Richard Northedge

Cadbury Rules not OK for investors

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.

‘Read this and weep’: lessons not learned from Slater Walker

Richard Northedge has unearthed confidential papers that reveal the Bank of England and the Treasury at loggerheads over a banking collapse 35 years ago  In the permanently uneasy truce between Threadneedle Street and Whitehall, Bank of England governor Mervyn King has never been shy of publicly criticising the Treasury. But confidential files on a banking

House prices

Here’s my hot prediction for 2009: house price inflation at 10 per cent. Yes, that is a 10 per cent increase, and yes, I do mean 2009. Halifax figures for the year to November were still showing prices down by 1.6 per cent — but believe me, by the end of this month housing will

A lost decade in the London stock market

Richard Northedge says the FTSE’s dismal performance since the millennium will deter a generation of investors The familiar fallback for fund managers when shares falter is that investment is for the long term. But how long is long? December marks the tenth anniversary of a stockmarket peak that has never been seen again. Money invested

In the boardroom | 14 November 2009

One of the oft-repeated excuses for high executive pay is the need to compete for top talent in an international market. A scan through a list of heads of FTSE 100 companies certainly shows just how many boards go abroad for their boss: 41 of the UK’s top 100 chief executives are foreigners, including three

Twenty-five years on, the game begins again

In the autumn of 1984, solicitors were allowed to advertise for the first time, but if the public failed to spot their modest announcements it was probably because the newspapers were awash with a much more unusual publicity blitz. The government was selling half of British Telecommunications, as the phone company was then called, and

In the boardroom

ITV shareholders did not wait for Sir Crispin Davis to be appointed chairman before saying publicly they didn’t like him. No wonder people are thinking twice before putting themselves forward to head our major companies. Even salaries of £500,000 plus share options have left supply well short of demand in the ‘C-suite’. A large number

Does the Bank of England deserve more power?

Critics of Gordon Brown’s ‘tripartite’ regulatory structure want authority restored to Threadneedle Street, says Richard Northedge. Critics of Gordon Brown’s ‘tripartite’ regulatory structure want authority restored to Threadneedle Street, says Richard Northedge. But is the Bank’s track record tarnished? The simplistic initial analysis of the financial crisis — that the tripartite oversight structure of the

Investment: Equities

Dividends — the directors’ cut At least the savers whose interest rates have been squeezed still have their money in the bank. Shareholders, by contrast, are seeing their dividends slashed after also suffering substantial share price falls — and there is no compensation scheme to cover their lost capital. That is a risk of equity

How many banks does the government want?

So Business Secretary Lord Mandelson is planning to turn the Post Office into a ‘people’s bank’ — to add to the taxpayers’ portfolio that includes most of Royal Bank of Scotland, the biggest stake in Lloyds Banking Group, the rejuvenated Northern Rock, the rump of Bradford & Bingley, and dear old National Savings & Investments.


Next year will be a good one for anniversaries. A century since Lloyd George’s People’s Budget, 60 years since Attlee’s devaluation, 25 since inflation swept away the ha’penny coin and £1 note. And it’s the golden jubilee of the reverse yield gap. Yet the reverse yield gap will not be present at its own celebrations.

Boom and bust

So many ways to say we’re in trouble Without an Inuit thesaurus I have no way of checking how many words the Eskimos really have for snow, but each day’s newspapers reveal just how large a lexicon we have for an economy going into reverse. Recession, depression, downturn, decline, disinflation, slump, slowdown, squeeze, freeze, meltdown,

Is that a new boom on the far horizon?

The real economy has taken only the first step towards recession but the housing market has already clocked up four successive quarters of negative growth. Indeed, house prices have now fallen further in 13 months, according to the Halifax, than they plunged in the whole three years of the 1989-91 crash. And like the rest

Socialism seizes the City

To anyone born before 1980, the idea that the state would own a large part of the economy was normal. The ‘mixed economy’ was a typically British compromise between American cut-throat capitalism and the incompetent communism beyond the Iron Curtain — or at least a compromise between the socialist leanings of the Labour Left and

The Housing Market

If Britain’s housebuilders really want to sell more homes, they ought to slash their prices rather than lobby the government for packages like last week’s ill-conceived attempt to boost the property market. That’s what the rest of us have done, but while prices of all other houses have plunged, new homes have still been selling

Credit Crunch: First Anniversary

When Britain had a secondary banking crisis in the 1970s the big banks launched a lifeboat to rescue the sinking smaller lenders. Today we have a primary banking crisis. It is the big banks that are in trouble — but this time there are no bigger brethren, at home or abroad, to launch the lifeboats.

The great box-ticker takes charge

The Financial Services Authority has had only two chairmen since its creation in 1997, and as the Northern Rock debacle happened on the watch of the second incumbent, Sir Callum McCarthy, the model for his replacement is inevitably the original holder, Sir Howard Davies. On that basis, Adair Turner — Lord Turner of Ecchinswell —

The FSA is not fit for purpose

‘It is somewhat ironical,’ the chairman of the Financial Services Authority told the Treasury select committee investigating the Northern Rock crisis, ‘that one of the responses is to try to seek from the rating agencies even more work and even more assessment.’ The paradox intriguing Sir Callum McCarthy was the suggestion that credit-rating agencies, having

Half a million rooms to choose from

Most hotel-group bosses like to be at the opening of each new property in their chain. Some claim to have slept in all of their establishments or even to have spent a night in every room. Not Andrew Cosslett. His company is the biggest hotel group in the world. It has 572,000 rooms in more