Where's Boris When We Need Him ?

Up to his old tricks, that's where.  The papers are full of stories of how he is using the Olympics to further his designs on the Conservative leadership, just as the great international banking-regulatory crisis - conspiracy or no - threatens the City he sometimes claims to defend and promote.  All hands should be on deck to repel boarders, else we may find that during our rose-tinted Olympic revels Johnny Foreigner has been purposefully neutering our financial pre-eminence.

We have fingered Osborne as being asleep on watch, a capital offence, and we must diskard him utterly. Boris, a classicist, doubtless sees himself as Julius Caesar in Gaul, with dreams of crossing the Rubicon in due course.  He needs to recall that victories in vital battles are what is needed, not self-indulgent grandstanding.

The track record of our own regulators gives little grounds for optimism they can do what is needful, which is a sight more than a 'Libor overhaul', or token prosecution of a couple of small fry. ("Supervision of Libor could be handled by a 'college of supervisors' from across the world with Britain in the chair, Wheatley said."  Did he, indeed ? And why does he think we'll be given the chair, eh ?)

No, it is the politicians that must act, working night and day to restore the situation, as we've prescribed before. It should be Osborne.  It could in theory be Cable.  Clearly, neither is equal to the task.  Boris, you have no formal powers in this matter but you have the pulpit. If you are genuinely up for the Top Job, here's a battle for you. 

ND

Always Pleased To Help

This gets my weekend off on the right footing. The Telegraph reports that "Athens has launched the biggest sovereign bond restructuring in history". Ah yes, part of the Euro rescue plan from which Cameron so rudely opted out, leaving the UK a pariah and dooming the City to irrelevance.

But wait, what's this a the foot of the article ?

"The bond swap will be run from London by Deutsche Bank and HSBC."

Too right! Because with the best will in the world they really don't understand these things in Brussels, Luxembourg, Paris or even Frankfurt. (I particularly enjoy the idea they will require that Euro-denominated derivatives must be settled in Euroland: do these people actually know what a derivative is ?)

Now for the rest of the weekend: let's see what the much-vaunted Welsh back line can manage at Twickers.

ND

Shaking Hands at EMI

EMI was never an obvious acquisition for Guy Hands, as we said at the time: it lacked the key characteristic of his previous successes – steady, conventional cash-flow for ease of subsequent securitisation. Instead he acquired a business that he hoped to transform via a fanciful two-pronged strategy of Hands-on cost-cutting, and innovation in channels to market and pricing.

Innovation & cost-cutting in the media business - did he think he was Murdoch ? Or was the Devil making work for idle Hands ?

So, instead of sticking to the business and financing models he knew, he wanted the whole world in his Hands. He accepted the helping Hands of a standardised CitiCorp finance package on offer at the time of acquisition. Clap Hands ? Nope: it’s all gone sour and now it’s Hands on deck. Suing his bank ! - biting the Hands that feed.

Time to put your Hands up, Guy, you’re playing losing Hands here – losing Hands-down, in fact. No cash in Hand(s). Time to shake Hands and walk away.

Sorry about that, folks, don’t know what came over me.

Now wash your Hands.

ND

Conflicting news shows a City on the edge

On the one hand, Government backed LLoyds has 90% take-up for its recent record breaking rights issue. Why people are so keen to own a bank which has the bust HBOS book with all its horrors is beyond me. I sold banks back in the summer when prices were getting very toppy.

On the other we have the Gartmore IPO, which has had to slice its offer price, as the market does not appear so keen to back this fund management business.

This latter position show that weaker companies are not going to be able to come to market easily. However, the predictions for a strong revival in IPO's for next year maybe premature.

Government back issues are still all the rage; but fund raising for more normal times are struggling.

The markets remain on edge.