Martin Vander Weyer

When the solemn temples are dissolving, why are they still offering giant salaries? I had the pleasure of giving a prize-giving speech on Saturday, at a lovely school called Fyling Hall which looks out over the North Sea near Whitby. I have developed a theme which seems to go down well on these occasions: treasure your long-term friendships, I advise the leavers, because the people with whom you walk life’s path will turn out to be far more reliable than the institutions along the way, which look so permanent but turn out not to be: cue quote from The Tempest about gorgeous palaces and solemn temples dissolving.

Eddie was a model public servant: that’s why Gordon was so rude to him In Tokyo in the mid-Eighties, I bumped into a very senior Japanese investment banker who had just been to London to negotiate an operating licence. ‘We met...’ he paused for effect, bowing slightly at the neck and adopting what I can only describe as obsequious grimace, ‘...Eddie-George-san!’ All the other Japanese present nodded vigorously and sucked their teeth in accord. Lord George, who died last Saturday aged 70, was a big player on the world banking stage long before he became Governor of the Bank of England in 1993. He was also a model public servant: modest, calm, courteous, firm-principled, and a master of market technicalities.

Lloyds becomes one more catastrophe for which Brown will never apologise How Lloyds Banking Group chairman Sir Victor Blank must regret not having had a prior engagement on Monday 15 September last year, the night he bumped into Gordon Brown at a City reception and got bounced into the takeover of HBOS by Lloyds TSB. Dubbed ‘the bank that did dull’ by Neil Collins, Lloyds was a safe bet to survive this crisis unscathed — until Brown started mumbling through his canapé about sweeping competition issues aside, safeguarding Scottish jobs and saving the world. With its debt downgraded by Moody’s this week, Lloyds will be crippled for years by HBOS’s losses even if it manages to avoid majority taxpayer ownership and Treasury control.

A hot new brand, a better train service and a kinder role model for harsh times Here in Old Queen Street, we have (in our editor’s eloquent phrase) said pants to recession by launching a fistful of ‘brand extensions’ this year: our Australian edition, our online Book Club, and the soaraway monthly Spectator Business. Even in the teeth of recession, there are other potent brands out there waiting to be exploited, and the next one I’ve got my eye on is the Bullingdon Club. This Oxford University bad-boys elite, boasting David Cameron, George Osborne and Boris Johnson among its former members, has emerged this year as the new nexus of money and power.

My hopes for America lie less in Obama- mania, more in Vaud and the Villains Long before I became a journalist I taught myself to absorb the essence of an unfamiliar city by staying alert in the taxi from the airport: Los Angeles offers a particularly vivid first encounter. As the yellow cab barrels out of the precincts of LAX on to an angry avenue called La Brea, images and warnings crowd in. Neon signs in Korean and Spanish tell me that this is one of the planet’s most multi-ethnic conurbations. Half-crazed vagrants haunt the sidewalks, their random possessions piled in shopping trolleys. Radio ads offer a catalogue of modern American neuroses. Behind on your mortgage payments, facing foreclosure? Here’s the number of a friendly lawyer. Expecting the unexpected?

Martin Vander Weyer looks ahead to next week’s Pre-Budget Report and reflects on George Osborne’s contentious remarks about the devaluation of sterling. It looks like Gordon Brown is getting away with his borrowing binge — leaving the Tories isolated On Monday afternoon I rang a distinguished City economist and asked him a rather technical question about the relationship between issuance of gilt-edged stock and movements in the dollar-sterling exchange rate. ‘Not really my specialist field,’ he replied suavely. ‘But I’ll give you my overview: George Osborne is a prat.

The ticking parcel I failed to spot and the oil-price prediction I got spot on Last week’s global stock market panic, the overture to this week’s astonishing round of state interventions, was in part provoked by fear of humongous losses in something called ‘credit default swaps’. These arcane inventions by Wall Street rocket-scientists are a form of derivative contract — or ‘weapon of financial mass destruction’, as Warren Buffett put it — akin to debt insurance. A ticking parcel of at least $400 billion worth of them relates to bonds issued by Lehman Brothers before it went bust. Since Lehman paper is now priced at only 8 cents on the dollar, enormous claims are about to emerge against the parties to the swaps.

At the historic moment when the House of Representatives passed Hank Paulson’s bail-out bill last Friday night — thus, we must hope, despite early indications to the contrary, significantly improving the world’s chances of avoiding economic cataclysm — I was conducting some research into the Scandinavian solution. I don’t mean the policies followed by the Swedish government to steer its banking sector through a near-terminal crisis in the early 1990s, of which more in a moment. I mean I was sitting in the back row of a packed cinema watching Mamma Mia!, the Abba-singalong movie, and observing the impact of a mass inoculation of feel-good on a crowd that had been battered with bad news all week.

On Monday afternoon I rang a Wall Street friend who used to work at Lehman Brothers. ‘What’s the mood?’ I asked him. ‘Do you think this is the turning point?’ ‘Hold on a moment,’ he replied. ‘Let me just climb back in off the window ledge.’ There was a pause, then a nervous chuckle. For the half-second of that pause, I actually wondered whether he was serious. And that was just Monday: since then, things have got really frightening. The former Federal Reserve chairman Alan Greenspan says the current financial crisis is ‘a once-in-a-half-century, probably once-in-a-century type of event’, but he’s wrong.

Does Medvedev really believe in the rule of law? The fate of TNK-BP is the test Is President Dmitri Medvedev of Russia — who looks and sounds like a liberal-leaning modern technocrat — really his own man, or is he merely the stooge of his predecessor, the sinister, warmongering Vladimir Putin? The mad situation engulfing BP’s Russian joint venture, TNK-BP, is surely the test of this question. Its BP-appointed chief executive, Robert Dudley, has met such hostility from the gang of oligarchs who are BP’s partners in the company that he is now trying to run it by email from a secret address somewhere in eastern Europe.

Martin Vander Weyer's thoughts on the world of business Shell and Barclays were the two highest-profile British companies in South Africa during the apartheid era. Both pursued non- racial business practices as far as they could, but both endured years of disrupted shareholder meetings and flak from the student Left. Shell stuck it out — and shortly after his release from prison in 1990, Nelson Mandela declared, ‘We’re glad you stayed.’ Barclays bowed to the protesters and abandoned its network of 900 branches in 1986; when the bank returned in 1995 to open one office in Johannesburg, Mandela told the men from Lombard Street, ‘You should never have sold.

How times change: the ECB has become the very model of a modern central bank I don’t suppose many of my readers took part in the European Central Bank’s tenth birthday celebrations last week — but if I’m wrong about Jean-Claude Trichet’s taste in columnists, then bon anniversaire, monsieur le président, though I can’t quite bring myself to add beaucoup des retours heureux.

These days, Vesco the fugitive fraudster would have had a top job on Wall Street So farewell, Robert Vesco, the fraudster, drug trafficker and fugitive from US justice whose death last year has been ‘confirmed by Cuban burial records’, according to the Daily Telegraph. Vesco absconded with $200 million of other people’s money — $60 million of it in banknotes in his excess baggage on a commercial flight — after looting Investor Overseas Services, the mutual-funds empire created but recklessly mismanaged by Bernie Cornfeld. Welcomed as a white knight when he gained control of IOS in 1970, Vesco proceeded to steal most of its remaining assets by selling them to fictitious companies as fast as he could print imaginative new letterheads.