Martin Vander Weyer

Of all the heavyweight books I’ve ever been asked to review, one that most influenced my view of how the world works was Why Nations Fail (2012) by two American academics, Daron Acemoglu and James A. Robinson. Their theory, drawn from a broad sweep of history, is that all state regimes fit patterns that are either ‘extractive’ or ‘inclusive’. To be inclusive is to be egalitarian in access to resources and rewards, and responsive to the will of the people. To be extractive is to rule despotically in the interest of corrupt elites, often profiting from ruthless extraction of natural resources. Inclusive economies are prone to occasional crisis but capable of self-renewal;extractive economies are destined to fail.

Forecasting is a mug’s game, as the Bank of England governor Mervyn King once said. But I’ll sketch a few trends for 2026 nevertheless, starting on a positive note in the stock market before moving on to some of the many choices on an à la carte menu of gloom. The FTSE 100 index will have ended 2025 almost 20 per cent higher than it started – slightly better than the US S&P 500 index – and the consensus of fund managers is that (having closed for Christmas at 9,870) it will carry on upwards, perhaps even towards 11,000. Why? In short because many UK blue-chips in traditional sectors such as banking, housebuilding and mining have been undervalued for too long, because interest-rate cuts will help, and because stock markets have a mind of their own.

God bless Netflix: I’ve just watched all 28 episodes of Foyle’s War, the 1940s detective series set in Hastings and London that first aired on ITV more than 20 years ago. Pedants may have spotted minor anachronisms or been irritated by London scenes filmed in Dublin, presumably for tax breaks. But for me, the whole oeuvre – Spitfires, ration books, moustaches and all – stands as a monument of meticulous and compelling period drama. And as an amateur actor who always struggles to keep a straight face on stage, I’m in awe of Michael Kitchen’s gift of expressing Detective Chief Inspector Foyle’s moral outrage and inner pain by the tiniest twitch of a cheek muscle.

‘Banks don’t vote and citizens don’t love them, so they’ll always be the Chancellor’s target of choice,’ I wrote in September when one of this autumn’s many false Budget trails pointed towards a left-pleasing extra surcharge on bank profits. But it didn’t happen: partly because Rachel Reeves was love-bombed by Goldman Sachs chief David Solomon and JPMorgan chairman Jamie Dimon, promising new investment in the UK if she held off; partly because she had evidently figured out that a raid on banks that already pay higher tax rates than in any other major financial centre – many of whose bosses are already packing to move to Dubai – would make them even less eager to help boost growth by lending more to British businesses.

When I first joined The Spectator under the proprietorship of Conrad Black, we operated in sisterhood with the Telegraph titles which he also owned, and no one objected to the Daily Mail ringing the Spectator house in Doughty Street most Fridays to buy the best of the week’s articles for re-publication or to commission the authors to rewrite them in humourless Mail house style. In short, there were frequent meetings of minds in our grove of the media forest.

How, I wonder, did a shortlist of candidates to succeed Sir Mark Tucker as chairman of HSBC come into the public domain? The three names ‘exclusively’ revealed by Sky News, if they really are the final contenders, ought to be a secret kept between a board committee led by senior independent director Ann Godbehere and the headhunters on the job, named as MWM Consulting. Two of the three – Kevin Sneader from Goldman Sachs and Naguib Kheraj, formerly of Barclays and Standard Chartered – might feature in a round-up of usual suspects. But the third is the former chancellor George Osborne, who has no public-­company chairmanship experience and is, to say the least, a Marmite figure.

The softening of the Bank of England’s stance on ‘stablecoins’ looks like another tugging of the British forelock towards the Trump regime. Stablecoins are virtual money akin to cryptocurrency, but theoretically safer because their value is pegged to the dollar or other conventional currencies. Often used by investors to buy into crypto, they’re claimed to offer a more efficient future for international payments – but also accused of facilitating crime. Two years ago, Governor Andrew Bailey decreed that stablecoins did not ‘meet the standards we expect of safe money’; other non-US regulators largely agreed. That well-known crypto player Donald Trump, however, called them ‘perhaps the greatest revolution in financial technology since the birth of the internet’.

Call me hard-hearted, but I doubt even a magic mushroom-induced tantric visualisation of a harmonious universe could transport me into a state of sympathy for Rachel Reeves. Her content-free but don’t-blame-me speech on Tuesday morning did nothing to make me feel more benign. Yes, it’s not entirely her fault that a Labour cabinet can’t deliver welfare cuts, that defence spending must rise and that the UK has a chronic productivity deficit; and yes, the Tories left a mess behind. But in every other respect she’s in a trap of her own making, in which the only Budget move that might restrain out-of-control public borrowing, namely raising income tax, is also the one that should surely guillotine her disaster-strewn chancellorship.

In a radio discussion of the Renters’ Rights Act which passed into law this week, I heard ‘Britain’s housing emergency’ referred to as a given fact. If that’s so, then the housebuilders who create supply and feed home-owning aspirations ought to be public, political and stock-market heroes. But they’re not – and it’s worth asking why such an essential sector has fallen so far out of favour. Think back to Sir Lawrie Barratt, who built 300,000 houses and achieved fame with 1980s television ads featuring a strong-jawed actor as Barratt himself arriving by helicopter to inspect the latest show house.

Who knows what Rachel Reeves reads in bed. Perhaps she dips into her own debut book, The Women Who Made Modern Economics (2023), and dreams of those carefree pre-government days when serious people, Mark Carney for one, thought she might make a decent Chancellor. But if she’s also burning midnight oil over drafts of her Autumn Statement, I hope her boxes are packed with granular data on the state of the UK job market. September normally sees a recruitment surge, but not this year. A summary of recent stats in IFA Magazine shows vacancies down by 119,000 from a year ago and entry-level graduate jobs down by as much as a third, as diminished hiring focuses on ‘skills-based’ selection rather than useless degrees.

Between news bulletins of the Manchester synagogue attack last week, I popped into my local Co-op for some groceries. When the public address system said something indistinct about ‘solidarity’, I paused to listen: it was an advert for Sun & Stone lager, produced in Scotland in collaboration with Taybeh, a Palestinian microbrewery, and with a slice of any profits going to the Disaster Emergency Committee’s Gaza appeal. The Co-op is a benign beacon of alternative capitalism, owned by its members and valued by millions of customers. At their annual meeting in June, those members voted to ‘cease all trading with Israel’, as the Co-op has also done with the likes of Belarus, Iran and Syria.

A friend runs a small factory employing 60 skilled workers. He exports industrial components worldwide, competing with Europe for quality and China for price: a model enterprise for the productive economy we wish we had more of. Earlier this year, his top concerns were the hike in employers’ national insurance (costing the equivalent of several new apprentices) and the advent of Donald Trump’s tariffs. Since then, he’s been hit by a cyber-attack – and his story, a miniature of Jaguar Land Rover’s, is a parable for business everywhere. Like most companies today, this one is paperless: IT-dependent in everything from product design to accounting and HR. It also happens to hold ample cash, which hackers could have spotted from Companies House filings.

Barely noticed amid all the other bad news and political shenanigans, there’s a slump in UK housebuilding that makes Labour’s promise of 1.5 million new homes within this parliament not just ‘stretching’, as the departed minister Angela Rayner called it, but a Truman Show fantasy of utopian suburbs that will never exist. Glenigan, a data provider for the construction industry, reports that residential ‘main contract awards’ in the three months to the end of August were down 44 per cent on last year and detailed planning permissions down 42 per cent. In London, only 2,158 new homes – a tiny fraction of anyone’s target or expectation – were started in the first half of the year.

I awoke on Sunday to what felt like a Brave New World moment: Radio 4’s news-reader reciting an unedited Downing Street script for Donald Trump’s visit, about US financial firms (mostly Citigroup, in fact) agreeing to invest £1.2 billion over here to create 1,800 jobs. Or some such propaganda, the Financial Times having already set the tone with ‘Rush for deals ahead of Trump trip – tech, nuclear and whisky on table’. As the President packed his best leisurewear for Windsor Castle, news followed of £5 billion from Google for UK-based AI services; and finally, even bigger bucks from Microsoft. All to the good if pledges turn into realities and AI doesn’t knock out those new jobs in financial services.

Gold goes on up: having risen by an unprecedented 40 per cent in a year to pass $3,600 (or £2,675) per ounce by the beginning of this week, even its most ardent devotees are wondering how long the surge can last. Much of the rise clearly represents a stampede towards the most traditional of safe havens, in anticipation of market storms ahead as well as fears over inflation and Donald Trump’s threat to the independence of the US Federal Reserve. But it also has to do with a secular shift in the economic world: de-dollarisation, as favoured by the busload of US-hating heads of states who partied with Xi Jinping and Vladimir Putin in Beijing a couple of weeks ago.

‘We’re going to get all our oil and gas out of the North Sea’ was certainly a winning line for Kemi Badenoch to deliver to the Offshore Europe conference in Aberdeen this week, just as she might open with ‘I love puppies’ to a spaniel breeders’ convention in Surrey. But other than as an appeal to climate-change-sceptic would-be Reform voters, how much sense did it make? A recent study by the industry body hosting the Aberdeen event says that if – in some Ed-Miliband-free alternative universe – all remaining reserves under the North Sea were licensed for development, they could provide half the UK’s hydrocarbon needs until 2050, by which date we might have approached full transition to cleaner energy.

The theme of my holiday reading has been the insidious ways in which the vanities and fetishes of rulers harm the interests of citizens. I started with 1929, Andrew Ross Sorkin’s new history of the Wall Street crash, which I’ll be reviewing elsewhere ahead of its release in October –my point here being not about whether President Herbert Hoover and the US Federal Reserve mismanaged that market cataclysm and its aftermath, but rather the fact that my zero-value, plain-cover ‘uncorrected proof’ copy of the book was held up by French customs for almost three weeks for want of a ‘commercial tax ID number’ on the packaging label. ‘A common post-Brexit headache,’ the publisher shrugs.