Money Management magazine’s December 1984 issue would make you want to take a holiday. With a pleasant, summery cover image of a sandy beach with palm trees, it pointed to offshore tax havens. The cover story featured then editor Janet Watford’s personal experiences from a trip to the Cayman Islands and Bermuda.
The feature focused on what offshore tax havens offered a UK investor and how an investor could avoid the UK tax system by moving away. The feature said investors could avoid paying UK tax by working abroad for a limited time or retiring overseas. However, it also pointed out that those who were happy at home should not emigrate just for tax reasons.
Both Bermuda and the Cayman Islands remained popular for UK residents but with more people looking at a move to these countries, house prices were at a premium in Bermuda. Overseas residents were not permitted to purchase property valued at under $300,000 (£230,769 at the exchange rate of the time). In the Cayman Islands, most properties were flats, with a two-bedroom flat costing close to $200,000 (£153,846). According to Nationwide House Price Index, the average UK property cost just £29,000 in 1984, so this represented a significant investment.
In other news, chancellor Nigel Lawson’s autumn statement reinforced belief in the economy with growth prospects for 1985 pegged at 3.5 per cent. Markets moved to a new high in November and corporate profits were expected to keep growing through 1985. RPI inflation in the UK averaged 5 per cent over the year.
In the US, signs of slower economic growth had started to show a favourable impact on credit markets. European economies saw a pick-up in their growth rates and lower interest rates were expected to encourage higher consumption and investment in the new year. Inflation was at a remarkably low level, similar to today.
The magazine also featured a special report on unit trusts, on the back of a conference organised by the Unit Trust Association and the Financial Times in association with Money Management. Attended by over 300 delegates, the report focused on the growing popularity of unit trusts as discussed by attendees at the conference.
However, another feature on unit trusts in the magazine discussed market reverses in the UK that had led to a severely depressed performance in the unit trust industry and caused a faltering in consumer confidence. This in turn was worrying management groups and brokers alike.
Other events in December 1984
December 3 - A leak of toxic gases from a Union Carbide pesticide plant in Bhopal, India, caused the death of 2,259 people (official figure for immediate deaths - other estimates go as high as 16,000 including later deaths) and left over half a million injured
December 7 - Allan Border’s first Test match as captain of the Australian cricket team (versus West Indies in Adelaide)
December 9 - ‘Do they know it’s Christmas?’ by Band Aid goes to the top of the official singles chart. It stayed there for four weeks and became the biggest selling single of all time in the UK.
December 19 - UK signs agreement with China to return Hong Kong to China in 1997
December 21 - The three-month-old son of The Prince and Princess of Wales is christened Henry Charles Albert David.[51] (He is and always has been known as “Harry”).
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