Tag: FTSE 100
Equity Euphoria. Why?
The Markets are in the wrong place. For about two years, I have been suggesting that market sentiment bears absolutely no relation to what is really happening in the real economy.
Yesterday’s Markit manufacturing figures clearly show that Europe’s manufacturing sector is in a mess. At 12% , Eurozone unemployment is at an all time high with further austerity measures to follow.
In spite of all that and with increasing hand-wringing from economists, the markets are buoyant at near-record and record highs, the euro is showing only modest losses and for Bond investors it’s business as usual!
What is going on?
One thing that we can see from the manufacturing figures is that there is quite a marked divergence between Germany and the rest. Although manufacturing activity is shrinking to 5-6 month lows, the so-called “financial fragmentation” across the Eurozone has become increasingly obvious. The Eurozone does NOT have a uniform monetary policy which means that Italian and Spanish banks, for instance, pay much higher funding costs than Germany. That means that certain manufacturers are paying much more than German ones for their cash. On the face of it, that seems to be anti-competitive – but that unfortunately is just one of the many anomalies of the Eurozone – in fact of the entire European Union.
“The poorer you are, the more you pay for your heating fuel.”
This is the backdrop to a largely blinkered , almost “autistic” equities market where we appear to have reached the stage of self-amplification where , because of the abysmally low bank rates, EQUITIES is the only game in town. Self-amplifying? Yes – as more and more investors pile into stocks – mainly because they don’t want to lose out on a rally which they themselves are now fuelling.
The only cautionary note should be for investors who are only just coming into the market to ask themselves “What is the real likelihood of me making a profit?”
When will it stop? History shows us that rallies such as the current one can stop pretty suddenly!
There will come a point at which traders, especially those with short positions will decide “Enough!” – in spite of the fact that currently, there is no obvious level at which to climb out and possibly take a loss.
Once one jumps, the rest are sure to follow.
We could go down so fast that you’ll get a nose bleed!
European stock markets slumped and the euro dropped under $1.28 for the first time in four months Wednesday owing to concerns over fallout from the Cyprus bailout and a disappointing bond sale in Italy, analysts said.
London’s FTSE 100 (FTSE: ^FTSE – news) index of leading companies fell 0.69 percent to stand at 6,355.10 points in afternoon deals, as Frankfurt’s DAX 30 (Xetra: ^GDAXI – news) shed 1.44 percent to 7,766.11 points and in Paris the CAC 40 (Paris: ^FCHI – news) slumped 1.46 percent to 3,693.95 points.
Madrid tumbled 1.90 percent and Milan lost 1.59 percent. The Athens stock exchange, a low volume market, plunged 6.83 percent.
Italian borrowing rates fell slightly in a 10-year debt auction on Wednesday, but borrowing rates were higher for five-year debt and demand was weak amid concerns of political deadlock in the recession-hit country following inconclusive elections.
Stock indices were falling “as the ongoing issues in Cyprus continue to weigh on sentiment,” said Alpari trading group analyst Craig Erlam.
Gold prices slipped to $1,591 an ounce from $1,598 Tuesday on the London Bullion Market.
Troubled eurozone nation Cyprus on Wednesday scrambled to finalise capital controls to avert a run on banks, a day before they are due to reopen after a nearly two-week lockdown while the island secured a huge bailout.
Meanwhile there are fears that the controversial terms of the bailout could be mirrored in any future financial rescues of indebted eurozone members.
Nicosia early Monday agreed a last-minute deal with its international lenders that will see it receive a $13 billion rescue package to help pay its bills.
And while the decision to tax bank savings above 100,000 euros raised fears of a similar move in future rescues — reinforced by comments from the head of the Eurogroup of finance ministers — officials have since insisted that Cyprus is a special case.
“The negative sentiment is also enhanced by rumours that this format will be adopted as a template for any further bailout schemes,” said Currencies Direct trader Amir Khan.
“Although top officials deny any such move in the future, markets are still wary that this format will leave the banks with fewer deposits and in turn will allow them to lend less, shrinking growth.”
Elsewhere on Wednesday, in indebted eurozone member Italy there was weak demand at an auction of 5- and 10-year bonds, with bid-to-cover ratios of 1.2 and 1.3.
Ratios of above 2.0, where submitted bids are double those accepted, are considered strong.
The Italian treasury took in 3.91 billion euros at a rate of 3.65 percent, a five-month high.
However the yield on 10-year bonds dipped 4.66 percent, compared with 4.83 percent at the last similar auction on February 27, with three billion euros raised.
The European Commission meanwhile said its key business and consumer confidence index for the eurozone fell 1.1 points in March to 90 points, reflecting a downturn in the manufacturing and service sectors while consumer sentiment was steady overall.
Amid the gloom in Europe, US stocks moved lower Wednesday in early trading.
The Dow Jones Industrial Average gave up 0.33 percent, the broad-based S&P 500 sank 0.36 percent, while the tech-rich Nasdaq Composite Index dropped 0.26 percent.
The retreat followed strong gains Tuesday that resulted in a record high for the Dow and a near-all-time high to the S&P 500.
“Follow-through has been lacking this morning for reasons that are both convenient and clear,” Patrick O’Hare of Briefing.com wrote. “Headlines out of Europe are largely to blame.”
— Dow Jones Newswires contributed to this report —
Jittery Markets make small gains.
European markets have made nervous gains despite lingering fears that the world economy is heading back towards recession.
The FTSE 100 Index in London gained 1.5% as traders decided that shares represented good value after the index fell 5% last week. The CAC 40 in France and the DAX in Germany also pushed higher.
However, markets remain jittery after last week’s poor economic data from the US and eurozone created fresh panic about the prospect of a global recession.
The glut of bad news caused London’s blue chip index to suffer its biggest daily loss in nearly three years on Thursday, wiping £62.3 billion from the value of the UK’s 100 biggest companies.
In another session of volatile trading on Monday, London’s leading shares index slid nearly 1% at the start of the session – taking it below the 5000 mark – but it bounced back shortly afterwards.
Gold continued to hit new record highs, rising to 1,895 US dollars (£1,151) per ounce, because it is seen as a safe haven amid the market turmoil.
Oil prices fell more than 2%, on speculation that Colonel Muammar Gaddafi’s 40-year rule in Libya is on the edge of collapse, which traders think could reopen supplies from the war-torn country.
The gain for European markets was despite the Dow Jones Industrial Average in the US falling more than 1.5% on Friday.
Markets have swung wildly in recent weeks as figures revealed the pace of economic growth in countries such as the US and Germany has slowed, leading to fears that the global recovery is running out of steam.
Fears about the strength of the world’s biggest economy were heightened by a rise in the number of jobless claimants and weak manufacturing and home sales figures. There are also unresolved worries about the eurozone debt crisis after French president Nicolas Sarkozy and German chancellor Angela Merkel failed to back eurozone bonds to fix the current problems at an emergency meeting.
Copyright © 2011 The Press Association. All rights reserved.
A couple of days ago, the FTSE 100 index rose by about 2% and gold reached a new high. In addition, the economy shrank by only 0.3%, compared to the experts’ predictions of 0.4% and the banks had a Supreme Court judgement in their favour. So why the continuing uneasy feeling?
Next year, interest rates are going to rise and that means that borrowers, both corporate and personal will begin to have difficulty in repaying their loans. This means another wave of write-downs for the banking sector and they could be as huge as last year’s write-downs. Plus it could mean a huge wave of foreclosures on borrowers who can’t afford the new, higher monthly repayments.
The Gross Domestic Product may well rise in the short-term but the ability for business and taxpayers to service a debt does not depend on a rising GDP figure. It depends on income. That’s why the high unemployment rate is very bad news for the housing market and for the banks — again.
It’s still too early for the mortgage reset problem to derail the banking system and stop the economic rebound in its tracks, so there will be more days like today when the FTSE has a healthy “Bounce” and all appears well and on the up.
Nevertheless, the looming debt problem does explain the Treasury’s and the Bank of England’s apparent reluctance to return to a more normal monetary policy. In addition, the Treasury and the Bank of England have completely abandoned any semblance of fiscal discipline. Consequently, the United Kingdom is running an ever-larger budget deficit.
As interest rates rise, absolute debt levels will climb ever-higher and spiral upwards. In plain English, we’re going to be dedicating a larger and larger share of the United Kingdom’s budget or income to pay interest on debt. That applies to both the government and the taxpayer. That will inevitably result in higher taxation and a watering-down of public services.
As a nation, we are in hock as never before and currently it looks as if the government has no intention of changing that fact. Their “wait and see” policies are extremely dangerous because both the actual and hidden costs of our debt are rising every day.
It looks as if the Bank of England and the government are expecting another major “dip” in the economy because they know that their current economic policies make another dip almost inevitable. That is why there is the occasional mention of a “double dip” recession. We’ve had the first one and now we’re awaiting the next one.
So why is the price of gold currently going through the roof? It’s because gold has always been THE insurance against the follies of government, especially against inflation. Gold speculators are expecting inflation. Hence the mad scramble for gold.
In the past, the majority of monetary regimes were based on money backed by gold and silver. Silver is no longer a precious metal and gold is only backing the currency of a few countries.
If central banks around the world fail to remove the emergency stimuli before their current measures translate into inflation, ALL currencies will fall in value relative to hard, tangible assets like gold. That is when we will have global inflation.
Big spikes in inflation have always had one major characteristic – a strongly rising budget deficit mainly financed by monetising government debt. That characreristic is present today, and not just in the United Kingdom but globally. Monetising debt means turning something into money. In our case, the government “issues” debt in order to finance its spending – for instance on buying worthless bank assets. The Bank of England then buys that debt by printing money.
Most of the the world is using money based solely on promises and faith. Hence the constant repetition of the word “confidence” – it is not confidence based on assets or REAL money but on hope.
When the financial crisis hit in 2007/08, governments all over the world reacted the same way: They started a debt binge accompanied by an extremely lax monetary policy. Central banks such as the Bank of England monetised government debt. That was the birth of modern “quantitative easing.”
These are the very same policies (debt and printing ever-increasing amounts of money) that were present during every large jump in inflation in history and these policies are the fundamental drivers behind the advance in the price of gold.
As long as there is no major fiscal and monetary policy change, inflation will heat up and gold’s bull market will continue.
Hence the uneasiness whilst enjoying the sunshine of what looks like a mini-boom.
The FTSE 100 index held its value yesterday – that’s in spite of the bad economic news and the announcement that the United Kingdom is still very much in recession. The FTSE 100 seems to be almost impervious to any bad data that can be thrown at it. GDP data should have shocked the market because it showed that the UK economy unexpectedly contracted in the third quarter. Sterling tumbled more than a cent against the dollar and gilts jumped. On the face of it – nothing seems to make sense any more. Read More
Conservative Party Conference week.
Boris Johnson once again has showed his leadership credentials by being approachable, witty and engaging. He does make the rest of them look a little bit pedestrian. In spite of his shambolic image, you can sense a rod of steel running through both his speech and personality. One to watch for the future. Imagine a TV debate between Boris and Gordon Brown. It will never happen – but what a prospect.
- Boris Johnson and friend
George Osborne’s department lined up like a row of fairground ducks was quite diverting. George Osborne is gradually shaking-off his Tim Nice-but-Dim image.
It’s very brave of David Cameron to allow Ken Clarke a voice – bearing in mind his strong Euro-sceptic stance. The Conservative Euro-sceptics should not attempt to embarrass David Cameron at Conference. They all seem to think that the next election is already won.
Custom dictates that when any Party is in the middle of its Conference, the other Parties keep quiet and do not make any pronouncements. So, Alistair Darling’s crudely populist announcement of cutting the incomes of GPs and other high earners leaves us in no doubt that the Election campaign is now in full swing.
Retirement at 66? Purleeeze George – you can do better than that! Many will still retire at 65 and most of those who have not retired will be out of work – unless there is a local B&Q. The ACTUAL money saved will be negligible and it was hardly worth the leak.
It appears that as far as cutting Public Expenditure, the main Parties are now engaged in what can only be described as a peeing contest.
It was good to see that old duffer Kenneth Brown. So there is life after death!
The Editor of the Sun did not have to buy a single drink in the Conference bar last night. Hardly surprising but the Sun’s move to withdraw support from the Labour Party caused some disappointment among Conservatives. About as much disappointment as finding out that Gary Glitter can’t babysit tonight.
On a completely separate subject, the annual yakfest that is the 11th Pride of Britain Awards took place last night. One is never sure why only some kids with cancer attend the show, why only the kids whose parents managed to inform the media of how their brave 2year-old “dialled 999 whilst motherwas having a seizure in the bath” receive bravery awards and why Gordon Brown has to make a “surprise” appearance. We all like proper heroes but nowadays it seems that we have developed a real “need” to worship – as long as it involves lots of celebrities. If Michael Caine is made to feel any more ” ‘umble” I shall throw up. Having said all that, I’ve never managed to watch the show. This year there is a teacher whose Maths lessons contain RAP (one presumes that the “C” is silent). Then there’s the lady who stood between a small child and a Rottweiler. The best one is an ex-heroin addict with 176 convictions who now helps “young people to change their lives”.. As long as Simon Cowell, Tess Daly and Davina are there plus a room-full of tear-wracked luvvies we can rest assured that all’s well. Now where can I buy a Rottweiler? I’ve just noticed something and it is the final piece of jigsaw in a theory that I have been working on for some time. Here goes. I believe that Christopher Biggins is God. Why? because God is everywhere.
Safety campaigners are saying that if the Conservatives axe speed cameras, the accident-rate will increase. Here’s a compromise – and it will be comparatively cheap to implement. How about a sign that says “SPEED CAMERA IN 50 YARDS” on either side of every single speed camera in the country. Not a good idea, I hear you say. Why not? Oh I see. What you really want is speeding motorists that produce a revenue and not necessarily slow motorists who do not.
Sir James Dyson managed to look like a prat when his autocue failed. A Dyson Vacuous.
Liked the announcement today that the Conservatives will begin a process of ridding us of Government forms and red tape. THAT’S the sort of thing we like to hear.
Conservatism SHOULD be the politics of giving everyone in Britain the ability, opportunity and tools to look after themselves and their families – without the smothering State intervention that is the hallmark of Socialism – even when it is wearing the thin veneer of New Labour. That should ALWAYS be, of course, coupled to the State taking care of its weakest citizens. Call it benevolent Conservatism if you like. Simple. THAT is the message that David Cameron and his rejuvenated Parliamentary Party should be promulgating. Needless posturing and name-calling should have no place in the modern Conservative political toolbox. David Cameron should look straight down a camera lens and explain what modern Conservatism is. Unsurprisingly, there are those who have never heard exactly what modern Conservatism represents because their views and opinions are still being distorted and influenced by New Labour spin.
George Osborne is looking very promising.
So why DOES Jordan look as if she’s wearing a gumshield? Is in “hommage” to her cross-dressing new beau and professional thug Alex (Max – you’re running out of crap copy!) or has she been “done”. I think that we all know the answer to that one.
David Cameron has been photographed with a glass of champagne. Big deal! I shall simply repeat a previous report: The biggest consumption of champagne at Conference time is by Labour. That was told to me by a former Chief Barman at the Grand Hotel in Brighton. Hypocrites.
Today, all the Socialist rags are laying-into George Osborne who has introduced a bit of realism into our understanding of the economy. One suspects that once the Conservatives are in power and manage to have a good look at the books, they will see that things are far worse than has so far been admitted by ther present incumbents.
We are still living in cloud-cuckoo land as far as the economy is concerned. The FTSE is UP. House prices are UP, Gold is UP, Tesco shares are UP. In fact – everything is UP. Sounds great doesn’t it? So why aren’t we all feeling more positive. The fact is that the FTSE is up because money is being invested on the Stock Exchange as a result of bank savings rates being so derisory plus, much of the money currently being invested is foreign so it could leave us at any time. The money that is being invested by British banks is not all real money. Some of it is the stuff that has been printed by the Bank of England and handed to the banking system. Mr Quantitative Easing strikes again. Gold has been creeping up for months. It is normally viewed as a “hedge” – somewhere to run when equities and commodities are down in price. That is not the case at present. Something that has gradually been creeping into our collective peripheral vision is the slow-collapse of the dollar. There are strong rumours that very soon, oil will no longer be traded in dollars – there is foreign plotting afoot! Once the dollar really does go into freefall, share and commodity prices will tumble very quickly. The British economy has much to fear because the factors that it has traditionally relied-upon to buttress the economy have all but gone. The City of London USED to be the world’s financial centre. That is no longer the case. WE used to MAKE things and export them. Nowadays, that is down to about 17% of the country’s total economic output. Finally, the British economy and Governmemt are “over-borrowed” with little realistic prospect of repaying much of what was borrowed. If George Osborne had been in possession of ALL the facts, I don’t believe that he would have wished to even beigin his speech yesterday. He did very well and reminded us that we need to take a more collective and inclusive approach to heal the economy.
Yesterday I said that I would probably throw -up if Michael Caine was once-again “umbled” at the Pride of Britiain Awards. Apologies to Michael as it was Joanna Lumley’s turn to be “humbled and overcome”. Please make it stop.
So Boris and Dave are ex-Bullingdon boys and used to piss it up, throw bread rolls about, get toffed-up and pose for silly photos. Go to any Comprehensive School on Prom Night (American import, I’m afraid) and watch scores of youngsters, toffed-up, arriving in ridiculous stretch limos and being encouraged to be extremely silly. So where’s the difference between our Grease wannabees and the Bullingdon Boys. Apparently, it’s only OK to dress like a posh prat and behave outrageously if you’re NOT a posh prat. It seems that those aspirational working classes are being herded by the Labour media back towards a concept which one hoped had been left behind – The Politics of Envy.
There was a great photograph of the Pride of Britain winners outside No 10 Downing Street. Sarah Brown looked very vivacious – so why did Gordon Brown look as if someone had inserted a six-inch ruler between his cheeks? Oh I see. Smile, eh? Wow.
Are we, as a nation, losing our sense of humour? We all remember Boris Johnson insulting Liverpool, Portsmouth and rather bizarrely – Papua New Guinea. He acknowledged all that in the introduction to his speech at Conference this week. Whatever you think of Boris, you have to admit that he carries a very mischievous sense of humour. That reminds me of a pilot who was censured by his bosses for the following Tannoy announcement: “Ladies and gentlemen, we are about to fly over Liverpool. Would you please ensure that you have placed your hands over your wallets.”
She used to work at Little Ted’s Nursery and is a pervert. Although her husband does have our sympathy, one cannot help but think that at some stage during the marriage, he would have benefited from a visit to Specsavers.
The Conservatives have announced that they will deal with binge-drinking and teenage violence through the medium of taxation. Surprisingly, this is the first Conservative initiative that I disagree with. Remember that some drugs are far more expensive than alcohol, yet, money is still found for them. The alcohol genie is so far out of the bottle that there are no initiatives that will ever change the Brits’ uneasy relationship with alcohol. Social Engineering through taxation does not work. Let’s face it, Brits drink to get drunk – and then they drink some more. A few more pence on booze will make no difference whatsoever. Practical tip: The increased tax will be on cider and strong lager so do what kids do already, buy normal lager and tip cheap vodka into it. Now what?
Could it be true? Avram Grant is returning to Portsmouth as Director of Football? That should cheer the place up. Here is a photo of Avram practicing his Gordon Brown smile.
- Sharon Shoesmith has launched judicial review proceedings against Haringey Council, Ofsted and the Children’s Secretary Ed Balls. She was in charge of Haringey Social Services during the Baby P murder. One of the great British traditions is that if there is a screw-up on your watch then you fall on your sword. Ms SHOESMITH DID HERSELF NO FAVOURS during her few TV appearances when the Baby P affair was at its peak. She seemed aloof, smug, unrepentant and unapologetic. ” I was following orders” is the usual excuse. Hers was “We followed all procedures”. That neither exonerated her, nor did it go down well with the public. Had she cried, begged forgiveness and made some sort of admission, the public would have been a little more sympathetic. As it was, Ed Balls did exactly the right thing in instructing Haringey to sack her without compensation.
Labour bleating noises have been heard again today. General Sir Francis Richard Dannatt, GCB, CBE, MC is our most distinguished soldier and tomorrow (Thursday) he will be officially announced as a Conservative Life Peer who will be advising the Conservatives on defence. General Dannatt was our highest-ranking soldier and Chief of General Staff. He was going to be promoted to Chief of Defence Staff , which means that he would have become head of all of our armed forces – not just the Army. However, Gordon Brown personally blocked the promotion and General Dannatt was instead given the consolation prize of Constable of the Tower of London. Traditionally the Chief of Defence Staff is principal military adviser to the British Government. Gordon Brown was miffed because of General Dannatt’s “repeated calls for better pay and conditions for servicemen”. So General Dannatt’s sins? Speaking his mind, not being a Brown “yes man” and caring about his soldiers’ safety and welfare. Gordon Brown really has no idea whatsoever – probably because he was dealing with a proper leader. It’s patently obvious that Brown does not recognise the species. He should learn that leadership is much more than Benito Mussolini-type posturing with overworked, overtired, adjective-free, moribund speeches.
Obama wins the Nobel Peace Prize. Quite right too. Climate, Democracy, Nuclear Disarmament – in fact, everything that he has touched so far. It looks as if Zimbabwe’s Morgan Chanderai was the runner-up. There is already talk and discussion of whether Barack Obama deserves the Nobel Peace Prize with only nine months in office. The fact is that the Nobel committee can see that in spite of the fact that Obama’s actual achievements so far are comparatively modest – he is by far the most influential individual on the planet as far as the short and medium term futures of the Earth are concerned. The progress that he has made in the last nine months is nothing short of remarkable.
It appears that today is probably the last posting day for Christmas. If you want to send cards abroad, you’re too late. Christmas parcels should have been posted by March 31st. Why didn’t Crozier stick to football. This is yet another case of a Business Model triumphing over the Customer. Perhaps Royal Mail should be renamed Royal Lemming.
Friday October 2nd 2009
- Ethiopia has suddenly become the focus for all anthropologists. An ancient skeleton was found in 1992 and it has taken 17 years for the research team to rebuild it. Why all the excitement? The skeleton belongs to an in-between species of humanoid about 4.4 million years old. It has been designated Ardipithecus Ramidus. It is not “the missing link” but by extrapolation, it appears that it is probably about 9 million years since the division between apes and humans. So where was John Prescott this week?
- The East of England Minister Barbara Follett is to stand-down from Parliament. She is (was) Minister for Culture, Creative Industries and Tourism. Her reasons for leaving? Yes, it’s the old chestnut: “For family reasons – to spend more time with my family”. Heard her name before? She’s the MP who claimed £500 to repair a Chinese rug ( don’t we all?) and she also claimed £25,000 “for security reasons”. She has since repaid all of the money. So how could she afford to sign such a large cheque? Her husband is millionaire pulp fiction writer, Ken Follett. Barbara and Ken epitomise the “champagne socialist” and are chums of Tony and Cherie Blair.
- Jobs for the boys. Former Northern Rock boss, Adam Applegarth is now an advisor to Apollo Management. They are an American Equity firm. Adam is advising them on the purchase of bad loans, including parts of Northern Rock bank, the former Building Society he brought to its knees. Perhaps a touch ironic but perfectly legal. He will earn about 200,000 per year which is a lot more than the thousands of people who lost their jobs at Northern Rock. It’s all very worrying.
- Today, Ireland will vote in favour of the Treaty of Lisbon. It’s their second attempt. The Irish economy is currently in such an appalling state that they appear to have little choice. However, if they do not support the Treaty, then it’s curtains for the Treaty.
- The International Monetary Fund (IMF) is predicting that the British economy will grow by 0.9% next year. That’s about four times the current politicians’ prediction. House prices have returned to their pre-crunch 2008 levels, the FTSE 100 index is UP. As one of the few people who predicted nationalisation of the banks, I am still not sure whether to put the Bolly on ice just yet.
- Vanessa George, Colin Blanchard and Angela Allen. They are the three baby-abusing perverts who are spread all over the newspapers today. Angela Allen is the one from Little Ted’s Day Nursery in Plymouth. She photographed herself sexually abusing babies as young as 12 months. Whichever prison they end up in, they are guaranteed some very close attention from other inmates. The burglars, drug dealers, fraudsters etc look almost honourable professionals next to these degenerates. I do hope that the other prisoners are not too gentle with them.
Thursday October 1st 2009
A survey has just been published of the world’s top Broadband Countries – taking into account speed etc. The United Kingdom is languishing in 25th place. The top country? South Korea. Is this another indicator of the rise of the East and the slow eclipse of the West?.
The Daily Mirror has adjusted its reportage of the Tories today – presumably in response to the Sun’s decision to back the Tories. It’s going to be a right mess leading up to the election. The gloves are off
BAE systems is about to be prosecuted for dishing out hundreds of millions in bribes. You may recall that when Tony Blair was in charge , there was a bit of a bribery scandal involving Saudi Arabia, but as they say – all charges were dropped. There is one thing that both our Government and Judicial System would do well to remember and that is that greasing the cogs of commerce through the medium of bribery is normal in many countries – especially hot ones. Many years ago, I sold a yacht for a $1million to an Arab Prince and we shook hands on the deal and arranged to complete the paperwork the following day. That night , my phone rang. It was the Prince’s “Private secretary and advisor”. This is what he said: “Although the Prince is a very rich man, alas he is not a generous man. You will also understand that he always seeks my counsel and almost always heeds my advice. I have yet to advise him as to whether he should complete this purchase – but I am sure that we can come to some sort of arrangement.” I was outraged! I told him that I did not make a practice of dishing out bribes and that I would report our conversation to the Prince. I never saw the Prince again. Some time later I realised that the Prince had probably been sitting next to his Secretary when he had made the call and it was probably his way of getting a few thousand off the price. I also recall another yacht-owning Middle Eastern client. Whenever we presented him with an invoice, I would ask the staff to make sure that it was itemised and added-up wrongly, but in his favour. Usually by either £50 or £100. Before handing over a wad of cash, he would add-up the bill himself, realise that it was incorrect , say ” Yes, that appears to be in order” and pay. He was happy and I was happy but more importantly, honour had been satisfied, he had won a little victory and he always came back to us because he enjoyed our little game. We should NOT always be so po-faced about the way that other nationals do business. It may not be pretty but it works.
Is it really the end of the Labour Party Conference? Thank You, God. Harriett Harman is not too chuffed about the Sun’s decision to support the Tories. She said: “Let’s face it, the nearest their political analysis gets to women’s rights is Page 3’s news in briefs.” It’s only a matter of time before Harriet gets the call from Hugh Hefner.
At the Labour Conference yesterday, the jurassic Tony Woodley, leader of UNITE, was cheered when he tore up a copy of the Sun. One presumes that he had looked at the pictures first. He said: “I suggest the rest of the country should do exactly the same thing”. Labour should persuade more progressives such as Tony Woodley to give voice to their views – that way they’re absolutely GUARANTEED to lose not only the next election but several after that. During Tony Blair’s tenure these Brylcreemed 50s throwbacks used to be kept in a darkened room or padded box until after Conference. A dignified silence without even a platform-mention of the Sun would have been far more powerful.
Financial Analysts seem to be confusing the state of the FTSE 100 with the British Economy. The fact is that many of the billions invested in the Stock Exchange consists of foreign money. That’s where many of the profits are going – abroad. Instead of flying to Monaco to play the tables at the Casino, many foreigner “investors” are winning lots in the Casino that is the London Stock Exchange.
The FTSE 100 has experienced its biggest quarterly rise in 25 years. Once again, this is being hailed as some sort of success. It simply means that lots of bets have been placed. The punters will be taking their profits soon. Then the Government can once again blame the bankers. Let’s hope that they don’t break the bank again.
Politicians are always saying that it is the Pension Funds and Insurance Companies own most of the assets traded on the Stock Exchange. In fact, between them, they only own about 25%
Today the national minimum wage rises by 7p an hour to £5.80 and for 18 to 21-year-olds, the minimum wage increases by 6p to £4.83 per hour. This is also the day when the government legislation on “tips” has changed. From today it illegal for bars, restaurants and hotels to use tips or service charges to make up a minimum salary. That is all very well but in the grand scheme of things, it is a comparatively trivial matter and possibly not a terribly cost-efficient move by the Government. Especially as the Government has already conceded that the changes governing tips will lead to an estimated £60m in extra costs to ensure the legislation is implemented properly. The new code will also lead to higher National Insurance payments. This is an inflationarymove because bars , restaurants etc will simply “up” their prices to maintain their margins. The British Hospitality Association (BHA) estimates the new rules could lead to an additional £130m in costs and up to 5,000 job losses. There are those of course who feel that a tip should be a customer’s expression of appreciation for good service and should not be used by an employer to bring wages up to the minimum. Mind you, both the Federation of Small Businesses and UNITE are both in favour of the changes. The only people who will be really affected are the tippers and the tipees. The customer tippers will experience increased prices and the waiter tippees may suffer up to an estimated 5000 job losses. There is a saying: ” If it ain’t broken – don’t fix it.” Needless to say, one of the few groups who will not be affected is Politicians. You may have heard that when they eat out or stay in hotels – it tends to be on expenses.
Monday September 7th 2009-Friday September 18th 2009
Friday September 18th 2009
- There has been some concern that Romell Broom may have suffered mental anguish when two Ohio State officials failed to find a vein in order to deliver a fatal injection. According to Broom’s lawyer, Broom had suffered both “mental and physical injuries” and apparently became distressed and appeared to cry. Broom was convicted of raping and then killing a 14 year-old girl.
- We’re too fat, we drink too much alcohol, we’re unfit, we ingest female hormones in our meat and weedkillers from our vegetables and we’re too stressed. Paradoxically, our life expectancy is increasing.
Alistair Darling is engaged in a series of meetings in order to decide where spending cuts can be made. If you’re expecting decisions within the next few months – stop being so silly. Although professional pundits do now have the opportunity to make pointless predictions.
Andy Burnham is suggesting yet more NHS changes. The God of Change strikes again! This month’s idea is that we will all be able to choose our GP. I would like one that’s qualified, understands human anatomy and is sober.
Baroness Scotland should know that in a Court of Law, ignorance is no defence. Mind you, the Baroness is the Attorney General. Hopefully, hiring someone called Loloahi Tapui(clue!) with out-of-date papers was just an oversight and as such, does not generate a witch-hunt. Oh yes – there’s an enquiry. There’s always a feckin’ enquiry.
Suddenly, Jordan doesn’t want to talk about “the rape”. It seems that her PR people are running out of interesting stories. The only remaining possbilities are either ” I was abused as a child” or “I was abducted by aliens”.
Bit of a “to-do” about unofficial sperm donors. Apparently, ladies can contact a sperm donor on-line, arrange a meeting and either be handed a container-full of the stuff or on occasion have it delivered direct through the medium of sex. Hence the phrase : “”Bottled or draught?” Sounds like an excellent service as well as an interesting career move, although it could mess-up the old CV, especially if the CV is printed on a sheet of Kleenex. Just realised that if this type of work is a career, the phrase “hand job” begins to make sense.
How would the management at Student Loans UK feel if they were told that because of administrative incompetence, their September salaries will be paid at the end of October. They would probably be quite upset. Next question: How do young kids with the incredible stress associated with leaving home feel-when they’re told by Student Loans UK that their University grants will be paid “about” four weeks late? Why is the beginning of the academic year ALWAYS a surprise? For the record and to help Student Loans UK: The next academic year will be starting in October 2010. Hopefully, that’s enough notice.
Scientists at Newcastle University have produced human sperm in the laboratory. Didn’t know that there was a shortage. Just take a chipping hammer to any Confessional carpet.
Gordon Brown said today “Cooperation between nations at the G20 summit will be crucial to ensure global economic recovery” That is probably the twentieth version of the same sentence . It is a truism and it’s boring. Here’s another sentence which I hope Gordon finds as interesting as his own deep thoughts: ” The sun is in the sky”
Here is a quote from this evening’s No 10 bulletin: “The Prime Minister is launching a brand new podcast series this week talking directly to you about the big issues of the day. The podcasts, which will be available on our iTunes channel andonYouTube, will be recorded at Downing Street or around the world when the Prime Minister is travelling.” Wow! That Gordon Brown is so “street” -using that Interwebthingytoconnectwith the YouTube dudes. Way to go, MC Gordo! Soon, he’ll be buying a pair of those really cool Levi Strauss blue denim casual trousers with the turn-ups, copper rivets and the little red label. Sound! Should go well with the black brogues.
Remember what I told you about the American dollar going into freefall. Soon. Read More
Is there “naughtiness with intent”?
” Mr Banker, would you please move your head just a little bit to the side. It appears to be blocking your backside.”
One of the conditions of the Government’s bailout of the banks was that no dividends were to be paid until any loans (the debts to the taxpayer) had been repaid.
It was that condition which caused the participating banks’ shares to be dumped this week. That caused quite striking drops in share prices. In fact, they all nose-dived.
HBOS shares fell so much that it is pretty definite that Lloyds-TSB will want to renegotiate the terms of their proposed takeover. At those prices – so would you! It also begs the question – does HBOS need to be taken over. I know that it’s a small price to pay to wipe the smile off Alex Salmond’s face but as long as Gordon Brown is in the mood to over-mortgage the country (the United Kingdom – not the Caledonian “republic”), perhaps HBOS is best left alone. Otherwise Scottish bank notes may have Eric Daniels’ mugshot on the front. Eeek!!
Currently, the majority of bank shares are being sold by petulant institutional investors in the full knowledge that their actions will cause prices to drop – and it looks like a coordinated effort which is designed to persuade the government to cave-in and agree to some sort of dividend payment.
Once the government has clarified what it intends to do and (inevitably) agrees to postpone the taxpayers “charge” over dividends – watch bank prices increase as institutional buyers pile back into the market.
Financial institutions know that the government’s biggest fear is what is currently shaping up to happen on the stock markets and that is the inevitable mega-fall. Financial institutions are not-only still manipulating the market but treating the Treasury and the Bank of England like idiots.
Incidentally, has the Treasury or the BoE carried out detailed audits of the banks? Do they know the exact extent of their “losses”?
There is still a total lack of numbers – probably because no-one has asked for them.
Black Friday tomorrow? I’m only asking because it’s about time we had the romance of something black. Unfortunately, the markets are so volatile that closing prices nowadays are a matter of timing and a reflection of current confusion. For instance, yesterdays Dow was rattling up and down at such a rate that the closing-bell value could have ended anywhere between 3800 and 4050, It just happened to end on a high. Of course the high finish will influence the Asian markets which will show the inevitable initial gains – and so it will go on.
Whatever happens, it will be interesting to watch shares belonging to the “silent” banking institutions (those which been keeping a low profile over the last month).
And prepare for an assault on insurance companies.
Even Mr Peston might mess himself.