The Independent - Business Comment RSS Feed

Hamish McRae: Yes, but what about the savers?

Fri, 05 Dec 2008 13:54:19 GMT

It has been almost lost in the wave of support for the cut in rates by the Bank of England that there are about four or five savers for every mortgage borrower

Jeremy Warner: When interest rates reach zero, what does the Bank do then?

Fri, 05 Dec 2008 02:22:02 GMT

Outlook: Things must be bad, mustn't they, if interest rates have been cut all the way down to 2 per cent, the lowest since 1951 and indeed equal lowest in the Bank of England's entire 314-year-history, with markets predicting still more reductions to come? Well, plainly they are, but it is an interesting thought that though rates as low as these can hardly be described as "a return to normality", in the broad sweep of history, they are not as unusual as you might think.

Jeremy Warner: When interest rates reach zero, what does Bank do then?

Fri, 05 Dec 2008 02:22:02 GMT

Jeremy Warner: Cynicism of the mortgage plan

Fri, 05 Dec 2008 02:19:35 GMT

Outlook: Following my generally positive note yesterday on the Government's proposed mortgage-relief scheme, a banker calls to tell me I'm talking nonsense and to point out that the largesse of the taxpayer in underwriting a two-year moratorium on mortgage repayments for the unemployed is far from free.

Jeremy Warner: Savers ignored in the rush to zero interest rates

Fri, 05 Dec 2008 02:17:37 GMT

Outlook: Good news. Interest rates are going down – for millions of borrowers. Bad news. Interest rates are going down – for millions of savers. While falling interest rates make profligate borrowers better off, it makes those who have laboriously saved for a rainy day worse off. As a nation, we have become so seriously indebted that reducing the cost of money puts more back into the economy than it removes from those who rely on their savings for all or part of their income.

Jeremy Warner: Biotech faces funding crisis

Fri, 05 Dec 2008 02:13:44 GMT

Outlook: A high-level group of entrepreneurs, business leaders and scientists, including Sir Christopher Evans and Sir Richard Sykes, is warning that the financial crisis threatens meltdown in Britain's once-thriving biotech industry unless the Government steps into the breach with alternative funding. Welcome to the club. Just about every industry in the land is holding out the begging bowl right now.

Hamish McRae: US house market still holds the key to the date of the recovery

Fri, 05 Dec 2008 00:00:01 GMT

The central banks pull the levers but is there anything attached at the other end?

Jeremy Warner: Sterling was far too high. Now it may be going the other way

Thu, 04 Dec 2008 03:01:52 GMT

Outlook: Jose Manuel Barroso, head of the European Commission, thinks Britain is “closer than ever before” to joining the euro and even claims to have had conversations with senior members of the UK Government to that effect. Meanwhile, Christine Lagarde, the French finance minister, would be more than happy to welcome us in.

Jeremy Warner: Sibir Energy’s lesson in caveat emptor

Thu, 04 Dec 2008 03:00:46 GMT

Outlook: Ah, the perils of investing in Russia. M&G, Black Rock and other top-drawer London-based investors might have thought when they bought shares in Sibir Energy they were investing in a Siberian oil and gas play, but in fact it turns out they were buying into a Moscow property company with a portfolio of largely uncompleted development projects.

Jeremy Warner: Mortgage plan may be smarter than it looks

Thu, 04 Dec 2008 02:59:42 GMT

Outlook: Brown’s mortgage relief plan is smarter than it looks. On the face of it, underwriting lenders who allow those who lose their jobs to defer their mortgage payments for up to two years is an outrageous use of taxpayers’ money as well as amounting to unwarranted interference in a necessary housing market adjustment.

Sean O'Grady: Don't blame the banks

Wed, 03 Dec 2008 14:11:02 GMT

Here we go again: banks as scapegoats once more. It was a very similar story in the last recession, in the early 1990s; at that time it was the banks' interest and other charges that were supposedly crucifying small businesses, and Chancellor Norman Lamont was the subject of media campaigns to stop the banks behaving like normal businesses.

Jeremy Warner: British Airways adds Qantas to list of marriage partners

Wed, 03 Dec 2008 00:00:01 GMT

Outlook That two-timing Willie Walsh, chief executive of British Airways, has been playing the field again. Not content with his ongoing courtship of Spain's Iberia, or even his on-off affair with American Airlines on revenue, sales and cost-sharing, he's also been sweet-talking the Australian carrier Qantas, though you must please understand that it wasn't any part of Mr Walsh's doing. It was apparently Qantas that made the approach. What can a man do when such an attractive-looking Sheila throws herself at your feet?

Jeremy Warner: The real carnage comes after Christmas

Wed, 03 Dec 2008 00:00:01 GMT

Outlook Little sign yet of the wheels coming off the Tesco juggernaut. UK like-for-like sales growth of "just" 2 per cent is the slowest since the early 1990s, but there is no profits warning, as forecast by some. Given that the growth being reported is all volume, with no contribution from inflation, performance doesn't look that bad.

Jeremy Warner: 'Not guilty', plead bankers on small business lending

Wed, 03 Dec 2008 00:00:01 GMT

Outlook Forget the bankers, it may be as much suppliers and customers who are to blame for the present squeeze in small business lending. In launching its "charter for small businesses" yesterday, Lloyds TSB insisted that, far from reducing its small business lending over the past year, it had increased it by 18 per cent, with the average amount drawn rising from 50 per cent of overdraft limits to 58 per cent. These figures seem to conform with separate data from the British Bankers' Association suggesting an overall uplift of 10 per cent in lending to SMEs among the major banks.

Jeremy Warner: Housing market adjustment cannot so easily be halted

Tue, 02 Dec 2008 00:00:01 GMT

Outlook: Stephen Hester, chief exec-utive of Royal Bank of Scotland, hopes people might look more kindly on banks now that RBS is planning to give six months breathing space to householders who fall behind with their mortgage payments.

Jeremy Warner: O'Leary back for a second bite at Aer Lingus

Tue, 02 Dec 2008 00:00:01 GMT

Outlook: If at first you don't succeed ... Michael O'Leary, the pugnacious boss of Ryanair, thinks conditions in the airline industry have deteriorated so much in the two years since he last took a tilt at Aer Lingus that now he's bidding at half the price he did back then, the competition authorities in Europe will be only too happy to wave him through.

Jeremy Warner: New Star in meltdown as shares plunge

Tue, 02 Dec 2008 00:00:01 GMT

Outlook: As founder of first Jupiter and later New Star Asset Management, there is no doubting John Duffield's talents as a serial entrepreneur and money maker, yet the skids have been under his once buoyant share price for more than a year now. After yesterday's calamitous attempt to suspend trading in the shares, they have become worth little more than option money.

Stephen King: Bernanke's blueprint for dealing with the horrors of debt deflation

Mon, 01 Dec 2008 00:00:01 GMT

In late-2002, Ben Bernanke, now the chairman of the Federal Reserve, gave a speech entitled "Deflation: Making Sure 'It' Doesn't Happen Here". Then, Mr Bernanke was merely a Fed Governor and had yet to make his way to the very summit of the central banking profession. Nevertheless, there can be no doubt that the thoughts expressed in that speech are thoughts which, once again, are very relevant.

Margareta Pagano: We need equity to become equitable

Mon, 01 Dec 2008 00:00:01 GMT

Workers of the world unite. Don't down your tools but buy a slice of the action. There couldn't be a better time to start learning to love equity – owning shares and investing in business – while weaning ourselves off our addiction to debt that has landed us in our present mess.

Margareta Pagano: Male egos, move over, women are retail's best hope

Sun, 30 Nov 2008 00:00:01 GMT

Are we watching the end of the ego on the high street? For the past two decades a clutch of retailers, such as Sir Stuart Rose, Sir Philip Green and George Davies, have strutted their stuff pretty much unchallenged.

Hamish McRae: If the recession won't be that bad, why will we go so far into the red?

Sun, 30 Nov 2008 00:00:01 GMT

So what will happen to the economy during the next couple of years? If the recession is shallow and short, then we might just about scramble through. But if not, then we will be in a huge mess, having to tighten policy while we're still in recession.

Jeremy Warner: Private equity sees land of opportunity

Sat, 29 Nov 2008 00:00:01 GMT

Outlook: Thought you had heard the last of the private equity boys? Think again. The death of leverage hasn't dispirited them at all. With the credit markets closed and even major, well-run companies with market-leading positions struggling to finance themselves, private equity senses a veritable lorry-load of opportunity.

Jeremy Warner: Now we own the banks, what should we do with them?

Sat, 29 Nov 2008 00:00:01 GMT

Outlook: It's been on a slow burn, but that doesn't make the moment any less historic. On Monday, Her Majesty's Treasury becomes the proud owner of 58 per cent of Royal Bank of Scotland, ostensibly putting the Government in charge of £1.9 trillion of assets and liabilities, equal to one and a half times Britain's entire annual output. Add in the 43.5 per cent of the combined Lloyds TSB/HBOS that the Government is likely to end up with once the recapitalisation of the two banks has gone through, and the Treasury might be deemed to control assets valued at well over double GDP.

Jeremy Warner: Car makers beg for state assistance

Fri, 28 Nov 2008 00:00:01 GMT

Outlook The age of state intervention is back with a vengeance. Not that the Government is a particularly willing intervener, despite Labour's socialist roots. Rather, circumstance is forcing intervention on reluctant ministers. Almost unbelievably, given their natural aversion to anything to do with the state, the severity of the downturn is causing business leaders to start queueing at the Government's door, cap in hand, begging for assistance.

Jeremy Warner: Retailers face up to a slimline future

Fri, 28 Nov 2008 00:00:01 GMT

Outlook First housebuilding, now retailers. After banking, these are the industries in the front line of the deepening economic and financial crisis, though there are plenty of others fast following up the rear. Perhaps oddly, no major housebuilder has yet gone bust, but in retailing they are already dropping like flies. Woolies may be the biggest and most iconic name to have bitten the dust so far, but it is only the outsized tip of the iceberg. Scores of smaller retail chains have been forced to quit the high street over the past year.