Tuesday, 27 January 2009

Burns Money: the honest new name in banking

What would the Chinese do to a chief executive who brought a major bank to its knees? Their traditionally uncompromising approach to such corporate misdemeanours was demonstrated by last week’s death sentences on two men involved in the recent tainted milk scandal.

While they march out a firing squad, we content ourselves with dishing out a certain amount of abuse in the media, bandying around phrases like “the world’s worst banker” with no apparent fear of libel writs. Meanwhile the alleged villains of the piece nurse the comfort blankets of their multi-million pound pension funds and doubtless plot their comebacks when the dust has settled.

It is the money that sticks in the craw, obviously. These fallen masters of the universe waxed rich on bonuses, based on profits that now turn out to have been entirely illusory. All of us as taxpayers are presented with the bill for the resulting black holes in the banks’ balance sheets. The bonuses, meanwhile, have doubtless long been wisely invested in houses, cars, yachts, holidays, horses, jewellery, opera tickets and similar essentials.

I have heard those with a taste for revenge calling for these undeserved windfalls to be somehow clawed back, suggesting that the holders of bank shares could take legal action to achieve this. But those shareholders are largely professional fund managers who in turn earned huge bonuses for the strong performances of their investments, based upon precisely those same fictional profits. So somehow I cannot see that idea taking off.

So what can be done to seek redress? Perhaps the Queen could take a lead by reclaiming her knighthoods and other honours from those who got us into this mess. Then she could surely confiscate the “Royal” from the all but nationalised Royal Bank of Scotland, which has had the most spectacular fall from grace. Any risk of confusion with another troubled institution north of the border could be avoided by the adoption of a suitable new name. In this 250th anniversary year, what could be more appropriate than Burns Money?

As one of Britain’s leading monarchists and a notorious snob, I was always rather tempted by a “Royal Bank” cheque book, but was luckily deterred by the presence in its title of that other word, “Scotland”. Always one to avoid, I feel, except when buying malt whisky.

So when my own bank became part of the expanding RBS Group a few years ago, I swiftly moved my account elsewhere. I recommended my new, very small bank to a rich friend who expressed horror at the risk I was running. “At least we can be sure the Royal Bank of Scotland will never go bust”, he said confidently.

Ah, such innocent days. When I was a boy, people similarly used to describe things as being “as safe as the Bank of England”. But then they used to say “as safe as houses”, too. Oh dear. I understand that geologists are conducting an urgent examination of the Rock of Gibraltar to ensure that there is at least one ancient simile that is still fit for purpose.

Surely the sad truth is that we all loved the idea that we could go on getting richer every year without any effort on our part. Just get a foot on the housing ladder and watch your wealth grow, even though the idea was as flawed as the machine for making bread from stones in The Rake’s Progress, or Jonathan Swift’s fantasy of extracting sunbeams from cucumbers.

We may smirk now at the folly of the mediaeval alchemists, struggling to turn base metal into gold, but I am not sure we have much to be smug about. Unless, of course, we happen to be a failed banker who received excellent advice in his fortune cookie and recently relocated from China.

Originally published in The Journal, Newcastle upon Tyne.

Tuesday, 20 January 2009

Please don't jump off the roof, Gordon

In the days when the BBC broadcast programmes with titles as patronising as Children’s Favourites, I particularly enjoyed my regular Saturday morning singalong with that most unlikely crooner, Tommy Cooper. His song was called “Don’t Jump Off the Roof, Dad” and concluded with the appeal “If you must end it all, Dad, please give us a break. Just take a walk to the park, Dad, and there you can jump in the lake.”

Desperation and suicide no longer seem to be considered fit subjects for kiddie-friendly comedy in 2009, even by such exponents of edginess as Jonathan Ross. Yet when I found myself caught up in the aftermath of some poor soul taking the easy way out on Friday evening, the only possible reactions were to laugh or cry. In which case, I always feel a strong preference for the former.

To be honest, my own involvement was completely tangential. My fiancée was travelling from Chester to London to meet me for an evening at the theatre. And, having dashed to the station from work and caught her train with about five seconds to spare, gasping for breath, she naturally found herself delayed for more than three hours by a death on the line.

This at least made a refreshing change from the long string of problems on the West Coast main line caused by failures of overhead equipment, immediately after they had finished spending £9 billion of our money on an upgrade. Believe me, if you ever feel aggrieved with the service between Newcastle and King’s Cross, you do not know how lucky you are.

If you are stuck on one of Sir Richard Branson’s trains on the other side of the country, you cannot even relieve your feelings by firing off abusive emails. He may aspire to take passengers into space, but it has apparently never occurred to his minions that those on the ground might quite like wi-fi.

Every year some 200 people decide to end it all under a train, and in my experience quite a few of them reach the end of their rope just as the Friday evening rush hour is getting underway. Is it the prospect of another weekend alone, or with a family they have finally decided that they cannot stand?

If your thoughts are running along those lines, I am here to beg you to think again. While I cannot deny that I have considered it myself in the past, experience of its effects on others has led me to conclude that suicide really ought to be rendered socially unacceptable on account of its total selfishness.

Frankly I don’t think it comes much more selfish than popping up in front of a traumatised train driver who has no chance of avoiding you, and screwing up the happy plans of thousands of your fellow human beings. So please do not end it all, and if you absolutely must then find a way of doing it quietly in the privacy of your own home. Gas explosions are another no-no.

But think first whether you would really have wanted to die if you had been aboard the amazing Captain Sullenberger’s plane last week, as it plunged towards the Hudson. Surely not. Now that really was no time for a novice, and I promise that I shall never scoff again when the stewardesses run through those life jacket demonstrations before take-off.

Now reflect that we are all aboard a similarly hazardous flight as Captain Brown battles with the controls to bring the crippled British economy to a safe landing. It has never been done before, but then neither had ditching a full passenger jet on water. Surely it will be worth hanging around just to see whether he can pull it off?

Do keep your fingers crossed, but on no account hold your breath.


Originally published in The Journal, Newcastle upon Tyne.

Tuesday, 13 January 2009

The myth of the self-winding watch

There have been a couple of recent cases of elderly people dying under mountains of their own accumulated clutter. In one instance, it took police in Stockport two days to find a “shopaholic” 77-year-old who had been buried under an avalanche of full suitcases.

Anyone who has ever visited my house will understand why I always intone “There but for the grace of God ... ” after reading such stories. Not that I am a compulsive shopper, or anything like it. I just cannot bear throwing things away.

I find it particularly hard to be ruthless with unwanted or unsuitable gifts. It seems the height of ingratitude to dispatch them to the tip, and I am much too old to master e-bay. So I had a real problem when my fiancée bought me a new wristwatch for Christmas, and not just because it threatened to eliminate my only plausible excuse for failing to arrive at events I would rather miss.

It was a really beautiful watch. The very one I would have chosen for myself, but for the fact that some high-pressure saleswoman had persuaded her that an “automatic” mechanism is the latest thing.

These “self-winding” gizmos were actually popular back in my schooldays. They belonged to the boys who were always getting detention or being beaten for persistent lateness. They did not work then, and they do not work now. At least we had the excuse back in the 1960s that the battery-powered quartz watch had not been invented. Why manufacturers continue to turn out these useless articles is beyond me, unless it is a “saving the planet” fetish like the wind-up radio.

I spend most of my days writing and prefer to take my watch off and place it on the desk next to me, rather than have it clunking persistently on my keyboard. This obviously does not help. But I gave my present a fair trial by wearing it every day when I was doing other things. It never ran for more than a few hours before giving up, and lost time even while it was actually running.

Ordinarily I would just have muttered that it was lovely and buried it somewhere under my junk mountain. But my partner is made of sterner stuff and insisted we take it back and exchange it for something more suitable. So at the weekend we found ourselves in a major national jeweller explaining our predicament to a Saturday girl who looked like a cross between a hippopotamus and a halibut. We explained our predicament, and our desire to part-exchange the item for a rather more expensive battery-powered watch in their window display.

Off she went to consult the manager, returning to explain sadly that they could not take it back because it showed signs of having been worn. “Yes,” I patiently explained. “You have to wear it to know that it does not work.” She shook her head with what seemed like genuine regret, and explained that I just needed to charge it properly by moving around more, illustrating this with a recommended wrist action that seemed decidedly risqué.

We went and bought another watch elsewhere, and will never visit the original chain again. Since I began telling this story, I have met several other people who have encountered similar difficulties in returning unwanted or defective Christmas gifts. In these harsh times, retailers who have actually managed to make a sale are clearly prepared to go to unusual lengths not to hand the cash back. I would simply counsel those who hope to survive the recession that customer goodwill is their most important single asset for the long term.

Now, would anyone like to buy a beautiful self-winding watch? Would suit energetic conductor (orchestra not bus), cocktail barman, full-time semaphore signaller or serial road rager given to making obscene gestures.

Originally published in The Journal, Newcastle upon Tyne, minus the following important footnote:

This column refers to "a major national jeweller". In these harsh times for retailers and newspapers alike, I saw no reason to provoke a row between my fine employer and any actual or potential advertiser. However, for the record, the supremely awful customer service we suffered was at Ernest Jones. And, yes, I do know that we could and should have insisted on our rights to a full refund under Section 13 of the Sale of Goods Act, but my fiancée was so incensed by their attitude (and particularly by the fact that the manager remained skulking in a back room throughout and refused to come and speak to us, preferring to convey his messages via his moronic Saturday girl) that she preferred to "let it go" for fear of the damage that a further surge in her blood pressure might do to our unborn child.

And while we are on the subject, "Britain's worst courier company", cited in last week's column, is City Link. In my personal experience, that is. Emphasising that this is not necessarily the view of the Newcastle Journal etc etc.

Tuesday, 6 January 2009

The most depressing day of the year

The BBC has just told me that I am writing this on the most depressing day of the year. Apparently bad weather, the end of the Christmas festivities and the return to work are all combining to make us the most miserable we have been since records began in 1349, at the height of the Black Death.

So it has nothing to do with Robert Peston and the other economic pundits, then. Though at least, if they are right, getting up and going to work will be one less thing for many of us to be unhappy about very soon.

The current phase of the Great Recession seems analogous to the Phoney War of 1939-40. Hostilities have been declared, but there is little sign of the expected cataclysm; just a few local skirmishes, like the “closed” signs going up at Woolies. The end of an era in pick ‘n’ mix, certainly, and terribly sad for their many employees, but hardly the collapse of civilisation as we know it.

We may soon see the equivalent of the Blitzkrieg of May 1940. Then again, it could turn out to be like one of those Met Office severe weather warnings which have repeatedly led me to lay in huge stocks of tinned food, bottled water and solid fuel, in preparation for what turned out to be the merest dusting of snow. Though I was apparently completely cut off by black ice throughout December, according to Britain’s worst courier company, which returned my eagerly awaited parcel to its sender because it could not cope with the treacherous conditions. At least if the recession puts them out of business it won’t be all bad.

I had been planning to add the further cheering thought that there is always someone worse off than yourself, and it could well be me. I am certainly feeling the strain as I face the combined challenges of marriage, moving house and impending fatherhood, at an age when anyone in their right mind would be winding down to a quiet retirement. But then I made the critical mistake of looking that lot up on a stress rating website and found that it was all a complete breeze compared with bereavement, divorce, serious illness or going to jail. Only marriage even makes it into the top ten of the most stressful experiences, interestingly a shade ahead of being fired.

So if I have one piece of sound advice to offer in 2009, it is this: never, ever look up anything pertaining to your mental or physical health on the internet, and in particular do not be tempted to type the words “pregnancy complications” into a search engine. You will probably never sleep again.

With interest rates plunging close to zero, this would be the perfect time to buy a new house, if only I could borrow some money. Where has it all gone? If the banks are so short of the stuff, the current trend in interest rates seems unlikely to help. As the returns offered by savings accounts tend to be pitched below base rate, we are soon going to have to pay them for the privilege of leaving our cash in their hands.

This will surely lead to a resurgence of interest in more traditional investment strategies such as stashing banknotes under the mattress or behind the clock. As an adviser for many years to Britain’s premier manufacturer of high quality biscuit assortments, I am fortunate to own a fine collection of tins which will make ideal homes for life savings, and will be setting up a new website to market this exciting opportunity just as soon as I get regulatory approval.

In the meantime I leave you on this Feast of the Epiphany with the encouraging thought that, if yesterday was the most depressing day of the year, things can only be looking up.

Originally published in The Journal, Newcastle upon Tyne.

Thursday, 1 January 2009

2009: year of opportunity?

Recessions are like wildfires: painful if you are caught in one, perhaps even fatal, and leaving a trail of destruction in their wake. Yet from the charred earth will ultimately spring recovery and even more vigorous growth.

As a specialist in drafting profit warnings, I have mixed feelings about 2009, rather like an undertaker reading press reports of an impending flu pandemic. As a sentimental old reactionary, I naturally regret the expected collapses of some fine old institutions. But while it is obviously ghastly for those whose jobs are on the line, the major corporate casualties up to now have been the walking dead; businesses that had failed to adapt to their changing market place.

The important thing is to ensure that the next generation of growing enterprises does not also go up in smoke. The best contribution we can all make to that end is to keep acting and spending normally. Every piece to camera by Robert Peston should be followed by that old Crimewatch disclaimer: don’t have nightmares. It may not be as bad as we have been led to fear. And if it is, keep reminding yourself that it is going to do us good in the long run.

Originally published in The Journal, Newcastle upon Tyne.