Of Folk, and Teenagers

“Try everything once, except incest and folk dancing.” Generally ascribed to Sir Thomas Beecham, British conductor.

I spent yesterday evening with a bunch of teenagers and early 20-somethings listening to folk music.

This is not my normal milieu. Daughter, 19, is going out with Will, a hugely talented singer/songwriter. He was the headline act.

Folk is awesomely cool now. When I was those kids’ age, it was not. It was the province of serious, elderly men with beards and sandals, drinking real ale. About the only thing less cool was country. That’s cool, too, today.

Will is a modern folkie, think Damien Rice. Not the fingers in the ear, damsels being ravished, remember that awful thing that happened down the pit in 1845, sort of thing. Thank God.

Folk is cool, then. Mumford and Sons, most of whom went to my old school, Laura Marling, Jonah and the Whale, Paolo Nutini, even James Blunt. Serious young people with acoustic instruments.

There they all were, singing along to “cockles and mussels”, Dirty Old Town, even, heaven forbid, John Denver’s Country Roads. I asked Dan, aged about 19, why. You would sooner have been buried six feet underground in my day. In an anorak.

Folk is self reliant. You can create it with an acoustic guitar, a box on which someone else hammers time, perhaps, and a limited sound system.  I suspect it plays to this generation’s self reliance and autonomy. They run their own websites. Their social media allow them to communicate with no intermediation from the authorities. Will’s music is available on Facebook, and can be accessed by those who know him, or have an interest in that sort of thing. The outside world need never know he exists.

Ideally, he would like it to. He is queueing to record an album. At Abbey Road studios. The average wait, apparently, is eight months. At Abbey Road? This is all part of the democratisation of the music making process.

Dan makes the point that the same is true of electronica, sampled electronic dance or ambient music. A teenager with a laptop can make a sound that, two decades ago, would have required a studio and a passel of expensive session musicians.

We have all been here before. Up to the late 1950s, The Business controlled music. Tin Pan Alley hired the songwriters, and paired the songs with singers willing to do anything for a break. The infrastructure required an expensive studio, again, an orchestra, and a distribution network.

Then along came a lot of unwashed kids with funny haircuts and electric guitars. Their equipment could be loaded into a van and dragged up and down the country. They wrote the songs. They were largely autonomous.

The Business fought back, of course. Expensive lawyers ensured said unwashed kids, who came from modest backgrounds and didn’t understand finance, got as little as possible from the results of their talent. That battle has been waged ever since. The Business created boy bands, who did and sang what they were told.  And the crawling horror that is Pop Idol.

A luta continua.


The Spectator

Funny how things come around. I have written a piece on investment for The Spectator.

It came on the back of my winning an award. (Did I mention I had won an award? Oh, so I did.)

About a third of a century ago, when I started up in journalism, I tried to sell a piece to the magazine. They didn’t want it. With the benefit of 20:20 hindsight, I can see why the maunderings of an early 20-something on the anti-nuclear movement might not have seemed that compelling.

And here I am now. You can find it at www.spectator.co.uk/features/9161821/when-i-pick-the-right-share-i-shout-about-it-and-heres-what-i-do-when-i-get-it-wrong/.

Better late than never.

Of Human Greed, and Stupidity

A hilarious announcement arrives from the Financial Conduct Authority. The City regulator has shut down a scammer who was ringing potential investors and pressurising them into investing in some company building luxury villas on Madeira.

They were promised that over a three year period their money would rise in value by 128 per cent. No proof, obviously, that the villas even existed.

Now, if someone you have never heard of rings and asks for money to build a project you have never seen and have no reason to believe exists, and offers to more than double your money over three years, you are inclined at least to wonder why they would wish to share this bounty rather than take it all for themselves.

You might even wonder why such a sophisticated financial wizard was reduced to cold-calling strangers for a living. You might be a little sceptical at that huge rate of return, too, implausibly better than anything on offer elsewhere.

Still, the FCA reports that 27 people mainly in the UK were persuaded to put up a total of £660,000 between them, or in some cases tens of thousands. Presumably they were interrupted in those cold calls whilst cheerfully stuffing cheques into letters to e-mailers from Nigeria with interesting business propositions. Presumably they are both greedy and stupid. You almost have to admire the scammers for tracking down so many people so eager to be parted with their money.

The Budget, and Responsibility

It has been a good Budget for me. Not financially but professionally.

The Chancellor’s decision to allow people to keep the amount they have accrued on retirement, rather than forcing them to hand it over to some financial services firm to stuff into a commoditised investment product, has had one amusing outcome.

Those companies who provide such annuities, whose track record has been poor and who have become lazy and indifferent to the service they provide customers, were forced to put out formal statements on Budget Day saying, through gritted teeth, how much they welcomed the move. While watching their share prices plummeting.

If people are required to look after their own money, and shop around more to decide where they wish to invest it, it can only mean more readers of my daily column. One of the great boosts to financial journalism over the past four decades, to which I directly owe my job today, was the privatisation boom that made investors of millions of ordinary people, who then had a reason to take an interest in financial matters.

But the Chancellor’s decision goes to the heart of one of the biggest philosophical questions in politics. To what extent should ordinary people be allowed to suffer from the effects of their folly and poor decisions?

The debate applies to drink, smoking, poor dietary choices – and now pensions.

It is largely a left-right split. The right generally believes people should be given the freedom to go to Hell in whatever way they choose. The left generally thinks the options should be limited, by state interference or legislation if needed.

An unspecified number of people, presented with a large sum of money on retirement, will simply spend it. Good for makers of conservatories, providers of exotic holidays, and car dealers.

We know this because it has happened before. During the boom years people loaded money onto their mortgages with no concern over whether they could afford to repay it, and then frittered it away on just that.

This profligacy in part led to the financial downturn, when the Law of Unexpected Consequences kicked in. They were largely spared the consequences because interest rates were kept artificially low for five years. What happens when this reverses worries many of us.

The consequence of the Chancellor’s move, then, could be a mini-consumer boom in time for the next election. Which was surely the last thing on his mind. And an unspecified number of significantly poorer pensioners a decade or so hence. That is the price of freedom.

Benn, Crow, and the Nature of Evil

“So far as I am concerned they (Tories) are lower than vermin.” Aneurin Bevan, Labour politician.

I have made an enemy on Twitter. Not difficult to do, I know.

I remarked on the generally favourable comments in the press, even the right wing papers, on Tony Benn and Bob Crow and wondered if, had an icon of the right died, it would have garnered an equally positive reaction from the left. And then answered my own question. The death of Baronness Thatcher.

The tweet was picked up by many who clearly agreed, and by one who responded: “Thatcher did many evil things. Benn and Crow didn’t.”

Now, there have been any number of politicians over the past century who have done evil things. Hitler, Stalin, Mao and their satraps and acolytes. Franco, Pinochet, Mengistu, Pol Pot…. No one rational would put Thatcher among their number.

The exchange highlights an odd fact about British politics, which is not always true elsewhere. The right tend to regard the left as misguided, foolish, naive, overly idealistic. The left, or a significant part of it, think of the right as evil.

It is an item of holy writ in some parts of the left-wing press that David Cameron and his colleagues are in politics to favour their own class, make their friends in the City richer, and make the lives of the poor, whom they despise, worse. You can read this stated as a fact fairly often, and not just in the Loony Left publications.

Anyone who knows any of the current administration knows this is nonsense. I have written this of Michael Gove, a former colleague, before.

It explains the row recently over Ed Miliband’s father. Ralph Miliband, like many of his ilk, died still believing in communism, small “c”, as a creed. Stalin may have gone too far, the invasions of Hungary and Czechoslovakia were a mistake, but yet…

Now imagine a parallel world where David Cameron’s father, about whose politics I know nothing, died an unrepentant fascist. The obituaries would not have read along the lines of, he accepted Hitler went too far and that the invasion of Russia was a tactical mistake but never wavered from his staunch support for the basic principles of national socialism…

And I do not think David Cameron would be prime minister.

Die an unrepentant fascist and you are a fascist. Die an unrepentant communist and you may end up as a national treasure.

On Black Ties

 I have won an award.

The honour was bestowed on me at a black tie dinner at Guildhall. It was a jolly enough occasion, and as ever at such events, I bumped into a few people I had not seen for a while. But it got me thinking about black ties, and dinner suits.

In earlier days, when a Gentleman had a Gentleman’s Gentleman, and a Gentleman’s Club, the GG would be on hand to ensure the necessary attire was available, and the GC would be the venue at which the Gentleman would change. Gracious living. Dragging your DJ into work, crumpled up in a bag, on a crowded Tube and then changing in the men’s loo is not quite the same thing.

I don’t like black tie dos. Their initial purpose was to mark one out as part of the ruling elite, or the aristocracy. All such dress codes were one of the many signifiers that one belonged to the club. Read Julian Fellowes’ Snobs and Past Imperfect, which he wrote before Downton Abbey, for an examination of many such codes and symbols, which were designed to separate the Us from the non-Us and exclude the latter.

The possession of a dinner jacket, or other form of dress appropriate to a gentleman, served to keep the rabble out, because they couldn’t afford it. Now an off-the-peg job is available from the high street for a few tens of quid, it all seems a bit outdated.

I would never, like our former Prime Minister, turn up to a black tie do to which I had been invited not wearing a dinner jacket. That is the height of rudeness; all dress codes should be observed, if you choose to attend the appropriate venue, and the same applies to a nudist colony as much as to a black tie dinner.

But I hope not to be invited to another one for a while.

On Bankers, And Bashing

The days are getting longer, the magnolia blossom is on the trees and it is time for the annual banker bonus bashing season. This comes around every year as the banks publish their annual reports, which are required to detail the transcendentally huge amounts their senior staff are paid

Meanwhile, a survey only this week suggests 40 per cent of City workers are dissatisfied with their bonus. One question I am often, as someone who knows a few bankers, asked is, how can they? Have they no sense of shame?

Here is a clue. One of the most successful investment bankers of his generation, and one of the best remunerated, is called Rich Ricci. Pronounced “Ritchie”. An American, he has a number of horses running at Cheltenham this week. Like you do.

Now, if you or I were a fabulously rich banker called that, you and I would probably use the Richard form of our name. It might seem a little less provocative.

It is also a weirdly hermetically sealed industry, more so, I guess, than lawyers or engineers or dentists. We had a couple of bankers for neighbours for a couple of years. They invited us to their housewarming. Pleasant enough people. But as I made polite small talk about the City, I was greeted with the same question over and over. Which bank did I work for?

It seemed inconceivable to those in the room, all bankers save neighbours like us, that anyone could do anything else for a living. They don’t get the criticism because they don’t meet anyone, or hardly anyone, who hands it out.

Then there is simple human nature. The row over executive pay really kicked off after the privatisations that started in the 1980s. Former civil servants, on appropriate salaries, were suddenly transformed into titans of industry with pay packages to match.

Every week some former regional electricity board chairman or someone of that ilk would be dragged, blinking, through the press and pilloried for their “obscene” salary. One paper even went to the trouble of sending a photographer down to the modest  French holiday home of one miscreant and snapping it though a fish-eye lens, to make it look larger and more palatial than it was.

You had to ask whether it was worth it. Until you think, here is the bargain. You get to spend a week or so in the public stocks, in return for riches that would have seemed unimaginable in your earlier, civil service job. Then the dogs stop barking, the caravan moves on, and someone else gets their turn.

If I were to find myself earning, ooh, twenty million a year, I would probably work until about mid-August, bank the lot, and then never work again. But I am not a banker.

A Dirty Business

“We are all prostitutes.”

The Pop Group, obscure late 1970s agit-pop band.

A few years back, I suggested that if you wanted to picture the London of the future, think of a City inhabited by 20,000 of the mega-rich and 15 million serfs to service their every need. I was in part joking, I think. It is not so funny now.

An extraordinary, excoriating piece in the New York Times, titled London’s Laundry Business, says the UK is happy to betray the US, and by extension the free world, to protect the City’s supply of dirty Russian money.

Obviously, the context is Ukraine. And the Americans seem to be going through one of their periodic bouts of anti-British sentiment. But the piece has a point. London has become the first choice for some extremely dubious people who are trying to find a safe haven for money which they have stolen, misappropriated or otherwise embezzled.

This has always been the case. London, with its impressive shopping, posh hotels and gracious housing in some parts of the City, has attracted petro-dollars since the oil first came out of the ground in the Middle East. But what has driven house prices to their current, mad levels – and what will keep them there, believe me – has been the arrival of not just the oligarchs, the obvious face of the Russian economic upheaval, but their hangers-on and the not quite so rich further down the scale.

Joining them are the wealthy Chinese and other south east Asians, some of whom have an equally tenuous right to their newfound wealth. Some of those huge towers of flats being built on the Thames, or those luxury apartments in Chelsea or Belgravia, are not even marketed in London. They go up for sale in Singapore or Hong Kong and are bought off plan, unbuilt. No point in selling to the locals – they can’t afford it.

There is an obvious reason why you would want to buy into the London property market, even if you had little wish to live there from one month to the next. Putin has already shown a propensity to fall out with several of those newly enriched oligarchs. It is not inconceivable that he, or any subsequent Russian administration, perhaps one more concerned with social equality, might not one day come after those ill-gotten gains. But not if they are converted into a five million pound flat by the Thames.

The arrival of the super-rich has created an entire eco-climate of services to keep them in the comfort to which they are accustomed, from stupidly priced fashion boutiques for their wives and mistresses and interior designers who will convert their hideous taste into gold-plated reality to high class hookers. The City has a role to play in this. As the New York Times piece points out, there are more than 50 Russian companies quoted on the Stock Exchange.

When they first started to arrive, along with companies from countries that had earlier been part of the Soviet empire but broken away, some of which have appalling human rights records too, there was a genuine debate. Given that some were highly suspect, in terms of how those who controlled them acquired those holdings, should we risk the reputation of one of this country’s greatest assets, the London Stock Exchange?

The counter-argument was, if London turned them down, they would go elsewhere, to another domicile’s benefit. This is the same argument, by the way, that fuels the arms trade. If we don’t sell it, someone else will.

Some of them were allowed to bend the usual rules of corporate governance, which are designed to ensure all shareholders are treated equally. In some cases, this has subsequently done a disservice to those investors who bought in when the companies floated, though those investors will have known what they were buying.

Now there are plans to charge a million pounds or more for British residency, and a visa. What once had to be earned of right is now up for sale, at the right price.

Some years back I had the chance to interview someone who had made rather a lot of money in Russia. He lived in a gated compound in… well, probably better not to say. He was affable enough. But the place was genuinely scary, a small piece of my home town I was allowed into on sufferance by guards who may, or may not, have been armed. You had to ask yourself just why the residents needed quite such heavy-handed security, and why they were obviously prepared to pay so much for that peace of mind. What were they afraid of?

Money talks, and everything is for sale.

On Ukraine. And Crimea. Not My Business.

“All summer they drove us back through the Ukraine/Smolensk and Viasma soon fell/By autumn we stood with our backs to the town of Orel.”

Al Stewart, Scottish songwriter.

Let’s set up a proposition. A Very Large Colonial Power is required, because of global geopolitical trends, to give up control of a state on its borders. Part of that state, geographically, is a semi-autonomous region, the majority of whose population plead allegiance to that colonial power.

Let’s call that colonial power Great Britain. Call the state on its borders Eire, and call that semi-autonomous region Northern Ireland.

Let us suppose that a regime utterly inimical to the UK emerged in Dublin. The concern in London would be its fellow citizens, in reality if not in law, in Northern Ireland. There would be warships off Belfast, troop carriers trundling through the streets of Londonderry. Making a point.

You see what I am saying. I have no huge amount of time for Putin, though his conservative, anti-gay stance seems to be playing well with some parts of the extreme right in the West. The survival of the post-Soviet state is predicated on high energy prices, which may not continue. Or perhaps, given those geopolitical trends, they will.

We in the West fail to understand the Russian mindset. The collapse of the Soviet Union was a sudden, disastrous humiliation which dwarfs the loss of Empire we saw in the 1950s and 1960s. Putin is, cleverly, playing on that humiliation. Strengthening the Orthodox Church, harking back to the days of Stalin, a leader still hugely admired by many Russians.

The great state of Kiev was founded by Vikings. The first ruler was Rurik, a good Norse name. Within two generations, the ruler was Svyatoslav, the first ruler with a Slavic name. Kiev, and Ukraine, is part of the Rodina, Holy Mother Russia.

The Russians will not forget that. Read “Ivan’s War”, by Catherine Merridale, a depiction of the Eastern Front from the viewpoint of the Russian soldier who fought and died to win the war against fascism.

Read it. Then marvel at the triumph of the human spirit, that saw Russians and Germans speaking in a civilised manner within a generation. I cannot decide which I admire more.

On M&A. Or The Lack Of It.

Much has been made of the stock market being buoyed up by the expectation of a load of mergers and acquisitions coming down the slipway. I am not so sure.

There are deals being done, Rentokil Initial selling to Interserve, Dixons and Carphone Warehouse possibly merging. But there has not been a serious mega-deal since Glencore bought Xstrata. That was first mooted in 2012.

The people who are claiming M&A is about to take off are either investment bankers, who have a vested interest here, or those who listen, perhaps over-credulously, to investment bankers. But the feature of the reporting season over the past couple of months has been corporates handing over surplus cash, in the form of buy-backs or special dividends. This hardly suggests an appetite to use all that cash to buy up their rivals.

I was talking to the head of a decent-sized services company  the other day. He was openly contemptuous of those investment bankers. He had been pressured by the same to buy a smaller, under-performing business in an adjacent area to where he operates. This throws up lots of warning  signs.

What would persuade him he could run that underperformer better, save arrogance and hubris? Why was it underperforming in the first place? If it was outside his main market, in which he was doing rather well, what would persuade him he could do as well there?

He would much rather devote his energies to expanding his business through winning new work from multinational clients.

Most acquisitions destroy value. Most do not earn a worthwhile pay-back. Any number of academic studies have shown this. Rather more companies, historically, have been destroyed by extending themselves too far, buying unsuitable assets , than have foundered because they gave investors their own cash back. In fact, I can’t think of one in that last category.

I wonder if today’s senior executives, looking back on the last bout of M&A frenzy , more than a decade ago, are drawing the appropriate conclusion. And learning from others’ experience.