You may have noticed or perhaps, been relived, to see a distinct lack of writing on the forthcoming Royal Wedding here.
No doubt it is going to boost London Tourism and retail sales - however, overall the double bank holiday is expected to shave 0.5% off GDP for the quater - so after yesterday's first quarter GDP Q2 is going to be anaemic too. Expected lost labour production is £7.9 bnillion - so the Tourist spending will have to be chunky to make up for the Bank holiday. I somehow doubt we will see the BBC's fees for worldwide broadcast come off the licence fee for next year either.
I am though a staunch Republican and so am dismayed by the reaction to the Wedding. it is costing taxpayers a forutne and next year we have the Olympics too - with tickets for hospitality going for £4000 pounds and a £9 billion state subsidy to boot. It's a sad state of affairs.
In a real democracy there should be an aspiration that anyone can make it; this will be tempered by the knowledge that life hands out easier and harder starts and is in the end, very unfair. But the US has this right, we should all have hope. In the UK there is no hope of reaching rigth to the top except by marrying Prince William. Only Royalty rules and this is through birthright. This creates a divide and limits aspiration, idolsingin kings and Princess's is no better than idolising celebrities and this level of wishful fantasising on the part of people in the Uk is in part responsible for the gradual decline of the Country and its culture.
Generally lefties I come across who get overly excited about class are middle-class charlatans who are pretending to be downbeats - useuly to secure some pernicous advantage of their own either moral or commercial. I do agree with them though about the need for merit in society and rewarding merit, not of rewarding birthright solely. That is feudal not deomcratic.
I would much rather see even Neil Kinnock as titular head of state than the Queen. even Kinnock has tried and failed miserably for his whole lifetime - something to be respected if not admired.
None of this refelcts badly on the couple getting married, good luck to them. The Country would be a better place if they could go and live happily ever after in obscurity though.
I shall say no more of this now.
Not great form for George Osborne to be front running the GDP numbers at Cabinet yesterday. Still the news is really as expected, with growth at 0.5% a decent start to the year.
The 'growth' spurt given by the pumping in of QE money and exorbitant Government spending is over and now we are left with the underlying private sector growth trying to outdo the very modest public sector contraction.
In real terms its rubbish because inflation is at 4% (UPDATE re comments, constant prices are compared to CPI not RPI, so the disparity is messing with the figures) so any growth this year under that is a decline in real terms on an RPI basis, on the plus side a low pound could re-value and alter the equation but ultra-low interest rates are not going to encourage that.
In the long-term, all is not so bad for macro-economic Britain, the deficit is being eaten into and the tax base will start to grow substantially and close the structural deficit as the Public Sector is shrunk over time.
Politically who would have thought that the Lib Dems hold the keys to the future of the UK a couple of years ago, if they fall apart and the Coalition fails then Labour will be back in and mess everything up again!
 As behoves a metaphysical, Mr Marvell's work is timeless.
To His Oh-so-coy Mistress ...
Had we but cash enough, and time,
To print our names would be a crime;
Our lawyers would devise a way
To keep the media at bay.
Super-injunctions fit the bill
When we’ve embarrassments to kill.
For, Lady, you deserve a break
(And I’d be free to play the rake).
But at my back I clearly hear
That bastard Hislop hurrying near;
And yonder all before us lie
Deserts of vast ignominy.
Your reputation turned to dust;
Revealed to Ashley, all my lust.
The Beeb’s a fine and private place,
But Private Eye is on my case.
So now, before our cover’s blown
Let’s claim the high ground for our own.
“I would not gag a fellow hack -
I wished to spare the lovely Jack !
Surely a man and family
May have a little privacy ?”
Thus, though we cannot thwart the Sun
We’ll still look out for Number One.
ND
In the US NFL, there is a collective bargaining agreement for the players. As noted here before US sports are organised in a very socialistic manner. Spats like the current one with owners versus players are regular in all the major sports and baseball even lost a whole season becuase of it recently.
it is hard to imagine how the Premier League could have the same thing happen. Yet the owners must yearn for it, the terms of the current agreement for the NFL is that the players get 60% of the income, for many Premier League clubs that is a dreamland, some of them like Manchester City pay well over 100% of revenues to their players. In the NFL they want to reduce that level below 60%.
So maybe it will be some time yet until we see Gordon Taylor railing like Red Robbo on behalf of the players. In many ways it is a shame though as the NFl is much more competitive than the Premier League due to having a more level playing field around incomes and player salaries.
A big decision in recent times for many people in the UK has been what to do about their mortgages. Rates have been so low for so long that over 70% of people are now on variable rates, myself included.
Yet the prospect of sharply higher rates has been in the offing for most of this year. With RPI inflation at over 4% rates in a normal economy would be expected to be around 6 or 7 percent; that for many people would mean a doubling or even trebling of their mortgage.
Now though one benefit of the sheer difficulty of tyring to keep the economy going whilst the debt is paid down is a strong likelihood that interest rates will be kept low in May. If this is the case they will likely stay low until people come back from their summer holidays in September - or maybe even October.
For those of us who have been agonising over whether to fix rates at a much higher level than the variable rates this is welcome new, as it gives another 6 month breather before real rates of interest need to be paid again.
 Looks as though we are going to have to watch our steps on C@W. First, the Greek government calls in the rozzers when they hear someone's written something unhelpful about their economy: seems that talking about a potential debt restructuring is "possible criminal conduct" nowadays.
Then, Obama mobilises the Feds against speculators causing oil prices to rise & similar malfeasances. "We are going to make sure that no one is taking advantage of the American people for their own short-term gain".
Oo-err.
So no more commentary from us on how Spain will be next down the pan; or how the price of oil will be staying in 3 figures from now on. I'm purging the archives as we speak. And heaven forefend we should short the $, eh?
Watch out, China, Mr Obama is on the case.
ND
PS - is long-term gain OK ? Just asking, sir ...
 No Question Time so its the Bank Holiday quiz. {Saint George's special edition}
1.Who was 'old nosey'
A Wellington
B Julius Caesar
C Charles de Gaulle
D Matthew Parker
2. The national flower of England is the rose. It is also the national flower of..
A. Sweden
B Columbia
C France
D USA
3. Sir Arthur Conan Doyle was supposed to have been a goalkeeper for which football club
A. Arsenal
B Fulham FC
C Portsmouth FC
D Charlton Athletic
4. Henry VIII once travelled from Hampton court to Greenwich by what method
A- Sleigh
B- Steam Boat
C - Elephant
D - On the shoulders of a disgraced noble.
5. Which country invented the Guillotine?
A- France
B - Netherlands
C - England
D - Macedonia
6. Charles Babbage invented the difference engine. He was good friends with
A - Prince Albert
B - Charles Dickens
C - Robert Peel
D - Lady Hamilton
7. Why is the 'pound' weight abbreviated to lb.
A - It is actually 1p {one pound} that has been accidentally changed over the years
B - It meant light bag , as 2pound bags were the standard weight for corn
C - It comes from the French Livres de boulette {a pellet of grain}
D - Latin - Libra Ponda {scales}
8. Why do we have a wooden spoon?
A- The wooden spoon was for serfs. Knights had metal cutlery
B - It was awarded for the lowest maths pass mark at Cambridge
C - A low wooden arch used to erected after battle and the losers had to walk under it
D - A medieval tradition. The wooden spane was a wooden lance presented to the most promising youth at a tournament.
9. Which Scot is the odd one out.
A - James Watt
B - Robert Stevenson
C - Adam Smith
D - Thomas Carlyle
10. What was the bowler hat invented for?
A- It was for horse riding gamekeepers to prevent low branches from knocking the hat off.
B - It was to be a military cap, having a much lower profile than the traditional 'Shako' style.
C - It was designed for a bank worker to be able to withstand a blow from a robber's baton.
D - It was designed in India for ladies as a fashion accessory
We shall use the honour system for scores in the comments.
If you want the answers, scroll over below.
1. The Iron Duke who reportedly had a massive, bent hooter.- but Matthew Parker was supposedly inquisitive in the 16th century about church affairs. The Archbishop of Canterbury called him Nosey Parker.
2. D - USA. The red rose was a Victorian message of love, as it is still. But an orange rose meant passion. Ronald Regan declared the rose the national symbol in November 1986.
3 - It was Portsmouth. While living in Southsea , he played football as a goalkeeper for an amateur side, Portsmouth Association Football Club, under the pseudonym A. C. Smith. (This club, disbanded in 1894, had no connection with the present-day Portsmouth FC which was founded in 1898.) But he did play cricket for the MCC. Taking just one wicket. But can you guess who?
4. A - Sleigh. The Thames frequently froze over in those pre global warming days. Frost Fairs were held on the frozen river.
5- C - England. The Halifax Gibbet first recorded use was in 1286 and the last in 1650. A fixed machine which used a heavy, axe-shaped iron blade dropping from a height of several feet to cut off the head of the condemned criminal.
6. B - Dickens. Babbage hated buskers. He wrote an essay entitled 'observations of street nuisances.' He baked himself in an oven at 265f for five minutes 'without any great discomfort.' No real reason. He was just odd.
7 D- Latin. The star sign Libra comes gets its name from the scales.
8 -B. Cambridge.Cuthbert Lempriere Holthouse received the last wooden spoon in 1909. It was about 1.5 meters long as was really like an oar.
9- C Adam Smith. He is the only Scot to ever feature on an English bank note. {not including Lakelander's famous nine bob note}
10. A- For riding, and is still popular. In the American wild west the bowler, as worn by Butch Cassidy, was far more common than the cowboy hat as it was very strong and fitted snugly so it did not blow off in the wind. why it became the accessory for city financiers, I have no idea.
This time it's different.
That is the call from Chancellor George Osborne. The EU may make demands for great rises in its £117 billion budget but no, sir, we are not going to agree to them this year. Except last year, when the same thing happened and a reduced increase was agreed. This is in many ways no different to corporate budgeting processes as I experience them.
Firstly, the FD says no increase, we must reduce costs, then the business units put together mushroom budgets and say we can't do with less, then the Finance department says we need real cuts. Then the business units start downgrading their growth predictions, then the CEO steps in and forces a compromise of modest growth. More or less, this is the same every year bar bad recessionary years and years of huge growth. In years of recession the FD has his way and budgets are cut, staff reduced and the balance sheet preserved.
However, as far as the EU is concerned, this should be a recessionary year, but they do not think so. They are not interested though and think it is fun to laugh at their paymasters, here is what he Commissioner Lewandowski has to say:
Someone is criticising us, I have to say the UK budget is growing this year. Is this austerity?
Last year this was the man who thought it right to question the British CAP rebate and suggest our remaining £3 billion should be scrapped.
So what can be done, well I think the best solution is to really push it this year. We have elections coming up and the Tories could make great popular hay by saying we won;t sign up until the budgets are audited and we won't pay any extra this year. Not only will this be domestically popular but it will draw a line in the sand for next year and help to reduce the EU's appetite for a fight each year. Today too, Merkel and Sarkozy also need popular domestic policies to boost their flagging domestic political situations.
There has never been a better time to actually stand up to the EU; so no doubt, we will bottle it again. This time it's no different.
 Many years ago, before the birth of the first of the Drew offspring, an earnest member of the midwifery service announced at an ante-natal class that her department "would be responsible for your child until the age of 2". She copped a curt correction from yours truly, which made for a frosty evening as you can imagine.
It's all too easy in our 'civilised society' to take the view that nothing trumps the well-being of innocent children. A colourful example comes in today's news of a super-injunction that is to spare the blushes of we-all-know-who-anyway, on account of his kids who might be bullied at school if word of his marital infidelity were to be published. No, Lord 'Justice' Ward, responsibility for protecting his children lies with the miscreant lui-même: if they can't take the joking, don't do the poking.
This matters a lot more than just gossip about TV personalities: more, even, than the obvious logical extension of this daft ruling which would protect the names of criminals if they had school-age children. Because it lies behind the utterly ruinous policies whose guiding principle is - it doesn't matter how irresponsibly and willfully an adult has behaved: if there are children involved the state must step in and see everyone alright. It certainly costs us untold amounts in welfare benefits. And I expect it speaks well for us as a nation.
Except that, naturally enough, just as women who anticipated being under sentence of death used to get pregnant, so the reckless and the feckless make damned sure they have some children with which to share any misery that might be the outcome of their behaviour.
Reductio ad absurdum. There should be no reward for using children as human shields, because (a) it's rather easy to come by children and (b) it's the height of wickedness.
As ever, how we are to get back to universal parental responsibility from the depths to which we have now sunk is a very difficult question. If we are relying solely on Iain Duncan Smith and Frank Field to solve it for us, I fear we may have several generations to wait, and many more millions of little hostages to be taken.
For all that we can't do much about it, it's wicked nonetheless.
ND
That is quite some move by the price of Gold. The metal is up a long way in the recession, indeed it has proved recession proof since the initial sell-off in 2008.
The metal was a mere $275 an ounce when Gordon Brown decided to sell off our Gold reserves. Now it is $1500.
If the Bank of England had sold those reserves to market today we would be an extra £12.4 billion pounds better off. That is some amount of money in this austere times, equivalent to half the defence budget.
And yet Gordon thinks he is smart enough to run the IMF? Cameron has it right.
Even this article of years ago shows him ignoring warnings of the experts just as he did throughout his career. The man is a disgrace and should stay out of public life as at least a small penance on his behalf to us.
Germany’s power is a threat to the Eurozone The First Post thinks similar to CU's Beam me up Scotty post a few days back. Why don't the weakest indebted nations, Portugal, Ireland, Greece utilise their power?
I have had a bad run recently with my investments; probably deserved after years of huge success. However, today is an interesting one due to news out of EMED mining.
Now as before, EMED are trying to re-open a copper mine in Spain and it is proving very troublesome. Today they finally announced the news that the Government departments have approved their plans, however this is tempered by the fact they have also extended the area the want EMED to be environmentally responsible for clean-up of. This latter news means another delay whilst they look into this and probably a cost in the future to the project.
Overall, it is not great news so the share price is off 20%, on the other hand the mine is now really going to open after nearly 6 years of trying. So wwe are looking at Q3 or Q4 this year for final approval (it was supposed to be Q2).
EMED is now 13p a share; the target projected price of brokers is 32p, 52p, with 70p as an optimistic level from one. I would be happy with 30p pre-opening and moving up to over 50p in 2012. A 300% opportunity - so a good time to buy in over the next few days/weeks as the shareprice settles.
Change is coming to America. Change We Can Believe in.
(Not so good for the CU share portfolio though, 4% off in a day. Mr Gold and Silver Nick Drew had a better day, up 2% I would guess- sadly for me the race is not even close at the moment!)
At last, many years after the US took a big swipe at a growing overseas industry, the US has got tough on its own Poker gambling companies. It is quite a surprise as the original thoughts over here was that the outlaw of online gambling was a simple defence of Las Vegas and an attack on the fact that some US companies had got the head start in the industry.
Now it seems that the US is going to finish off Poker Stars et al. With defendants arrested and property seized it does not look good for them. On the other hand, a big buy signal for tomorrow for our listed co's like 888 and BWIN.
BWIN (formerly partygaming) has taken huge hits to its share price in recent days due to poor corporate news - I fully expect a huge bounce on opening tomorrow, I think 20-30% is on the cards first thing. Not a sector I know well enough to stay long; but a short-term good bet.
Moody has today downgraded Ireland's debt to one notch above junk status. Given Ireland's debt is being almost entirely purchased by the ECB this means a lot of European taxpayers money is being flushed away.
I really don't understand what Ireland is doing (nor Greece, Portugal). They can't pay their debts and need to declare bankruptcy - or at least a 'restructuring' which is the national equivalent of a CVA.
I think Ireland is in a great position to do this now. All they have to do is call the Germans and say the game is up. The Germans will properly panic as it is THEIR banks (UK banks too, but they have written off big chunks this past year) which are most exposed by a long way. The Germans have been using EU funds to protect their own defunct banking system.
The whole pretence at the moment is incredible really. The debts are too great to pay back and the austerity only works in Countries like the UK where the levels of debt are sustainable. In Countries where the debts are too high then an outright default is necessary.
The sooner they get on with it the better. I have no idea why they continue to do otherwise. Then again, the Irish Government underwrote its entire banking system which has to be the worst decision made during the entire financial crisis across the whole world - and that is saying something.
Question Time comes from ..?
Will any of the panel match the Cicero like response from Caroline Flint. "Austerity Sucks!"
David Dimbleby is joined in Liverpool by
Chris Huhne,{Crapper Huhne!The original energy giant.} ND will be phoning in.
Peter Hain,{ dodgy accounting, Immigration expert. A QT favourite who is usually quite unconvincing}
Michael Howard {The other side of the coin for today's big story. "I didn't go into politics to be liked. Which is just as well, because you're not." Still love that quote.}
Alex Salmond {First Minister of Scotland, soon to be ex-First minister of Scotland. What's he doing here? Giving us a clue I hope?}
and
Cristina Odone. {Author, journo, religious broadcaster who has traveled all the way from editing the New Statesman to voting Tory.}
In a slight change Mr Drew, still fighting for the title, has emailed his questions in from across the globe.
So here they are.
1) Royal Wedding must feature somewhere, somehow
2) must Oxbridge admit the personal nominees of Cameron & Clegg ?
3) immigration, who's right, Cameron or Cable ?
4) shall we all boo the Tories on the NHS, 'pause for reflection' and all ? altogether now ...
5) are the Scouse LibDems right to be demanding Clegg leaves the coalition ?
Can't rule out the EHCR ruling either ...
ND
Winner gets to decide if Gordon Brown really can become the new head of the IMF.
Current leader board 15/4 New Champ is Miss S-J - 39Malcolm Tucker -38Botogol - 38Timbo614 - 37.5Bill Quango - 37.5Nick Drew - 35.5 Appointmentotheboard - 33 Miss CD - 32 Hatfield Girl - 27 CityUnslicker - 26.5 Measured - 23 Hovis 21.5 Dick the Prick - 21.5 Steven_L - 20 GSD - 18.5 Andrew - 16.5 Anon -12 Mark Wadsworth -12Woman on a raft - 7
Budgie - 5
BE - 3.5
Philipa -3.5
Lilith -3
Alan -2
Ever close is my demand to Nick Drew for a dinner (or was it a drink, inflation is terrible these days) over the shenanigans at BP.
They have an annual meeting today and the shareholders should be spitting fire at the board.
Firstly in the last year they have had the Macondo disaster, on balance the company did OK with it after a while, but the price they paid was the end of their US business and a cool $30 billion off the stock price.
The US was a 1/3rd of their business, so the company is left with a major strategic dilemma
Now, the new strategy was to do tie up's in BRIC Countries and it started with India. So far, so good. The though came this insane deal with Rosneft. Now Bob Dudley, chased out of Russia before by the BP JV partner's of TNK-BP, should know how Russia works. The latest twist to the story is that Rosneft and BP have offered a premium to buy our TNK-BP and been rebutted. Now BPO is left in a very sticky situation as Rosneft can really walk away from the deal and offer it to Shell, Total - anyone really, who will scoop it up delightedly. Of course, TNK-BP is going to sue its parent company too!
It looks very bad management from Dudley and the Carl 'The Ghost' Svanberg. I can't see how BP get through this mess well at the moment, it will take a miracle unless there is some shady deal with Putin underneath which in itself is a hostage to fortune for the future.
I won't be buying shares in BP anytime soon.
 18 months ago Goldmans offered an analysis which seemed pretty compelling to me. It charted in detail the rise and fall of the oil price 2007-2009, and showed how, when the global recovery had run for a short while - they specifically predicted turn-of-2010 - based on the fundamentals oil would steam ahead into 3 figures again, which would be the way of the world thenceforward. (You'll perhaps have noted that I was still persuaded of this, and other arguments, at the time we made our 2011 predictions.) This view wasn't universally held: amazingly, right up until the end of last year some 'reputable econometric forecasters' (oxymoron) were still seeing oil in only 2 figures for the whole of 2011.
Anyway, Goldmans were right: and the only thing that can upset the applecart on a sustained basis (i.e. more than just a bit of dithering either side of $100 for a while) will be the dreaded GlobalRecession2.
So how come the vampire squid is now advising clients to ditch oil & other commodities ? Is GR2 just around the corner - or is it just a bit of tactical trading advice ?
Alternatively, it seems that copper demand has been boosted artificially by the Chinese playing games - or has it ? ... and so you don't have to go far to assemble a Conspiracy Theory. Goldmans certainly caused oil to dip on Tues. But it hasn't lasted long, has it - so what's fundamentally changed ?
Hmm ?
Nothing that I can see. Now, about that conspiracy ...
ND
 Centrica is a company that I generally admire. In its 15 years of existence it has pursued a dogged, ambitious and pretty successful gameplan, whilst remaining flexible enough to alter course from time to time when adverse winds have blown. They are pretty competent & professional; and I particularly like the (relatively) high level of openness & disclosure, though there has been the occasional lapse. Of course, they operate in a sector where it is easy to fall foul of public opinion periodically, and they get their share of opprobrium over gas & electricity prices. Every year or so, someone sets a rumour running that Gazprom is going to buy them up (which ain't gonna happen): but they have remained independent.
We've had occasion to analyse the evolution of their once extreme 'merchant energy' strategy, which became progressively more challenging post-Enron, and is now heavily modified by successive pragmatic moves in the direction of vertical integration. Clearly, their acquisition of 25% of British Energy was a step along that path, filling a fairly large short electricity position.
But a heavily nuke-oriented strategy ? Take a look at the chart - by 2020 they expect to have invested in at least a couple of new nukes with more building, and to be significantly reliant on their output (along with that of existing nukes) - far more so than industry average. Fellahs, is this wise ? Even your media outlet of choice, the comely Rowena Mason at the Telegraph, is wondering out loud whether the game is up.
Stick to gas guys, it's what you're good at. Plenty of time for another touch on the tiller before 2020. And the BE investment ? Sunk costs. Move on.
ND
The day after the Banking Commission interim report and Lloyds bank have reacted angrily to the recommendations to make them sell more than 600 of their 2900 Branches. of course, they have a plan which has been in motion for some months and now this suggestion messes that up and probably also makes them have to wait for the full report out in September before knowing what they can do.
No element of surprise for the market or their shareholders and the shareprice has been relatively steady since the announcement.
The real issue, which Lloyds have hinted at, is that with say 1000 branches for sale it is a big deal to buy them. RBS has sold 326 to Santander for £1.8 billion, so treble that and you have a deal of £5.4 billion.
Are the new entrant banks like Virgin Money or NBNK really going to find that kind of money - I think not. Even Private Equity houses are going to be hard pushed to raise those kind of funds in this market, especially as retail banking will get harder in the years ahead. Also there are huge back offices issues as these banks need a really strong IT platform that Lloyds is not going to give away with it. Plus of course there are other ancillary services like Insurance and Asset Finance that are not going with the branches.
All in all, a challenging pill, which means perhaps the most likely option will be a floatation of the business - a re-birth of HBOS, although no doubt they will choose another name for it from their stable of brands, probably Cheltenham and Gloucester.
What is ironic is that if Lloyds had shut more branches as it was originally planning to do then it would not have so many, would have less perceived market share and thus would escape having to do this deal.
As for buying into the IPO, as always it would depend on the price, but retail bankign is goign to be a heavily regulated area in the future, with mroe competition - it's not facebook is it?
 We've been sent a press release from an anti-nuke group, variously calling themselves Kick Nuclear, Stop Nuclear Power UK and Boycott EDF, with jolly photos endearingly provided by Mini Mouse. (If I hear Monsieur Rivaz say that the largesse he demands from government and electricity consumers is 'not a subsidy' one more time, I may very well join Boycott EDF myself.)
Anyway, they blocked Grosvenor Place for a while today (EDF now occupies Enron's old offices there), until the Old Bill moved them on.
I'm sorry to say, they really haven't got the hang of this yet. Their French confrères manage to turn out 3,600 for protests: but the standard is set by the good old Germans and their long-running Atomkraft? Nein Danke! which is enjoying something of a revival as all the ageing hippies reach retirement with time on their hands to re-live golden moments of yore.
The Germans it was who mustered 60,000 (sic) the very day after the first trouble at Fukushima, to surround a nuke at Neckarwestheim near Stuttgart. They regularly block trains carrying nuclear waste, ten thousand people at a time, forcing the various German regional police forces to contribute 20,000 men to a flying column to clear the tracks. We've reported before on the Battle of Stuttgart Station: these massed legions of teutonic Greens are quite bonkers, and seemingly out of control.
So, Mini Mouse & your EDF-boycotting friends, you've a way to go yet. Keep it non-violent; come up with a catchy chant involving rejection of subsidies and Crapper Huhne's electricity market 'reforms'; and who knows who might join you next time around, eh ?
Two-four, two-four, say NO to the carbon floor !
ND
photo © Mini Mouse / Boycott EDF
At last we have the considered view of John Vickers and his team on UK Banking; albeit in interim form. Sir John makes a good case for the protection of retail banking in the UK in future.
The implicit suggestion is that by protecting retailers, other parts of banks can fail and the State will not have to offer blanket guarantees. However, the big miss here is the failure to really make clear how the Commission has viewed corporate banking. There is a use of a catch-all term of Investment Banking but this is not the same thing. If a major bank like RBS went down it would also take 28% of all UK corporate loans with it, this wold cause huge issues to the UK economy. The device chosen in the report of simply looking to only guarantee retail deposits does not really do enough to sort out the 'too big' part of the 'too big to fail' question.
For the Government there is much to cheer, criticism of the Lloyds/HBOS merger and a suggestion of further break-up; one in the eye for the former Government. However, the lack of break-up of Investment and other Banking is not much of a success for either George Osborne or Vince Cable.
I see many articles claiming that it was not investment banking that brought down the UK banks; Northern Wreck, HBOS etc. However, RBS, the biggest beast by a long way, was indeed smashed by its GBM arm. There is a strong case for banking to be split into utilities and casino banking; it would require a global level agreement but this should be pursued and not given up on. Alone, the UK is not in the best position to enforce this division as Barclays will go to NY and HSBC to HK.
The final main recommendation is the move to 10% capital retention over the current 7% of Basle III. What this means in that banks will have to hold over 30% more capital on their books in the form of cash equivalents. This will directly translate into lower overall lending; directly against the Government off-stated targets of getting the banks to lend again. Enacting this policy whilst we are not yet out of recessionary times will be madness - typical civil servant gold plating.
 For starters, an analogy. When the EU emissions trading scheme started, power generators were given free allowances to cover almost all their historical levels of emissions: they'd only need to buy a few allowances at the margin, at whatever was the prevailing price. Politicians (notably in Germany where they don't understand how markets work) convinced themselves the free allocation meant the price of electricity wouldn't go up.
Wrong. Using the allowances they'd been gifted incurred an opportunity- cost because they could have sold them instead. So, as any fule could have told them (this fule did), the price of electricity went up by the full amount of the price of carbon.
Anyhow: those University fees, with rationale in italics.
Oxford £9,000 - best in UK, got to keep up standards
Impressive Coll, London £9,000 - thinks it's the best
Cambridge £9,000 - needs £ to catch up with Oxford
LSE £1,000 - supplemented by Gaddafi bursaries
Oxford Burkes £9,000 - hopes to be mistaken for Oxford
Univ. of Loamshire £10,500 - didn't understand the system
Squalor Metropolitan Uni £9,000 - thinks it will gain status
Groveller 's Coll £7,500 - Vice Chancellor wants peerage, hopes to curry favour with Clegg
Wigan Uni £9,000 - because we're worth it
Sheffield Hellhole £6,000 - because, errr, we're not, & Clegg's our MP
School of Social Engineering £8,500 - thought this was a clever idea, now trying to increase to £9,000
Urban Central Poly £9,000 - taking the piss
University of Life £9,000 - that's just the way it goes
ND
On last night's Question Time there was a discussion on AV voting. The example given was if you sent someone to buy you a Mars bar, but they didn't have any, then you'd rather they came back with a Twix, than nothing at all.
Is that right?
If you vote for Labour, but they don't win, you can console yourself that the Greens are in?
Swinson was using this Twix/Mars example that has become a sort of unofficial explanation for AV, but I think she phrased it badly.
I think its supposed to go 'Get me a Mars, or if no Mars a Twix, or a Double Decker or a packet of Cheesey Whatsits, or anything with a crispy shell but if they've only got nougat based chocs, forget it!
At the risk of unleashing the forces of the converted, pointing out my stupidity, is this really right? The preference that is listed is the preference that is accorded. No choices count twice? Its not 49% of people wanted Mars, there wasn't any, but when they added in the people who wanted a Twix first and Mars second , they decided to go to another confectioner and everyone got a Mars, even those that wanted a Twix?
Not being facetious. Just haven't paid much attention as I'm party bound to vote NO.
Of course if there was an advantage to BQMP in voting yes.....Well i'm fanatically loyal, not stupidly so..
It seemed to cause some confusion in the comments last night too..
Philipa said... Twix & Mars:
If I sent you to the shop and asked you to get a Mars but if they didn't have one asked you to get a Twix then that would be OK because I'd still have a chocolate bar.
ie. any MP is just as corrupt and a lying XXXXbag as any other - it doesn't matter who you vote for.
Nick Drew said... OK. Under the terms of the Treaty of Unslicker 2011:
1) HMS Quango to sail up the Tagus and deliver 4 billion Mars Bars and a consignment of Wellington Boots;
David Dimbleby is joined in Oxford {which is politically a three way. Labour hold east very strong - lib/con equal votes amongst the rest.}
by Jeremy Hunt MP,{minister for opera/tv & football. Ex Oxford man himself. Man who decides if evil Murdoch will gain control of the world or something..}
Caroline Flint MP,{Former minister of various non-posts culminating in minister for Europe when she confessed to having no idea what was in the Lisbon treaty she urged everyone to support. Interrupts a lot..See how long before Dimby slaps her down.}
Jo Swinson MP, {Scots lib-dem. Noted campaigner against chocolate eggs, which is at least topical.}
Professor Lord Winston {Medical media figure and Labour peer. Big on the arts too. Is that a hint?}
and Simon Callow {insufferable luvvie, but I really like him. Actor/writer/ raconteur/ prominent homosexual in the best Stephen Fry tradition. Hopefully entertaining.}
BQ thinks
1. Portugal - Does this prove the debt has to be tackled? {no}
2. Cuts to the arts have decimated Britain and returned us to some pre Ipad dial-up hell zone.}
3. NHS U-Turn, that is, but isn't. {leave it Dave! it ain't worf it.}
4. Tuition fees at 9k by 99% of uni. Did anyone on the panel really expect that would not happen? {Jo Swinson excepted.}
5. Could be anything..will go for IRA bombing shows ireland now more united than ever.
Winner gets to decide whether to bail out Portugal or just invade it.
So Portugal had to take the bailout.
{Peston had the market's price for financing a bad credit nation yesterday. Portugal had run out of options on ways to service its debt.}
So - bets on Spain to have to a euro bailout.
- 1 months
- 6 months
- 12 months
- 18 months
- never.
 Marks and Spencers
Like-for-like sales, which ignore new store openings, rose 0.1% in the 13 weeks to 2 April. General merchandise fell 3.9%, but that was cancelled out by a 3.4% rise in food salesAnd please note..continuing on from previous retail post.The company added that it was planning to increase its store space in the UK by about 2% and overseas by about 10%. Last week, it announced plans to return to the French market, 10 years after closing its stores in Western Europe.
I hope you're all writing this down. If you're picking winners look for good online, and expansion overseas
 And not just to a 'low- carbon future'. Here it is, long in the drafting and keenly awaited: but slipped out last month to no great fanfare at all, what with Libya and Fukushima and the rest.
But it's not without interest. Let's just identify one undercurrent.
It was heralded as being a roadmap for a low-carbon energy system in 2050: this became a low-carbon future or a low-carbon economy. But as published, it's a competitive low-carbon economy, and it contains the following interesting sentiments.
"competitiveness concerns ... if the EU's main competitors would not engage in a similar manner, the EU would need to consider how to further address the risks of carbon leakage due to additional costs [on Europe] ... there will be a need to continue to monitor the impacts of these measures on the competitiveness of energy-intensive industries in relation to efforts by third countries, and to consider appropriate measures where necessary ... including on the inclusion of imports into the ETS ... The Commission remains vigilant in order to maintain a strong industrial base in the EU"
A straw in the wind-turbine ? I detect a harder-nosed attitude in the Commission than some give it credit for (Oettinger again ?) The 'competitiveness' strand isn't the only indication of this in the Roadmap, and the renewables lobby is getting the wind up (sorry...). One more time: GDP trumps GHG ...
ND
 Mark Wadsworth had a pretty good set of links about the last few weeks retail announcements, on his blog, here.
Lots of points raised in the comments about why this recent set of bad news may have come about too. I doubt the most touted two, VAT hike and Fuel prices making people unwilling to drive, have much to do with it. Sure fuel rises are the problem. But only in as much as energy and fuel price hikes have forced consumers to cut discretionary spending.
General inflation cash squeezing is the culprit. There's no money left.
Officers Club which has gone into administration again, is a victim of better rivals. The average Officers club is 1000- 2,500 sq ft. A Primark or Matalan, selling similar ranges, are ten times that. Republic, Fat Face , Bank etc all have much more popular brands. Officers Club traded on discount clothing. That 75% off fools no one any more, when a similar item can be found at H+M for a cheaper price. Officers Club was just a decade old format, unable to compete.
{ 56 OC stores were sold to Blue Inc, who used to be Mr Byrite, a twenty year old fashion menswear store, widely copied by every discount fashion chain in the 1980's and 1990's. Blue Inc is very similar to officers club but have some 'designer' brands.}
Mothercare is more of a worry. They have good store mix of centres, streets and out of town an almost monopoly high street position. Baby wear should be recession proof. Online must be taking its toll. But Mothercare also has the answer for Britain's chain stores. The 9.5% drop in sales hid a 10% rise on its global profits. Mothercare had shown a 22% increase in its foreign business at the end of last year.
The firm said it expected the 894-store international division to continue its rapid growth with at least 150 new stores opening in 2011-12.
As the UK struggles Chinese, Indian and Latin American domestic consumers continue to rise. A long established retailer, who knows how to market and manage can do very well in the emerging markets.
 The hastily-cobbled North Sea windfall tax is a black mark against Osborne, though not necessarily for the reason the oil lobbyists would have us believe.
It's dumb because (a) any hasty intervention into the incredibly complex N.Sea taxation regime is bound to go wrong; (b) it was motivated by a determination to do some sort of very noisy, attention-grabbing hand-brake turn on Fuel Duty; (c) Osborne started rowing back on it immediately, thereby confirming the impression it's ill thought out.
But, CU's anguish notwithstanding, we shouldn't rush to accept at face value the oil companies' protestations that they'll stop drilling forthwith ("pause and reflect", my arse). As an old oil-man myself I have trooped to the Treasury on many occasions, crying wolf with the best of them. Confident politicians see this special pleading for what it is.
It's a fact that oil companies the world over fully expect that when windfalls accrue - especially from oil price increases that they have in no sense budgeted upon - windfall taxes are never far behind. They know it, they expect it, & they kick up a fuss for the sake of form.
So - can't lose sleep over this, even though the Law of Unexpected Consequences is in full swing and something daft will probably come of it all. But no dafter than the rest of the shambolic 'energy policy'. I see that Huhne is at loggerheads with Clegg on nukes, calling him a headless chicken, no less. Kinda amusing ... Huhne ... chicken ... Huhn ... no ? Well I thought it was funny.
ND
 We have found, and will continue to find, plenty to be scathing about in 'Boy Genius' Osborne's 2nd Budget, but there was at least one thing very good. I refer, of course, to the announcement that NS&I are reintroducing inflation-plus tax-free bonds.
This is a touchstone of the Government's good faith. We all know that the savings of the prudent are under assault from all quarters: from greedy bankers and investment advisers looking to gull the unwary, through tax-and-spend socialists & LibDems seeking to advance their social engineering, to outright scam-artists and criminals (if there is any meaningful distinction to be made between all these rapacious groups). Oh, and of course indebted governments everywhere, who can't help but notice that inflation nibbles away at their problems. The attitude of all of these bastards is the same: why do they rob banks ? - because that's where the money is.
It was a hammer-blow when the inflation-plus bonds were withdrawn last year, and now we must give credit where it's due. Thank you, George.
Back to bashing next week ...
ND
 OK, so it was in the Coalition Agreement: "We will introduce a floor price for carbon". And it's not a floor price for carbon, it's a new top-up tax on CO2 emitters with an effect meant to be similar to how things would be if the actual carbon price was higher. And it hasn't been set particularly high; and only until 2020 ...
But it's downhill from there, because, aside from the Treasury, who benefits ? Bloody EDF, that's who, plus assorted windfarm operators - in fact, anyone who has already built a non CO2-emitting power plant. That's people who neither deserve nor need further subsidy because they've already built the damn' things !
Yes, EDF wins, to the tune of billions: £1.3 bn according to the government's own advisers, anything up to £5 bn according to Jeremy Warner in the Telegraph, who goes on to note
Yet even this isn't enough to convince EDF's UK chief executive, Vincent de Rivas, to build more nukes. Post the uncertainty over costs introduced by the Fukushima disaster in Japan, he wants a standing charge for nuclear renewal on top. I'm not sure UK consumers yet fully appreciate what's about to hit them in terms of rising utility charges.
And it's not enough for the greedy greens either, as we've noted before.
Well, in the long term you know what I reckon: Osborne will back off from higher electricity prices, just like he ran scared of the Fuel Duty Escalator. But if he does back off the 'Carbon Floor' tax, how will he make good on the tax foregone ?
The answer, of course, (if he's determined to press ahead with the Carbon Floor) should start with a windfall tax on the good Monsieur de Rivas. Because another raid on the North Sea producers doesn't look favourite at the minute, eh ? No! says CU, and a bunch of angry oil industry lobbyists (a topic we shall return to).
We really need the 3-figure oil price to work its harsh logic and reorient our energy policy onto rational lines. It can't happen too soon.
ND
Astonishment and panic swept through the NATO coalition yesterday evening when France decided to surrender to Libya.
Nicholas Sarkozy was informed by the Général d'armée aérienne, Hector Mondieu, that the Armée de l'Air, the French airforce could no longer continue fighting.
He offered his resignation and then left his headquarters in Sardinia.
"When we decided to embark on this Cyrenaica venture we knew we wouldn't have long to achieve victory. The Fighting French soldier has only a limited capacity for warfare." explained Oui Givup, the head of French forces in Luxembourg.. "Since Napoleonic times French soldiers have been demanding shorter,easier wars. This one just went on too long. We had no choice but to surrender."
David-Lloyd Cameron, the British war leader was reportedly in a towering rage with his former ally.
" First WW2, then the EEC and now this! I think its a pretty poor show pulling out before the whole thing has got properly going.
It sends a very bad message to other world dictators if you're going to start something and then just give up. We'd all love to be able give up and go home from interminable,unwinable conflicts.. Afghanistan, Iraq, the Welsh Assembly elections.. but you don't just quit. You put your best trousers on and face the medicine ball. I mean look at us ..We joined in and we didn't even have any aircraft carriers or any proper kit at all.."
A jubilant colonel Gaddafi has arranged to take the surrender ceremony in Tripoli. "Its great news. I knew four weeks was the most they could take. I expect the Italians to pack up by the end of the week too," and he started doing that waving like a man with tennis elbow, from a balcony.
A spokesperson for the Italian army said "Us and the French have beautiful wives and girlfriends and mistresses. We can't be expected to kip out in the desert for years on end like the yanks and the British. Its easy for them as their women ... {cont P2-12}
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