A central tenet in modern economy should be: "Take nothing at face value."
In a world that inundates its citizens with advertisements hand crafted by neuroscientists and deeply complex documents that would take a team of lawyers and accountants to decipher, the simple consumer can easily fall into the clutches of those not necessarily looking out for their best interests.
Take the offer of a new mortgage rate from a bank, which we have been seeing with increasing frequency of late. These typically come with what is known as a "teaser rate". A teaser rate is usually several points below the prevailing interest rate, so on the surface it seems like a good deal.
In some cases, a closer look may reveal that the teaser rate is not what it seems, however. In Abu Dhabi, for instance, it is often more difficult to get a mortgage when you are buying a home from the second-hand market than if you are buying from a developer directly. Developers are also more likely to offer mortgages with teaser rates or much lower rates than the market norm.
But, those same developers often ask significantly higher prices for their properties than sellers on the second-hand market. So the developer's mortgage may seem cheaper but it is only accessible if you pay more money for the property.
What is more, after a year or two, the teaser rate might disappear, switching from a fixed, low-cost rate to a variable rate that changes according to the London interbank offered rate (Libor). A buyer can almost always be sure that such contracts are written in the best interests of the bank and its shareholders.
Now, this does not have to be the case. A well-educated consumer is a powerful thing. Because the economies of the world are so vast and complicated, the average person needs to become more of an investigator than he or she was in previous decades.
This means to succeed in the financial world, or at least make it through unscathed, you have to learn the meaning of the terms in contracts and financial statements. What is a "variable Libor rate"? How do banks calculate credit-card interest? What is a "related-party transaction"?
Even accountants have trouble understanding the true financial position of a company. They need constant training to be able to keep up with those who devise increasingly tricky ways to express information on financial statements. So much so, one would be forgiven for thinking they were trying to conceal it.
A well-known businessman in Dubai recently told me that when someone offers him a deal that has a "guaranteed return of 20 per cent", his first instinct is to bolt out of the room. "Nothing is guaranteed," he says. "And even more importantly, they are offering me something with a return higher than I can get elsewhere. There must be some risk to the investment that I do not fully understand."
These offers seem to swirl around booming economies, such as the UAE's, in ever greater numbers.
There has been no bigger benefit for consumers and investors than the arrival of the internet, which allows people to connect to each other and share their discoveries. There are large consumer advocacy websites that expose pyramid schemes and scams. One person's mistake told on such a site can prevent dozens more from falling victim.
What is clear is that a big, evolving capitalist economy is full of perils. A badly worded contract could leave home buyers waiting an extra two years for their apartments. A quick acceptance of a deal could mean a greater cost down the road. An investment made on purposely muddled financial statements could turn into a deep loss.
The only way to survive is to get good information before making decisions and this can only be done if consumers and investors also consider themselves investigators.
So, the next time someone offers you the deal of a lifetime, be polite but explain that you have a "few more questions to ask".
bhope@thenational.ae
Tax authority targets shisha levy evasion
The Federal Tax Authority will track shisha imports with electronic markers to protect customers and ensure levies have been paid.
Khalid Ali Al Bustani, director of the tax authority, on Sunday said the move is to "prevent tax evasion and support the authority’s tax collection efforts".
The scheme’s first phase, which came into effect on 1st January, 2019, covers all types of imported and domestically produced and distributed cigarettes. As of May 1, importing any type of cigarettes without the digital marks will be prohibited.
He said the latest phase will see imported and locally produced shisha tobacco tracked by the final quarter of this year.
"The FTA also maintains ongoing communication with concerned companies, to help them adapt their systems to meet our requirements and coordinate between all parties involved," he said.
As with cigarettes, shisha was hit with a 100 per cent tax in October 2017, though manufacturers and cafes absorbed some of the costs to prevent prices doubling.
MATCH INFO
Uefa Champions League semi-final, first leg
Bayern Munich v Real Madrid
When: April 25, 10.45pm kick-off (UAE)
Where: Allianz Arena, Munich
Live: BeIN Sports HD
Second leg: May 1, Santiago Bernabeu, Madrid
How much sugar is in chocolate Easter eggs?
- The 169g Crunchie egg has 15.9g of sugar per 25g serving, working out at around 107g of sugar per egg
- The 190g Maltesers Teasers egg contains 58g of sugar per 100g for the egg and 19.6g of sugar in each of the two Teasers bars that come with it
- The 188g Smarties egg has 113g of sugar per egg and 22.8g in the tube of Smarties it contains
- The Milky Bar white chocolate Egg Hunt Pack contains eight eggs at 7.7g of sugar per egg
- The Cadbury Creme Egg contains 26g of sugar per 40g egg
Jumanji: The Next Level
Director: Jake Kasdan
Stars: Dwayne Johnson, Kevin Hart, Karen Gillan, Jack Black, Nick Jonas
Two out of five stars
The specs
Engine: 2.9-litre, V6 twin-turbo
Transmission: seven-speed PDK dual clutch automatic
Power: 375bhp
Torque: 520Nm
Price: Dh332,800
On sale: now
UAE currency: the story behind the money in your pockets
The specs
AT4 Ultimate, as tested
Engine: 6.2-litre V8
Power: 420hp
Torque: 623Nm
Transmission: 10-speed automatic
Price: From Dh330,800 (Elevation: Dh236,400; AT4: Dh286,800; Denali: Dh345,800)
On sale: Now
COMPANY%20PROFILE%20
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The National's picks
4.35pm: Tilal Al Khalediah
5.10pm: Continous
5.45pm: Raging Torrent
6.20pm: West Acre
7pm: Flood Zone
7.40pm: Straight No Chaser
8.15pm: Romantic Warrior
8.50pm: Calandogan
9.30pm: Forever Young
The Settlers
Director: Louis Theroux
Starring: Daniella Weiss, Ari Abramowitz
Rating: 5/5
Notable groups (UAE time)
Jordan Spieth, Si Woo Kim, Henrik Stenson (12.47pm)
Justin Thomas, Justin Rose, Louis Oosthuizen (12.58pm)
Hideki Matsuyama, Brooks Koepka, Tommy Fleetwood (1.09pm)
Sergio Garcia, Jason Day, Zach Johnson (4.04pm)
Rickie Fowler, Paul Casey, Adam Scott (4.26pm)
Dustin Johnson, Charl Schwartzel, Rory McIlroy (5.48pm)
Our family matters legal consultant
Name: Hassan Mohsen Elhais
Position: legal consultant with Al Rowaad Advocates and Legal Consultants.
WHAT IS A BLACK HOLE?
1. Black holes are objects whose gravity is so strong not even light can escape their pull
2. They can be created when massive stars collapse under their own weight
3. Large black holes can also be formed when smaller ones collide and merge
4. The biggest black holes lurk at the centre of many galaxies, including our own
5. Astronomers believe that when the universe was very young, black holes affected how galaxies formed
Key facilities
- Olympic-size swimming pool with a split bulkhead for multi-use configurations, including water polo and 50m/25m training lanes
- Premier League-standard football pitch
- 400m Olympic running track
- NBA-spec basketball court with auditorium
- 600-seat auditorium
- Spaces for historical and cultural exploration
- An elevated football field that doubles as a helipad
- Specialist robotics and science laboratories
- AR and VR-enabled learning centres
- Disruption Lab and Research Centre for developing entrepreneurial skills
Concrete and Gold
Foo Fighters
RCA records
COMPANY%20PROFILE
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How to wear a kandura
Dos
- Wear the right fabric for the right season and occasion
- Always ask for the dress code if you don’t know
- Wear a white kandura, white ghutra / shemagh (headwear) and black shoes for work
- Wear 100 per cent cotton under the kandura as most fabrics are polyester
Don’ts
- Wear hamdania for work, always wear a ghutra and agal
- Buy a kandura only based on how it feels; ask questions about the fabric and understand what you are buying
TWISTERS
Director: Lee Isaac Chung
Starring: Glen Powell, Daisy Edgar-Jones, Anthony Ramos
Rating: 2.5/5
The Buckingham Murders
Starring: Kareena Kapoor Khan, Ash Tandon, Prabhleen Sandhu
Director: Hansal Mehta
Rating: 4 / 5
If you go
The flights
The closest international airport for those travelling from the UAE is Denver, Colorado. British Airways (www.ba.com) flies from the UAE via London from Dh3,700 return, including taxes. From there, transfers can be arranged to the ranch or it’s a seven-hour drive. Alternatively, take an internal flight to the counties of Cody, Casper, or Billings
The stay
Red Reflet offers a series of packages, with prices varying depending on season. All meals and activities are included, with prices starting from US$2,218 (Dh7,150) per person for a minimum stay of three nights, including taxes. For more information, visit red-reflet-ranch.net.
'Gehraiyaan'
Director:Shakun Batra
Stars:Deepika Padukone, Siddhant Chaturvedi, Ananya Panday, Dhairya Karwa
Rating: 4/5
THE SIXTH SENSE
Starring: Bruce Willis, Toni Collette, Hayley Joel Osment
Director: M. Night Shyamalan
Rating: 5/5
UAE currency: the story behind the money in your pockets
Jetour T1 specs
Engine: 2-litre turbocharged
Power: 254hp
Torque: 390Nm
Price: From Dh126,000
Available: Now
Feeding the thousands for iftar
Six industrial scale vats of 500litres each are used to cook the kanji or broth
Each vat contains kanji or porridge to feed 1,000 people
The rice porridge is poured into a 500ml plastic box
350 plastic tubs are placed in one container trolley
Each aluminium container trolley weighing 300kg is unloaded by a small crane fitted on a truck
World Series
Game 1: Red Sox 8, Dodgers 4
Game 2: Red Sox 4, Dodgers 2
Game 3: Saturday (UAE)
* if needed
Game 4: Sunday
Game 5: Monday
Game 6: Wednesday
Game 7: Thursday
BUNDESLIGA FIXTURES
(All games 4-3pm kick UAE time) Bayern Munich v Augsburg, Borussia Dortmund v Bayer Leverkusen, Hoffenheim v Hertha Berlin, Wolfsburg v Mainz , Eintracht Frankfurt v Freiburg, Union Berlin v RB Leipzig, Cologne v Schalke , Werder Bremen v Borussia Monchengladbach, Stuttgart v Arminia Bielefeld
