TODAY’S FAYRE – Monday, 25th January 2016
“COME, I will make the continent indissoluble;
I will make the most splendid race the sun ever yet shone upon;
I will make divine magnetic lands,
With the love of comrades, With the life-long love of comrades.
I will plant companionship thick as trees along all the rivers of America, and along the shores of the great lakes, and all over the prairies;
I will make inseparable cities, with their arms about each other’s necks;
By the love of comrades, By the manly love of comrades.
For you these, from me, O Democracy, to serve you, ma femme! 10 For you! for you,
I am trilling these songs, In the love of comrades,
In the high-towering love of comrades.”
Walt Whitman – author & poet – 1819-1892
At this late stage for the corridors of power to start flagging up Michael Bloomberg’s name as a serious Presidential candidate is confirmation to me that Donald Trump is not the US electorate’s answer to the problem to succeed Barack Obama. His candidacy, which must be unlikely, would also seriously spike Hillary Rodham Clinton’s guns. Michael Bloomberg, despite being 74 years of age, would gender great support and much interest. Bloomberg is a very rich man, but whether at this juncture he is prepared to shell out hundreds of millions of dollars from his personal fortune in his twilight years remains to be seen.
Many people truly admire Adidas’s brave decision to withdraw as the IAAF’S major sponsor four years early due to the level of skulduggery. I was pleased to see that Adidas’s shares only eased by 0.8% in response to the announcement. Lord Coe, PLEASE! Don’t make a fuss; there’s a good chap! Just go in peace and with dignity. Let us remember you as a great and world class athlete and a pioneer of London 2012!
The dear old FT, totally obsessed with remaining in the EU, has started massing its troops – the captains of big business, industry and commerce. The scaremongers have raised their game to fever pitch. Lord Rose, Sir Mike Rake, Roland Rudd and all his FTSE 100 clients and the ‘movers and shakers’ from the drug industry can only tell us about the desperate ramifications for trade, if we do pull out of the EU. What they are failing to do, is to tell us something positive. The rhetoric is all negative. I fear that apart from existing trade arrangements, they believe that the outlook for the EU’s economy looks extremely patchy. I am not in the camp of desperation. Do you know I am really looking forward to getting out on the hustings to extol the virtues of UK PLC, unless David Cameron returns from Brussels with a ‘slam-dunk’ agreement, delivering our wonderful country from the vice like grip of the European Court of Human Rights!
Over the weekend the papers did not make great reading. The cynics were there in plenty. EY confirmed what we already knew, that the number of companies posting lower profits or warnings in the UK continues to increase – over 300 companies come in that category. To add to that uncertainty it is becoming clear that the maintenance of dividends at recent levels is looking increasingly unlikely, with oil companies, miners and retail operators coming under the cosh. Though the worst of the financial storm seems to be over for the time being, few believe that we are out of the woods. Certainly the mood of the editorials was very much downbeat. Then we had the expected pro-EU rhetoric, lead by IMF’S Christine Lagarde to stir the pot of indecision up.
This coming Wednesday, the International Monetary Fund (IMF) begins the selection process for its next managing director to replace Christine Lagarde whose term will expire in early July. She was actually nominated by Obama for they were personal friends. It was Lagarde who effectively began the worldwide assault on tax havens by threatening them with isolation and the removal from the SWIFT system. She was also behind the attack on the Vatican that will force them to report all wires and parties on both sides for the tax nightmare that arrives in 2017.
The Executive Board will select three candidates from the nominations — that is unless Obama directs them to appoint another person against society to hunt down money for wasteful governments to support their pensions. The nominations should be in quickly and the selection process should be complete by March 3. The next member of the Troika governing Europe’s fate will begin their reign of economic terror on July 5.
This morning there were a few pieces of news nuggets to keep in mind this week – Firstly Kingfisher’s decision to revamp its business to include at £600 million share ‘buy-back.’ Then Tesco may be looking to repay £1.4 billion worth of debt. Deutsche Bank looks as it will need another €7 billion of fresh capital. Some of it could come from the sale of Postbank (circa €4 billion). It also looks as though ChemChina will place another bid for Syngenta. This morning the FTSE showed a touch of cautious optimism, but the price of oil soon put that rally to the sword and at 10.00am the FTSE 100 was down 30 points at 5880. Oil stocks were down about 1.5% with BP easier by 2.5% and mining stocks were lighter by 2.5%. New York may not be open this afternoon due to inclement weather conditions and if the NYSE does open it may only open to 15% capacity. We should not forget that 2 years ago first quarter GDP came in at -2.9% due to a prolonged bad weather. Everyone said that activity for the rest of the year would make up for it. It never did.
Market commentator – Panmure Gordon & Co