A well worked story

At the moment in the day job I'm working in PR (I know, I know, "hangs head in shame") which makes me rather more sensitive than I normally am to well placed stories. Like this one.

Asda said that the sales increase was driven by a combination of increased customer numbers, in particular among wealthy AB shoppers looking for bargains, and a higher average 'basket spend' per visit. The company said that it had grown its profit ahead of its internal targets "with good cost control despite rising energy costs".

What they've said there might even be true...

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Why I like the financial crisis

Because it means that Will Hutton writes more often for public consumption. This makes my job easier as, being a self-declared crusader against idiotic economic commentary  Will Hutton writing provides me with fuel.

There are a number of areas in which it needs to change rapidly, bringing forward proposals in the pre-budget report. First, it is stipulating a 12% interest rate on the coupon rate it is charging when it invests in banks via preference shares. This makes the cost of capital high, and encourages the banks to charge high margins to deliver the profit to pay off the...

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No to the Detroit bail-out

David Brooks has a powerful column in the New York Times today arguing against the proposed bail-out of the auto industry. Here are his key points:

This is a different sort of endeavor than the $750 billion bailout of Wall Street. That money was used to save the financial system itself. It was used to save the capital markets on which the process of creative destruction depends.

Granting immortality to Detroit’s Big Three does not enhance creative destruction. It retards it. It crosses a line, a bright line. It is not about saving a system; there will still

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I like this

It's always terribly gratifying when someone much cleverer than yourself supports some view that you've been espousing.

Longstanding critics of the industry claim vindication. Peter Morici, professor of business at the University of Maryland, says hedge funds originated in a lucrative niche that has simply become too crowded.

"There were some very smart guys who would find seams in the market - inconsistencies in pricing on different markets," says Morici. "But if a lot of people do it, they end up competing against each other for very small opportunities. The concept of a hedge fund was simply not...

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Why I don't read Hansard

Or more accurately, why I don't read Hansard very often. It's simply not good for my blood pressure to come across ideas quite as fatuous as this one:

That leave be given to bring in a Bill to make provision for a maximum limit for interest rates to be prescribed; and for connected purposes.......My Bill would limit the interest charges at a fixed rate above the base rate set by the Bank of England. I believe that a fair rate would be 5 per cent. above the base rate.

So the maximum interest rate that could be charged would...

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