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Friday Fiver

posted by Edward Jones

 

Image source: STV

1. FRIDAY FIVER IS BACK!

After a brief winter hiatus, we are delighted to announce that Friday Fiver is back with a vengeance! We’re sorry we went away and we hope you’ll have us back!

2. Blimey… Tax evaders named and shamed by Revenue

This feels like a bold step from HMRC. Will ramp up pressure on the Govt to disclose big business’ tax evasion – as demonstrated by Margaret Hodge’s intervention.

3. Trial by media or trial by jury?

Judging by the number of online mentions of the tragic incident of Reeva Steenkamp’s death, which was close to 1,000,000 on the day of the shooting, it’s hard to detract from the two trials Oscar Pistorius is facing. One in front of the Magistrate’s court and the other in front of the world’s media and the court of public opinion. Nicely summarised in this piece by Daniel Howden and Ian Burrell at The Independent:

“…in many ways his trial began as soon as news of his lover’s death reached the media. The only difference here is that the facts of the case carry a much lower burden of proof. The slow grind of South Africa’s justice system, which barely recognises contempt of court, has been unable to keep pace in the era of social media and rolling TV news. As a consequence, the first disabled global sports superstar has found himself deluged with accusations and insinuations masquerading as facts.”

4. Harry Styles Backs Ed Miliband for PM

This is BIG NEWS! Really big, but begs the question ‘Who do the other members support?’ Perhaps they’re all lefties! Harry is the lead singer afterall. Ok. What about One Direction’s big rivals - The Wanted? They must be true blues. Mumford and Sons? Lib Dems. Definitely. Their love of string instruments, country folk and their urban upbringing must surely indicate a yellow streak.  

5. FPS FATTIES

And a lighter story to end this week’s Friday Fiver, especially for the snack-loving FPS team, and for the myth of the “H+K stone” to be confirmed by a story in the papers this week. Research by The Village Bakery found that office workers are amongst the worst offenders for piling on the pounds – over 6lbs in fact – with cakes and biscuits brought into work by colleagues. This week already, we’ve had homemade cupcakes brought in by the lovely Clare M and the week before, a deliciously moist lemon drizzle cake made lovingly by Liz, Syrian delights and Jersey fudge from the islands. Temptation is just too hard to resist. Pass the biscuit please.

Thanks to @liyywln for contributing to this week’s Friday Fiver

Five lessons from the US election campaign

posted by Edward Jones

1. BE BOLD.

I was fortunate enough to attend a debate hosted by H+K last Monday on the US Presidential election, never ones to blow our own trumpet enough, it’s worth saying it was an excellent event. One of the panelists, Philip Stephens, a columnist for the FT hit upon the idea of Obama treating the first term of his Presidency as a delicate vase. Incidentally, the FT ran this cartoon (£) a few days later. The idea that Obama hadn’t been bold enough struck a chord with the audience. As I have sought the views of colleagues it is clear that in the UK at least, commentators think he could have been bolder, both in his Presidency and the campaign. That is the enduring hope for the second term.

2. IF DISASTER STRIKES. FOCUS ON THE DISASTER.

The President’s response to Hurricane Sandy served him well. Not least because of the ringing endorsement of the Republican, New Jersey Governor, Chris Christie. This WSJ On Leadership article is an excellent summary of its impact.

3. KNOW YOUR AUDIENCE.

It’s a simple enough concept and one we’re mostly familiar with. My colleague, Ted Robinson, who has followed developments more closely than most in the UK at least (I’ve asked him to write a post on this too), highlighted the confusion within the Republican camp with who they were targeting, asking:

“Are the GOP just communicating to whites or are they the party of social conservative hispanics? Lesson: decide who your audience is – does it surprise you?”

He had previously highlighted that…

“The Republicans have to win back California as they did under Nixon and Reagan – winning 49% of the pop vote and getting nailed in the electoral college sucks”

Quite. What drove this point on audience home for me though and brings me on to my fourth point is sophisticated use of digital…

4. USE DIGITAL. BE SOPHISTICATED.

The Obama camp, building on the success of their social media campaign and fundraising in 2008 have raised the bar. Again. They knew who they were targeting and they weren’t bashful about it, as this excellent piece from Will Foxton in the Telegraph attests.

5. DON’T OFFEND.

Romney’s campaign started to derail in the UK. Whilst the cynics said that doesn’t actually matter, it was only a part of a catalogue of well documented errors. Celebrated today on the Times website (£). 

For a view on what Cameron might learn, I can’t recommend Matthew D’Ancona’s piece in the Evening Standard today, highly enough.

What’s in a (nick)name?

posted by Edward Jones

THIS POST IS BY JOSHUA GLENDINNING

The consequences of the loss of £2bn by JPMorgan Chase’s London office have continued to ramify. The US Justice Department and Securities and Exchange Commission have both announced that they intend to investigate the debacle which has inevitably led to calls for tougher regulation. The loss has also claimed its first victim in the form of the company’s Chief Investment Officer, Ina Drew, while serious questions have been raised about chief executive Jamie Dimon.

Meanwhile, eyes have also focused on the single trader regarded  responsible for the investments in unsafe credit default swaps. French trader Bruno Iksil, who worked in JP Morgan’s Chief Investment Office under Drew’s leadership, reportedly returned to his Paris residence on Friday while his employers struggled to deal with the financial, corporate and public relations storm he has created.

However, what truly captured the attention of the media was the epithet attached to Mr Iksil by fellow traders for the size of the deals which he carried out. The metaphorical ‘London Whale’ appeared to capture the imagination of the media much like his literal namesake did more than six years ago. Most of the major broadsheets pounced eagerly on the cetacean imagery, while the tabloids preferred Iksil’s other, more sinister nickname – ‘Voldermort’. Even the normally sober and reserved Financial Times couldn’t help but help but get involved by making a few distinctly fishy puns.

This certainly isn’t the first time nicknames in the financial services sector have captured the media’s attention. It wouldn’t be surprising if a significant proportion of the public were under the impression that the former head of RBS was called Mr The Shred given the media’s obsession with the epithet Fred Goodwin gained for his savage cost cutting. Figures with less notorious but equally amusing nicknames include Choc Finger, Chainsaw Al, The Gorilla. By contrast, the names of Jérôme Kerviel (whose rather boring ‘Five Billion Euro Man’ simply didn’t pass muster) or Kweku Adeboli (who failed on the nickname front altogether) haven’t lasted long in the public imagination despite the eye-watering sums they were responsible for losing.

Why do the media jump on these monikers with such gusto? Nicknames certainly add a splash of colour to what are rather complicated and dry stories involving incomprehensibly large amounts of money. Furthermore, the personalisation of such stories allows for an element of tangible understanding of a group of people whose lives are far abstracted from those of ordinary people but whose actions can have the most profound consequences.

Cameron needs to communicate a vision to leave a legacy

posted by Edward Jones

The Government, well, Number 10 actually, is in a quandary. On the one hand, there is a need for quick wins to move on from what has memorably been described, in the words of Malcolm Tucker, as an omni-shambles. On the other, the Prime Minister is presiding over a period of austerity. The two, unfortunately, are not compatible.

At first austerity measures were seen as essential to return to economic growth, but the implications of this are now starting to bite. The quick wins on their own are not sufficient to change perceptions. If Number 10 is to change perceptions, a coherent narrative, with stories that constantly reinforce what David Cameron is trying to do is required.

As Oliver Wright and Andrew Grice write in The Independent, Number 10 has been looking for good news stories across Government for Cameron to be personally associated with. The hope is that any good news story will move the agenda on from the current post-budget malaise. The problem with this approach is these stories, good though they might seem, fail to form part of a coherent narrative. They do nothing to alter the perception of the Government as overseeing economic hardship. 

The prospects for the average voter look bleak. Less money. More tax. Later retirement. That’s before you put it in the context of a class war. Philip Collins notes in his excellent article in The Times that Number 10 needs to communicate that all this pain is not for nothing. Collins should know the merits of communicating a long term ambition, having been present as Tony Blair struggled to come to terms with what his legacy ought to be. Cameron is now at this same juncture. Collins has written the basis of what Cameron’s narrative might look like:

“The first [pledge] is that we will restore this country to economic health. We will clear the horrible mess in the public finances that was left once the other side had finished its irresponsible partying. We will get Britain moving.

“The second commitment I can make is that the burden of austerity will be shared out fairly. By the end of this Parliament, it will be clear that those with the broadest shoulders will have taken most of the weight. We all have to make a contribution in accordance with our means. That is only fair.

“That leads to my third pledge. When prosperity returns to Britain, which it will, the hard-working families, those who are digging us out of a hole they were thrown into, will see the benefit.”

It is fair to say that the first point is well understood and well communicated. Credit where credit is due, the messages on this point were relentless and the Conservatives and George Osborne in particular should take credit for successfully undermining Gordon Brown’s economic record and mentally preparing voters for economic hardship.

Number 10 and the Treasury have acknowledged that the second point above is important, but they have been unconvincing in their attempts to convince the electorate that the burden is being shared equally.

The third element, which promises light at the end of the tunnel or, put another way, hope, has been non-existent.

Number 10’s communications can’t simply be seen through the prism of points one and two. Moreover, the economic legacy that this Prime Minister will leave behind will belong to George Osborne. The promise of a better future however is absolutely critical and has thus far been forgotten. If Cameron is to leave a legacy of his own, then he has to convince voters that under his stewardship a better future lies ahead.

The acceptable face of economic debate?

posted by Edward Jones

THIS POST IS BY JOSHUA GLENDINNING

Angela Knight, head of the British Banker’s Association, is to step down after five years at the helm of the industry body. Knight has led something of a charmed life in what would be seen by many as an invidious position in an adverse political climate for the financial services sector. While the former Tory MP doesn’t garner respect from all political quarters, she is certainly admired by many within the financial services sector for her ability to speak on behalf of the industry. According to The Guardian, she has given over 800 broadcast interviews, and travelled over 14,000km to and from Brussels alone since 2006. For those working in the City, it has been preferable to have such a shrewd political operator speaking on their behalf rather than having to face the ire of public opinion themselves

Knight’s time at the BBA has been indicative of a broader trend within politics and the media. Despite frequent media brickbats, those within the financial services sector are often far better able to carve themselves positions of political and intellectual authority than many other would-be commentators. Ultimately, the BBA is little more than a lobbying organisation for its members and yet Knight has been able to assume an air of authority within the media which would not be accorded to many others in similar positions.

For example, Unite General Secretary Len McCluskey may have been making political waves this week but he is unlikely to be asked on most news programmes to talk on subjects that don’t explicitly affect his members. (Incidentally, for an interesting insight on the man who appears to have the ability to turn the government and subsequently the public into Corporal Jones from Dad’s Army, listen to Profile on Radio 4). Knight, on the other hand, has been frequently asked to discuss broader social and economic issues, as well as more obvious areas such as the reform of the banking sector.

The financial crisis (or perhaps Robert Peston) has increased public interest in the financial services sector to a level previously unseen. However, outside of personal finance, many commentators in possession of a sufficient degree of technical knowledge are also industry insiders. The adversarial exceptions to this rule (for example, here and here) lack experience at conveying their views to the new audience which has invaded their previously arcane and quiet cloister of political debate. Unlike construction, manufacturing or even many service industries, the products of financial services are almost entirely intangible and the sector is therefore assumed to be too complex or too boring for most people to understand. The upshot is that media discussion is divided between either popular yet infantile anger or sophisticated yet sterile analysis.

‘The acceptable face of British banking’ may not be missed by all, but the reputation she has built for herself is certainly instructive for any company or organisation wishing to make an impression on the media.

The Best of the Budget

posted by Edward Jones

Rather than the usual Friday Fiver, this week we have decided to look at the Budget. Shock horror. Rather than add to the millions of words of analysis already published on that topic, we thought we’d make your lives easier and point you to the most memorable elements of this week’s main event.

Best Analysis

The IFS’ Budget 2012 briefing yesterday cut through the hyperbole to deliver a sober assessment of the red book. Their analysis of the implications of the 50p tax rate, suggested that contrary to the mooted 300,000 extra taxpayers roped into the lower 40p tax rate threshold, this figure could actually be closer to a million by 2014, adding fuel to the flames that were already raging, particularly among the usually supportive right wing media. 

A mention should also go to the Economist’s analysis. Highlighting Britain’s expertise in high-value services and the need to attract the world’s brightest, the Economist applauded Osbourne’s efforts to signal, “about as clearly as a man with no money to spare can, that Britain is open for business”.

Best gag

Sending the Government bench into raptures and consequently, Lindsay Hoyle, the Deputy Speaker, into apoplexy, Osbourne, when announcing tax breaks for the animation and video game industry in reference to this well know cartoon sketch said: “It is this Government’s determined policy that we keep Wallace and Gromit exactly where they are“. BOOM!

Best Headline

The Sun could’ve won this thrice with some absolute beauties including: “HE’S TAKING US FOR FUELS” and “GRAN THEFT OSBO.” The best ones are captured in this image courtesy of Conservative Home’s @TimMontgomerie

Best Post Budget Admission

‘We hid the papers.’ The Prime Minister’s aide unveils to the Times, Number 10’s response to the negative headlines on Thursday.

Best Punch

Miliband’s 50p tax gibe at the Government. With one question – ‘Who on the front bench would benefit personally from the 50p tax cut?’ Ed stunned the Cabinet and made his point effortlessly; we are no longer all in this together. Very clever.  

Best PR

The anti-war protesters – who employed a very, very long handle on their ‘stop the killing in Iraq and Afghanistan’ sign, which meant every interview Jon Sopel gave on College Green featured that banner in the background.

Best ‘_______ tax’ name

Whilst the half-baked pasty tax made a valiant effort, the Granny tax is set to be the classic. As a closing gambit, we quite like this spin on the Granny tax from the daily mash.

Friday Fiver

posted by Edward Jones

1. In a late breaking development, FSA regulatory chief Hector Sants announced his resignation from the soon to be disbanded organisation. It’s an unfortunate end to a week when the FSA successfully stung another trader for insider trading. Where next for Hector? Some are already suggesting a high profile role in industry awaits.                                                                                                                                                                                                                                              

2. Budget fever grew nicely, with more leaks from Treasury than there are hangers-on at an Only Way is Essex party. In no particular order, scrapping pensions tax relief, scrapping the 50p tax rate, issuing absurdly long-dated bonds, tax breaks for the TV and film industry and raising the income tax threshold towards £10,000.

3. Following on from point number one, it seems insider trading is a crime, but one that is only punishable by removing half a bonus. Then again, based on this, the key to insider trading really is as simple as playing a popular after-dinner game with your client over the (recorded) landline at your desk.

4. Hell of a week for Tesco losing its UK boss and telling its employees they’ll have to work two years longer before they retire – on the latter they’re to be applauded for addressing the issue sooner rather than later, many more are likely to follow.

5.  Fitch joined Moody’s this week to put the UK economy on a negative outlook threatening the AAA rating. Some have said it’s a gift for George Osbourne before the budget as it will set the tone for continued austerity. Indeed the agencies have been clear that any deviation from austerity would be more disconcerting. Ed Balls’ line however, that you should never set policy by the credit ratings agencies might just get some traction, particularly given the criticisms they face.

Friday Fiver

posted by Edward Jones

1. Peston & Hester on the One show: On the eve of RBS’ eagerly anticipated results this week, Stephen Hester, the undersiege Chief Executive, took to the airwaves to defend RBS. The interview on the One Show was as expected, up until the point Robert Peston, commenting that bankers usually hate the limelight, asked ‘Are you enjoying yourself?

Hester’s response was telling:

‘The limelight I hate. I don’t know if I’d have done it if I had my time again, but I’m here and what I care a lot about is can RBS succeed? I think it can, I want to be part of the team that made it succeed, and I’m gritting my teeth about the rest and pushing on with that.’

I was impressed with two things: first, his honesty, and secondly his determination. Both came through during the interview and set the tone for how the results were received the following day.  

2. Another week, another Greek bailout: A second bailout in as many years, amid constant rangling begs the simple question will it last? I’m not convinced.   

3. A less marked U-turn, but a U-turn nonetheless: Cameron ‘attacked’ anti-business rhetoric this week decrying those who criticise big business as ‘dangerous’. Quite. I’m pleased to say it wasn’t just us that noticed the irony of this statement. 

4. Only girls allowed: An advert with face recognition technology is highlighting discrimination against women for children’s charity, Plan UK. The ad on Oxford Street ignores men and will only play to women aiming to send a message about equality. Perhaps the Government could place one in the boardrooms of Britian’s biggest companies in its drive to improve equality.

5. The Sun on Sunday: Finally, we’re eagerly anticipating our little trip to the newsagents this Sunday morning to get our hands on the first edition of the Sun on Sunday, to complement our last edition of the News of the World. Don’t forget yours.

Friday Fiver

posted by Edward Jones

As you may have noticed this week’s fiver is a little, well, smaller. Importantly however, it’s still perfectly formed! It’s a new format designed to fit in around what we know are normally busy Friday afternoons. We hope you approve and do let us know what you think. 

1. Merlin fails to wave magic wand – Project Merlin’s official data this week confirmed what most people already knew, principally that the banks have missed their SME lending target of £76bn.

2. A case of impeccable timing – Good news then that later this week companies with a turnover of up to £41m will now be able to apply for the Enterprise Finance Guarantee Scheme and four new lenders have been accredited for the EFG scheme including Metro bank.

3. Inflation signals reprieve for consumers – Though expected, the news of a decrease in the rate of inflation is welcome news to household budgets and savers, as Lucy Tobin pointed out this week.

4. Taking AIM – Newspapers continue to fret about the fluctuating FTSE and its effect on our pension funds, the inactivity on the sister AIM stock market used by smaller companies is even more worrying. Allenby Capital reckon fundraising on AIM was very quiet in January with even less money raised than at the back end of 2011.

5. Not all bad though – 10 of the 17 companies that left AIM during January left because they were bought by other companies, which just goes to show that a well performing share price remains a magnet for buyers. Meanwhile the City continues to eye up the Glencore Xstrata merger, not least the eye watering fees, with glee.

FPS’ Friday Fiver

posted by Edward Jones

This is the last time in 2012 I say this – Happy New Year! I hope you all had a good Christmas but now it’s done let’s look forward to what will no doubt be a memorable year, in many ways, most of which Dr Doom will relish, but many of which are truly historic. Here is our first fiver of the year.

Probably the best recovery of any opposition party in history

So the Labour Party hasn’t had the best of weeks. In fact on Thursday it really didn’t have the best of days. Firstly, Lord Glasman, adviser to Ed Miliband, gifted the tories and the so-called ’Miliband hunters’ in the Labour Party with a stinging critique of the Labour leader’s, err, leadership. Shortly after this excitement, Diane Abbott kicked up a storm over comments she made on twitter, later interrupting an interview on Sky News to take a call from Ed Miliband himself, who proceeded to give Abbott a ‘severe dressing down.’ The icing on the cake was a leaked strategy document script for broadcast (according to Labour HQ), which is worth a read, if you haven’t already (P1 & P2), and yes, it does include those fateful words in the above subtitle.     

Count the cars

No doubt you’re bored of hearing about Europe and the mess our inter-dependent economies now find themselves in. The simple fact of the matter is, the problems are not over, and 2012 is set for more of the same.

Singing a different tune at the end of 2011 however, Sam Jones, the FT’s Hedge Fund Correspondent penned an intriguing piece about the lengths hedge fund managers go to find out what they are investing in. The crux of the article was that all may not be quite as rosy as it seems in the East and that problems may lurk within the Chinese economy. Hedge fund managers have dispatched intelligence gatherers to factory gates to “count the cars” and ensure official figures match realities on the ground.

Image: http://thefederalist-gary.blogspot.com/2011/07/real-estate-bubble-chinas-ghost-towns.html

The article also linked to a video of hedge fund manager Hugh Hendry dating back to 2009 on a jaunt amongst seemingly empty Chinese skyscrapers pondering who is actually going to rent these steel giants. Both the article and the video are worthy of five minutes of your attention.

Top 50 Most Valuable Brands in China

Moving seemlessly from empty skyscrapers to those who might fill them.

Click on the image – Simples!

Old hacks new tricks

After tweeting this in error, Sky’s crime correspondent Martin Brunt gave a quick lesson in how to shut down an embarrassing moment with this swift response.

Tweet that

A precise report which helpfully landed in our inbox earlier today revealed the following:

Who ‘owns’ your company’s Twitter followers?

A US firm is suing a former employee who took 17,000 Twitter followers with him when he left the company. PhoneDog Media is seeking damages of up to USD370,000 from Noah Kravitz after claiming the costs and resources invested in its followers and fans were substantial. Kravitz speaks to TheDroidGuy about the dispute and says the company never asked for the Twitter account back and suggested he could tweet on its behalf. In contrast, PhoneDog president Tom Klein says the Twitter account was created to promote PhoneDog content and to give fans a chance to follow Noah ‘as a representative of the company’. The New Statesman says the case could have far-reaching legal implications regarding the value of social media and its users and how intellectual property law has adapted to the emergence of social media. The outcome could also influence how companies choose to use and invest in such technology in future.

It is an interesting development, and follows (to some extent) the debacle around Twitter account ownership of Laura Kuenssberg, who you may remember, moved from the BBC to ITV taking some 60,000 followers with her. The central question (or one of them) being are you following the tweeter due to the specific interest you may have in them as a person, or because of the inherent brand association they enjoy thanks to their role i.e., were you following Laura Kuenssberg, or the BBC ‘s Chief Political Correspondent?