According to C&G's Debbie Isaacs, the rationale was simple: "We could offer higher rates by post because accounts did not incur the overheads arising from our branch network."Postal accounts do not have the scary connotations that direct and electronic banking hold for many customers," she said.This may be so, but sifting through fine-print terms and conditions reveals that some of these accounts may carry substantial penalties.Most accounts offer a choice of monthly or annual interest. An account paying 7.5 per cent gross will return 6.0 per cent net to a basic-rate taxpayer and 4.5 per cent net to someone on the higher rate. With inflation at a 12-month average of 3.6 per cent at the end of September, the real income net of inflation from the investment does not leave much room for Christmas spending sprees.Postal deposit accounts were introduced by Cheltenham & Gloucester Building Society in 1989. Non-taxpayers can use an R85 form, available from post offices, to apply for interest to be paid gross.Basic-rate taxpayers need do nothing but those paying the highest marginal rate will have to declare their income from interest and dividends on their annual tax returns and see their interest further reduced.Now include the effects of inflation. However, finding the highest rates of return for your cash is not straightforward. Postal accounts offered by banks and building societies offer some of the best deals but are subject to terms and conditions which need close scrutiny. Many lenders advertise gross interest payable in bold type but these rates are only available to non-taxpayers Basic-rate income tax is deducted from interest at source.

Since the Bank of England was given responsibility for setting interest rates after the last general election, it has nudged the cost of money upward as a means of controlling inflation This is good news for savers. Quite whether the IMF would be able to bail out an economy that is comprehensively bigger than most of the other so-called Tigers in the region put together is a moot point.In the meantime it looks a "won-way" ticket to nowhere.Brian Tora is chairman of the Investment Strategy Committee of stockbrokers Greig Middleton.. There are always many willing to recruit, not least being Nicola Horlick, who was herself once at Mercury.If investment attention is firmly focused on domestic players in investment management, it can only be because the Far East is being studiously ignored by managers in London at present.If it had not been for the US brokers' largesse in London, I would have been writing about Japan.The market there has been plunging up and down in a fashion that should be a comedy writer's delight. What the final act will usher in for the market that was once bigger even than Wall Street is hard to gauge.Most foreign investors are sitting on the sidelines, either having withdrawn from an investment area where damage has been meted out on both the currency and share front, or wishing fervently that they had the foresightedness to have withdrawn, as Templeton did back in the late 1980s.Deregulation looks more of a reality now, but the financial sector, and the economy for that matter, is in a mess.Just over the sea, another major local economy is also suffering from the aftershocks that have travelled around the region.Korea is fortunately trying to tough it out. And, of course, in the end buyers start bargain hunting - up we go again.Except, of course, it is not really the end. First economic measures are badly received, then a bank goes bust - and shares rise.Then worries filter through that the authorities might just bail out the beleaguered financial sector - leading to a sharp downward correction.

The assets Merrill Lynch are buying are principally individuals, people well skilled in winning and retaining investment portfolios.Make a mess of managing a business like that and your expensively acquired assets walk out the door. Yet the reason for the sale was given as the globalisation of the fund management industry. Just because there's no oil there doesn't mean Bosnia's not important."After all this heaviness, you might have thought Fox would have sought out something lighter for her next roles. True to form, however, she has jumped out of the frying-pan into the fire. Her next two films are The Sound of One Hand Clapping - about how "the effects of the Second World War are still destroying the lives of two Slovenian immigrants" - and The Hanging Garden In this film, "I marry a bisexual. And it does no harm to have your most senior fired manager dubbed the most powerful woman in Britain either.In practice it is very difficult to spot the next takeover victim.

Few would have expected MAM to be a willing target - but this is an agreed bid from America's most powerful brokerage house.Fund management is, after all, a people business. The MAM deal puts Merrill firmly in the No 2 position in the world, behind Fidelity of America.Consolidation in the US has been taking place already and some domestic companies, such as Invesco, the fund management group that has its origins in the old Slater Walker investment banking business, have turned their attentions to the other side of the Atlantic as the only way of achieving the size that many perceive now to be necessary to win the major institutional mandates that are so highly sought after.The investment clout that these institutional funds provide can allow the development of retail products, which both adds to and benefits from the public perception of the fund management operation. The trouble is that most of the players in the UK are simply not big enough to interest the likes of the major US houses. The acquisition of BA Financial Services, which includes such household names as Allied Dunbar and Eagle Star in the UK, by Swiss insurance giant Zurich, has also created a major multinational fund management force.It seems these days that big really is beautiful.Naturally enough, speculation is now rife on who will be the next to fall. It seems in the view of the owners, LGT was too small to survive by itself. In a comparatively short space of time a large number of seemingly impregnable British financial institutions have fallen to foreign predators - all in the cause of globalisation.Warburgs is now part of Swiss Bank Corporation, Kleinworts of Dresdner Bank. Morgan Grenfell fell to Deutsche Bank some years back, but perhaps that just shows the prescience of Germany's leading bank.The deals have come thick and fast recently.

There was an inevitability about the bid for Mercury Asset Management that should, with the benefit of hindsight, have seen arbitrageurs building their stakes in the company. Just a few days earlier the noble Liechtenstein owners of LGT put the fund manager up for sale. At pounds 40bn of funds under management, this previously British company is less than half MAM's size, but no small player either. It's a really painful story about a totally dysfunctional family," Fox explains, before adding with obvious relish: "I hope it shocks people."No change there, then.`Welcome to Sarajevo' is on general release.