TODAY’S FAYRE – Wednesday 8th July 2015


Down, wanton, down! Have you no shame

That at the whisper of Love’s name,

Or Beauty’s, presto! up you raise

Your angry head and stand at gaze?

Poor bombard-captain, sworn to reach

The ravelin and effect a breach–

Indifferent what you storm or why,

So be that in the breach you die!

Love may be blind, but Love at least

Knows what is man and what mere beast;


Or Beauty wayward, but requires

More delicacy from her squires.

Tell me, my witless, whose one boast

Could be your staunchness at the post,

When were you made a man of parts


To think fine and profess the arts?

Will many-gifted Beauty come

Bowing to your bald rule of thumb,

Or Love swear loyalty to your crown?

Be gone, have done!

Down, wanton, down!”


Robert Graves – poet – 1895-1985


I suspect we shall see very little play in Cardiff today for the start of this Ashes series, but let battle commence! I just cannot wait. A rejuvenated England is not out of this. Both sides have players are becoming a little long in the tooth! There’ll always be an England. Grab the moment boys!


Much of the domestic agenda will be centred round the Budget statement 12.30pm; so I will leave comments and observations to my excellent friend and colleague – Panmure’s chief economist, Simon French.


Presently there is turmoil in every direction any investor or interested party turns! – Greece, China, markets in general, with the departure of Antony Jenkins being added to the list this morning– more of that later. If the EU head honchos are to be believed the Greek crisis will come to a conclusion – an unhappy one whatever is decided – on Monday. Tsipras smiled like a Cheshire cat in front of the cameras in Brussels, as if he did not have a care in the world, despite staring in to the vortex of economic despair. At least we will all be taken out of our misery by Monday – one way or another. My own unsophisticated feeling suggests an 11th hour cobbled deal to help the terrible plight of the Greek people on a temporary basis, with Greece inevitably looking at the GREXIT door, as it has zero chance of sustaining debt let alone repaying it. There comes a time when the kissing has to stop and that time is nearly nigh upon us. I have no idea if the new finance minister Euclid was pulling a flanker or bluffing EU leaders with a tatty piece of hotel headed paper with a few scribbled notes in full view of the media, but I suggest that he takes his job rather more seriously. I don’t think the EU/ECB/IMF, despite the latter’s absence, are bluffing.


Yesterday European bourses lost between 1.5% and 2%. The DAX and the CAC was probably down to dire sentiment re Greece and the possible contagion. In the case of the FTSE, it was oil and commodity prices that took the FTSE lower by 103 points to 6432. The FTSE 100 has surrendered all this year’s gains plus another 1.5%. The Street of Dreams, on the back of decent Labour data – 5.36 million job vacancies – the highest number since 2000, pressed on regardless – DOW +0.53%, S&P 500 +0.61% and the NASDAQ +0.11%. This scriber is starting to feel very nervous on the back of valuations though chartists seem comfortable.


This morning it was ‘murder & mayhem’ in Asia. The NIKKEI closed down 3.14%. It too has had a terrific run on the rails on the back of stimulus packages for the past year. The Shanghai Composite opened down 8%, pulled itself back to -3.88% but closed down 5.9%. The authorities seem to have lost control with their brokerages assistance. Half the companies are not being quoted; so how one measures performance in China the Good Lord only knows? The Hang Seng took a really larruping – down 7.5% at the close. It has taken time to catch up with the Composite. One must remember that there is ‘fungeability’ between the two centres. The Shanghai futures appear to be in absolute turmoil. It is interesting to note that the Shanghai is more or less at the same level as it was in March this year. All may not be well with China’s economy. Maybe we are close to deflation. Take a look at the price of REBARS from the construction industry. They have fallen from 5200 to 1900 – often a decent barometer of economic activity.


Now to Barclays! When John McFarlane was appointed to succeed the government’s appointee Sir David Walker in 2012 – a good steady pair of hands; an economist; BOE man; chairman of Morgan Stanley who probably would not have said ‘boo’ to John Purcell and without being disrespectful uninspiring!; ‘the writing was on the wall’ for Antony Jenkins, who tried manfully to make Barclays an ethical bank at the cost of market share and profits. Sadly Mr J was much in the same mould as his chairman for expediency. With great respect to Mr Jenkins he never had the charisma to follow in the vilified Bob Diamond’s boots. Say what people will about Bob – he delivered profits in spades through BarCap – maybe not in the manner that everyone would like. So if you are ‘metaphorically’ going to throw the baby out with the bathwater’, you have to have a plan to replace the profits. That plan did not seem to be there – just a massive cost cutting exercise.


That will not do for shareholders. John McFarlane, formerly of ANZ and chairman of Aviva, eats nails for breakfast and spits the rust out! He will take no prisoners. He is a salesman and if he cannot do it himself, he will find people who can. Banking, with the extra cost of capital is more competitive than ever. So Mr Jenkins’s demise with indecent haste comes as no surprise to me. McFarlane has had a few weeks to look around and I suspect that he was underwhelmed with what he saw. He is now executive chairman assuming overall responsibility until a successor has been identified. Mr Jenkins will go home with a humped back crying all the way to the bank with a surplus of largesse. So life is not all bad! I suspect Bill Winters is kicking himself that he did not have the opportunity of applying for this job. Standard Chartered have a good man!



US companies posting results – Wednesday – COSTCO, Thursday – GAP, FRED’S, WALGREEN BOOTS ALLIANCE, PEPSICO and PRICESMART.



Economics – Wednesday – UK BUDGET, FOMC MINUTES, Thursday – MPC MEETING




David Buik – market commentator


Panmure Gordon & Co​


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