24 July 2010
Martin Vander Weyer
A London hedge fund, Armajaro, has cornered the market in cocoa, for which prices have already risen by 150 per cent over two years. Armajaro is reported to have paid £650 million to take delivery of 240,000 tonnes of beans, all the cocoa there is in Europe in fact, and no one seems to know what they plan to do with it — other than reap a huge profit. This is the sort of trade that earned hedge funds a bad name two years ago, when grain and soy prices soared — though investment banks, which regard ‘soft commodities’ as...
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17 July 2010
Martin Vander Weyer
The flotation of a business that has carved a big slice of a fast-growth consumer market within less than a decade of its start-up ought to be a cause for celebration: an example of capitalism doing what it’s supposed to do in support of entrepreneurs; an affirmation that markets are back in business after their nervous breakdown two years ago. But the share offering for the online grocer Ocado, for which a price will be struck on 21 July, has provoked more of a City brawl than a champagne reception. Some fund managers are enraged by the indicative pricing, which...
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10 July 2010
Martin Vander Weyer
I once heard an after-dinner speech by Jackie Blanchflower, brother of the great Spurs captain Danny. Jackie also played professional football, for Manchester United, but his career was cut short by his injuries in the 1958 Munich air crash, in which eight of his fellow ‘Busby Babes’ died. Thereafter he scratched a living as a publican, a bookie and an accounts clerk, and by the time I saw him, not long before he died in 1998, he looked so knackered that I wondered whether he would be capable of standing to speak. But he did, and delivered an unforgettably funny...
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3 July 2010
Martin Vander Weyer
I’m standing on a hot platform at Tottenham Court Road, waiting for the relief of the momentary breeze that precedes an approaching train. I’m staring at a T-Mobile poster featuring people dressed as nuns at what looks like a karaoke party. And I’m thinking: do I really want to write another essay about the imagined pain of cuts to come, or the right way to regulate banks, or the prospects for growth in 2013-14? And more important, in a heat wave and a mood of post-World Cup gloom, do you really want to read one? Then the air moves, the...
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26 June 2010
Richard Northedge
Kraft Foods’ takeover of Cadbury was only a quarter the size of last year’s biggest bids — BHP Billiton’s for Rio Tinto, for example — but the offer for the confectioner has assumed disproportionate importance and could permanently tilt the playing field for future British acquisitions, by protecting companies at the expense of investors’ profits. The Takeover Panel is considering new ‘Cadbury Rules’ that would allow companies to keep their independence even when most shareholders want to accept a bid, and that could leave directors in control who are opposed by a majority of investors.
Cadbury was part of all...
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26 June 2010
Jonathan Davis
There was nothing in George Osborne’s emergency Budget on Tuesday to contradict the idea that the transition from Labour to Conservative (or in this case Conservative-led) governments tends to be good for the investing classes. The fall of the Callaghan government in 1979 was followed after an initial period of uncertainty by the start of an 18-year bull market that was resilient enough to survive two nasty recessions, the 1987 crash and our undignified exit from the ERM in 1992. There were similar bull markets for shares in the mid-1930s, following the formation of a Conservative-dominated National Government, and in...
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