I was asked at the end of last year whether I would be prepared to enter a competition wiht Citywire to raise awareness of Investment Trusts as an Investment. I agreed, which may be arash decision but time will tell.

Four competitors are being provided wiht £4,000 each to invest in at least four investment trusts. My other competitors are two Cardiff IFAs and a Citywire journalist who started life as a stockbroker.

Any profits that we make are to go to a charity of our choice; Citywire will bear any losses. My chosen charity is Parkinson's disease, this is a terrible disease which can take many forms and needs plenty of research to enable sufferers to acheive a better quality of life even if there is no cure.

This makes the incentive for making a profit high.

I have invested my funds already, although I was a little worreid that the news on Friday 13th, 'nine eurozone countries downgraded by ratings agency' might make shares plunge on Monday 16th. Fortunately this didn't happen. I have chosen two funds which were trading at a slight premium to net assets: Edinburgh Investment trsut run by Neil Woodford; this gives exposure to some large cap companies and Neil has a reputation for the defensive stance of his portfolios; Finsbury Growth and Income run by Nicholas Train; another well knowm income manager. This gives exposure to the mid-cap UK market. There is then a global fund run by Martin Currie at a discount of 5% and Scottish Oriental (run by Susie Ripingall of First State) at a discount of 2.5% and Templeton Emerging Markets run by Mark Mobius at a discount of around 7%.

So far we are not in profit but I aim to provide a week;y update.

These two headlines give an indication of the contradictions that can be found in the Media. What to believe?

The first is from tne front page of The Times today 26th January 2012; the second headline from the inside pages of the Financial Times. It is clear which headline sells more papers.

So which gives the most accurate view? I am going to make a conscious effort not to listen to too much news. The Media love to dramatise but rarely give more than one side of the argument.

So, here goes for some positive thinking! Many companies that manufacture goods are reporting full order books. Companies are lean with good cash balances so that when recovery comes they may be able to start hiring more people.

Britain may not own any car companies but many cars are still manufactured here.

The European Crisis rumbles on without any clear leadership but the Euro is likely to survive. Despite all the turmoil is is still the second most favoured reserve currency.

Greece has already technically defaulted on its debt and may eventually leave the Eurozone. If this is managed successfully it does not have to be a disaster.

Europe needs to restructure to allow more flexibility. Since no country, except Luxembourg, met the Maastricht Treaty requirements at the start of the Euro it is unreasonable to expect this now.

The markets are in positive mood at the moment .

Just a few thoughts to start off 2012 in positive vein. Despite all else this is the year of the Olympics; only a country with the demeanor of the Brits could find the negative aspects of this. It is likley to boost building at least on infrastructure which must be good for the East end of London eventually.

We wish all our clients a Happy Christmas and a Prosperous New Year.

The office will be closed from 23rd December 2011 until 3rd January 2012.

The year started with the Arab Spring which spread like wildfire from Tunisia to Eygpt culminating with the defeat and death of Gaddaffi in October. Syria is still in turmoil with President Bashar al-Ashad seemingly in complete denial that he has anything to do with the violence. He has signed a deal on Monday to allow a group of Arab dignatories to come into Syria to attemp to understand what is going on and to bring the violence to an end.

It is still unclear whether all the unrest will bring the hoped for democracy to the Arab nations. There is still a fear in the West that the unstable conditions will provide an opening for the extremist Islamic movements to take hold.

Europe has lurched from one crisis and summit meeting to another without solving any problems. We have seen the unholy alliance of 'Merkozy' ever more prominent in discussions but seemingly lacking in the imagination and creativity to bring the crisis to an end. The last summit, at which David Cameron vetoed the proposed treaty, seemed to be intent on generating more controls with little provided to stimulate the growth needed to bring Europe out of the doldrums. Both Merkel and Sarkozy face elections next year which provides another damper on progress.

The US has had an unsettled year and is also going into Election mode in preparation for the Presidential Election in 2012.

The Far East and South American economies have had a troubled year. China and Brazil have both suffered from high inflation. The markets in the far east have shown greater volatility than Europe. We wait to see whether China's property market will fall and whether it will contain inflation. China and India have both been affected by the slowdown in Europe, one of their major markets. On the positive side there is a need to develop infrastructure in the rural areas and this should provide some relief.

So what can we expect in 2012? Britain has the olympics which should at least provide a colourful spectacle. Often in the past when the world has seemed really black it has provided opportunities for investors.

We need creative imaginative people to bring us out of the quagmire. Let's hope that they surface in the New Year.

Following last week's strike which closed a large number of schools and upset refuse collections John Hutton whose report recommended the changes has come out to make a statement that his projections underestimated the seriousness of the drain on government resources.

Whilst not taking Jeremy Clarksons line I do think that the unions have been completely irresponsible in the way in which the have whipped up a frenzy about this.

Public Sector pensions after the changes will still provide defined benefit related to salary. Even if this is changed to career average earnings rather than final salary this will still provide a valuable guaranteed benefit for most workers. Unlike most of the benefits now provided in the private sector the benefits do not depend on stock market performance. The risk is firmly with the tax payer.

The greates danger of all this is that some low paid workers will opt out of their excellent pension scheme. This will leave them dependent on state benefits only which will is likley to halve their pension in retirement.

All workers are going to have to work longer, pay more and get less

The government is still planning to stop child benefit for families where there is one member who is a higher rate tax payer. This penalises families where the mother or father has chosen to stay at home to look after the children. If the worker is a higher rate tax payer (earning abve £50,580) child benefit will cease in January 2013. A couple can earn up to £100,000 before the benefit is taken away provided that both stay below the higher rate threshold.

This seems unjust and penalising poorer families. It remains to be seen whether there are any changes before next year.

The main features of the Autumn Statement are listed below:

More information can be found in the Articles and Newsletters section.

State pension are to be increased in line with the CPI index which was 5.2% in September. This means an increase of £5.30 in April for the basic state pension bringing it up to £107.45 per week.

The State pension age is increasing to 67 for those born between 6th April 1960 and 6th April 1961 will have a pension age between 66 and 67. Those born after 6th April 1961 will have a state pension age of 67. The chancellor has also announced that this is likley to be increased in line with life expectancy meaning that those in their 30's are likley to have a state penion age of around 73 years.

The increase in fuel duty of 3p has been deferred until August.

Business rate relief for small companies has been extended for a further six months from 2012.

A new seed enterprise scheme (SEIS) is to be introduced in April 2012 with a 50% tax credit to encourage investment into new companies to stimulate growth.

The CGT allowance has been frozen for a year at £10,600 but the personal allowance will increae by £630 to £8105. Higher rate tax threshold is frozen at £42,475.

Rail fares will rise only 1% above RPI July rating of 5% rather than the 3% declared before. This rise will take place in January.

November 1st saw the introduction of the Junior ISA or JISA as it seems to be called in the industry.

This allows parents or anyone else to put up to £3,600 a year into an ISA account for a minor child. They are available only for those children who don't have a child trust fund. Hard on those children born after August last year and before December 31st as they were given only £50 for the child trust fund reduced from the previous £250.

The government will come under pressure to allow the current child trust funds to be transferred into Junior ISAs which are likley to be less expensive.

One of the things parents should consider when setting up these plans is that the money in them belongs to the child. If you are considering this as a savings plan for University education the child would need to agree that the funds could be used for this when they reach 18 years of age. If they choose to do something else with the money this is their prerogative.

The 17 members of the Eurozone agree a package of measures to aid Greece including a 'haircut' of Greek debt. This means that Greece will only have to pay back half of the money that has been loaned in the form of Greek bonds. More money is being provided from the European Financial Stability Facility (EFSF) to enable the government to continue.

This was thrown into disarray by Mr Papandreou who went home and declared that he would hold a referendum of the people on the Greek measures. This sent markets into a tailspin again.

As as a result Papandreou was SUMMONED by Merkel and Sarkozy to attend an emergency meeting before the G20 conference began in earnest.

He went back to Greece and did a U-turn on the referendum saying that this was cancelled. He narrowly retained his seat in parliament by 8 votes. Over the weekend he ahs agreed to step down to allow a government of National Unity to be formed. This should give the impression that the Greeks are keen to progress an make efforts to stem their deficit. Not out of the woods yet but at least making positive moves.

So where is the next crisis coming from: You've guessed it ITALY! Berlusconi refuses to consider resigning; Italian debt is €1.4 trillion. New issues of government debt have coupons of over 6% which means that it is becoming increasingly expensive for Italy to service its debt.

The G20 meeting did not bring committment from the other members to provide extra funds for the European Central Bank (ECB) or the International Money Fund (IMF) so this crisis will continiue to rumble on.

We'll see what happens this week!

Following lobbying from Ros Altman the government have agreed to delay the increase in State Pension age to ensure that no one has to work more than 18 months extra.

This goes someway towards meeting the requests but many people will not be satisfied as 18 months is still a long time to continue working if you has not planned for it.