Sunday, 31 July 2016

Going Japanese?

Nope, this is not a post about economics! Street parties all round!

Tokyo is in the process of electing a new governor. An impressive role for whoever wins, as the leader of the largest city on the planet (circa 37 million residents). The structure seems vaguely similar to that of the London mayoralty, with the governor having executive power, constrained by an assembly. The governor's budget is roughly equal to that of the entire central government of Sweden. Tokyo is also the only prefecture in Japan that makes a net contribution to the national budget. Remind you of anywhere?

So, a fairly important decision for the voters. There is a scandal involving sexism, party splits, and so on. The previous governor resigned thanks to allegations of mis-use of public money.

But that is not what interests me about this story. Japan runs a very sensible first-past-the-post electoral system. So no doubt the bazilliions of votes for its governor will be counted more quickly than under the absurdist Supplementary Vote system, which managed to confirm that Sadiq had won convincingly in London about a week after everyone on the ground knew what had happened. And nobody mention Modified d'Hondt, which seemed to allow Jenny Jones to get re-elected each time to the assembly, despite nobody really voting for her.

Britain has experimented with all sorts of weird and wonderful electoral systems. In the 1920s and 30s there was even a move towards multi-member constituencies and the Alternative Vote system for general elections. Bullet Dodged. AV was, of course, only finally put to bed by Nick Clegg in 2011.

Although the erratic and clunky FPTP system has served the UK extremely well,  certain groups still insist that complicated systems understood only by elite members of the self-same groups will result in better "democracy". It is true that in elections we have to make awkward least-worst and second-best choices, and that sometimes seems uncomfortable in today's technicolour choice-marathon of a world, but it is not unreasonable to predict that we will not be switching to anything new for Westminster elections any time soon.

Japanese minor parties deal with this other than by moaning about the unfairness of the electoral rules; this may be worthy of consideration by the UK's fractured opposition parties. In the Tokyo election, some parties are putting forward joint candidates. Thus, in UK terms, instead of voting first choice for Green and second choice for Labour (for example, under an AV scheme), one might vote for their joint candidate. This could allow opposition candidates to avoid the vote-splitting that can often let the incumbent through the middle.

I can see this catching on here. For example, Owen Smith is apparently suddenly interested in electoral reform because he wants to appeal to the trendsetters who might otherwise vote for Tim Farron's "party". Instead, they could come to an understanding. I believe that something similar happens in Australia and Germany.

If the Yellows really care about proportionality, they should embrace such an idea wholeheartedly.

Saturday, 30 July 2016

The Bullying Business

Prince William seems to have thrown himself into National Stand Up To Bullying Day (sic), "warning that unrelenting torment isn't just confined to the playground".  It's an odd one, isn't it?  Aside from places like prison or street-life in various unsalubrious neighbourhoods where the threat of physical violence is real, or in sordid workplaces where the threat of instant loss of livelihood is a serious prospect, how could grown adults be susceptible to bullying?  Well they are, and it's a striking phenomenon.

I suffered very little from bullying at school: we were a rugby-playing outfit, and everyone knew that however big a 16-year old would-be tyrant thought he was, there were any number of First-XV prefects who could mallet him effortlessly if he overstepped the mark.  Being beasted at Sandhurst was tough, but never personal.  It came as a shock, therefore, to find myself suffering under a bully in my first regimental posting: it was the CO, a petty tyrant whom I rapidly learned to avoid.  (It was because he was thick, had never been to university or Staff College, knew he was never going any higher, and had a mile-wide inferiority complex.)  I learned just how easily heavy-duty brow-beating comes to a certain type of overbearing individual, and how effective it can be even with people who are not of a particularly nervous disposition, and who'd ordinarily reckon to be able to fend for themselves without difficulty.

Having come under the thumb of this bastard, I vowed there and then never again to succumb.  One knows perfectly well that in most everyday environments there is absolutely no prospect of physical violence; and while you can perhaps be threatened with the sack etc, in reality it's almost always just bluster, however genuinely unpleasant.

This resolution has served me just fine, in the military and as a civvy: indeed the issue never seemed to arise again.  That was until in business I ran into a well-known commmercial negotiator from another oil company, we'll call him Jim (because it's just possible he hasn't succumbed to the ulcers he was obviously due).  His reputation went before him - "nobody ever stands up to Jim" - but somehow our paths hadn't crossed: until one day in a new job I found myself across the table from him.  Our two companies had a minor commercial tiff and Jim, contemptuous of the efforts of his underlings in the dispute, had decided to take the matter into his own hands.  I invited them to our offices, and there they were, six of them under Jim's glowering leadership.

Only Jim spoke (the rest - all grown adults, of course, lawyers and negotiators alike - looked utterly in thrall to him).  He started softly:  there must, he presumed, have been a fundamental misunderstanding on my part, obviously I was new etc etc; but I had thwarted him which was completely unacceptable.  He was here to have me reverse my position on the spot, publicly.  I politely demurred:  the exchange of correspondence between us that I had on the table in front of me clearly supported chapter-and-verse my position, which I proposed to maintain.

He raised his voice, his face blackened, and I could see his people sinking into their chairs.  Those who dared to flash a glance in my direction were clearly imploring me to concede in my own best interests.  He thumped the table, told me my company had once been good to do business with but was now beyond the pale; that it was entirely my fault; and that he would be taking the matter directly to my CEO.

I stood up and told him I was leaving, but that he and his crew were welcome to continue using the conference room if they wished.  I said that the CEO's office was on the second floor, if he'd like to call in afterwards; and bad them good afternoon.

Needless to say, a couple of days later a written apology arrived in the post; the misunderstanding was his & he hoped we could move forward etc etc.  And so we did.

But Jim generally prevailed, and made a lot of mileage for his company and himself using the bullying tactic elsewhere, before and since.  When one reads about the behaviour of the Fred Goodwins ("he manufactured fear") and the Bernie Madoffs ("people were afraid of Bernie"), one is in no doubt that they rose to great pinnacles in their respective callings by the same means.

Bullying adults?  It's real, right enough.


Thursday, 28 July 2016

The Nonsense that is Hinkley

Ho hum, what can we say?  The monstrous Keynsian job-creation scheme (mostly for Frenchmen) is "allegedly" underway.  What a joke, what a farce.

Many years ago, before EDF had bought British Energy, I wrote hereabouts:

That's still one of the major drivers for the French.   But the fat lady still hasn't sung yet ...


+ + + +  UPDATE  + + + +  UPDATE  + + + + 

Hoho, what's this - second thoughts from Phil 'open-for-business' Hammond?  He's every reason, FFS.  We can only hope.

Wednesday, 27 July 2016

Oh, America [again]

Periodically I fret about America, that great nation under whose umbrella (or shadow, your choice) we all operate.  So: open thread:  what kind of a choice is Trump vs Clinton?

If you'd like to start with some stats, here's polling overload to fuel you up. 

Personally, the word I can't get out of my head is corruption.   These people are deeply, deeply suspect.  Now money has always spoken in American politics, but generally it's been 'into my campaign coffers, please', rather than 'in my back pocket, thanks, cash'll do nicely', third-world style. 

On another tack - not the weightiest of considerations, perhaps - it's interesting how western nations seem to be moving away from the 'skip-a-generation' kick.  (Some people, *ahem*, find this quite encouraging.)

Over to y'all ...


Monday, 25 July 2016

Towards global Marxism?

At the weekend I shared sparkling wine (English, as it happened) with some Marxists. OK, so I did not go drinking specifically with Marxists, they happened to be at the flat-warming I went to. But they are Marxists, and unashamedly so. Their basic premise is that a lot of people have had their living standards hollowed out by globalisation. Another guest - from more of a right-wing perspective - seemed to agree that while trade and migration within the EU and NAFTA had generated wealth overall it had produced some pretty worrying side-effects.

My main contention was that in the long term, say the next fifty to a hundred years, these imbalances will become less marked as developing countries catch up on living standards and so will be less able to undercut rich-world workers. Trade restrictions cannot be tough enough to undermine the cost advantages that China, India et al. have at the moment, and it would be thoroughly immoral (not to mention self-defeating) to try to stop poor countries from getting rich by selling us stuff. While the Marxists may pine for an era of an enthusiastic proletariat (yes, someone actually used the word) working in Utopian steel factories, we cannot turn back the clock even if we wanted to. 

So, can the people and governments of the world do anything to mitigate the most negative effects of rapid globalisation, whether they are exploitation of workers in poor countries or the undermining of traditional working class industries and skills in the rich world? Should we try to? Or should we try to get through this stage of the world's economic development as quickly as possible, by streamlining the whole process, with the hope that in a few decades' time many many more people can expect a comfortable living whichever part of the globe they are born in?

Friday, 22 July 2016

The Vision Thing

Do I detect the Beeb's post-referendum Continuity Project Fear beginning to run out of traction?  Maybe that's just my own optimism shading the landscape.  But relentlessly optimistic I remain, because there is just so much to play for, and the 'other side' is in such utter disarray.  Actually that should be 'sides' in the plural, but hey, Come the three corners of the world in arms / And we shall shock them. Nought shall make us rue / If England to itself do rest but true.

Not that the situation isn't fraught with peril.  In a situation like this one could wish for a Heseltine - an onside Heseltine, obviously - someone with tenacity, tactical nous and creativity: the chap who solved the Poll Tax in half an afternoon.  Is David Davis that man?  We shall find out.

I actually agree with whomever it was (can't find the link) who wrote recently that the government now needs to conduct itself as if we were at war.   Yes, it's big and serious!   Full attention and maximum effort required on all fronts.  Melt down some of the family silver.  Tighten the belt.  Grown-ups to the front.  Now is the hour.

Funnily enough, the early signs of exactly such an attitude that may be detected - everyone lauding the big cross-border investment deals that have been announced as proof we are open for business - make the wretched Hinkley all the more likely to "go ahead", however crass.  The French are obviously rushing to grab, quick, while stocks last.   So be it; a 'yes' in July 2016 means very little in practice, but has big symbolic importance and, given we really don't need the project & the French really, really do, confers some rather handy leverage.

(But isn't ND an implacable opponent of Hinkley?  Yup - which goes to show the priority I'm advocating for all things that tend towards advancing the main cause.)

I quite like the parallel Paul Goodman draws with the Stuart Restoration: a time for focus, creative politics and reconciliation.  Might draw this out a bit more on another occasion.  But an even more compelling analogy (and I hope I'm steering clear of the Godwin trap) is with Churchill taking the reins in 1940.  Phoney War coming to an end; focussed leadership drawing on eclectic resources; clear vision.  You ask what is our policy? .. what is our aim?..   

Just now the Vision thing is, maybe, a bit less black-and-white: a bit harder to articulate in detail what would constitute success.  But here's my attempt.

The settlement we reach - with Europe, and amongst the various parts of the UK - must be so good that the Irish (that is, the Southern Irish) should seriously start thinking about whether they want to join us.

I don't see why not.


Thursday, 21 July 2016


If the tea-leaves are being read correctly, it looks as though the world is soon to embark on a co-ordinated fiscal expansion. The UK arm of this is already being talked about, with Mrs May having ditched George Osborne's impossible timetable for balancing the books before she even became PM. The economic situation really has changed since 2010, in that even in the post-referendum mini-paddy nobody has predicted that the UK's public finances are in danger of running out of control - which was a genuine worry in the late-Brown-early-Cameron era.

The politics has certainly changed. While it is lazy to read general themes from the referendum numbers, it seems that a lot of people may have voted Leave because they were frustrated by economic stasis and they wanted to give The Establishment a black eye for having let things slide; and at least some of that is thanks to the big fiscal squeeze under George Osborne*. A more balanced UK economy is going to require some big investments. Not all of that has to be led by the public sector, but it seems inevitable that not all of it can or ought to be privately-financed.

BUT. One of the most important criticisms of public-sector investment is that it is so often misdirected. This is hugely important, because the efficient allocation of capital is the be-all and end-all of successful economic policy. Building the feted "roads to nowhere" takes capital away from the productive sector and allocates it less efficiently.

So how might we work out how to decide how much to spend and, crucially, how to spend it?

With borrowing rates as low as they are, it makes sense to borrow big and borrow now. The world's holders of cash are running around in search of yield and security. The government could gain a bit of confidence from the markets by hiving off bonds for infrastructure investment from day-to-day spending: Gordon Brown's Golden Rule in certificate form...

But UK politicians are notorious bad at spending money sensibly. Pet projects, vanity projects, pork-barrelling and general incompetence rule OK. But we can take advantage of the re-emerging diversity of decision-making in Team UK. For example, should more money be invested in London infrastructure or would the same money be better spent Oop North? Let the super-cities, combined authorities and monkey-mayors compete for the cash. In other words, auction the cash. Run competitions. Use tested multiplier formulas. Hold these local governments' accountability to the fire by making the availability of funds contingent of the area's ability to raise additional tax revenue. In other words, let a million projects be proposed, and only push the button on the best of them.

The buck will, of course, eventually stop at Westminster and its national tax-raising abilities, but we should avoid giving Whitehall itself the chance to go on a white-elephant binge. We can do better than that.

Also, the UK government should immediately give a decision on airport expansion in the South East. This should be relatively easy in the new political and economic environment. The simple answer is this: to give BOTH Heathrow and Gatwick permission to build new runways, but stating that the taxpayer's contribution to consequential transport upgrades will be auctioned off. Let the two airports effectively bid to take the least amount of public cash. 

* a wooden spoon prize to the first, second and third commenters who claim we have not had a fiscal squeeze in the UK. Please go and read David Smith.

Wednesday, 20 July 2016

The silly long last

After a hard month (it is not even 1 month since the EU Referendum) of politics and tragedy, the silly season is finally here in the news.

The main headline is a Welsh clown, going by the name of Owen Smith.

No for him the hard slog of working his way up the political firmament. No, Mr Smith instead seems to seek the Andrea Leadsom path to supernova status and then trudge quickly back to the darkness of anonymity.

Mr Smith has bravely pushed aside a well-known and liked Labour politician in Angela Eagle, useless of course, but then they all are. Now he is out there, promoting his own brand of meaningless phraseology:

"Jeremy has slogans when we need solutions"

This is fantastic, do you see what he has done, created a meaningless slogan to deride his rival by doing the same thing. Genius, of a sort.

Anyhow, the grown ups in charge of the Country have little to fear from the Taffia-leading Mr Smith. And neither does Jeremy Corbyn. Labour already have in a place a well-meaning out of touch loser, why replace him with another?

Monday, 18 July 2016

Abolishing DECC Offends 'The Elders' ...

Of all the interventions from the audience at the delightfully fast-moving show that is British politics, this has to be one of the funniest.  It's from "The Elders".
We regret decision to scrap @DECCgovuk. #Climatechange shd be priority for UK to meet #COP21 pledges but this will not encourage leadership.
We know Ed Miliband is pretty pissed off about the demise of DECC, but wow, he's got support from The Elders!   Who?  It's Nelson Mandela (worrying from beyond the grave), Jimmy Carter, Desmond Tutu, and Mary Robinson, to name but a few.

The whole COP21 things was itself a jolly fine festival of comedy at the time, and hasn't sobered up much since.  You will recall that last December 994 nations came up with the 'Paris Agreement', which committed them to two-tenths of bugger all.  It was to be 'signed' in April (which it was - in New York, at a big piss-up, which is the kind of thing they actually know how to do); but unless it is ratified by quite a large number of the big players by the end of one year, it will be null and void.  Has anyone ratified it?  Yes: a handful of island nations who fear disappearing off the map as the oceans rise; plus, errrr, France.  Yes, France it was who orchestrated the whole empty thing, because it is M.Hollande's legacy, don't you know.

Elder Mary Robinson has yet more to say on the subject
The likely US Republican presidential nominee, Donald Trump, has said he would try to unpick the deal, but Robinson said if it was ratified by the US this year “unwinding it would be very prolonged and difficult
Difficult for whom?  The Agreement states that after ratification, anyone wishing to abandon it must merely notify the registrar of ratifying countries.  Sounds rather easy to me.

The appropriate response must be the one Father Ted was obliged to give after losing a forfeit.  He had say to b*ll*cks very loudly in front of President Mary Robinson ...


ARM is gone - sometimes M&A is a good thing

Softbank bought ARM today £24 billion.

It is a great price, but as ever the UK model is to build and sell. It is almost impossible in the UK to become the dominating player in an industry - it makes Vodafone and GSK almost unique.

It also shows, whatever the naysayers in the city tell everyone, that M&A works. If you are a small company and growing, you need to bet the farm on overseas growth and acquisitions; just like Softbank have done.

If you remain an organic growth focused business the chances of you dominating your chosen sector(s) globally is tiny.

Yet the same people who bemoan that Brits sell-out to the world all the time (this is true, Brits have a life view very different to Yanks or others in that a few millions is enough, no need for billions); also bemoan that M&A is only for the Banksters and serves no purpose.

The counter-factual here is what if ARM had used its shareprice to buy into a new business that really scaled it - but it never did. Instead it made a whole host of small acquisitions in businesses aligned with itself.

SO, like many before it, it is gone to the Japanese. Hopefully they can keep the mainstay of the business in the UK for the foreseeable.

Friday, 15 July 2016

Very sad about Nice

Hard to believe there are people so evil and mad enough to do such terrible thing, but there we are it is all too real.

Thursday, 14 July 2016

Open Thread - Cabinet Appointments

We lost Osbo!

If I had not been in the office until 10pm last  night that would have been worth a drink. I see Hammond as being a far better Chancellor - no more scheming Brownian nonsense in No 11.

On the downside, we gained Amber Rudd as Home Secretary. Rudd truly is useless. Luckily, Home Secretary is not that important at the moment and no doubt she will screw up really quickly and be gone; at least her fingers are off energy.

Boris is a terrible choice for Foreign Sec, should have swapped him and Fox around but there we are.

Lots of Brexiteers is good news for Brexit and the Country. Hopefully we will quickly move to WTO now and avoid the fudge - here is hoping anyway!

So...let's see what this morning brings...

Wednesday, 13 July 2016

Cameroon, Silver Spoon era. 

The May Day Parade begins. The Cameroon era ends a little sooner than expected. Only a little sooner as we know David Cameron was going anyway. Probably in 12 months or so time. He hasn't gone as he would have wished. And  he will now be as historically defined by the referendum he called, as Tony Blair is by the Iraq War he began. Not a legacy he would have chosen.

 How do we rate the Cameron era? Good, bad or just..meh!?

The referendum does rather define the weaknesses of his era.  Continuity New Labour was very evident. Cameron was one of the early Tories to realise that it wasn't possible to beat an election winning machine like Blair by opposing his populist policies. It seems obvious now, but not that long ago the Tories answer to Tony Blair's success was to try and attack all his popular measures. When that failed it was to point out the flaws and the contradictions and the cost of all the magic money. But the Tory media was not a patch on the Labour one. So the attacks failed. Worse, they rebounded. The 'Nasty party' was back.

Cameron saw all this and figured, if you can't beat them, join them. To the annoyance of very many in his own party. But he was right. It is only in very recent times that Tony Blair's star has faded. That spin doctoring every sentence in every provincial newspaper has been discredited. for years and years that was what worked. And Cameron wanted to win. So the never actually called, but absolubtely was, New Tory, was born.
Not defeating the dysfunctional Brown government outright was a bad blow. It should have been easy. And without the world economic crash and all those spending promises to out Brown, Brown it would have been. The Tories were well ahead and remained so up until the point that they spoke about making some cuts. Then the gap narrowed. 
And, with hindsight, we know the polling has been off for quite a long time, so don't really know how close it ever was. Untried Posh boy versus Financial Titan?

The coalition was probably Cameron's biggest success. There was instant talk of how long it would last. Six months to a year was considered good. Cameron managed to make it last the term. And in doing so he also destroyed the Liberal Democrats. 
He stopped the financial crash getting any worse for the UK. Steadied a very rocky ship in difficult waters. 

The defeat of Miliband was a s welcome as it was unexpected. So one and a half wins out of two. pretty good for a post war British PM.

Too much sofa cabinet. Too much of  clique. To much party centralisation. Silver Spoon toffs and a lack of any real, real vision other than keep the Trots away from power and make Britain a nicer place.

Too much government.  And too much politics playing. That continuity Blair again. Too much concern with how the media would play an event and not enough about the actual long term consequences of the event. Those '10s of thousands of immigrants' promises. "Cast iron". Even his 'making savage cuts' narrative for the first year, when few were made at all. All those 'Spins' eventually came back to bite. The internet and social media had rendered much of New Labour's manipulative methods obsolete. It was a mistake to persist with them.

And of course the biggest folly of all. Shooting the UKIP fox short term, by promising an EU referendum he didn't want or even need to call. This wasn't a Scottish one that was forced upon him by the destruction of Labour in Scotland handing a very unexpected majority to the SNP, who used their power to demand one. This was a referendum Cameron himself chose to allow.
That decision was made worse with the all too predictable  'Renegotiation with Europe' fiasco before the campaign had even begun. 

On paper, it all looked good. Promise a referendum that killed the Tory dissent and stopped the drift of voters to UKIPt. It put both liberals and labour, who refused to go along with it, on the unpopular side of the popular argument. A New Labour/Tory tactic from the best of their playbooks.
And the Tories were expecting a coalition anyway. No need to ever implement that manifesto promise.

But they won, and so it had to be delivered. 

Going early was the best option. Nothing in Europe was going to get any better in the longer term. probably much worse. The real mistake was firstly trying to renegotiate from a position of weakness instead of strength and secondly identifying himself so strongly as the leader of remain. 
He needn't, indeed, should not have, done either of those things. Plenty of government ministers available for those roles. By taking them on himself, Cameron ensured that if the remain ship went down, he would go down with it.

One of the things I liked most about the Cameron era is him personally. He looked like a prime Minister. spoke like one. Sounded like one. Was reassuring and confident. He looked like the British Minister wherever he was. The number of gaffes he made was minuscule. Considering this was a man who was televised every day at every occasion he ever attended for 10 years, that was pretty impressive.

Especially if you recall the lumpen troll that had come before him. A national embarrassment at any diplomatic event. A man who needed his own wife to hold his hand at a party conference of his own party as he was so incapable of leadership and gravitas.

It doesn't sound like much of an achievement.  

Cameron didn't fall asleep at the G8 with his tie in the soup.
Or tumble down the stairs of Airforce one. 

That's not the angle. 

Cameron looked, sounded and acted like a leader at a time that the country desperately needed a leader. His personal approval ratings were always well above his party. he was a very reassuring presence.

That should be remembered when his legacy is debated.

Tuesday, 12 July 2016

South China Sea: Game On

Open thread on China's expansionism.  We've looked at this before, and as the Philippines wins against China in the Permanent Court of Arbitration, it's moving closer to the top of the front page.  

Wonder if our shiny new, *ahem*, 'aircraft' carriers were designed to 'project power' with the South China Seas in mind.  Hope they've read about the Repulse & the Prince of Wales ...


Monday, 11 July 2016

UK: Clarity of Power

23rd June - Power Vacuum

23rd June - Netherlands Prime Minister - Britain is basically an economic and politically failed state

...18 days later, new Prime Minister announced, Brexiteer leaders defenestrated but then will be picked to lead Brexit in a more pliable way.

It is pretty good going and demonstrates how quickly the UK can move on large challenges. Spain is about to go for its 3rd General Election of the year to try and resolve its issues.

This is a key reason why the UK will remain the pre-eminent destination for capital and investment in times of stress - because the world sees a determined Country that deals with some (if not all..) of its problems when compared to everywhere else. And does it without resorting to authoritarianism but within the confines of representative democracy.

Sunday, 10 July 2016

The Entertaining Torment of the Leftist-Feminist

One of the gloriously predictable joys of the current political turmoil (and there are many) was that the leftist-feminists would be in an ecstasy of despair over the Tory Party cheerfully lining up a run-off between two women for the top spot on the greasy pole.   That's women, not wimmin.  But they're not proper wimmin!   Indeed they are not - hahaha!  Why can't the Labour Party have wimmin at the top?  Because, oh, the reasons are many.  Because they are useless.  Because the Labour Party is dominated by neanderthal northern union-members (have you ever met any of them? or any 'traditional' northern / scottish Labour MP?).  Because, in the immortal words of a CiF BTL comment, "the main problem with tokenism and quotas is that you just end up with Diane Abbbottt".  etc etc.   

And another from CiF:
"... the current Labour membership would rather elect the most clearly useless man than debase themselves by backing a competent woman. Knee-jerk sexism - fiercely denied - is one of the most predictable characteristics of the Left, much moreso even than the obvious but fiercely denied knee-jerk antisemitism, knee-jerk anti-Americanism etc. And very strongly tied to their fiercely denied alliance with Islamism."
And so the agonies commence, oh this is fun.  Here are my first two sightings for the collection:
- and if you see any more, please do drop the links in the comments.  It's not nice to mock the afflicted, but - well ...


Friday, 8 July 2016

Clutching at Bremain straws

The media is an interesting creature. All week I have watched it report every slight fall in the FTSE as the harbinger of doom and ignore any rise.

The mood music is unrelentingly downbeat. I work in the City and it indeed pretty crap.

Property and M&A deals have been put on hold. Companies are already looking at how to move their HQ's into Europe. Some staff are thinking of going home...

Re the transactional deals, even with super optimism I can see this is an issue that will last for a few months yet. That in itself is bad for business, but M&A and Property deals are not the whole world (although many debt markets are shut too).

On the other hand, property prices are about to fall quite quickly and this will stimulate demand. A lack of new issues is generally good for current equity market participants too...just not the Banks who provide the commentary.

Also, we seem to have dumped most of our useless political leaders. This is a good thing, especially if we get a new Chancellor and Leader of the Opposition who is not a cold war commie warrior.

But he most egregious thing I keep seeing is very well fed and paid people moaning about the result. Claiming the referendum should be voted out of Parliament, hiring lawyers, marching and whining. Just today I had one chap bemoaning the state of the world as he locked his DB9.

My hunch is if they ran the referendum again the Leave vote would be higher. It achieved its main objective - change to the liberal elite media dominance. Why would we not do so again?

Because we might lose Scotland - give the English a vote on that issue and St Nicola would be happier than ever?

No the moaning about the result is both dull and expected. The deed is done, the die is cast, the Rubicon crossed, the fat lady is in the cab on her way home.

Let's get this pesky bit out of the way and plan for the future  - the quicker we do it, the quicker the economy recovers.

Thursday, 7 July 2016

The Scruples of Tony Blair

They went to war in a Sieve, they did, 
In a Sieve they went to war: 
In spite of all Hans Blix could say, 
At Bush’s command on that fateful day 
In a Sieve they went to war! 
But when no weapons were found in the place 
And every one cried, “You have no case” 
Said Tony Blair “we’re trusting to luck
We don’t care a button! we don’t give a f***! 
In a Sieve we’ll go to war!

Far and few, far and few, 
Are the scruples of Tony Blair; 
His lies are bold and he’s shameless too, 
And they went to war in a Sieve. 

They went to war in a Sieve, they did 
And totally unprepared 
With not enough armour for soldiers to don 
With too few choppers – the list it goes on 
But Blair, he never cared. 
And everyone said, who saw them go, 
“O won’t they be soon undone, you know! 
For the list of shortcomings is terribly long, 
And happen what may, it’s extremely wrong 
To send our boys unprepared!” 

Far and few, far and few, are the scruples of Tony Blair... 

The casualty figures soon started to rise, 
The coffins they soon came in; 
So to cover their arses they lied and lied 
(No sign of remorse for the many who died) 
And they gave the order to spin! 
And they hunkered down at Number 10 
And they lied and they spun and they lied again 
"Though the charges against us be ever so long 
Yet we’ll never admit we were rash or wrong. 
While we have breath, we spin!” 

Far and few, far and few, are the scruples of Tony Blair ...

(with apologies to Lear)


Tuesday, 5 July 2016

Fox, Crabb Gone - Hopefully Osborne Too

So CU called Fox right: he's gone, and Crabb too.  We're down to May, Leadsom and Gove, with the Fox and Crabb votes - now adrift - being directed at May.

Can we please hope this means May will feel sufficiently confident as not to need Osborne in any shape or form?


If We Think The European Commission Is Bad ...

You probably hadn't noticed but last month we go a new Energy Act, entirely home-grown here in the newly-liberated UK.  "An Act to make provision about the Oil and Gas Authority ..." it says in the preamble.

To get a flavour of just how interventionist this bastard quango is allowed to be, feast your eyes on Chapter 4, entitled 'Meetings'.  In brief, if anyone operating in the North Sea is holding a meeting between two more more companies, they must give the OGA 14 days notice about it, and the OGA can insist on attending.  Or join in the conference-call: yes, they've thought of that one.

Pause for effect.

For a decade I was extremely active in this sector and let me tell you, the number of meetings between companies was astonishing.  This is because (a) it's very usual to form joint ventures to carry out exploration & production in the North Sea, sometimes with many companies involved (check out how many licencees there are in some North Sea permits); and (b) because oil and gas fields often straddle more than one production licence.  The sector has consolidated a bit over the years due to the natural decline in production, but the same principle pertains.

And now the man from the OGA has a right to dip in his wick at all times**.  We haven't had dirigisme like this since Tony Benn made BNOC a carried participant in every licence back in 1975.  But this is 2016, under a majority Conservative government.

And guess what.  
'Andy Samuel, Chief Executive of the OGA welcomed the news that the Energy Bill has now gained Royal Assent. "This is an important step in establishing the OGA with the necessary powers ..." ' 
I'll bet he bloody did.  And, to repeat myself, this is 2016, under a majority Conservative government.

_ _ _ _ _ _ _ _ 

** I have a feeling they'll be deluged by hundreds of notifications of "meetings to discuss what biscuits to serve on the Brent Alpha platform" etc.  Also, m'learned friends have not been slow to point out that the Act doesn't take precedence over legal privilege.  And for a small fee, no doubt, they'll be happy to tag along to discuss the biscuits ...

Monday, 4 July 2016

Fox will go Tuesday, then who and then what?

Tory Leadership elections are quite something. Labour really could learn a lot from their could UKIP!

By teatime tomorrow the Tory field will be down to 4 already, May, Leadsom, Crab and Gove.

Given that Crabb is not really in it the race at all, then it is the 3. By Tuesday next week then we will have the final two and the vote for the party will be being arranged.

I find it hard to see beyond Teresa May who personally I would not go for. After the Brexit vote, strong Brexit leadership is called for. If we want a remainiac, we could have just stuck with Cameron.

Still, I don't get a vote these days so my tuppence is not worth even that.

Of more interest this week and far, far more importance is:

1) Will the markets and Sterling settle down at last?
2) Will all the deals and IPO's put on hold start to come back at all?
3) Will big ticket retail spending come back?

I certainly don't expect all 3 to happen, but the latter could turn around quite quickly and the first of those should be the case. They key is point 2 - that alone is a big weakening of the economy and it has to be reasoned that the suspensions will continue as it is the middle of the summer anyway and decision-makers who are not already on Ramadan will be off to St Kitts anyway in a few days.

Friday, 1 July 2016

The 'Genius' that is Gove

Now hang on a minute here.  Gove is no genius.  Apt commentary on Gove comes in a brilliant 2012 Stephen Collins cartoon in the Grauniad, of which this is a detail:

Stephen Collins /

It doesn't end well.  

Remember that in the Westminster bubble, 'Nudge' is considered a work of profound political philosophy: and for being an afficianado of said inane book George Osborne was considered wise beyond his years.  The bar for genius in that parish is set very low.

(All the talk seems to be of how Gove stabbed Boris in the back.  Might it not be that he put a gun to his head ..?)

I love reading the Labourites prosing on about how the Tory Party is in meltdown and that now is a time for capitalising on this (instead of what they are actually doing, viz mass self-immolation).  Nope: the Tory Party, a very serious power-minded entity, is seriously about the business of Choosing A New Leader, a post which naturally attracts the toughest and most ambitious in the termite-nest.  Might it be bloody?  Yes.  Will it be protracted?  Not particularly.  Will it end with everyone dead on the floor?  Assuredly not.

Will the party re-unite to win the next election?  Most probably.  Because if it's done adroitly, (a) Tory deserters to UKIP will come back into the fold - quite quickly, in fact;  and either (b) Labour will insist on opposing Brexit and be finally wiped out by UKIP or (c) Labour will do whatever it takes to win back its UKIP defectors, in which case ...


UPDATE: in the comments, our good friend Kev asks:  Do we allow cartoonists to influence which leaders we choose? 

What a great essay title!  Beware, you may get the essay ...

Brext Steps

Lots of focus is now on the selection by the Tory party of the next PM; and rightly so, because the decisions made now will affect whether we can achieve a smooth exit or not. One faux-pas and it might be auf wiedersehen, pet to any sweetheart deal with Queen Europe. Luckily, international leaders are urging all parties to behave sensibly and it is in nobody's interest to foul up the world economy.

But there is plenty that the UK government can crack on with on the domestic front, to try to keep the economy whizzing along nicely during potentially turbulent times. Mark Carney has hinted at a rate cut, which has confirmed the Pound as a weakening currency. So far, so good. He could go further, of course: he should re-affirm that no monetary tightening efforts will be made unless and until any signs of inflation arise. He could set an explicit inflation-trigger-level, perhaps, and make sure that nobody is under any illusion that the exchange rate will be propped up.

Next, the new Chancellor should swoop in and make some emergency business tax cuts. Take a few points off the Corporation Tax rate, and set out a timetable to phase out employers' national insurance "contributions". The government must send a message to the outside world that the UK is Open For Business. A reduction in business overheads ought to stave off any worries about tariffs that might be imposed by the rEU if a hard exit does happen. After all, a suggestion I read was that the average tariff on the sort of stuff that we sell to other EU countries is about 4%, which is relatively easy to deal with, with some judicious tax cutting and a falling Pound.

At the same time, a review into the operation of the VAT system is a nice easy early start, too. Even if we end up staying within the EEA we can play around with the VAT system in a way we cannot within the EU. Show voters and the world what a difference it can make to be in charge of our own decisions. Abolish the "tampon tax".

Make it immediately clear that it will not play politics with the people from other EU countries who are already here living and working. We absolutely must not use the possibility of throwing people out as a bargaining chip. Anything other than this leads to uncertainty for everyone, and leaves space for rumours and threats. 

Start talking to friendly non-EU countries about trade deals. Get the momentum going. Boris said that he has been quietly approached by various important markets. Make it less quiet. Get those orders in and show the French and Germans that we will be quite happy to compete with them in the world. Set up a trade fair. Send Prince Charles around. Invest in a Trade Force One jet to fly business leaders around the world and to bring them to Britain. Reinvigorate the Board of Trade, appoint a President of it.

Set up an investigatory committee to look at what rules and regs have been put in place under our EU membership that could be tweaked or abolished. We have the Law Commission to review the criminal law, let's have something similar to make sure that we only have sensible and light-touch regulation. Some areas will be out of bounds until we know whether we are inside the single market or not; that is fine, start with the low-hanging fruit.

There is one HUGE risk for Brexiters: that the economy tanks while we are sorting out what we are doing.