Any other business

Wednesday

Ian Cowie

The East powers ahead while America stumbles

Ian Cowie asks whether high-growth economies such as China’s are a safer bet than those of the debt-laden West Emerging markets have been the most profitable game in town for several years now, even after the setbacks some suffered toward the end of 2007. True, the bears enjoyed a bit of a picnic when China funds — easily the biggest single country segment of the emerging markets sector — fell by about a fifth of their value in January. Now the big question for investors is whether the bull is dead or merely pausing for breath. Wiseacres have been calling the top of these markets all the way up, but relative returns since 2003 have called into question conventional assumptions about risk.

Joanna Pitman

The timeless beauty of a Stradivari

How many investments can bring you joy as well as financial gain? Unless pure lucre flows in your veins and you’re the sort of person for whom an excursion into the derivatives market is your greatest pleasure, then there are not many. Wine and art spring to mind, but one relatively under-exploited investment opportunity that can bring pleasure on many levels is that of world-class violins. If the violin is a high-quality instrument, it will bring steady financial appreciation as well as the chance to enable a top-flight musician to conquer the world’s concert halls. In the world of classical music, young and highly gifted musicians find it hard to lay their hands on the quality of instruments they need for a successful international career.

Saturday

Simon Nixon

Farewell to Scottish & Newcastle …

Usually the passing of a major UK company into foreign ownership — and with it the ending of British pretensions to global leadership in another industry — is the cue for national soul-searching and recrimination. Not so the demise of Scottish & Newcastle, which finally agreed last month to be carved up by Denmark’s Carlsberg and its Dutch rival Heineken. Except perhaps in its native Edinburgh, the brewer of Fosters and John Smith’s bitter is likely to go unlamented — either by its shareholders or customers.

Paul Johnson

And Another Thing | 9 February 2008

There is more writing about food now than ever before, most of it feeble. There are exceptions. My Somerset neighbour Tamasin Day-Lewis descants admirably on the subject because she knows everything about the raw materials and has a stunning gift for turning that knowledge into noble repasts. She is quick and graceful too in cooking: watching her dance about her kitchen preparing a three-course meal reminds me of Margot Fonteyn performing Nutcracker. But most of the tribe are dull; off-putting too. All they convey is their own overweight greed. My favourite writer on the subject is Lamb. Whenever he touched on it he struck gold.

Wednesday

Judi Bevan

The entrepreneur’s art: buying, building, selling

Judi Bevan meets David Young, who served in Margaret Thatcher’s cabinet before chairing Cable & Wireless and creating his own successful private-equity business Few 75-year-olds supply and programme their grandchildren’s computers or keep in touch with the younger generation by text. But Lord Young of Graffham — the businessman who was parachuted into the cabinet as secretary of state for employment by Margaret Thatcher and later headed the Department of Trade and Industry — is one of a rare breed of septuagenarian technophiles. ‘I have owned a PC since 1977 and I bought the first Apple in this country,’ he claims, with the boyishly pleased air of someone who stole a march on his peers.

Saturday

Christopher Fildes

The disappearing bezzle

My friend Herbie from the Last National Bank of Boot Hill understood about rogue traders. When another hapless bank owned up to losses ‘due to unauthorised trading’, he added: ‘They mean nobody authorised the guy to get it wrong.’ Now that a French trader called Jerome Kerviel has set a new record by losing £3.6 billion, Société Générale, whose money it was, is left to wonder how it happened and to search for some deep, dark conspiracy. It looks more like a familiar story with extra noughts on the end. A swashbuckling trader buckles when he should have swashed, and then tries to double up and cover up. The money all goes to the people on the other end of his deals.

Neil Collins

Why it’s raining dividends in Wales

Neil Collins meets Nigel Annett, who runs Welsh Water — a unique utility company which operates without shareholders and distributes profits back to its customers It does sometimes stop raining in Wales. When the sun comes out, it’s pretty stunning, thanks to the green all that rain produces, but much of the time the residents must wonder why they pay so much to get what the Lord deposits on their heads so liberally. But then, following the pain of the water bill, comes a £20 bonus — call it a dividend, rebate or discount, it’s real money. Every water company charges the maximum the regulations allow, but only Glas Cymru Cyfyngedig pays profits back to its customers. That’s because they effectively own it, even though they didn’t buy it.

Paul Johnson

And Another Thing | 2 February 2008

The litigation about the death of Princess Diana drags on, to the confusion of most of us, the satisfaction of none, and I imagine to the great distress of her two sons. And what is forgotten in this grimy attempt to prove conspiracy theory is the woman herself, a true princess of delight and fantasy. She was a wonderful example of a certain type of gifted woman, the epitome of whom is Rosaline in Love’s Labours Lost. She always insisted that she was uneducated (though her handwriting was excellent) and far from intelligent — ‘thick as two planks’ was the expression she used. But I have never met anyone, male or female, who had such strong powers of intuition. And intuition, I have come to realise, is often as important, sometimes more important, than intellect.

Saturday

Martin Vander Weyer

Scrabbling to save the monolines

Martin Vander Weyer on the next thing to cause heartburn in the financial markets.  The current market crisis sometimes feels like a Scrabble championship between financial pundits, in which most of us hesitate to challenge dubious words and strange jumbles of letters for fear of showing ignorance. First came ‘subprime’, which we learned to define as a category of mortgage borrowers so uncreditworthy they cannot even afford the hyphen the Spectator’s learned sub-editors would prefer to insert between the ‘sub’ and the ‘prime’. Then came a rash of acronyms encapsulating both the science of subprime lending and the alchemy of securitisation by which its poison has been spread around the world.

Martin Vander Weyer

WEB EXCLUSIVE: There’s trouble brewing

Oh Boy. If you thought the Société Générale saga was beyond belief – today we learn that Eurex, the derivatives exchange, had been trying to warn the French bank for two months about Jerome Kerviel’s extraordinarily large trading volumes – then I invite you to contemplate the £274 million loss clocked up on hedging transactions by Mitchell & Butlers. Oh Boy.

Martin Vander Weyer

Any Other Business

Network Rail’s performance is poor enough to test an archbishop’s patience, writes Martin Vander Weyer The archbishop and I — not having been formally introduced — confined ourselves to an exchange of despairing glances. We were at Doncaster, in the buffet car of the 19.13 from York to King’s Cross, listening to a series of apologetic but hopelessly uninformative bulletins about how long we might be delayed by a signal failure at Finsbury Park. ‘The driver says it’s a waiting game, there’s trains queuing in front and behind,’ was the announcer’s best shot. To add insult to injury, the buffet could not even provide the saintly Dr Sentamu with his preferred tipple — which, I can exclusively reveal, is Guinness.

Matthew Lynn

A paragon of Britishness reinvented by Germans

Matthew Lynn visits the Bentley factory in Crewe — where Spitfires were once built — and discovers how Volkswagen’s engineers and marketing men have revived the classic marque Turn right as you step into the plush foyer of Bentley’s Crewe headquarters and you find yourself in the company’s museum — a display of gorgeously preserved vehicles from Bentley’s prewar heyday, all gleaming brass and steel, all with their tax discs up to date so they can be taken out on the road at any time. For most companies, the museum might be tucked away somewhere. Not at Bentley. Since the almost-forgotten brand was bought by Volkswagen of Germany a decade ago, its history has been woven into everything it does.

Cosmo Lush

Coming soon to a screen near you

Vegas, baby. Ask any self-respecting geek what’s the hottest thing in this town and it isn’t lap-dancers or crapshoots but gadgets and gizmos. Las Vegas is the venue for the gadget squad’s annual get-together, the Consumer Electronics Show. This year’s was the biggest ever: 150,000 specialists from all over the world in town for a week in the cavernous Las Vegas Convention Center, with almost 3,000 exhibitors displaying their wares. Televisions, computers, hi-fis, cameras, in-car entertainment systems, robots to make the tea: you name it, if it’s new and shiny, you’ll see it first at CES. Only Vegas could host a show on this scale.

Paul Johnson

And Another Thing

Do the sources disagree? Of course. And so they should. One of the mysterious aspects of human perception is the way in which eye-witnesses disagree about what they have seen. Not just many years later, when memory has had ample time to weave its fantasies, but soon, even immediately, after the event. An interesting case concerns Jimmy Cagney’s masterpiece, The Public Enemy. This brilliant and horrifying movie, with a spectacularly gruesome ending, is now chiefly remembered for one bizarre sequence, in which Cagney, playing the top gangster, is having his room-service breakfast in a slap-up hotel, and is annoyed by his tiresome moll. Suddenly he says ‘Aw, shuttup!’, snatches up a half-grapefruit, and screws it into her face. I remember it vividly.

Saturday

Richard Northedge

The FSA is not fit for purpose

‘It is somewhat ironical,’ the chairman of the Financial Services Authority told the Treasury select committee investigating the Northern Rock crisis, ‘that one of the responses is to try to seek from the rating agencies even more work and even more assessment.’ The paradox intriguing Sir Callum McCarthy was the suggestion that credit-rating agencies, having failed to predict Rock’s troubles, should now also produce liquidity reports on banks. MPs on the select committee — about to produce a report that will be highly critical of the financial regulator — may themselves think it ironical that, having equally failed to foresee Rock’s fate, the FSA is being rewarded with an expanded role.

Paul Johnson

And another thing | 19 January 2008

Charles Lamb, writing to Joseph Hume at Christmas 1807 on the subject of ‘a certain turkey and a contingent plumb-pudding’, added, ‘I always spell plumb-pudding with a b, I think it reads fatter and more suetty’. As it happens, the big OED has found the same suetty spelling in a cookery book published in 1726. As Lamb says, one of the delights of the English language is the existence of words which have almost physical properties, a propensity to conjure up succulence or flavour, warmth or cosiness, sounds and magic, powerful images and sheer solid matter.

Wednesday

Elliot Wilson

The military millionaires who control Pakistan Inc

Elliot Wilson says Pakistan’s economy is dominated by a ruthless business conglomerate that owns everything from factories and bakeries to farmland and golf courses: the army Sometime in late 2004, Pakistan's all-powerful army made a curious decision. Under mounting pressure from London and Washington to capture Osama bin Laden, believed to be hiding in Baluchistan, Islamabad's fighting forces instead turned their attention to a far more profitable venture: building golf courses. In itself this wasn’t particularly unusual. With 620,000 soldiers, Pakistan boasts the world’s seventh-largest standing army, but its senior officers long ago realised the perks to be gained from commercial ventures.

Saturday

Martin Vander Weyer

Rock On

Since I’m not a Northern rock shareholder, I wasn’t at yesterday’s EGM in Newcastle’s Metro Radio Arena – so I’m grateful to Graeme Wearden on the Guardian’s NewsBlog for a blow-by-blow account of the proceedings. A lot of ‘north-east (hurt?) pride’ was on display, he writes, as well as some natty shirting worn by the two hedge fund managers who have made themselves central to the story, Philip Richards of RAB Capital and Jon Wood of SRM. In the chair, trying to get the audience on his side with a joke about having the second toughest job in Newcastle (the worst, of course, being manager of the troubled football club), was Bryan Sanderson, the ex BP executive who was parachuted in after Dr Matt Ridley did the decent thing and resigned.

Paul Johnson

What has sawing a lady in half to do with global warming?

At this time of year, exactly 70 years ago, I was taken to my first exhibition of professional conjuring. The magus called himself Dante — he was Danish-American and his real name was Harry Jansen. He had an amazing moustache and beard, wore dazzling evening dress and a red satin-lined cloak, and performed his tricks at lightning speed: his slogan was ‘15 sur- prises in 15 seconds’. However, the performance I would like to have seen most was staged by Charles Dickens on Boxing Day 1843 at a children’s party given by the actor Macready. Dickens had bought at Hamley’s a proper ‘apparatus’ which had belonged to the conjuror Doëbler. Being the man he was he had learned his business thoroughly.

Tim Heald

Life after Wills: barely a whiff of smoke in the cosmopolitan gateway to the west

At the time of his death in 1972 my father worked for WD and HO Wills, the Bristol tobacco people. Wills were huge and rather enlightened employers and even now plenty of Bristolians remember the days when everyone either worked for the company or had a friend or relation employed there. Wills produced a cigarette called ‘The Bristol’ but were most famous for cheap Woodbines and Wills Whiffs — small cheroots sold in packets of five. For the first three quarters of the 20th century, the company seemed unassailable — and synonymous with its home city.