Monthly Archives: January 2010

Kiran Stacey

At the height of the crisis, in November 2008, the Queen asked a room of academics at the London School of Economics what could be the key question of the last few years: “Why did nobody see this coming?”

It is a question seized on by David Hare in his new play, The Power of Yes, but which is arguably better answered by Lucy Prebble (a Londoner in her 20s) in her play Enron, which debuted in London’s West End last night, and which ostensibly has nothing to do with the credit crisis and its aftermath.

Enron‘s West End debut, especially for those who, like me, were seeing the play for the first time, was a triumph. The acting was compelling and believable, especially from Sam West, who as Jeff Skilling managed to make a seamless transition from maths nerd to master of the universe. This was coupled with the kind of spectacular pyrotechnics that audiences expect from a Rupert Goold production, including a stunning representation of 9/11 (an event not exactly easy to re-create within the confines of a West End stage). Nor were the special effects out of place: Prebble explained recently in the FT that part of the point of the elaborate staging was to capture something of the out-of-control nature of Enron itself.

But the real star was the writing. Some of it seemed too prescient to have been written before the current crisis, and Prebble says in the FT piece that she re-wrote parts for the West End. But in one scene, which must have been there from the play’s inception, she captures perfectly how Enron got into the position it did and why no one saw it coming, and it is a scene that translates perfectly for the current crisis.

James Mackintosh

Tony Blair’s appearance at the Iraq inquiry on Friday has proved a gift to journalism: “Questions Blair must answer” has become the standard outlet for outrage over the botched invastion. Even the BBC is trying to anticipate what questions Blair will actually be asked.

Here’s a selection:
Was it all tied up at the Crawford meeting with Bush?
Would he have invaded anyway even if he knew there were no WMD?
The 45 minutes claim and the rest of the dodgy dossier: was pressure put on the spooks to fabricate evidence?
Did he put the thumbscrews on Lord Goldsmith to make him approve the legality of the war?
Was the army under-resourced?
Did he even thinkabout the aftermath of the invasion?

Examples include the Telegraph, Guardian, Telegraph readers, the Observer, Evening Standard, Left Foot Forward, the 38 Degrees Campaign, and Philippe Sands,

Funnier, though less likely to be right, are Richard Ingrams, who wants to be pointed to the biblical passages George W. Bush might have referred to at the Crawford meeting with Blair, and Iain Martin, who wants to know what Blair had to eat at the famous Granita lunch where he stitched up the leadership with Gordon Brown. Norman Geras’s irony is well applied to one of the questions. The best serious analysis of the genre, though, comes from John Rentoul at the Independent, who goes through the questions and dismisses them point by point.

Of course, almost no one expects Blair to actually answer the questions, no matter what he is asked.

Kiran Stacey

The Independent
Matthew Norman, Blair will always be a pariah
Hamish McRae, This time let’s not waste growth
Victoria Clark, Yemen’s greatest enemy is sitting across its border

The Times
Patrick Hennessy, Good news from Afghanistan: democracy is taking root
Editorial: Credit rating

The Wall Street Journal
Bruce Ackerman and David Wu, How to counter corporate speech
Editorial: The Hong Kong tea party

The Guardian
Jonathan Freedland, The change we need is a rougher Obama
Raphaël Liogier, France’s attack on the veil is a huge blunder

The Washington Post
Harold Meyerson, Ditch the Clintonism?
Michael Gerson, Or keep the Clintonism?

The New York Times
Maureen Dowd, Bringing sexy back
Thomas Friedman, Adults only please

The Huffington Post
Robert Scheer, The sorry state of the union

From the FT’s comment section:
Martin Wolf: Volcker’s axe is not enough to cut banks to size
John Kay: How political ideology found a new world
Stephen Graubard: Obama needs to perform a U-turn
Michael Pettis: Why trade war is very likely to break out this year
Glenn Hubbard: A true Marshall plan for Haiti
Editorial: Barack Obama’s state of the union
Editorial: Republican bigotry
Editorial: A very small mercy
Global Insight: Peggy Hollinger, Sarkozy hopes force is still with him
Market Insight: Ben Funnell, Recovery at risk if contradictory forces collide
Notebook: Sue Cameron, Whitehall vents its dissatisfaction
Lex: The agenda-setting column on business and finance

James Mackintosh

Britain’s out of recession at last: fourth-quarter growth of a stunning 0.1% (unless it is revised down). Predictably, there aren’t many cheers, particularly among the right-wing bloggers. Britain, Paul Staines points out in an amusing video, is the last country in the G20 to emerge from recession (although conveniently Spain, which has not yet published Q4 numbers and might still be in recession, isn’t in the G20).

But wait: while Britain was late to return to growth, the scale of the recession wasn’t as bad as some. And while growth remained elusive, job losses were less severe than, for example, the US.

A random selection of those doing worse than Britain’s 6.1% economic contraction:

-6.3% Sweden
-6.5% Italy
-6.7% Germany (what? The Teutonic powerhouse did worse – yes)
-8.6% Japan
-9.1% Finland
-10.8% Ireland
-19.8% Lithuania (completely stuffed)

James Mackintosh

Thanks Bill. This from Bill Gross, manager of the world’s largest bond fund. The man James Carville might have wanted to be reincarnated as – and the 32nd most powerful person in the world, according to Forbes.

The UK is a must to avoid. Its Gilts are resting on a bed of nitroglycerine. High debt with the potential to devalue its currency present high risks for bond investors. In addition, its interest rates are already artificially influenced by accounting standards that at one point last year produced long-term real interest rates of 1/2 % and lower.

He recommends Canada and Germany – dull dull dull, which means money to bond investors.

His warning comes almost exactly a year after Jim Rogers, co-founder of the Quantum Fund with George Soros, dumped on sterling in a big way, saying Britain “had nothing left to sell”.

Both are undoubtably talking their own books. But on the day the UK finally emerged from recession, this was not what Brits wanted to hear.

Kiran Stacey

It’s a tough job, being a journalist, especially on a Sunday newspaper, when readers expect page after page of original stories even though nothing happened on the previous day. So hats off to The Sunday Times for this classic piece of self-made news featuring Lionel Shriver, the author of hit novel We Need to Talk About Kevin.

Shriver herself describes it here, but to summarise, this seems to have been the sequence of events:

1) The Sunday Times suggests Shriver should write a travel piece for them if she should ever visit a country as research for an upcoming novel.
2) Shriver contacts the Sunday Times to suggest she write a travel piece about Pemba, which she intends to include in her new book.
3) The Sunday Times accepts, and pays for Shriver to go. The hotel she stays in gives her a free stay (which presumably the paper knew about, if only from the lack of an invoice in their inbox). She writes a lilting, if uninspired article – and declares at the end of the piece that she accepted the holiday for free.
4) When the book is published, including a mention of said hotel, The Sunday Times writes a new piece about how Shriver is benefitting from a holiday freebie in return for mentioning the resort in her book.

Brilliant stuff, and I’m sure you will all be delighted to know that Maurice Chittenden, the resourceful journo who wrote the news item, was one of my tutors at journalism school.

James Mackintosh

While the banks are currently taking the blame for the financial crisis, there are other culprits who share at least as much blame, and sound guilty before you even know anything about them: the shadow banks. While SIVs, SIV-lites, CDOs and other structured finance vehicles are assumed to be in the past, the role of surviving money-market funds and the prime brokers which service hedge funds, plus other bank-like operations, is conveniently ignored by most of the current proposals.

Kiran Stacey

The New York Times
Roger Cohen, A woman burns
David Brooks, The populist addiction
Bob Herbert, Obama’s credibility gap

The Huffington Post
Taylor Marsh, Barack Obama, Cynic-in-chief

The Guardian
Joseph Stiglitz, A principled Europe would not leave Greece to bleed
Bryan Gould, The real reason for the Iraq war

The Washington Post
Richard Cohen, Bought with a smile
Anne Applebaum, India’s hopeful patriotism

The Times
Richard Kemp, Al-Qaeda is losing. Prepare for a daring hit
Sathnam Sanghera, We’ll pay a high price for this free-for-all

The Wall Street Journal
Najib Razak, Finding unity in Malaysia’s diversity
William McGurn, Bill Clinton’s revenge

The Independent
Steve Richards, Cut now or cut later: the election decider

From the FT’s comment section:
Philip Stephens: The futile quest for Iraq’s smoking gun
Raghuram Rajan: A better way to reduce risk
Gideon Rachman: When nations turn to hoarders
Michael Skapinker: Too early to write off democracy in China
Arthur Levitt: How to bypass populism and tackle banking
Mark Roe: More corporate lobbying is bad business
Editorial: Forcing the peace in Afghanistan
Editorial: Bernanke’s battle
Editorial: Breaking the Linke
Global Insight: Alec Russell, Zuma’s Basic instinct sees him wooing China
Market Insight: Hugo Banziger, Where the Walker Review stops short
Notebook: Brian Groom, Frying tonight, a very British story
Lex: The agenda-setting column on business and finance

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Politics, economics, high finance and morality – this blog addresses the issues being considered by the FT’s comment team, and their thoughts.

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Christopher Cook is an FT editorial writer. Before joining the FT in 2008 as a Peter Martin Fellow, he worked for three years for the Conservative party.

Lorien Kite is deputy comment editor, a post he took up in 2009 after four years as a commissioning editor on the analysis page. He joined the FT in 2000.

Ian Holdsworth became assistant features editor in 2009 and was previously chief production journalist for the features pages.


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