Monday, 30 November 2009
Wow. Where do we start ? Firstly, Clark had better decide whether he intends to follow anything approaching NuLab’s fantasy-plan for renewables – because if so, he’ll need the Big 6 to make it happen.
Hopefully, though, someone will tell him what everyone in the industry knows, viz that 30% renewables by 2020 is utterly, utterly infeasible, in which case let’s move on. Remember this ?
However much the EC likes to think they are all mutually reinforcing, the drivers of the ‘policy triad’ are inherently in tension. Improving competition trumps renewables so far as I am concerned, and vertical integration is anathema. But before we break up our vertically-integrated Big 6 – shades of breaking up the ‘Big 3’ ten years ago – let’s please remember the major setbacks that have been suffered since 2001, when the UK looked to be set fair for a highly competitive energy future.
Firstly, the collapse of Enron and the ‘merchant energy’ business model in 2002, and with it liquidity in the forward markets. Then, the complete failure to enforce the EC directives on EU gas-market opening in time for when the UK became a net importer of gas in 2004. Next, the banking crisis which snuffed out much of the intelligent new sources of liquidity that had almost replaced Enron & Co: and finally the cementing of the vertical integration model when EDF was allowed to buy BE (the last big structural long) and sold on a large slice to Centrica (the last big structural short).
Mr Clark, even if competition trumps renewables on your agenda - and we haven’t mentioned security of supply yet, either - this isn’t an easy situation to unpick. My energy manifesto is two years old now and may need updating - looking forward to a bit more detail in yours …
Sunday, 29 November 2009
GKP is a very small oil company that has attracted a lot of attention since the summer. It has a a share in a number of oil exploration blocks in Kurdistan, Iraq. In the summer it hit a lot of oil, quite how much is in dispute but certainly over 1 billion barrels and perhaps as many as 5 billion. Plus it still has some blocks adjacent to drill next year.
This find caused its shareprice to rocket from 12p to 100p. Quite a ride for a few days, since then it has been one of the most watched and volatile stocks on the AIM market. This is because it has very few institutional backers; firstly it was a small company without need for major backers, then it did a deal with ETIMAC - an Arabian group who bought a 50% share. Many people are wary of the company for its strange dealings and penchant for doing odd share placings at convenient times for current holders.
So instead of lots of institutions, there are thousands of small private investors, watching and panicking with every move. As a result the shareprice is very volatile and behaves quite strangely, dropping on any good news as people sell out and being bought heavily on any dips as new investors look to get in.
Its future is utterly tied up with global politics, at the moment the oil is worthless as the Iraqi government will not recognise the Kurdish contracts. This an issue which will take at least a year to resolve - and maybe not happily for the Kurdish investors. Also the oil has to be retrieved and that needs a lot more investment than GKP has.
It is a very interesting situation to watch and, as you will have guessed, I have some holding of GKP shares, as well as another Kurdish explorer, Heritage Oil ( you can put HOIL in an ISA too). It is very high risk to invest much, but it is interesting to see how global events can impact even small companies.
As an investment it is a real all-or-nothing one. Easily £3-£5 if they get the licences and can start selling the oil....or 5p again if the contracts are voided.
Saturday, 28 November 2009
Also here is a link showing what everyone really knew all along, Abu Dhabi will step in to back most of the loans, leaving just the really crazy ones. Dubai may not be shining quite so bright in future but it is far from bleak.
One thing to consider is that Dubai had only a little oil and tried to spend the money on developing a new economy. Quite a shrewd move.
Anyone tell me what the UK has to show 30 years plus of being an oil producing country?
Friday, 27 November 2009
Blair v7.0 transformed into Brown v0.5
Dear Tech Support:
I am still having trouble with this program. I was told that Blair v7.0 would continue being in operation until at least 2010. Yet I have discovered that since the Iraq update Blairv7.0 is no longer supported. Instead Laboursoft advised me to install Brown V0.5. This has proved totally unsatisfactory. Brown V0.5 runs very slowly,is erratic and is very expensive. The specs for the Prudence program are totally off. No way will this run on 1mb Ram! More like 8mb Ram. I'm very disappointed.
How can I go back to Blair v7. ?
REPLY: to Adam Uff
Tech Support: N.Urd
Sorry, but Blair 7.0 was becoming very unpopular and corrupt so Laboursoft took the decision to discontinue it. You had Brown V0.1 already installed as a utilities background program with Blair V.1.01. It had some useful features like SellGold and the game BoomBust. However Brown V.05 is the operating system and is proving very difficult to remove. I will send you patch 1.00 Miliband to see if this helps.___________________ __________________
Installed Miliband patch but it did not do anything except add a banana logo to the opening screen. It totally failed to purge Brown from the operating system. Also I now find that Chancellor/resentful/bitter which was a separate program under Blair V.07 is now part of the Brown v.05 core program and cannot be operated independently. Its very frustrating as that is where the finance files are. Also Brown V.05 is taking up a lot of the resources from the other programs. Its constantly relaunching itself from the desktop. I don't believe this program is very stable.
I've removed the Vince data Cables as they weren't doing anything and tried booting from a previous 1997 backup but it won't restore. I just get this message
ERROR £200,000,000,000,000 UNSUPPORTED DEBT.
DO YOU WANT TO REPORT THIS CODE TO THE IMF?
REPLY:Tech Support: N.Urd
On Livingstone V8.0 I used Bozone and it completely cleaned out the registry and restored all the corrupted files. Have you tried that?
REPLY: Adam Uff
Bozone is only a London local program and cannot delete Brown V.05. I have just checked for Spyware.
WoW. I ran DavidDavis and found 1000's of spyware all over the place. Jacqui CCTV, JohnsonDNA, 42 daysReid, Eye-Dcard-4U. There is also a program called Mandlespin and Equality restore. What do you think. Is that bad?
REPLY:Tech Support: N.Urd
Yes that is bad. Mandelspin is a self replicating backdoor worm that pervades everything without any user intervention. It does not attach itself to any existing programs but still consumes huge resources and keeps spreading itself. Do not open anything up if near Mandelspin.
Equality restore looks harmless but it is the old Harmanx Trojan under another name. A very nasty piece of spyware and as hard to remove as Brown 0.5. Harmanx monitors your bin levels, methane emissions, alcohol consumption, double-entendres, skirt lengths and also all emails and phonecalls. Harmanx can also lose all your data and transfer your online accounts to a failed bank.
I'm afraid it may have to be a complete reformat. Even then that may not work and you might have to just junk the whole PC and start again. Election2010 is promising to remove Brown V.05 and all that other malaware completely but its not available until the new year Then you install Cameron V1.00 and hope for the best, but that's completely untested at the moment.
I'll open up the comment board in case any readers have any solutions for the removal of Brown V.05 or some other applications or programs that might help your situation.
Thursday, 26 November 2009
Wednesday, 25 November 2009
However, the idea of a lender of last resort is that you take effective action and this is certainly one of the few times the Bank of England made the correct decision in the credit crunch.
Also, in its own way the Bank of England balance sheet, published weekly, made it quite clear huge sums were being lent, but not to whom. However, it was not rocket science to guess who was big enough and desperate enough to want the money; just check out the collapsing share prices of the biggest banks!
So all in all this is a bit of a storm in a teacup as I see it. If small shareholders in Lloyds think this is yet another aspect of deception then so be it; why don;t they campaign for Eric Daniels to go, he after all is the remaining architect of the deal?
Tuesday, 24 November 2009
This is normally a bad sign, similar to a spinning top running out of energy, as the wobble grows the crash comes nearer. QE has prevented a crash so far and yet the top of the market seems close now. My hunch is that we will see 2009 out and then in 2010 there will be another roller coaster with big drops in prices of oil, commodities and share prices in the first few months of the year.
Interesting times for trading, if only I can find the time to keep up!
Monday, 23 November 2009
Blacks Leisure have avoided administration and destruction by getting landlords and creditors to agree to a company voluntary agreement. Landlords are having a bit of a moan at having to take all the pain but they have little option. Long lease agreements with upwards only rent increase and unfair rent reviews have punished retailers for a long time. A unit may have had a brand new retail park open at the other end of town and still find itself locked into a 12 year lease with increasing rents as its footfall continually drops making it not just unprofitable but completely cancelling the profit from another store or two.
Now, with empty space on every high street in the land the hiking boot is on the other foot.
Liz Peace, chief executive of the British Property Federation, said: "While this CVA has covered landlords' empty rates payments, it has not taken any bite out of shareholders' or other creditors' pockets. Landlords have borne all the pain, and when you consider that many of our pension funds are invested with them, it is clear this is not fair."
Landlords have to pay the rates even on empty buildings and with virtually no chance of an early let for the newly empty Blacks and Millets units the administrators X in the £ wouldn't have gone far.
In fact landlords still have a pretty good deal. For one, they are not among the 450 staff who will be unemployed shortly as Blacks Leisure close their 89 worst performing stores, about a 1/4 of the group. Secondly they will get a 6 month rental payment. Thirdly they will continue to have the rates paid on the empty units, which are usually a third of the total rent bill, by Blacks instead of having to pay them themselves.. Fourthly, by being forced to agree to monthly, instead of three monthly in advance rents, they have greatly increased the chances of the firm surviving to honour its future rental payments.
Lastly, although there is no detail, it would be amazing if the new lease agreements do not contain entirely favourable conditions for the landlord, such as a one way, one month notice to quit, or rent review in 2010 or something similar.
Blacks has been on the C&W sick list a long time. KPMG who brokered this CVA also did so for JJB, another on the very sick list. They are not in the clear, just temporarily out of intensive care, but the new improved medical facilities might just help them survive.
Its not guaranteed though. BQ can think of at least two high street chains that currently pay zero rents and are still losing money every day.
Sunday, 22 November 2009
Since then it's soared away (leaving a few notable casualties in its wake) and is apparently forming a ... wait for it ... a Swiss Stair. This, according to my diligent google-researches, is taken to imply that (as I surmised before) some heavy-duty players are intent on buying in large quantities, and the market knows it.
So - now you know too! Click image to be blown away ...
(long gold meself; do yer own DD etc)
Saturday, 21 November 2009
.Just thinking about last years predictions for this year. One of the better ones was pick firms, especially retailers with a strong online presence.
Consumers are expected to spend £8.9 billion this Christmas, representing 20p in every £1 spent according to research carried out by the Centre for Retail Research for Kelkoo.
The piece goes on to describe a 50% online sales Christmas by 2015, which seems ridiculously optimistic as it requires full retail Y-O-Y growth, online to continue growth at 24% while offline takes no action to combat that. Even so online continues to make advances.
Friday, 20 November 2009
Thursday, 19 November 2009
The story so far: gas demand in Europe has slumped and the spot price has collapsed, facts that (under the Civil Code contracts used by continental gas buyers) can be adduced to force a renegotiation of prices and/or volumes. The big wholesale buyers are politely bringing this to the attention of Gazprom, their friendly Russian supplier. Gazprom has told them to, err, take a hike, and that their expensive oil-indexed contract prices are here to stay. Now read on...
Gazprom is reluctantly being forced to takes its arguments public. Trouble is, they are truly awful arguments, to wit:
‘Gazprom has defended oil indexation, saying there aren't trading hubs with sufficient volume to provide better pricing signals than oil products. "The NBP [the UK pricing hub for wholesale gas] handles 15 billion cubic meters of gas a year while Gazprom sold 160 billion cubic meters to Europe last year," said Sergei Komlev, head of price formation at Gazprom Export. "If we used the NBP it would be like the tail wagging the dog".’
Unfortunately Cepëж мой друг, the figures are not these at all – you are out by two orders of magnitude.
According to best estimates, trade at the NBP is approx 10 times the amount of underlying UK demand, itself around 100 billion cubic meters per annum. A higher multiple would be preferable, but a churn of 10 is pretty respectable. Hence, price formation here is based on around 1,000 BCM of trade – around 6 times more than Gazprom’s exports. Some tail !
NBP price formation is not beyond technical criticism, but inputs include the dynamics of diverse pipeline gas supplies and LNG; the smaller German, Dutch, Belgian and French wholesale markets are highly correlated to NBP; and it is used as a pricing basis in vast amounts of contracts for traded and delivered gas and a range of derivatives across all of the UK, much of northern Europe, and in the substantial Atlantic LNG trade. It’s a real, meaningful price, reflecting the fundamentals of supply and demand. An ideal candidate for indexing long-term contract prices, obviating the need for future price renegotiations.
Still, Gazprom can rely on plentiful Stockholm syndrome amongst its counterparties.
‘The International Energy Agency said on Tuesday there could still be a big surplus of gas in the global market until 2015, but an E.ON executive said the IEA was being "a little bit on the pessimistic side".’
Yup that’s E.ON, a buyer, one of Gazprom’s biggest, hoping the surplus won’t last long! When our suppliers start thinking like this, heaven help us consumers.
Wednesday, 18 November 2009
My government will set out its legislative platform for the coming parliament. My government will continue to lead the way in the economic management of the country. My government is also continuing to put the welfare of the people of Britain first and believes in a caring welfare state to protect them. It also believes in a robust economy, and a halving of the national debt by 2014. My government believes in pretending to legislate for further devolution of Scotland and Wales. The government also believes in completely unfunded free care for the elderly, new railway stations for labour voters, space hoppers for children, a bill to encourage the invention of domestic robots for hardworkingfamilies.
My government is an aspirational government and firmly believes in Magic, The Bermuda Triangle, The tooth fairy, witches taking the form of cats, Santa Claus, that Red Bull is really good for your health, UFO's and unfunded public sector pensions.
My government really believes that the winner of the X factor is always the most talented, that utility companies have the best interests of consumers at heart, owning the banks will encourage greater lending. My government has a strong belief that Emus can really fly but choose not too , That MP's are appointed to high office on merit not loyalty, climate change is not just a scheme to raise taxes, films with Ben Affleck make money, broken biscuits contain no calories and that the Lib Dems have a fair chance of forming a majority government.
Finally, my government would like to state its unshakable, iron like belief in Aliens, the Loch Ness monster, it all started in America, the 5p being a really user friendly coin, Northern rock will generate a profit for the taxpayer, magic beans, Gordon Brown campaigning for Tony Blair to be president of Europe will be a benefit, Pokemon, zombies stalking the earth at night, werewolves, recycling, telepathy, age reducing skin cream, Scotland would beat England at soccer,Dr Who, Hades, that the EU is about to sign off its accounts, crime really has reduced since 1997, if you cut open a tennis ball it contains poison gas, printing money doesn't cause inflation, peace for everyone and an end to all war,hunger,poverty,disease,discomfort,irritations,niggles and ennui. Most importantly my government steadfastly believes that it will win the next election.
I commend this fantasy speech to the bin.
Tuesday, 17 November 2009
Monday, 16 November 2009
However, as ever, Governments are not very good at joined up working and here is a typical modern example. The Daily Mail et al were very upset at the introduction of Home Information Packs; all set to bring added administrative burden, a lack of inspectors, that sort of thing.
However, there are people queuing up to be HIPS inspectors in our new wonderful spare capacity economy. Where there is a block however is in local Government. Due to cuts backs C@W understands that 3 big London boroughs, Woolwich, Croydon and Greenwich are processing as few as 2 HIP requests per day. Indeed, they have been cutting back on Property Searches recently to save money.
Given that you can't legally sell your house without a HIP this is going to cause a great blockage in the system. At the moment volumes in the housing market our very low so the impact is not yet noticeable in the mainstream; it will be though as bubble keeps getting blown.
Of course, a sensible Government may just scrap HIPS altogether.....
Sunday, 15 November 2009
"The solution may be to do something that was last successfully tried in the 80s – and fix prices for fossil fuels. This would force producer countries to negotiate with a full range of consumer countries from Britain to Bangladesh. Oil could be charged at different rates to different countries, depending on their wealth. Rich nations would be charged full whack, to wean them off fossil fuels and on to green energy; the world's poor would pay less and would have greater certainty over their fuel bills. Part of the revenue would go into a pot to help poor countries deal with climate change"
Solution ? Successfully ?? Bleedn'ell ! One would hope this wouldn't pass muster even for today's devalued 'A'-levels; but for a leader in a national broadsheet ?!
Tell me it's a spoof ...
Saturday, 14 November 2009
Yet, the history of the crisis shows the Hedge Funds had very little to do with anything, the short selling crisis was made up; bank share prices fell more after the short selling ban. When it ended the share prices of banks rose!
However, a victim needs to be found, and the Eu authorities don't want the people to know that many of the problems are in fact regulatory failures; exploited by the Hedge Funds.
Also it so happens that this industry is in London, outside the Euro and with an incoming Euro-sceptic Government. A nice target to hit. The Hedgies are going to Switzerland; personally I can see benefits for the UK to copy the Swiss model of co-operation with the EU rather than membership if we are simply going to be targeted as evil Anglo-Saxons at every opportunity.
Friday, 13 November 2009
If our great leaders were propelled back in time which particular style of mustache or beard would they adopt for that all important Punch cartoon sketch for the First Lord of the Treasury's pronouncements or posing in the churchyard remembering the Khartoum war dead.
- David Cameron
- Peter Mandelson
- Gordon Brown
- Ed Miliband
- Ken Clarke
- Jack Straw
- Alistair Darling
- George Osborne
- Boris Johnson
- Nick Clegg
- David Laws
- Ed Balls
Jar of Cockburn's Fortitude Beard and Bristle Wax to the winner
Thursday, 12 November 2009
You see Spain has so much going for it, a great place to go on holiday, beautiful weather and landscapes, nice people and thanks to Euro membership and economy even more shot to pieces than the UK economy.
In addition to all that, the Spanish Airline Iberia is just about to merge with our own, dear British Airways. You know the one, where all the staff strike at being paid double the industry standards; where the pension deficit is far bigger than the value of the company; the one that loses a million pounds a day and has done so for 2 years straight. Brilliant, thanks Iberia for being willing to share the load with us.
You may remember these posts too, when another kindly Spanish company Ferrovial enriched UK shareholders by buying BAA in huge top of the market leveraged finance deal. Now it has all gone sour for the Spanish owners with BAA splilt up and the debt overhang too heavy to want to even think about.
So for the hat-trick lets all hope that strong Spanish bank Santander can come along and take RBS off the UK taxpayers hands; what a coup that would be for the UK.
Vamos a ver?
Wednesday, 11 November 2009
Tuesday, 10 November 2009
Miliband (Ed)'s much-trumpeted nuke-and-coal announcements yesterday offered no meat that wasn't already on the table, and just about enough collateral comedy to raise a thin smile.
Firstly it offered us the plaisanterie of EDF's Vincent de Rivaz trying to argue that a government guarantee to ensure a price-floor on CO2 emissions wouldn't be a subsidy. Hohoho, monsieur. Then, we had Paxo's opening question to little Ed on Newsnight last night (8 min 45 into the prog).
Paxo: "so: will all these 10 nuclear plants be built ?"
L'il Ed: "did you say 'will they' ?"
Paxo: "Will they be built ?"
Li'l Ed: "err, err, well, that's err, err" (etc) (hint: no, they won't)
And all this cheery banter on the night his brother apparently confirmed he won't be accepting the nomination to be Europe's Lord High Whatever, thus dashing Ed's hopes of succeeding Brown next year. Tough shit Ed, but you had it coming.
Seriously, though, Miliband Minor must be credited with being the only member of Brown's Cabinet who instead of whimpering into his handkerchief is trying to conduct business as usual.
But what sorry business it is.
+ UPDATE + this apposite Grauniad piece should add to the gaiety of the nation.
Monday, 9 November 2009
The must have present this Christmas is a battery powered hamster.
Toys R Us has said that the “must have” toy for Christmas 2009 will be a battery operated hamster that has caused such a stir in the US that the company could not include it in its Christmas toy catalogue for fear of disappointing customers.
The Guardian had the story today. A range of battery-powered toy hamsters, costing just under a tenner a time, are proving to be among the must-have toys of the moment.
It's better, but not always necessary, for a toy that appeal to girls and boys to be picked as the big seller. In the past its been cabbage patch dolls, Mutant Ninja Turtles, PSPs. This one looks like you should be looking for a stockist about now as its low price entry of £9.99, and many retailers scaling back the inventory this year, make it a sell right out line.
Where are you going to get your
Christmas toys from this year?
Saturday, 7 November 2009
But today takes the biscuit big time. At the G20 Alistair Darling and Gordon Brown started advocating the tobin tax. This is an old left idea for taking a tax on all international finance transfers.
Not only do very few countries agree with this idea, it is simply impractical to implement; and wrong. more tax is never the answer as all good capitalist know.
What really staggers me though is that Badger and Brownstuff could promote this idea in the very week in which they confirm the UK taxpayer is to own the largest international bank in the world by assets and 43% of another top 20 bank.
So the UK government now owns banks and is advocating a policy which will cripple there recovery. This is beyond stupidity, it really is.
In years to come the political world will have a new lexicon for all this Government;
'as stupid as a Brown plan' - for a truly appalling policy announcement
'even Brown would not have done that' - for a really turkey of an idea
Banks in the boom lent an awful lot of money to football clubs. Lloyds (not the new group with HBOS) stayed out, but Barclays and RBS went mad for footie finance as did HBUST.
Key examples are the Arsenal stadium finance (sold on through a securitisation by RBS) and RBS's backing a Liverpool takeover to the tune of a cool £250 million (UPDATED - ta Scrobs).
West Ham were bought by an Icelandic consortium and now is in the hands of the Icelandic Government. They chairman Andrew Bernhardt is an ex-Leveraged finance banker - how appropriate!
Football is big business and it is really showing in the credit crunch. In fact Rangers and West Ham are the first of the many. Unless you have a billionaire owner the future is not so bright for a premier league club.
Hull are next on the hit list and their CEO has already resigned. Hull have huge debts and are going to be forced to sell players. If they are relegated they may well follow Forest, Leeds and Southampton down the divisions.
My view is it is that the billionaires have priced non-billionaire clubs out of the market. In the Premier League Everton, Hull, Portsmouth, Bolton, Stoke, Burnley, (Wigan) and Wolves all have no chance of competing with the other clubs who have mega-wealthy backers. Without a level field to play on financially, they should really just shrink the league and make participation based on how much money owners are up for putting into the clubs - more like Formula One. Radical, but the league would be more exciting to watch with a higher level of competitive teams.
Football clubs are not listed on the stock exchange so much anymore, but all of the above are in danger of over reach on their budgets and any could pop this year. Hull will go first, but how many will follow?
As for the banks I wonder how many football loans have made it into the RBS APS scheme - to think some players wages are likely being guaranteed by the taxpayer!
Friday, 6 November 2009
Well. In the meantime, Obama and the Chinese seem to have decided they'll each adopt a unilateralist approach to climate change: and despite his best huff-n-puff efforts Brown couldn't get the EU to agree anything concrete last week.
And lo ! Little Ed (the one with insufficient clout) has been thrust to the front once more, and is now inviting us to lower our expectations.
I'm guessing there is a spare seat on the plane to Denmark, too ...
Thursday, 5 November 2009
Wednesday, 4 November 2009
RBS - Raised £62 billion
Current market cap - £20 billion
Current Shareprice - 35p (18 months ago 368p)
Lloyds/HBOS - Raised £35 billion (or in process, includes goodwill from HBOS merger))
Current market cap - £23.46 billion
Current Shareprice 86p (18 months ago was 442p)
Barclays - Raised £7 billion
Current market cap - £38.47 billion
Current Shareprice - 323p (was 453p)
HSBC - Raised £12.5 billion
Current market cap - £117 billion
Current shareprice - 677p (was 850P)
When you consider the market used to think that HSBC and Lloyds were the conservative banks, Barclays in the middle with RBS and HBOS as the most risky; how wrong the sentiment was.
Tuesday, 3 November 2009
So they need to talk. However, in traditional Russian fashion, having put out the feelers, they still insist the meeting must be at their place.
It’s nevertheless an important opportunity. And we send Banana-Boy Miliband to bang on about Litvinenko. Miliboy, here’s what it boils down to:
- put your banana away, there’s nothing to be had on the Litvinenko front
- we will need their gas – and lots of it - five years or so from now
- there is a once-in-a-lifetime window to strike some good deals now, while gas prices are, as predicted :+) remarkably low and, offstage, the rest of Europe is locked in increasingly acrimonious disputes over their old-style Russian gas contracts
- get on with it
By which, I mean - clear the ground for Centrica et al to get on with it. They know how to avoid the contractual mistakes that bedevil European long-term gas deals.
Then you can piss off and be Europe's 'Lord High Representative' or whatever.
footnote: much as I despise him, it’s a bit unfair of the Grauniad to accuse Miliband of being unable to pronounce the Russian President’s name. If he did say ‘Midvidiv’, that’s closer to the real thing than Medd-vedd-evv, which is what they seem to be suggesting.
Monday, 2 November 2009
The prime example of this is the gold sale, where he pre-announced the UK gold sale to the market, caused a huge dip and promptly sold into it. Now on the TV you often here Labour spinners saying we bought euro's so it was not such a bad thing as the euro has appreciated nearly 30%. Well, gold is up 500%, 30% does not even keep up with inflation over 10 years.
Now over the weekend Alistair Darling has been flagging that he intends to play with the UK retail banking market to create more banks. Up to 3 new ones will hit the high street to try and make amends for the failures in the building societies and banks during the credit crunch.
Nothing wrong with this, I am all in favour of the mega-banks being cut down to size. However, you do not pre-announce such sales to the market. it is just stupid as you lower the price of the assets. Moreover, during a credit crunch, which seems to happen about twice per century, is the worst time to be selling bank assets. Talk about picking the bottom of the market.
Plus I am less receptive to the idea of this new retail banking market. The retail banking market is quite competitive even with only a few players. Much like the mobile phone market.
The real issue is splitting investment and retail banking up to de-risk the banks. Also to provide more competition in in Corporate lending where companies are struggling to raise funds.
So in summary, the Government has manged to get the timing and target of its initiatives wrong again.