The Dow Jones Industrial Average of leading US stocks passed 13200 for the first time last week, after its strongest run (23 rises in 26 sessions) since 1955. The S&P 500, a broader indicator, stood at just over 1500, a fraction below the record high set in the final spurt of the dotcom boom. London’s FTSE-100 index, at 6600, is not far behind. Both markets are being driven by a fever of takeover activity and rumour in the ‘digital media’ sector, including talks between Microsoft and Yahoo and an approach to Reuters from the Thomson empire of Canada — all ominously reminiscent of the AOL-Time Warner deal, announced in January 2000, that was subsequently judged one of the most value-destroying mergers of all time.
And as if this isn’t enough evidence that the global balance of money and sense is wobbling dangerously again, the Daily Telegraph tells us that ‘savvy investors’ are snapping up real estate in Ulaan Baatar, capital of Outer Mongolia. ‘Our main clients are wealthy bankers purchasing with dollars, which with the current exchange rate is very favourable to British buyers,’ a property consultant explains. OK, I accept that overseas house-hunting has become a new national pastime — and when Merryn Somerset Webb tells us this week that Berlin is the hottest new hot-spot, I’m almost ready to declare, with JFK, ‘Ich bin ein Berliner’. But a luxury condo in the land of the weeping camel, where half the population live in nomadic tents and get their kicks from fermented yak’s milk? Things may have improved a bit since I stared out of a train window at Ulaan Baatar’s crumbling Soviet blocks in the late 1980s, but I still think this is one of the barmiest investment propositions I’ve ever come across.
‘As far as I’m concerned, the party’s only just begun,’ declares the developer of the 14-storey Regency Residence, which will no doubt be the most sought-after address in the entire Gobi desert when it is completed next spring. As far as I’m concerned, the party’s almost over, and to paraphrase William McChesney Martin, chairman of the US Federal Reserve in the 1950s and 1960s, it’s time someone took the punch bowl away.
No pink ceiling
Lord Browne’s decision to lie in court about having met his boyfriend through an internet escort agency was at least partially excused, for some commentators, by the fact that he was trying to protect himself against unreconstructed homophobia in the business world, and especially in the oil industry. It may well be true that intolerance remains the norm on North Sea drilling platforms and Siberian pipeline stations, but I very much doubt that gayness or straightness any longer affects anyone’s career prospects in the upper reaches of the City or the elegant head offices of the West End. One robustly heterosexual senior investment banker I know chairs his firm’s gay and lesbian group with no embarrassment, and other blue-chip companies from JP Morgan to McKinsey eagerly advertise similar support networks.
John Browne was not even the first gay boss of a major British oil company. The late Sir Philip Shelbourne, chairman of the British National Oil Corporation from 1980 to 1987, was more discreet than he would have needed to be today, but his feline manner still provoked strong reactions — not least from Alastair Morton, later of Eurotunnel, who resigned as a manager of BNOC in protest at Shelbourne’s appointment. When I wrote Shelbourne’s obituary in the Daily Telegraph in 1993 (it is reprinted in Closing Balances, the collection published last year by Aurum Press) I wrestled with the problem of how to indicate his orientation — which would certainly have been known to, or suspected by, informed readers — without breaching journalistic boundaries. Among other descriptive details, I called him ‘a City grandee of strong opinions and fastidious tastes’, who ‘lived for many years in a Victorian house in Highbury in which he collected antiques and installed a complete Indonesian sitting room’. I filed the piece then rang the obituaries editor, Hugh Massingberd, to explain my predicament. ‘Oh don’t worry,’ he replied. ‘That Indonesian sitting room says everything.’
Who ate all the pastries?
But never mind metrosexuality, market exuberance and Mongolian buy-to-let — I hear you complain — tell us what’s happening in Helmsley. My North Yorkshire home town offers its own set of economic indicators, particularly at this time of year when new businesses open up to catch the spring tourists. Last year, you may recall, I was confidently predicting meltdown in the confectionery sector, having counted within a few yards of each other no less than four high-priced hand-made chocolate shops, one of which boasted a lukewarm chocolate fountain. I was wrong. They all survived, and so did the fancy patisserie we thought was doomed because there were already several bakeries nearby and we’d heard that this one was going to make the fatal error of calling itself ‘Patisserie’ — Yorkshire folk generally having no truck with anything French. In fact it announced itself in plain English and became one of the most successful start-ups ever seen in the town — a lesson to would-be entrepreneurs that if you really pay attention to the quality of the product, success will follow however entrenched the competition. Last year’s doomsayers, led by me, can now be found daily barging each other like bullocks in the shop’s narrow doorway to buy olive bread and Danish pastries from the charming Polish sales girl.
We’re also feeling the impact of the property boom. Even the top-of-the-range London prices that Judi Bevan writes about this week touch Helmsley indirectly: down on the industrial estate, a metalworking venture called Bisca is putting the finishing touches to a magnificent £50,000 steel-and-glass staircase destined for a multi-million-pound home in Richmond, Surrey. Our own house prices have soared, too, and the town is besieged (and in the case of many residents, angered and upset) by proposals for ‘infill’ development: archaeologists will one day be able to plot a long-term graph of economic confidence by mapping these outbursts of speculative housebuilding at roughly 20-year intervals. As for new businesses, the one stand-out success this spring is an illustration of the power of lateral thinking: it’s a ‘plus-size’ dress shop, catering for the ladies who ate all the chocolates and pastries.
Comments