TODAY’S FAYRE

TODAY’S FAYRE – Wednesday 28^th November 2012

“The Frost performs its secret ministry,
Unhelped by any wind. The owlet's cry
Came loud—and hark, again! loud as before.
The inmates of my cottage, all at rest,
Have left me to that solitude, which suits
Abstruser musings: save that at my side
My cradled infant slumbers peacefully.
'Tis calm indeed! so calm, that it disturbs
And vexes meditation with its strange
And extreme silentness. Sea, hill, and wood,
This populous village! Sea, and hill, and wood,
With all the numberless goings-on of life,
Inaudible as dreams! the thin blue flame
Lies on my low-burnt fire, and quivers not;
Only that film, which fluttered on the grate,
Still flutters there, the sole unquiet thing.
Methinks, its motion in this hush of nature
Gives it dim sympathies with me who live,
Making it a companionable form,
Whose puny flaps and freaks the idling Spirit
By its own moods interprets, every where
Echo or mirror seeking of itself,
And makes a toy of Thought.”

T

Samuel Taylor Coleridge  – Poet – 1772-1834

As per normal I am probably a million miles behind the curve when it comes to television series. In the last few days we have spent many hours in a torpor watching series 2 of “The Killing.” Even though Danish is not my second language I am totally enraptured by Sara Lund and her colleagues in their quest to solve copious murders in the most complicated of plots – enjoying it hugely!  Part of the Christmas holiday has every chance of being a totally decadent period of intrigue and fantasy as we have been recording Series 3! – Just cannot wait!

The US retail sector had a Thanksgiving weekend to purr over. Spending per shopper nationwide averaged $423 -- $25 more than last year -- from Thursday to Sunday, while total spending increased nearly 13 percent, to an estimated $59.1 billion, according to a survey by the National Retail Federation. Yesterday Cyber Monday's results collated up 3 p.m. showed that online shopping was up a whopping 25.6 percent compared with the same time period a year ago, according to figures by IBM Benchmark.

Lord Patten tells a Commons committee that former Director General George Entwistle wanted more than 12 months' salary to resign following Newsnight's bungled child sex abuse report. He says that anything less than a 12-month payoff on his terms would have resulted in a constructive dismissal action which would have cost considerably more than the £450,000 he was given to leave. I did not care for Philip Davies’s MP’s demand to Lord Patten that he should set out his personal daily time table as to how the Chairman allocates his time for scrutiny - Impertinence personified! Perhaps if the question had been asked less aggressively with some good grace Lord Patten’s response may have been less disdainful. It is fair to say that a representative of the people has the right to hold a public servant to account.  However there is a correct and incorrect way to gain acquiescence.

I just cannot wait for Tony Blair’s supportive speech on the future of the EU and the necessity for a President of Europe.  Achieving that goal on a personal basis would of course mean of straight royal flush of cards for the illustrious attention seeking Mr Blair!

Initially the news of the Greek bail-out caught the imagination of investors in Europe at the start of yesterday’s trading.  However once folk ruminated on the terms, perhaps it wasn’t as great a deal as it was cracked up to be.  Add the overhang from the US Fiscal Cliff and the threat of a Spanish bank bail-out, the situation began to look quite toxic.  So some risk came off the table and sentiment took a tumble.  Spain announced that the Banca de Valencia was to be bailed-out by the government slipped under the radar.  Frankly it makes me very nervous indeed.  This the 4^th Spanish bank to hit the rocks and be nationalised. Talking of politicians I do not like the cut of Harry Reid’s jib.  He may be US House leader, but frankly he’s a sour-puss.  I am sure he will get over it that I am not a fan.  However his belligerent attitude will not bring the GOP to the negotiating table. His patronising comments that ‘Happy Talk’ is over and it is time to negotiate will be met with some ambivalence. There is only about 2 weeks to go before we shall have to wait until January before any progress on the grave issue is made.

Yesterday’s ONS GDP figures made slightly less than awful reading.  There was confirmation of 3^rd quarter GDP at 1%, with manufacturing and industrial production both growing by 0.9%. However for GDP in the UK to only expand by 1.4% in 2014 is a worry.  However the OECD’S forecasts for Europe made dispiriting reading.  Their forecast for 2012 has been cut from 2% to +0.6% and for 2013 2%.  Without Germany and a touch of France, Europe’s plight looks unappetising.  That 2013 2% will take a bit of getting!

This morning the results of MegaFon’s IPO in Moscow and in London will be posted.  Trading starts today.  Shares will be issued at $20 – the lower end of expectation. The shares are expected to yield 7-8%.  MegaFon will be the 2^nd largest Russian mobile operator to MTS.  Corporate governance remains an issue for global investors to support Russian companies – a reason why Goldman Sachs did not participate as a lead manager.  Clearly Morgan Stanley, Sberbank, Citi, Credit Suisse and VTB were not fazed by the challenge.  About $1.7 billion will be raised through this issue, valuing the company at $11.2 billion.  Alisher Usmanov, who owns just over 29% of Arsenal FC will be the main beneficiary. He is purported to be worth $18 billion and probably directly and indirectly will bring influence to bear on 20% of the company. Global Investment Fund, which Usmanov is associated may have subscribed for $280 million of shares.  As a result of the IPO Telia Sonera will have cut its ownership in MegaFon down from 35% to 25%. The issue was oversubscribed at the bottom end of the range.  Market conditions will have some influence in early skirmishes. Lord Myners, hardly the most popular man within the square mile, though respected as a fund manger whilst at Gartmore, is on the board.  Having also been a government minister MegaFon will be hoping that Lord Myners will be able to broaden the shareholder register, adding credence to this issue. 

The press for Mark Carney, the Governor of the Bank of England elect, has been gracious and positive. Without stating the obvious Mr Carney is not Moses – the English Channel will not part and the UK’s economy is in the cack and will take more than his considerable input to improve the status quo!  He will not bring much in the way of influence to the table until next year.  In the meantime its business as usual with Sir Mervyn King scrapping with the Treasury over the £37 billion profit from QE not heading to cut the borrowing requirement.  In the meantime what of Paul Tucker?  The dignified silence has been not surprisingly deafening.  I suspect that the Deputy Governor will set about his business in his own inimitable selfless manner until next Summer.  He is a team player and will not be seen to rock the boat by leaving precipitously. Optics and credibility are very important. Then I suspect he will bow out into the commercial jungle.  Good luck to him!  He has been a first class servant to the community. He steadied the ship in 2008/9 when all seemed loss.  Thank you!

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