Resolutionary behaviour



Christmas is over, New Year's Eve revelry is around the corner, and - eating the cold leftovers aside - there's nothing to fill the fallow time. Except, of course, attending to the small matter of fashioning over-ambitious plans for the new you. "I will go to the gym." "I will give up smoking." "I will learn that instrument." Yes, ladies and gentlemen, it is perhaps the most ridiculous global phenomenon of them all: the new year's resolution.

The success rate is so low that it's difficult to see new year's resolutions as anything more than a seasonal tradition, alongside leaving mince pies out for Santa. One year, The Observer newspaper was so disbelieving that anyone actually kept them that it followed a group of people for six months to see if they'd followed through with their resolutions to get rid of weight, debt or cigarettes. Unbelievably, it turned out that most had. But there was an element of cheating. They only succeeded through the professional assistance of financial advisers and life coaches that The Observer had put them in touch with. Perhaps that should be a resolution in itself: get a life coach.

It would make a lot of sense. As anyone who has tried and failed to keep a new year's resolution knows, it is exceptionally hard to make such big life changes on your own. So why has the notion of the new year's resolution endured? To understand, we must travel back 4,000 years, to ancient Iraq. The Babylonians can truly lay claim to having invented the new year's resolution. Their new year parties lasted a whopping 11 days, and though they weren't actually in December they celebrated renewal and, impressively, the revitalisation of society, in fine style. They also set down their hopes for the forthcoming months, which included resolving to return borrowed farm equipment to its rightful owner - because, come on, who hasn't felt a pang of guilt about not returning that combine harvester?

The resolutions that played a part in the Roman new year, formalised by Julius Caesar in 46BC, tell us a little more about the motivation to make resolutions. The Romans were a superstitious bunch, and, in giving new year gifts (olive branches from sacred trees, coins of the god Janus), they were in fact hoping to throw out whatever bad luck they'd had in the old year and replace it with good luck in the new.

So it's this hope of betterment from which all our new year's resolutions stem. There are barely any variations across the world - we all do it, no matter what nationality or language we speak. It derives from a basic human desire to reflect upon what you may have done wrong - or not done at all - in the year that has passed and try to atone for that with better behaviour in the year to come. The problem is, we are fallible. Last year, a British mental heath charity advised people not to focus on problems or insecurities when they made resolutions, but instead to think about starting small - being active or going green - because if your well-meaning plans fail by mid-January, then you're probably going to feel worse than you did before you made them.

Psychological research into the new year conducted by professors at the University of Minnesota concluded that a whopping 80 per cent of resolutions have been broken by Valentine's Day. And if you think university research is taking matters slightly too far, then an official chart of popular resolutions from an official US government website surely trumps even that. Naturally, number one is to lose weight, and in these financially straitened times you'd expect that to be followed by managing debt, saving money and getting a better job. But we rather like the ideas, lower down the chart, of taking a trip or volunteering.

No wonder the British psychologist Cliff Arnall says the best time to make a resolution is not December 31 at all but - and unbelievably he's worked this out mathematically - May 18. Arnall shot to fame when he proposed that the most depressing day of the year is January 24, when the mental decline we're already experiencing during new year reaches its lowest point. All of this is, of course, based on the changing of the seasons in northern Europe, but his last point does ring true: that on May 18 you're likely to make decisions on your future because you want to. On December 31, you're doing it when you're "supposed" to.

Literature has had plenty to say on the matter and, as so often, Mark Twain summed up the new year dichotomy best: "Yesterday, everybody smoked his last cigar, took his last drink and swore his last oath. Today, we are a pious and exemplary community. Thirty days from now, we shall have cast our reformation to the winds and gone to cutting our ancient shortcomings considerably shorter than ever." True, but not exactly constructive: better to leave it to Bridget Jones in Helen Fielding's famous diary to come up with the sensible solution. "I do think new year's resolutions can't technically be expected to begin on New Year's Day," she writes. "Dieting on New Year's Day isn't a good idea as you can't eat rationally and really need to be free to consume whatever is necessary, moment by moment. I think it would be much more sensible if resolutions began on January the second."

And there, from the pen of a dappy fictional London PR girl, comes wisdom.

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Producer: JP Films, Zee Studios
Director: JP Dutta
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Rating: 2/5

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Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.

Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.

Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.

Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.

“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.

Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.

From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.

Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.

BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.

Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.

Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.

“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.

Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.

“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.

“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”

The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”

Real estate tokenisation project

Dubai launched the pilot phase of its real estate tokenisation project last month.

The initiative focuses on converting real estate assets into digital tokens recorded on blockchain technology and helps in streamlining the process of buying, selling and investing, the Dubai Land Department said.

Dubai’s real estate tokenisation market is projected to reach Dh60 billion ($16.33 billion) by 2033, representing 7 per cent of the emirate’s total property transactions, according to the DLD.

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On sale: from January 2022