to release people from mortgages before tie-in period? An obligation?? Definitely not – read your mortgage offer. Has HBOS bought out TMB? No. TMB (The Mortgage Business) were always owned by BOS (Bank of Scotland) before it bought the Halifax and became HBOS – TMB quickly established itself as a leading self-cert lender. Steps to locate lost will – possible intestacy? All very well making a will but you need to leave instructions with someone you trust about where to find it. Common Law wife/husband? No such thing in law – it is just something people do, and for a nightmare true story combining both previous items http://www.georgeemsden.co.uk/?p=31 But prize for the most unusual search phrase: Feels like a lump in my wind pipe?? Please visit your doctor!

A 3 minute video/podcast guide to this site now is available under the heading Video on the right hand side of the blog under the Pages section, just a little way down. Thanks to Johnny Mindlin of Green-Shoot http://www.green-shoot.co.uk/ for his help and guidance here and to Julian Guppy of Zebtab http://www.zebtab.com/ for posting it.

It is perhaps no coincidence that as the baby boomer generation starts retiring, living standards are at their peak. In the US where you do not have to buy an annuity with your 401 (k) personal pension, people are raiding their pensions to make ends meet, even if it means paying a tax penalty http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2008/06/07/BUP1114D52.DTL On this side of the pond, Otto Thoresen, Chairman of AEGON UK who own Scottish Equitable has plans for free generic advice http://business.scotsman.com/personal-finance/The-next-wave-of-pension.4163282.jp which might be dubbed a National Wealth Service but at the risk of sounding like a tape recorder, nothing about the telephone number public sector pension bill – £1 trillion.

Rising early Friday morning, to go to my weekly networking group BRX Bond Street, two angry magpies chase off an urban fox with a lovely red coat, in the street below. This group which meets at the RAF Club in Piccadilly, has a real buzz about it now http://www.brxnet.co.uk/bondstreet/index.html and the 1:1 meetings afterwards are always interesting. Last week’s one was with Kirsty Joly http://www.perfectlytempered.com one of the UK’s 40 chocolatiers – Belgium has 2,600 of them. Perfectly Tempered was started 18 months ago after a successful City career and tempering here refers to getting the chocolate or rather blend of different kinds of chocolate to the right temperature. Customers tend to be corporate although weddings and promotional events are catered for as well. The flavours offered change according to season or what is available and company logos are quite popular – both on the packaging and chocolate itself.

At Shakespeare’s Globe in Southwark http://www.shakespeares-globe.org/theatre/annualtheatreseason/ King Lear has given way to A Midsummer Night’s Dream and after spending Saturday afternoon having an almighty clearout at the office, I take a chance and see if I can get a seat or even be a groundling. With 30 minutes to spare, I take my place in the returns queue and have just been able to reading excellent reviews of King Lear when I get a middle-tier seat £24 from a party of 4 that turned out to be 3 – one guy didn’t turn up. Returns are sold for cash only by the way, but there is an HSBC cash point one minutes walk away.

As often with Shakespeare, love is the theme and this one is set in Athens although the costumes are classic Elizabethan. The starting point is a family argument where Hermia is in love with Lysander but she is engaged to Demetrius…. Invoking an old Athenian law, Hermia’s father insists she must marry him or face death. The lovers agree to meet in a wood the following evening and you have – A Midsummer Night’s Dream. There are 3 linked plots and all works out well in the end. The genius of Shakespeare here is balance – with the serious bits broken up by humour and song. Bottom & Puck are particularly amusing and the latter gives an example, of what you can do with some very crude stage effects. As I have said many times before, it doesn’t matter a bean if you have never read or studied Shakespeare – most of his Elizabethan audience wouldn’t have been able to read.

There is nothing like a hospital visit to make you count your blessings and my latest one is no exception. A lady with an adult-sized head on top of a tiny torso less than 60 cm long is chatting happily to the guy pushing her wheelchair out to her transport while she holds a cup of coffee in her hand.

At the Head & Neck unit itself in the old redbrick Rosenheim building, my fifth (I’m losing count) post-treatment session with the nasendoscope goes well. Just for a change, I am asked to breathe in through my nose, say Eeeeeeeeee then Heeeeee and puff out my cheeks, in that order. It’s all over in about a minute but I don’t feel able to watch it this time. The only current effects are less area to shave under my chin and an occasional dryness in the mouth, as some of the lower saliva glands were zapped by the radiation and will take years to recover. Beforehand in the waiting room, people with no voice box who talk to their partners in soft whispers go in to see their doctor before me and it is nice to see old friends who were having their RT last year, at the same time I was. The only reminder as I walk away is the lingering bitterness of the local anaesthetic sliding down the back of my throat.

The search statistics show the usual crop of interesting search phrases which have ended up on my site: Will MVR start being applied by insurance companies in 2008? Answer, Yes. Market Value Reductions are penalties applied by insurance companies when you take benefits before the contracted date in a with-profits fund. When stock markets are going up, these reduce or disappear and vice versa. Advising on with-profits can be a minefield for advisers and I pass my own queries onto a colleague where it is fee-based advice – see http://www.georgeemsden.co.uk/?p=28 . Private on door money lenders edinburgh? Sounds like loan sharks – don’t go there. Thailand mortgages? Thai banks seem to be very conservative and will only lend up to about 60 per cent of the value. You will need to prove more than three years income sometimes – good luck. Is a nasendoscope uncomfortable or painful? see http://www.georgeemsden.co.uk/?p=124 and above. As one of my clients told me in a mutual chat about cancers, “It’s amazing what you can get used to!” He had bladder cancer making me feel I got off lightly. Has a credit search been done before I get my mortgage Offer In Principle? Definitely Yes. Prize for the most unusual search phrase: Capital allowances on a hearse? Please ask your accountant.

Sunday is hot, so the thought of some nice cool German beer appeals and we pop into the Bavarian Beerhouse http://www.bavarian-beerhouse.co.uk/index.shtml?about_us near Moorfields Eye Hospital but it is fully booked for the European Championships for which England did not qualify. The decor has improved a bit since our last visit http://www.georgeemsden.co.uk/?p=130 and the Schnapps part of the menu now includes a 10 shot Journey through Life (£39.50) Porno meter and Porno half-meters? A more conventional curry wurst & chips, Bavarian Obazda salad and two beers do the job. The Obazda is delicious and is served with pretzels but being made largely from Camembert cheese, is the most calorific salad I have ever eaten – recipe here: http://www.letscookgerman.com/salads-and-snacks/mashed-cheese-obazda.html

Proving the old saying that truth is stranger than fiction http://www.telegraph.co.uk/arts/main.jhtml?xml=/arts/2008/05/22/sv_rahn125.xml this story might have made a better film than the fourth Indiana Jones one – a bit of fun but a bit short on ideas. The crystal skull looks awfully familiar if you have seen any of the Alien SF films. And if you want to believe something really outlandish – aliens probably exist.. http://www.telegraph.co.uk/earth/main.jhtml?xml=/earth/2008/06/02/scispace102.xml

But to finish on pithy note, I will leave it to cartoonist Matt http://www.telegraph.co.uk/news/matt/2091888/Matt-cartoon.html

Uberrimae fidei or utmost good faith is the guiding principle for insurance and requires the insured i.e. you, to declare all relevant information at the time the contract is started. Cynics will say this gives the insurer a way to wriggle out of the claim and unpaid insurance claims are probably the touchiest area for any Financial Adviser. Some of the cheapest contracts are actually underwritten later on at point of claim, which can perpetuate this view. It seems many do not read all the small print before signing a proposal form.

However, the principal of uberrimae fidei has become slightly outmoded with many disputes being settled by an Ombudsman so the ABI has issued new guidelines after the Law Commission published its consultation paper in 2007. If the error or non-disclosure is innocent – claim paid in full; if it is due to negligence where customer has not been careful – proportionate benefit is paid and if the error was deliberate or he was careless, the contract can be cancelled from inception – void ab initio.

The latter reminds me of my first life insurance claim. The contract was a twin endowment policy taken out by a brother and sister to cover a mortgage – the benefit was two amounts of half the mortgage rather than a joint-policy for the whole mortgage. The sister called me to handle the claim as the brother had died. Cause of death – motor neurone disease vide Dr Stephen Hawking. At the time I had never heard of this condition but it occurred to me this was probably not some lurgi that you might have caught on holiday.

One of the questions on the proposal form was: Have you visited the doctor in the last 12 months? Answer on the form, No. As usual, the insurer checked with his GP who confirmed that the brother had been to see him 8 months previously, complaining of headaches and slurred speech – classic early symptoms. The policy was made void ab initio and premiums returned. The sister’s request for interest on them was politely but firmly refused.

Back in the land of the living, the Olympics are coming and any former swimming students of mine might like to set up their video or Sky + so that they can record some of the swimming events – there are four strokes: freestyle where people do front crawl, breast stroke, back stroke or back crawl and butterfly. For anyone wanting to improve their swimming, the technical commentary, underwater cameras and stroke analysis can be quite helpful. I was going to suggest the 1500 metre butterfly as a example of supreme of human effort but checking the swimming events on the Beijing Olympic website http://en.beijing2008.cn/cptvenues/sports/swimming/ shows no such event although I do remember watching this at the Barcelona Olympics. There is a 1,500 metre freestyle where the UK’s David Davies is hoping to improve on the Bronze medal he won at Athens. And if you want a little swimming history see http://www.times-olympics.co.uk/communities/swimming/swimmingancient.html from the Sydney 2000 Olympics.

Skiving swimming on Monday, there is a fascinating programme about Queen Victoria’s Men on Channel 4 which continues to lift the veil on this distant era. http://www.channel4.com/video/brandless-catchup.jsp?vodBrand=queen-victorias-men Surprisingly, some detail that I know is left out – for example, her strict German mother kept her away from other children and made her sleep in the same bedroom which she hated. When she became Queen, one of the very first things she did was to banish her mother to another room. Albert gets a good mention of course but not his popularisation of Christmas trees and the invention of Christmas cards in the 1840s. In the 1970s when my three girls were born, I imagined myself a frightfully trendy new man who knew how to change nappies, make baby milk, cheerfully carried his offspring in a sling and was present for all the births. Prince Albert did the latter for all eight births more than a century before and one wonders what else he could have achieved had he lived longer.

Still on the subject of children, I am not sure whether Bridal Boot Camp belongs in the You Couldn’t make it up or The World has gone mad department. The thought of me or any other Dad telling his daughter to get into shape before leading her down the aisle seems bizarre. http://www.telegraph.co.uk/health/main.jhtml?xml=/health/2008/06/02/hbridalcamp102.xml My couturier friend Baron Pachenari confirms that brides typically lose pounds as their big day approaches. Each dress has an average of 5 fittings but the main one is left as late as possible for this reason. No sign of the credit crunch as he is busier than ever with wedding and evening dresses at his studio at St John’s Wood Roundabout.

Otherwise, it is a sad start to the week, as a story of courage comes to an end with the death at age 30 of Lorenzo Odone, the subject of the film Lorenzo’s Oil. The Daily Telegraph obituary has some interesting detail not featured in the film http://www.telegraph.co.uk/news/obituaries/2062622/Obituary-Lorenzo-Odone.html Even more sad news next day with an obituary for Bo Diddley http://www.telegraph.co.uk/news/obituaries/2066171/Bo-Diddley.html who was a huge influence with The Rolling Stones and The Who for example, but never spent much time in the charts.

Finally, for those with cash to invest, you might like to compare the one-year fixed rates offered by two Government-owned institutions www.nsandi.com/interest-rates/index.jsp (say, 3.90% p.a. gross) and www.northernrock.co.uk (say, 6.00% p.a. gross)