Infuriated by Fleet Street’s tabloids, the House of Lords this week nodded through a law to curb the British press. It authorised a Royal Charter that defines how self-regulation will work after the Leveson inquiry into phone hacking. Read more
Failed internet millionaires are our future
Like thousands of parents inspired by the story of 17-year-old “software prodigy” Nick D’Aloisio, I’ve just asked my teenage son what he’s doing on his computer that might later be worth $30m.
Mr D’Aloisio’s tale has all the elements to make pushy parents sweat: the boy had the idea for his news reader app Summly, just bought by Yahoo, while revising for his history exam, for goodness’ sake! Read more
US chief executives are beginning to wean themselves from their perplexing attachment to the role of chairman. But at a few large banks, the addiction persists. Read more
Small banking islands will suffer from the Cyprus bail-out
The chaos over the rescue of Cyprus – under which insured bank deposits were initially threatened but have been reprieved – has raised questions about whether depositors in other eurozone countries will feel safe.
But I wonder if the bigger long-term effect will be on offshore banking centres in general, rather than the eurozone. After all, Cyprus shows that a small financial centre that becomes overwhelmed by financial difficulties cannot stand behind a banking system several times the size of its economy. Read more
Depositors of banks in Cyprus now fear they have less money than they thought while US corporations have plenty of cash to hand – $1.45tn and rising, according to Moody’s. But whose money is it, anyway? Read more
The first two rules of Fight Club, according to the film of the same name, are “You do not talk about Fight Club” and “You DO NOT talk about Fight Club”. Studies of corporate success follow the opposite code. Since Tom Peters and Robert Waterman published In Search of Excellence in 1982, readers have not stopped talking about whether the lessons taught by such books are valid. Read more
Europe’s dislike of bonuses weakens financial stability
I struggle to see any logic behind the European Parliament’s latest initiative to crack down on financial industry pay, beyond a dislike of bonuses. The idea that investment funds should be treated similarly to systemically important banks has even less merit than the original idea.
The basis on which the EU proposed to rein in bank bonuses – despite UK opposition and criticism from supervisors including Andrew Bailey, the incoming head of the Prudential Regulation Authority – was that excessive bonuses gave bankers a perverse incentive to take risks. Read more
It has been a frustrating week for well-intentioned and interventionist political leaders. Michael Bloomberg and David Cameron have been roundly defeated in their efforts to prod citizens into health. Read more
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John Gapper is an associate editor and the chief business commentator of the FT.
He has worked for the FT since 1987, covering labour relations, banking and the media. He is co-author, with Nicholas Denton, of 'All That Glitters', an account of the collapse of Barings in 1995.
Andrew Hill is an associate editor and the management editor of the FT. He is a former City editor, financial editor, comment and analysis editor, New York bureau chief, foreign news editor and correspondent in Brussels and Milan.
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