Seen on the back of a bus

[Simpo Two]

Walking into town today I passed a stationary bus which had a small two-line advert on the back.

First line: 'Pro tip: If you can't draw it, don't invest in it'.

Well that's a worthy investment concept. I guessed it was warning against the perils of crypto, futures, intangibles and so on. Makes sense.

And then I saw the second line and actually laughed out loud. It went something like:

'Invest in Suffolk's green energy proposition'.

Suddenly the wisdom of Peter Lynch evaporated in a puff of smoke.

Peter Lynch: https://en.wikipedia.org/wiki/Peter_Lynch

Suffolk County Council: https://www.suffolk.gov.uk/council-and-democracy/c...

'The Sustainable Suffolk Investment offers returns 4% interest a year over a five-year term. This means investors will receive their original investment back in 6-monthly instalments along with interest on the remaining balance which can be reinvested or used as an income.'

Small print: 'Abundance’s service in relation to council investments (P2P loans) is not covered by the Financial Services Compensation Scheme (FSCS)... Holding investments in an IFISA does not reduce the risk of the investment or protect you from losses. You can still lose all your money.'

As I walked away pondering the horrendous mismatch between first and second lines, I realised that I can't draw a picture of 'green', but I can draw a picture of a oil rig.

And we wonder what Abundance's fee is.

But most importantly, where is the 4% (if it happens) coming from? Would it be Johnny Taxpayer, through green taxation? For that reason and the fact I can't draw 'green', "ah'm oot".

[mikeiow]

I imagine you need to dig a little more to find where the money comes from, but sounds a fair return for a safe investment.
But *is* it safe (ie, guaranteed)?

Not so sure about drawing it, but I do believe if you don’t understand an investment, don’t invest.

‘Green’ & ‘ethical’ investments aren’t necessarily bad. Quite the opposite, in general, although the best thing humans can do for the planet is die off, so do it take it to the extreme

[Simpo Two]

That can be true of proper ethical investments - not I suspect because the companies they invest in are intrinsically better than 'normal' ones but because people pay a premium for their products/services. However this one has been either cooked up by a County Council (a species not known for financial astuteness), or more likely sold to them by Abundance who want to make some money. I guess the claimed 4% return comes from other investors going 'gurr - green!', or the P2P lenders, if they are not one and the same. Of course if investors do get 4% back in their pockets then you can argue it works, it just wakes the cynic in me.

[snuffy]

Simpo Two said:

As I walked away pondering the horrendous mismatch between first and second lines, I realised that I can't draw a picture of 'green', but I can draw a picture of a oil rig.

If you can draw a picture of an oil rig, why can't you draw a picture of a solar panel or a wind turbine? I can.

[Simpo Two]

snuffy said:

If you can draw a picture of an oil rig, why can't you draw a picture of a solar panel or a wind turbine? I can.

I looked again to see exactly what I'd be investing in:

'Suffolk County Council, as part of the Sustainable Suffolk partnership, are hoping to raise £1 million to fund local projects that will cut carbon emissions in Suffolk. For as little as £5, people, businesses and organisations can make low-risk investments to fund these environmental projects and receive a steady financial return.'

I'm still not seeing what the products are or where the 4% return comes from. I see £1M being spent; I don't see a mechanism for a return, only lower emissions.

[C69]

Simpo Two said:

I'm still not seeing what the products are or where the 4% return comes from. I see £1M being spent; I don't see a mechanism for a return, only lower emissions.

From the Abundance website: "The money invested in the first phase of the Sustainable Suffolk Investment will be used to install energy-efficient upgrades at such council-owned sites to lower carbon emissions from utilities.. These are expected to include installation of solar panels and efficient electric heating systems such as heat pumps..."

It also says: "All investments from Suffolk County Council are compliant with the Green Loan Principles - internationally recognised standards that are also used by the UK Government for its green investments products. They require that the money invested can only be used to fund eligible green projects."

It's just public sector borrowing. A more local version of buying gilts.

While buying council bonds (which is essentially what investors are doing) is supposed to be low risk, platform risk should be another key consideration (as with all P2P activities).

4.00% over five years isn't a great rate, given that the best FSCS-protected five-year fixed-term savings bond is currently paying 4.30%. Likewise, there are a couple of five-year cash ISAs that offer a return of 4.18%.

[snuffy]

Well, regardless of anything, I'd not be giving any of my money to a council voluntarily, because they don't understand how money works and even if they have a slight inkling, they have no regard for it, because they don't have to work for it. If they lose the lot there's no consequences for them.

[Panamax]

Simpo Two said:

proper ethical investments

Now there's an oxymoron. Drill baby drill? Lovely, clean Pennsylvania coal? Bio-fuel made out of food? Fields filled with solar panels where nothing can grow? Windmills killing all the birds?

Ok, ok, forget that last one...