Archive for July, 2012

A weekend of sport that was an antidote to celebrity culture!

Posted in Sport with tags , , , on July 23, 2012 by Tom Leatherbarrow

What an extraordinary weekend of sport.  Frankly I don’t care what happens over the next few weeks I’ve got what I want – a British winner of the Tour De France and Ernie Els winning the Open!

I don’t know a lot about cycling (I leave that to my father-in-law) but I have read Lance Armstrong’s book “It’s not about the Bike” so I have a little understanding of how obsessive these individuals can be.  Wiggins is, apparently, cut from the same cloth as Armstrong, either living a pretty boring life in the small village of Ecclestone in Lancashire or a ‘monk-like’ existence at a training camp in Majorca in pursuit of his goals.

There is no entourage here.  No hangers-on, no long tail of ‘friends’ or newspaper headlines at the front rather than the back of the paper, just single-minded dedication.  Even the French have taken him to their hearts, calling him “Le Gentleman Wiggins” after he deliberately slowed the pace to allow his rival, Cadel Evans, the Australian winner of last year’s Tour, to repair his bike and catch up with the rest after saboteurs threw tacks at the summit of the final climb of stage 14.

It is much the same with Els.  Six years ago his world and his golf game collapsed when he found out that his son had autism.  Slowly and painstakingly he has dragged himself back (at the same time as raising millions through his ‘Els for Autism’ campaign).

Yesterday with nine holes to go, as everybody else went backwards, Els went forwards.  Four birdies on the fiendishly difficult back nine to come back in 32 and snatch the trophy from Adam Scott.  Yes, Scott collapsed like Devon Loch, but Els applied enough pressure for the cracks to appear in Scott’s game.

His victory speech yesterday was not about him or how he was feeling.  It was all about the loser, Scott, and the role Nelson Mandela has played in using sport to unite his country, South Africa.

One of my favourite phrases is “good things happen to good people”.  Yesterday in Paris and on a golf course in Lancashire, good things happened!

Only a fool would invest in Manchester United!

Posted in business, Sport with tags , , , on July 12, 2012 by Tom Leatherbarrow

The problem with blogging about football is that it is very hard to objective.  Tribal loyalties (in my case towards Liverpool FC) inevitably colour ones opinions.

However, I am willing to go on record with the following statement.  I feel sorry for Manchester United supporters!  There, I’ve said it, it’s out and I must say I feel better.

What you may ask has led me to reach this point?  In short, the antics of the Glazer family, who own the club and are busy making plans to incorporate it, not in Manchester or even the UK, but in the Cayman Islands and float it on the New York Stock Exchange.

On the surface this may seem like an attractive proposition for both investors and supporters with regular Champions League football and Premier League TV revenues offering floods of cash.

However, investors and supporters need to be cautious.  Firstly, the Glazers only plan to float a new B class of shares which hold no voting rights.  Secondly, the club will pay no dividend to shareholders.

Got that?  The Glazers want your money to pay off Manchester United’s £453 million debt mountain, but you will have no say in how the club is run and you won’t get any income from it.

It gets better, or worse if you are a United fan.  It would appear, according to Tuesday’s Guardian, that the Glazers want you to make your investment decision on the basis of the club’s accounts to 30th June 2011 when the team reached the lucrative Champions League Final.  Unfortunately, another financial year has passed since then, a year in which Manchester United won nowt!  Needless to say the accounts to 30th June 2012 have not been made public.

So, in short, the Glazers are saying, “Give us your money to help us pay off the debts we loaded onto the club in the first place, but you will have no votes, no income and no way of knowing if you are paying over the odds for the privilege.”

Of course this isn’t the first time that the Glazers have come up with such a hare-brained scheme.  A few years ago a flotation in Singapore was the preferred option until that crashed and burned.  This scheme deserves the same fate!

This feels like a BIG moment!

Posted in Banking with tags , , , , on July 2, 2012 by Tom Leatherbarrow

Sometimes watershed moments in politics only become clear with hindsight. The implications of the defeat of Barbara Castle’s In Place of Strife legislation for example, which was designed to bring the trade unions into line at the end of the 1960s, only became clear when the unions lost all control in the 1970s. The rest is history.

Sometimes however, watershed moments are more easily discernible and I think the Barclays scandal is one of them. The ironies with this story just keep piling up on top of each other. Investment bankers, the ultimate free marketeers, were going around rigging the market. Marcus Agius, Group Chairman of Barclays and Honorary Chairman of the British Bankers Association which sets LIBOR, sat atop an organisation which was screwing over his own trade association and its members.

Where do we go from here? I’m not sure I agree with calls for another public inquiry into the banking culture in the UK. What are we going to learn that we don’t know already? That the investment banking system is corrupt?

My view is that this is a big moment for the politicians. We have had Commissions, Inquiries, Reviews, appearances before Select Committees and much finger pointing but little has actually been put onto the statute books. If I was in Cameron’s position, I would do the following:

1: Implement the Vicker’s Commission Report with a deadline of 2015 brought forward from 2019. The Government cannot afford to kick this into the long grass a moment longer.

2: Implement a UK version of the Volcker Rule which prohibits proprietary trading by the banks on their own account. The banks have to get back to serving their clients and customers not just making money for themselves.

3: Beef up the Financial Services Authority (or the Financial Conduct Authority in its new guise) with enough budget and people to launch investigations into financial malpractice. Then do the same with the Serious Fraud Office.

4: Set up another Commission or recall Vickers and ask him to look into the economic implications of a forced separation (not just a firewall) between retail and investment banking along the lines of Glass Steagall.

Finally, if I was PM, I would pull the CEOs and Chairmen of all UK-listed banks into 10 Downing Street and say the following: “We are doing this. If any one of you so much as threaten to pull your head offices out of the UK (in my opinion a hollow threat!) I will personally front a campaign to encourage the British public to close down all their current accounts, savings accounts, ISAs and other financial products and transfer them to mutuals.”

All of this will go against the PM’s instincts. His late father was a stockbroker, but even he would now surely realise that, to paraphrase Philip Augar, gentlemanly capitalism has died a death. Now is the time for action.