What is the incidence of ‘enormous’ advisory fees

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FT.com / Companies / Financial Services - ‚ÄòEnormous’ adviser fees spark warning.

City apologists who vist this bloog spend ages talkinmg about he incidence of taxes on companies - claiming they fall on law paid labour and pensioners and so should not be charged. This I dispute.

But I bet there will be silence from them on this report from the FT:

The “enormous” fees paid to investment banks for advising companies on deals might be skewing the outcome of takeovers, the UK’s leading group of institutional shareholders has warned.

The Association of British Insurers said companies and regulators needed to take a close look at the advisory arrangements. The fees were a “deadweight cost” on shareholders that could swallow a significant part of savings derived from mergers and acquisitions.

That means someone bears the incidence of these costs. There's no doubt who in this case - it is labour made unemployed to try to recoup these costs (note Cadbury / Kraft) and secondly pensioners etc who really own shares.

This charge is intended to shift wealth from the least well off to the most well off - in the financial services sector. That is obvious.

Just as it is obvious that corporation tax is needed as what is, in effect a withholding tax to ensure that capital that hides in tax havens and other untaxed structures makes its fair contribution to society.

But the obvious is not obvious when the self interest of bankers and their apologists is at issue, except to thje extent that we can obviously expect them to create any cock and bull story that disguises the truth.

As evidence - do you remember 'trickle down'?