Any other business

Saturday

Margareta Pagano

The wonders of modern concrete

‘Look! Concrete!’ Bruno Lafont crashes his fist on the table. ‘You could put 30 tonnes on top of this table and it wouldn’t break. Tougher than steel!’ The table doesn’t look like concrete at all. The top is only a centimetre thick. The surface is painted a Tuscan tone, giving it the feel and look of polished stone. Lafont turns to his desk and bookshelves: ‘They’re also concrete. Aren’t they wonderful?’ These are a more utilitarian beige, but equally handsome. Scattered around the room are more clues to his passions: lumps of gypsum, vital for making cement; more rocks; and an enormous elephant painting, a present from the Prime Minister of Zambia. Lafont is chief executive of Lafarge, the world’s biggest cement maker.

Martin Vander Weyer

The row about private equity is mostly the Labour party arguing with itself

The current row about private equity seems to me to have much more to do with the flexing of union muscles in anticipation of a return to influence under Gordon Brown than it has to do with efficiency and fairness in the use of capital. The GMB union has taken the lead, publicising its claim that private-equity takeovers are fundamentally evil by staging stunts to embarrass Damon Buffini, Britain’s leading black businessman and the head of Permira, the firm that bought up Homebase, Bird’s Eye, New Look and the AA. On one occasion the union paraded a camel (and presumably the eye of a needle) outside the church where Buffini worships, to remind him how difficult it is for a rich man to enter the Kingdom of Heaven.

Paul Johnson

What constitutes elegant company in the 21st century?

Browsing through a Christie’s catalogue, I came across the description of a pen-and-wash drawing by Rowlandson, c. 1800, ‘Elegant company in a park’. It set me thinking. One knows very well what was meant by ‘elegant company’ at the beginning of the 19th century. It applied perfectly to the party Mr Bingley brings to the Merryton dance in Chapter Three of Pride and Prejudice. He himself is ‘good-looking and gentlemanlike’ with ‘easy, unaffected manners’ and £100,000. His two sisters each have £30,000 and ‘an air of decided fashion’, though one is married to a ‘Mr Hurst, [who] merely looked the gentleman’.

Saturday

Dominic Prince

Racing uncertainties

Dominic Prince says you’d have to be potty to buy a racehorse as an investment — unless your name happened to be John Magnier or Sheikh Mohammed Al Maktoum Owning and breeding a thoroughbred racehorse can be a mouth-wateringly profitable enterprise. Sir Percy, winner of last year’s Epsom Derby, cost a piffling 16,000 guineas when he was knocked down to the Pakenham family at auction as a yearling, and costs about the same in training fees each year. To date he has won a little over £1 million in a racing career of just two seasons. Not a bad return on capital, but the risk-reward ratio is huge — and it can safely be said that anyone who buys a racehorse as an investment is potty.

Merryn Somerset-Webb

Money really can grow on trees

With the endless talk about private equity these days you could be forgiven for thinking it must be the only sensible investment out there. Not so. In fact some of private equity’s biggest players (think Guy Hands) have recently been putting their money into something much more prosaic — trees. Until a few years ago, British forestry was usually seen as just another way for the market to separate fools from their money: timber prices had been in freefall for years thanks to cheap imports from Scandinavia and Eastern Europe and a fall in domestic processing capacity. They have been recovering slowly (up 13 per cent in the last three years according to the FIM Timber Index) but even now are still only half of their 1996 prices.

Jonathan Davis

Toys for boys who play the markets

Twelve years ago, on a rainy afternoon when nothing much else seemed to be happening, I abandoned my desk in Canary Wharf for a few hours in order to track down a new and obscure betting operation somewhere off the Mile End Road. The managing director was a large, florid man in his late forties. He smoked a succession of fat cigars and looked the picture of ill-health. No medically-minded betting man would have offered better than evens on his survival into the new millennium. The business he ran belied his appearance however. The office, in a quiet cul-de-sac, was newly fitted out and spotlessly clean. The trading screens were impressively up-to-date and there was a buzz of excitement.

Elliot Wilson

It ain’t half hot in Mumbai

Elliot Wilson explains how to navigate India’s rigid investment rules and buy into a dazzling growth story Sweat was pouring off the commodities broker sitting next to me in the sauna of the Taj Mahal Hotel in Mumbai. ‘India is shining,’ he thundered. ‘You must invest in it — everyone in England must. The economy will always go up; it will never come down. We’re on top in information technology, in financial services, in infrastructure.’ Was he just overheating — India’s infrastructure, after all, is indisputably among the worst in Asia — or offering a fair assessment of one of the world’s great emerging economies? Certainly India’s economy has begun to dazzle: it is on course to grow 9.

Jules Evans

A rollercoaster ride with the Caucasian billionaire

In his annual meeting with foreign journalists in January, President Putin enthused over his country’s record on initial public offerings: ‘Without any doubt, 2006 can be called the year of IPOs, because it was the first time that Russian companies carried out ... IPOs worth dozens of billions of dollars on international and Russian exchanges.... And this is just the beginning.’ Indeed, this year’s schedule for Russian IPOs is even more packed, as companies rush to issue before the presidential elections next year. Analysts estimate Russian companies will attempt to raise as much as $25 billion this year, well ahead of last year’s total of $15 billion.

Robert Cottrell

Princes meet in the desert to discuss the bank that has lost its way — and its brolly

When Charles Prince, the chief executive of Citigroup, announced two weeks ago that he was getting rid of his bank’s rather likeable corporate logo, a red umbrella, I feared that he might be tempting the household gods. And the gods have duly stirred. The Financial Times has reported grumblings from some big shareholders that the Citigroup board has been giving Mr Prince too easy a ride while the share price has languished. The external directors are mostly other big bosses ‘naturally sympathetic to Chuck’, says one complainer. A fair argument, and a timely one.

Paul Johnson

There are worse things than 35ft crocodiles

I admire the late Steve Irwin, the Australian crocodilaphile who, coming from nowhere, contrived to make £2 million a year sporting with these ugly, dangerous and tremendous beasts, and was then killed by a miserable stingray. I say ‘ugly’ but that is a matter of opinion. I love drawing them more than any other creature except a rhino. Humanity has a long and mysterious history of crocodile-fancying. In Central America, in the region known as the Gran Chingui, Indian tribes in the deep pre-Columbian era seem to have worshipped them. They figure prominently in pottery as stands, handles, beaker-mouths and entire vessels. There is a whole range of ware known as the Alligator Group. No accounting for tastes, eh?

Saturday

Matthew Lynn

The front-row forward who never loses a fight

Of the Australian tycoon Alan Bond it used sometimes to be remarked that, after a nuclear war, there would be only three things left alive: seaweed, cockroaches and Bond. In British business these days, there is probably only one man with the same kind of durability: Peter Sutherland, chairman of BP. The recent warfare at the top of the giant oil company, which led to the early departure of its much-admired chief executive Lord Browne, might not have been nuclear. But it was noticeable that after the dust had cleared, Sutherland was still in his job and Browne wasn’t. To anyone who knows him, that was no surprise. Sutherland has one of the toughest skins in global business.

Edie G-Lush

A win-win proposition, but not for the punters

Edie Lush endures a ‘Win Investing’ seminar which fails in  its promise to reveal the secrets of stock-market success ‘What percentage of ten trillion pounds do you need to be happy?’ asks the young Australian called Jonathan who is instructing the ‘free’ Win Investing seminar I’m attending. You may have heard Win Investing’s irritating ads on Classic FM, pressing you to attend one of about 18 free sessions a week available in Bristol, Birmingham, Manchester, Oxford, Cambridge, Edinburgh and London. You’re promised that by spending two and a half hours with a tutor like Jonathan, you’ll learn the secrets of trading the £1 trillion UK and £9 trillion US stock markets.

Martin Vander Weyer

Don’t believe in trickledown economics? Consider the parable of the Chelsea nanny

Peter Hain says two thirds of City bonuses should be redirected to charity, or employers who dish them out should face tax penalties. David Cameron is trying to find a formula to suggest he disapproves of City greed while signalling that the City need fear no tax-grab from him. Those who find the disparity between bankers’ pay and everyone else’s morally repugnant, or at least uncomfortable, often also cast doubt on the ‘trickledown’ theory — that the wider economy benefits efficiently from the lavish spending of the lucky few. Such sceptics should consider the parable of the Chelsea nanny.

Paul Johnson

Are we heading, eyes open, to a materialist Hell on Earth?

If I wanted to pick an artist whose work and mind seem peculiarly apt for the present day, my choice would fall on Hieronymus Bosch (c. 1450-1516), the Netherlandish master who specialised in moralising fantasies and diablerie. The world we live in is characterised by unchecked and unpunished, widening and deepening evil, manifesting itself in countless ways but in particular by what I call the Seven Deadly Sins of the 21st century.

Saturday

Paul Johnson

Is this a toasting fork I see before me?

Ghosts are fashionable just now. There are two productions of Ibsen’s play and a movie. At dinner parties, if conversation falters or begins to move down forbidden (by me) tramlines, I ask, ‘Do you believe in ghosts?’ Instantly there is a babble. Nobody believes in ghosts personally. But everyone knows somebody who does, and provides an instance of what happened to him or, more often, her. This illustrates Dr Johnson’s dictum on haunting, ‘All argument is against it, but all belief is for it.’ Dr Johnson was torn between his great fear of death and confidence in supernatural agency, and his contempt for credulity and the delight he took in exposing imposture.

Judi Bevan

The last of the City’s frequent flyers

When Win Bischoff and his colleagues Robert Swannell and David Challen threw a party last month to celebrate 100 years of working together at Schroders and Citigroup, it was quite a bash. Not only did it draw the cream of FTSE-100 chiefs — Sir Chris Gent, Sir Nigel Rudd and Stuart Rose, to name just three — but the throng in the Victoria and Albert Museum included a fair scattering of rival investment bankers. ‘You only have to play golf with Win to know how competitive he is, but he’s always worked well with other bankers,’ said one guest.

Joanna Pitman

Antiques: better value than Ikea

Not many people seem to realise this, but it’s cheaper in the long run to buy a solid carved mahogany antique chest of drawers than a modern pine one from Ikea. Without having to search far, you can get a beautiful Victorian chest of drawers in excellent condition for £200 which will last you and your descendants for a hundred years or more. The equivalent from Ikea might cost a quarter of that, but will probably last for only five years. And you have to build it yourself as well. ‘Basic “brown” antique furniture is extremely good value at the moment,’ says Mark Boyce of Ross Hamilton in London, dealers in 18th- and 19th-century furniture and works of art.

Robert Beaumont

Steel and socialism give way to sex and shopping in the post-Blunkett era

‘Blunkett Is Blind’ screamed a pertinent piece of graffiti in Sheffield city centre in the 1980s. This wasn’t just a statement of the bleeding obvious, as a London cabbie might say, but a condemnation of David Blunkett’s stewardship as leader of Sheffield City Council for the seven years before he became MP for Sheffield Brightside in 1987. Blunkett’s council became a national joke as it strove to stem the irresistible tide of Thatcherism. The decline of the steel industry, the city’s lifeblood, provided Blunkett and his civic henchmen with a groundswell of genuine support for their battle against capitalism, but they squandered this support in spectacular fashion with policies from the pages of Alice In Wonderland.

Saturday

Neil Collins

The long haul for Britain’s last industrial world leader

Mark Benton is quite clear why he followed his father into working for Rolls-Royce; after three years toiling away as a roofer, he discovered that ‘it’s nice and warm in here.... Oops, perhaps I shouldn’t have said that.’ Benton, 28, born and bred in Derby, rushes to add that he’s better paid, has had five different jobs since joining nine years ago, and is literally at the cutting edge of the company’s technology, machining turbine blades. Let’s get one thing straight: Rolls-Royce Group plc doesn’t make motor cars.

Julian Morris

Take control of your own streets

Councils the length and breadth of Britain are smelling the money Red Ken is making and talking of introducing congestion-charging schemes. Interest groups are starting to complain at the introduction of yet another tax on motoring. But there are better models than Ken’s, which could bring real benefits. Charging for road use is hardly a new idea. Beginning in 1663, a series of Private Acts of Parliament gradually transferred responsibility for highways from parishes to private Turnpike Trusts, which collected tolls and invested in roads. Over two centuries, about 10,000 miles of highways were thus privatised.