At the time of writing this we are a little over a month away from the next UK Government’s Budget Announcement on 30th October 2024. Ever since the result of the UK general election there has been much discussion and speculation regarding the details of what will be within this speech, supporting documents and future changes to legislation and taxation rules.
As a financial services profession ‘insider’ some people work on the assumption that we know what is going to happen within that budget and how to position accordingly.
Others also have the assumption that we know what is going to happen within financial markets over the next days, weeks, months and years.
And to go one step further on from that, other people hope that we will know what is going to happen in their lives in great detail.
On the first matters we keep our knowledge as fresh as possible by taking information from a range of sources. Whilst it is useful, this information is not fact and therefore needs to be treated with a degree of scepticism and account for the potential biases that may be included within it.
And whilst we do have a crystal ball in the office, unfortunately it doesn’t work and so it really just an ornament to demonstrate the point that we really don’t know.
So what does that mean?
Well what is means is that we can’t rely on speculation and use it in any meaningful way to help us make decisions. The risk and impact of error could be much greater by acting on speculating than by not and therefore neither should you!
What we do try to do instead is:
• Keep our knowledge as up to date as possible
• Use an evidence based approach where possible
• Use reasoned and reasonable assumptions within any forecasts
• Stress test for ‘known unknowns’
• Accept that whilst we positioning correctly now that things will change and that things may need to be adapted accordingly
So what am I saying?
Well I am saying three things:
1. Try not to listen to speculation and treat it with a degree of skepticism
2. Try to use evidence where possible, or reasoned and reasonable assumptions otherwise
3. Try not to worry about what you cannot control!
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