Shocks & Stares » Silvio Berlusconi H&K\'s Financial & Professional Services Team Blog Tue, 19 Mar 2013 08:00:56 +0000 en hourly 1 FPS’ Friday Fiver Fri, 04 Nov 2011 18:07:33 +0000 David Chambers Happy Friday afternoon everyone. The clocks have gone back, it’s dark outside, and the eurozone still doesn’t look any closer to salvation. Light relief does at least come however with the prospect of a good fireworks show this weekend. Before you get out the sparklers though, take a look at the Financial and Professional Services Friday Fiver below, which this week takes in a wide range of topics on everything from Bob Diamond to celebrity marriages. We hope you enjoy!

WE’RE GROWING!!! SORT OF…..Finally, some good news this week as the UK economy grew 0.5% in the third quarter of 2011. Compared to recent efforts, that’s practically a meteoric rise, and was ahead of City expectations.

But here’s the bad news though – the effect may not last for two reasons. Firstly, some of the rebound in growth is being attributed to the disruption in Q2 owing to that dress and the ensuing two week holiday that most people took to get over it. And secondly, the forecast ahead looks dire – the latest purchasing manager indices, released by our client, CIPS, nosedived this week, suggesting order books are drying up. Still, let’s enjoy a bit of growth while we can shall we?

SING SONG TO AN ATHENIAN RHAPSODY…..We’re viewing Europe’s sovereign debt issues through a musical prism this week. The debt odyssey has taken a number of twists and turns, the most unexpected of which was Greek Prime Minister George Papandreou’s call for a referendum on the latest bailout package. The brinksmanship proved a step too far and was quickly called off.

Disappointingly, the on-going crisis has meant that Italian Prime Minister Silvio Berlusconi has been forced to delay the release of his latest CD of love songs. On first inspection, readers would be forgiven for mistaking the article as an April Fool.

It’s good to see the City is keeping itself busy and Alphaville was the recipient of a cleverly penned version of Queen’s Bohemian Rhapsody set against the backdrop of recent events. Click and enjoy!

MORTGAGE DÉJÀ VU…..In 2006/07, people in America stopped paying their monthly mortgage bills. Many of them simply got up, left their houses and never came back (due to a wonderful quirk in US rules on home ownership they had very little obligation to stick around). Once enough people had walked away, banks realised that they were sitting on a pile of worthless housing stock that they couldn’t sell. Once that happened, banks who had bought mortgage loans off of other banks (neatly packaged up like a mince pie in lovable ‘CDOs’) realised they too were sitting on potentially worthless debt. Panic ensued, and we’ve been struggling to recover ever since.

Old news by now isn’t it? Probably not worth noting then that today’s FT reported that US state-backed mortgage company Freddie Mac has requested an extra $6bn from taxpayers because “homeowners were falling behind on their obligations and it could not count on mortgage insurers to reimburse the company for losses”. Or that US house “sales are down, delinquencies are rising and the pipeline of seized homes due to flood the market is growing ever larger”. Nope, not worth noting at all.

SLEB WATCH…..One for our celebrity interested readers at the request of our resident pop-culture queen, Helen Searle. Yes, in case you weren’t convinced, HuffPo’s title is eager to underline this IS an INFOGRAPHIC of the shortest celebrity marriages in homage to Kim Kardashian’s filing for divorce this week (your author this week isn’t sure who that is either). Although it could also be described as a bar chart, either way, our sleb watchers rather like it.

GOOD WEEK/BAD WEEK…..Whisper it, but it’s been a relatively good week for Barclays boss, Bob Diamond. His company’s results were better than most of its peers (though again the use of some accounting wizardry perhaps hid the true picture), and Diamond also faired rather better in media interviews than he did last time he mentioned the word ‘remorse’.

On the flip side, his banking compatriot at Lloyds, Antonio Horta-Osorio, faired far worse. No one should ever work so hard or endure such stress that they have to take a leave of absence to recover. Not ever. We hope he gets well soon.

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FPS’ Friday Fiver Fri, 28 Oct 2011 17:50:07 +0000 David Chambers Hello All! We’re a little late this week, though happily the ever entertaining Matt Muir provided yet another great Web Curios which has probably kept H&K blog readers’ attentions for most of the afternoon. However, we’re still committed to bringing you a round-up of this week’s news from the world of financial and professional services (and yet again it’s been a week not to miss). It’s a little shorter this week, but we hope you enjoy it as always. Thanks to Ed Jones and Jonny H as always.

WE HAVE A DEAL – JUST…..It went down to the wire, involved a very well received slap-up meal, and what most leaders likely found an annoying intervention from the British PM. However, we have a deal on the eurozone which should see it stabilise for at least a few weeks.

The medicine is nothing if not severe though – a 50% writedown on Greek debt held by private institutions (i.e. banks) and £100bn which needs to be found in order to recapitalise banks and prevent them from falling into the abyss (sound familiar from about 3 years ago?).

Will it work in the long or even short term? The jury is definitely out on that one but already things are looking a wee bit wobbly

THE RICH GET RICHER…THEN RELATIVELY LESS WELL-OFF…THEN RICHER AGAIN…..The info-graphic below from the New York Times captured our attention this week. It tracks the financial fortunes of US citizens dating back as far as the First World War and the original web version can be found here.

Wealth across the years (Image: New York Times)

The figures are relatively self-explanatory but they highlight how the relative prosperity of each segment of society has evolved over time. The Top Fifth of earners have done particularly well of late and in 2007 the top 1% of earners controlled 23.5% of all wealth. If you’ve been following the remarks of Warren Buffett of late you’ll know that the issue of distribution of wealth is a source of some debate in the US at present and only time will tell whether the 21st century will follow a similar pattern. Today’s figures from Income Data Services only fuelled the fire as well.

WHEN IS AN EMPTY TENT NOT AN EMPTY TENT…..On Monday, the Daily Telegraph (and others) shone an infrared camera on tents at the Occupy London site outside St Paul’s. Their results appeared to show that most of the tents were empty during the night, implying that these were the most fairweather of protestors.

It dealt a severe blow to the credibility of the movement, but not it seems the story may not have been entirely accurate. As The Guardian and others reported later in the week, the technology used to hunt for tent-dwelling heat-producing humans wasn’t entirely equipped for the job at hand. There seems to be little doubt that some protesters are sleeping at home, but probably far fewer than some media outlets tried to claim initially.

TESTING THE WATERS OF IMPARTIALITY…..Andrew Marr wrote in last weekend’s Sunday Times about the Queen on the eve of her diamond jubilee. One thing he noted in particular was that while the Monarch retained a thoroughly impartial stance on political matters, she did still enjoy quizzing ministers on matters of policy.

The same doesn’t quite seem to apply to the other supposedly impartial institution at the top of the British power tree, the Bank of England. In another sign that it is becoming increasingly bold with its statements, the Bank’s director of Financial Stability, Andrew Haldane, gave a bold speech on Monday about the dangers as he saw of the 21st century banking system. His comments received the support of prominent commentators, not least for his conclusion that:

“The words bank and bankrupt have common etymological roots dating from the 13th century. In the 13th century it was bankers bankrupting banks. In the 21st century bankers are still bankrupting banks. But it is no longer just banks. This tells us that the risks from banking have been widely spread socially. But the returns to bankers have been narrowly kept privately”

GOOD WEEK/BAD WEEK…..Silvio Berlusconi is pretty much a no-contest winner for the bad week slot this week, finely topped off by some more lurid accusations on Thursday evening.

Good week though goes to our favourite interviewee of the past year, Noel Gallagher, who gave this gem to Shortlist at the back end of last week. Still got it Noel, still got it.

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