Innehållsförteckning för 1031/1032 från MoneyWeek

Personal grooming product providers – “with no one to impress at work or when socialising”, supermarket sales of cosmetics, hairstyling products, toothbrushes and deodorant slid in 2020, says Zoe Wood in The Guardian. Cosmetics saw the sharpest decline, with sales down by £180m (22%), according to retail trade magazine The Grocer, as remote working and face masks meant a lot less makeup was worn than usual. Lager sales, on the other hand, boomed. Chilean president Sebastián Piñera was fined $3,500 last weekend after he posed for a selfie on the beach with a bystander without wearing a mask, breaching Chile’s strict rules on wearing masks in public places, says Reuters. Piñera apologised shortly after the picture surfaced on social media.…

Three to buy Bloomsbury Publishing The Mail on Sunday Harry Potter continues to work his magic for this publisher, which is profiting from housebound Britons looking for a good read. Profits rose by 60% on the year in the six months through 30 September and Christmas should herald a new wave of book buying. Bloomsbury’s cookery titles have also enjoyed an excellent year, while the digital academic division has benefited from the demands of remote learning. Bloomsbury’s own investment story, then, is also compelling. Buy (279p). Carvana The Sunday Telegraph This online used-car retailer is disrupting America’s $800bn second-hand market. The website offers buyers an Amazon-like range of choice, financing options and can even deliver via automatic roadside “vending machines”. The younger generation should be especially keen on Carvana as…

Hilton Worldwide Holdings 2020 has been a year to forget for this global hotel brand, which operates in over 100 countries. Earnings are expected to have fallen by 64%. “Revenue per available room” has slumped from $102 in 2019 to $47 today. But a “cash pot” of $3.5bn gives the firm the means to weather the storm and with any luck next year should bring a swift rebound in the travel sector. “A bet on a post-Covid-19 recovery.” $93 JPMorgan Chase Shares in this Wall Street giant have slipped by 15% this year as a weak economy and low interest rates have put the squeeze on financial services. However, the investment bank and trading division have enjoyed “record revenues” in 2020. JPMorgan Chase is a best-in-class operator and the recovery…

• The pandemic has “decimated” demand for oil and gas, resulting in both the finances and share prices of traditional energy companies being “pummelled”, says Laura Hurst on Bloomberg. However, investors expecting an “end-of-year rebound” for the oil and gas industry are likely to be in for a “disappointment”. Shell’s preliminary figures for the fourth quarter look “bleak”. The energy giant, which has already been forced to “slash its dividend, for the first time since World War II and plan thousands of layoffs”, has announced “another multibillion-dollar impairment charge, significantly weaker oil trading, a loss in its upstream division” and “sluggish” fuel sales. The latest figures have increased this year’s writedowns to a whopping $22.5bn, up $4.5bn from the last quarter. • The big bookmakers “rarely have a bad day…

1. Amazon splits itself up One day the technology giants may regret their huge success in the pandemic of 2020. With vastly increased market share, the regulatory scrutiny has become intense. Antitrust actions have already started in the US against Google and Facebook, and Apple and Amazon won’t be far behind. But there is one point we should keep in mind. Amazon’s founder, Jeff Bezos, is by far the smartest business leader in the world today. He might be thinking, why not get one step ahead of my opponents and break up my empire myself, rather than waiting for my opponents to do it? The company could be split into retail, for its massive direct sales operation; cloud, for its business services; and streaming, for its TV, e-book and music…

“It appears that even a global pandemic can’t put a dent in UK house prices” Let’s say someone had told you this time last year that within a few short months Britain would suffer the biggest plunge in its economic activity in modern history. What would you guess might happen to house prices? I’m betting that you would assume the same thing as most banks and estate agents did – which is that they would go down, potentially quite hard. And yet as 2020 draws to a close, it has proved to be the best year for the UK housing market – in terms of activity at least – in a long time. House prices hit new record highs and saw their strongest growth for years, as measured by any…

“My family thought it was rather vulgar to talk about food. They didn’t talk about food, money, sex or politics. God knows what they did talk about, because those are all the interesting things.” The Great British Bake Off judge Prue Leith (pictured), quoted in The Times “Look, if you say to anyone: ‘Do you fancy a 20% cut in your pay?’, I think you know what the answer is going to be. But I decided that, if you’re going to have your photo plastered everywhere as a high-earner, the very least you can do – not that it will impress many people – is to make a gesture, which in my case was quite a significant gesture. And I’ve done it because it’s the right thing to do. I…

unherd.com The NHS has long struggled to cope with the annual surge in demand due to cold weather and seasonal infections in the winter months, says Timandra Harkness. But this time the debate is no longer about why the NHS fails to provide for the public who fund it. Instead, it is about what the public should be doing to reduce demand. That is worrying. Our unhealthy habits have long placed extra demands on the NHS. What is new in the measures adopted to prevent the spread of Covid-19 is that never before has the public “embraced such sweeping, compulsory restrictions on how we live”. This sets a worrying precedent. Having “once been sacrificed on the altar of the NHS and its limited capacity, our freedoms are no longer safe…

A spin-off plan by LG Corporation, a South Korean conglomerate with divisions ranging from chemicals to telecoms, has been opposed by US-based hedge fund Whitebox Advisors, say Ortenca Aliaj and Song Jung-a in the Financial Times. Whitebox, which owns 1% of LG, says the group has neglected better alternatives and is merely embarking on the scheme “to resolve a family succession issue”. LG announced in November that it would spin off five affiliates into a new holding company next year; analysts predict the new holding firm will be led by Koo Bon-joon, ason of LG’s founder. But Whitebox is concerned that this won’t address LG’s “unprecedented discount… relative to its assets”. The group is trading at a 69% discount to the sum of its parts.…

• Check the cash-flow statement and the annual report, and avoid low-growth and unscalable businesses. • Cash is reality. It doesn’t matter how much profit a business makes if the cash is not appearing. As Jerry Maguire would say: “Show me the money!” • Check Aim Rule 26 for a list of major shareholders. Have any institutions been buying or selling? Does the institution have a good record? I don’t believe in following others, but seeing certain names on the shareholder register can offer a hint to keep digging. • Remember: nobody cares more about your own money than you do. Keep an eye on the story and play each card as it is dealt. So long as the story remains sound, it may not be a bad idea to…

No-one loves a crisis quite like a conman. The scammers have been out in force this year. In 2019, criminals stole more than £1.2bn through scams and fraud, according to UK Finance. This year the figure will be far higher. Scams have soared as criminals take advantage of rising online shopping and more people using internet banking than ever before. With millions of us being forced to do our Christmas shopping online this year, fraudsters are targeting the festive deliveries. Scam texts and emails pretending to be from DPD or Royal Mail, saying they have been unable to deliver an item, have proliferated.“They feature a link to a website where the receiver is asked to input their bank card details to pay ‘extra’ postage costs and told [that] if they…

• A shake-up of public-sector procurement rules will give small businesses a much better chance of winning contracts, the government is promising. Ministers have set out plans to get rid of 350 regulations governing public procurement. The reforms also include the launch of a new digital platform on which contracts will be registered. One key change is a new rule allowing the public sector to target smaller suppliers specifically. On contracts for public works of up to £4.7m, officials will be allowed to limit competition to small businesses, voluntary, community and social enterprises or to a certain geographical area. • Exporters are to be given extra financial help from the government to encourage trade after Brexit and take advantage of new free-trade agreements. The Department for International Trade’s UK Export…

Since 1985 our trust has invested in high-quality assets held through unconventional structures and trading at discounts to their net asset value (NAV). The portfolio comprises three main types of company: family-controlled holding companies; closed-end funds; and other asset-backed special situations, such as cash-rich Japanese operating companies. We aim to benefit from both NAV growth and discount narrowing, driving attractive long-term returns in excess of global equity markets. We are bound by our core philosophy: quality assets at discounted valuations. A widely diversified holding company One stock we consider particularly attractive is EXOR (Milan: EXO), the holding company of the Agnelli family. EXOR is a diversified investment holding company, with stakes in Fiat Chrysler, Ferrari and capital goods specialist CNH Industrial, as well 100% ownership of global reinsurer PartnerRe. EXOR…

Shahrzad Rafati decided at 13 that she would one day build a global business, writes Tom Saunders. As Andreane Williams points out on the BBC, she was born into a family of business leaders in Tehran, but left her native country at 17 to avoid the Iran-Iraq war. She moved by herself to Vancouver to attend the University of British Columbia, having very little English. “I knew that I needed a different future, and a life where I could make a difference, and where equal was equal.” After she graduated in 2000, Rafati studied French at the Université Paris-Sorbonne, and leadership at Oxford University’s Said Business School. Upon graduating she founded BroadbandTV (BBTV), which she still runs. Initially a hardware company that made set-top boxes that allowed users to watch…

The EU’s model of elegance steadies the ship “I always wanted… to come home,” said Ursula Von der Leyen, 62, last year, when she became the European Commission’s first female president – her family actually hails from Lower Saxony in Germany. But it was in Brussels that the gynaecologist-turned-politician was born, grew up and first “nurtured a passion for the European project”, says the Financial Times. Her first year in the job has been more turbulent than she could ever have anticipated – even leaving aside the hassle of Brexit dealings. The onslaught of the virus left the Commission “paralysed” as member states shut their borders and hoarded medical kit. Restoring harmony has been a major task for a woman “with little experience of EU structures or of managing the…

The Treehotel in Harads, northern Sweden, “is up there with the Icehotel as Sweden’s quirkiest accommodation”, says Mark Stratton in Wanderlust. Most eye-catching of the rooms scattered about the forest is the UFO, a five-bed flying saucer suspended by wires. “It has a ladder stretching down to the forest floor and I half expected to see a little green man appear, suggesting ‘he came in peace’.” Another comfortable nook, the Bird’s Nest, “took more finding, camouflaged by sticks, [and] roomy enough for both a family of four and a pterodactyl”. From around £550 a night – treehotel.se/en…

• Prince Harry and Meghan (pictured), the Duke and Duchess of Sussex, “have reportedly been paid millions by Spotify to regularly air their bien pensées to a breathless world”, says Jan Moir in the Daily Mail. “This must be hugely irritating for the recording stars who, on average, receive just £200 a year from music-streaming services such as Spotify for regularly playing their songs.” In the audio clip for their new podcast series, Harry beseeches people to listen as “it’s free”. Spare us. It’s just one step away from this man, “the son of a royal house in Europe, now little better than a Malibu disc jockey, urging you to book him for your next pool party”. It’s enough to make you cringe. • The Feltz Towers “Chanukah bush” has…

£3,144 The average price for an annual season rail ticket from March, a43% rise on 2010’s average, equivalent to an additional £950, according to calculations by the Labour Party. Fares are set to rise by 2.6% in 2021, the first above-inflation rise since 2013, says The Guardian. $28 The price for a bag of 14 servings of powdered “superlatte” coffee, made with oat milk, coconut cream, monk fruit, mushrooms and “adaptogenic herbs”. Clevr Blends, a Californian startup backed by the Duchess of Sussex, claims it reduces stress and enhances focus. 7,000 The price in Chinese yuan (£790) on the black market in China for two doses of a Covid-19 vaccine that has yet to be approved by regulators. That is almost 20 times the reported regular price, says The Times.…

Last year, when former nurse Sarah Stoute received a “tip-off” that a deadly virus was spreading from China, she sensed an opportunity, says Gabriel Pogrund in The Sunday Times. She and her husband, Richard, owned a small firm selling personal protective equipment (PPE) to hospitals – in the year to March 2019, it made a profit of £808,782. Today, the company – Full Support Healthcare – is Britain’s biggest supplier of Covid-19-related goods. Betting that demand would outweigh supply, Stoute ordered “hundreds of millions of pounds-worth of PPE”. The firm later received £1.85bn from the government to provide PPE to the NHS – more than double the size of the next-biggest recipient of pandemic contracts, which received £777m. The soaring success of their business has allowed the couple, who have…

“’Twas the nightmare before Christmas,” says Stephen Innes of Axi. The appearance of a new and potentially more transmissible strain of Covid-19 in southern England has squashed hopes of a traditional pre-Christmas “Santa rally”. With chaos spreading through supply chains and talk of domestic virus restrictions remaining in place until Easter, markets have not been feeling festive. The FTSE 100 fell by 2.9% on Monday before paring losses, with the FTSE 250 finishing the day down more than 2%. The price of oil dropped 4% and the pound had its worst day since September. Recovery delayed, not denied If the early reports about the new virus strain are accurate then “extended and severe lockdowns for the majority” of the first quarter of 2021 now look a real possibility, says Innes.…

“Tech chiefs considering [IPOs, initial public offerings, in London] in 2021 say... US investors think differently to British ones. Having grown rich on Google, Amazon and the rest, Wall Street is happy to back long-term growth stories. Even if the outlook is five years of investment-heavy, loss-making scale-up, if the vision is convincing, they will back it. Here in the UK, the first question the founder always hears is: why aren’t you making a profit now? The second question is: what’s our exit strategy? In other words, who’s going to buy you when you get bigger? It’s a culture that spills into a general market scepticism about young, fast-growing tech companies... We were lucky to get The Hut Group to float here... Those who backed the IPO have been richly…

The London Stock Exchange shrugged off the market turmoil caused by Covid-19 and Brexit-related uncertainty to retain its title as Europe’s most active market for flotations in 2020, says Hannah Godfrey on City AM. Proceeds from initial public offerings (IPOs) comprised nearly a third of the European total. This year has seen 26 IPOs so far, compared to 2019’s 27. Financials and industrials were the largest sectors in London, raising nearly £2.7bn from 11 IPOs and £2.6bn from six listings respectively. THG Holdings, which owns brands such as beauty retailer Look Fantastic and fitness company MyProtein, was the largest London listing this year, raising £1.9bn.…

• Dominic Cummings, Boris Johnson’s former chief adviser, received a pay rise of at least £40,000 in the 12 months before he left Downing Street, reports Sky News. Government documents show that Cummings (pictured) was paid between £140,000 and £144,999 a year, up from the £95,000 to £99,999 salary he had been on in 2019. “This put him among the top earners in Number 10 before his departure last month… [following] a bitter power struggle.” • Staff at the Financial Times suspended pay talks with the paper last week after it emerged that Lionel Barber, the former editor, received pay and pension benefits worth just over £1.9m last year, including £502,000 for “loss of office”, says the Press Gazette. Profits at the paper fell from £8.2m in 2018 to £1.9m,…

In “normal” times, central banks try to stimulate (or cool down) the economy by cutting or raising short-term interest rates, and thus wider borrowing costs. But since the 2008 financial crisis interest rates across the developed world have been stuck at near-0%. So central banks have experimented with more extreme monetary policies, such as quantitative easing (QE – printing money to buy government bonds and other assets). “Yield-curve control” is one such policy. A yield curve compares the yields on bonds with the same credit quality across lengthening maturities. So theTreasury yield curve shows how interest rates on US government debt change as the repayment date gets further away. A healthy yield curve slopes upwards from left to right – bonds with longer maturities yield more than short-term ones.That makes…

thecritic.co.uk It might seem unlikely that a hanging baskets of flowers could give people in declining towns a sense of civic pride and a feeling of control over the destinies of their communities. But the truth is that hanging baskets do make a difference, says Natascha Engel. The very sight of them lifts people’s spirits. As with New York’s broken-window policy in the early 1990s, the idea is that taking care of such small things pays for itself by signalling that this is a place where social problems are dealt with and businesses thrive. When local people in Ridgeway near Sheffield decided they wanted to beautify their village, they came up against the council, who said no: they didn’t have the budget, nor the manpower to maintain them. When the…

Widespread references to “the Roaring ’20s” in Britain following the end of an earlier pandemic indicate an almost total ignorance of economic history. A little – a very little – knowledge is indeed a dangerous thing. There was strong growth in Britain in the second quarter of 1920 and, to a lesser extent, in the third quarter of that year. But an extremely sharp recession began in the autumn of 1920. Real (after-inflation) GDP in Britain is estimated to have fallen by 23% between the third quarter of 1920 and the second quarter of 1921, and it did not regain its previous high until the second quarter of 1924 – four years later. Even at the cyclical peak (for the level of GDP) in the first quarter of 1930, GDP…

Dominic Frisby Author, MoneyWeek writer Max King Independent director, MoneyWeek writer Lucy Macdonald Independent director, private investor Jim Mellon Chairman Juvenescence Steve Russell Investment director Ruffer John Stepek: This time last year, the UK election was over, Brexit was near an end, things were looking up. Then we spent most of 2020 in lockdown. Yet, if you were to look at the market now for the first time, you would never realise that Covid-19 had happened. Max King: Yes, I thought you’d make 5%-10% from a decent portfolio, but we’re at the top end of that range. The surprise is how well private businesses have coped, including delivering vaccines on target. Lucy Macdonald: The market reaction isn’t so surprising when you consider the huge liquidity boost, which did what it…

As if dealing with Covid-19 and its economic fallout were not enough, 2021 will bring another headache for thousands of small businesses and entrepreneurs. The widely despised IR35 reforms are to make a return in just over three months’ time. The reforms had been due to come into force last April, but at the last minute the government decided to delay their introduction, recognising that businesses had more pressing priorities as the pandemic exploded. But ministers made it clear this was a postponement rather than a change of heart, and the new rules are due to take effect on 6 April. “Small firms meeting two of three criteria are exempt” The headline change is that from that date onwards, most businesses employing contractors will be required to assess the tax…

This has been an extraordinary year for markets on both sides of the Atlantic. My trading tips coped well with the volatility, with my portfolio finishing the year in a much better position than 12 months ago. I started 2020 with 12 ideas. There were seven long positions: Safestore, Bellway, Bausch Health Companies, International Consolidated Airlines Group (ICAG), Taylor Wimpey, Volkswagen and DS Smith. There were also five shorts (bitcoin, Netflix, Uber, Wayfair and Twitter). All of these were closed, most of them in the first three months of the year. Twitter was closed out at a loss of £1,005 in issue 983. In issue 985, I recommended that you take profits of £250 and £1,320 on bitcoin and ICAG respectively, and losses of £340 on Netflix. In issue 989,…

Codemasters Group (LSE: CDM) is a British videogame developer and publisher. US rival Electronic Arts, one of the world’s biggest videogame groups, has tried to “gazump” gaming rival Take-Two Interactive with a £945m offer for Codemasters, nearly £200,000 higher than Take Two’s offer, says the Financial Times. The bid boosted Codemasters’ shares by 20% last week. The company has benefited from the lockdown-induced videogame boom. The sector’s sales are set to jump by 20% this year to $174.9bn. Codemasters’ stock has gained 137% in a year.…

Despite being one half of the hit “say-it-as-it-is fashion sensation” What Not to Wear TV programme that started almost 25 years ago, it wasn’t easy for Trinny Woodall to secure funding for her latest project, says Harry de Quetteville in The Daily Telegraph. It was only after pitching to around 30 venture-capital firms thatt she finally found a “mainly female-led” team of willing investors and secured funding for Trinny London, her eponymous make-up brand. The online-only brand is designed to be an alternative to the old-fashioned department-store experience of buying make-up, which can often be quite alienating for middle-aged women — Trinny’s target dmographic — who don’t see themselves reflected in the people behind he counters. “There are a lot of women from 35 to 50, whichis our core target…

Woodnest is a “stunning” new retreat near the town of Odda in Norway, says James Gabriel Martin for Lonely Planet. Guests get to sleep in a “cosy and tranquil treehouse built in a forest that overlooks the magnificent Hardanger Fjord”. The two treehouses come with a small kitchenette, a stove top, a mini fridge, high-speed Wi-Fi and showers. There is even underfloor heating for cold winter nights. To get to the site, however, requires a 30-minute hike. So, not only is it the perfect hideaway, it has also been kept as environmentally friendly as possible. From NOK2,800 (£240) a night – woodnest.no…

2018 Blackbook, Pygmalion chardonnay, England £25, blackbookwinery.com The Battersea-based Blackbook “urban winery” is run by the mercurially talented husband and wife team Sergio and Lynsey Verrillo. I popped into their brilliant set-up, based in an old British Rail arch not far from Battersea Park, the other day and found no less than four wines which I wanted to alert you to immediately. These wines will recalibrate your palates for what we all hope will be a far happier year next year. Pygmalion is sourced from the Greyfriars Vineyard in the North Downs of the Surrey Hills. The grapes are whole-bunch pressed into Burgundy barrels where they undergo natural fermentation using indigenous yeast. The wine then stays in these barrels for a further 20 months and the results are nothing short of…

■ It would of course be useful to be able to spot potential corporate disasters before they wipe out the share price of the companies you have invested in. One book that can help you do this is a new edition of The Signs Were There: The Clues for Investors that a Company is Heading for a Fall by Tim Steer (Profile Books, £9.99). Steer has added material on recent disasters, such as those at Patisserie Holdings, Pets at Home and Woodford Investment Management, and generally does a good job of enabling the nonspecialist reader to understand what happened and why. The section on the Woodford fiasco is particularly good. ■ William Quinn and John D. Turner’s Boom and Bust: A Global History of Financial Bubbles (Cambridge, £18.99) show you…

MacKenzie Scott split a $4.2bn donation between 384 charitable organisations and entities, including food banks, emergency-relief funds and support services, says Jacqui Goddard in The Times. Scott, who received a $38bn settlement after she divorced Amazon founder Jeff Bezos, is the world’s wealthiest woman. She signed up to the Giving Pledge last year, a scheme founded by Bill and Melinda Gates that encourages the ultra rich to “commit the majority of their wealth to philanthropy”. Nine-year-old Ryan Kanji (pictured) was named YouTube’s highest earner this week, netting $29.5m from uploading “unboxing” videos for his 41.7 million subscribers, report Madeline Berg and Abram Brown on Forbes. Kanji, who opens and reviews toys on camera, makes most of his money from advertisements running on his videos, and from licensing deals for “Ryan’s…

This chart is a stark reminder of the extent to which Big Tech has powered the US stockmarket in recent years – and especially this one. The collective market capitalisation of Facebook, Amazon, Netflix and Google (represented by Alphabet, its holding company) has risen more than ninefold since 2013. (These four are the original FANG stocks; Apple was added to the mix in 2017.) The overall S&P 500 has more than doubled and is slightly ahead of the index minus the FANG stocks. “Almost all of this year’s outperformance has been from just four stocks,” notes John Mauldin in his Thoughts From The Frontline newsletter. “The S&P 496 has been relatively flat.” The FANGs now comprise a collective 12% of the overall market.…

The auto industry should start motoring as the global recovery gathers pace next year. One way for investors to cash in, says Wirtschaftswoche, is with shares in Germany’s Elmos Semiconductor. The group is a leading global provider of chips used in cars, notably electric and self-driving ones. They range from devices that help the car park automatically to semiconductors used for ultrasonic distance measurement. Business is recovering and the group should make a profit of €5m on €230m of sales this year. Last year it sold a subsidiary that made chips for pressure sensors for 3.4 times sales. Ascribing that valuation to Elmos itself would imply a share-price jump of 40%.…

Sony has “stunned” the gaming world by deciding to remove Polish software group CD Projekt’s game Cyberpunk 2077 from its online PlayStation store, say Leo Lewis and David Lee in the Financial Times. The game, “one of the most expensive and anticipated titles in industry history”, was expected to sell around 30 million copies at $60 each; eight million people pre-ordered it. But when it was released on 10 December it was lambasted for being full of “crashes, visual glitches and malfunctioning mechanics”. The hype surrounding the game caused CD Projekt’s shares to double in 2019 and gain “more than 50% this year”, despite “hiccups” resulting from three delays, says Kasper Viita and Piotr Bujnicki on Bloomberg. The surge saw the company exceed the value of the top European developer…

Britain and the EU “edged towards a compromise on fisheries” on Monday, with Boris Johnson eyeing 30 December for a “last-gasp parliamentary vote” on a Brexit trade deal, says the Financial Times. There has been considerable movement on the issue since last month, when the EU was insisting that it would not sacrifice more than 18% of its fishing rights to UK waters and Britain was asking for 80%. EU sources say that Britain’s demand has been reduced to 35%, “far closer to the 25% reduction” that Michel Barnier, EU chief Brexit negotiator, had said he would be prepared to accept, says Daniel Boffey in The Guardian. Boris Johnson has also upped his offer of a three-year phase-in of new arrangements to five, with “compromise also likely on the application…

Bosses of companies in the FTSE 100 index of leading British shares make, on average, 73 times more than the average earners in their firms, according to a report from the High Pay Centre think tank. Tim Steiner, chief executive of online supermarket Ocado, was by far the worst offender. His pay of £58.7m last year was 2,605 times that of the £22,500 average for one of his employees. Or to put it another way, says The Guardian, “24 hours of Mr Steiner’s time is allegedly worth about ten years of toil from an average Ocado worker”. Peter Cowgill of JD Sports was the next worst. His pay of £5.6m was 310 times greater than the £18,300 median average at the sportswear retailer. Tesco’s Dave Lewis, who was CEO at…

Let charity step in where the state fails Iain Martin The Times It is easy to be cynical about Sir Leonard Blavatnik, the Ukrainian-born philanthropist who is contributing £10m to the refurbishment of the Courtauld Institute of Art, says Iain Martin. He is worth upwards of £15bn and made his fortune in the former Soviet Union. But, for “all that we must be alert” to unsavoury characters, Britain should welcome the law-abiding rich and do all it can to encourage more philanthropy. Post-Covid-19, it will be “vital”. Britain lacks the philanthropic culture of the US, where $427.71bn was donated in 2018. The comparable UK figure is £10.1bn. Here, fundraising is “tinged” with “vulgarity and shame”; in a crisis people turn to the state. Yet “well-targeted” philanthropy is likely to…

capx.co There have been 17 housing ministers since 2001; eight secretaries of state since 2006, says John Myers. “Each change has brought new policies, new initiatives, and generally a new forgetting of all the things that failed before.” It’s time to “ditch the false promises”. By the time ministers even understand the “Himalayan scale of the challenge – to find politically durable ways to add more homes in expensive areas with amajority of homeowners” – the minister has moved on. The truth is that simply fixing a target to build X-thousand homes a year will never work. What we need to do instead is devolve decision-making powers – to allow “small groups of local people easy, workable and powerful ways to set rules to allow more homes of the right…

Commodities have been in the doghouse for much of the last decade. The largest and best-performing specialist natural resources fund in this sector, BlackRock World Mining, has lost 11% of its net asset value (NAV) over the last ten years, although its share price does show a small positive gain. Commodity specialist Goehring & Rozencwajg notes that raw materials haven’t been this cheap compared to US equities since 1920. Yet there are now signs of an incipient recovery as investors look forward to a global rebound in 2021, when demand for materials and energy products should improve. Iron-ore spot prices gained 33% between 1 January and mid-November; palladium 21%, uranium 19%, and copper 15%. Oil, despite a bounce to $50 a barrel in recent weeks, is still down by 34%,…

A somewhat US-centric view of economic history explains why we often think of the interwar decades as consisting of a booming 1920s, then a depression in the 1930s, writes John Stepek. And yet, for Britain, the reality is almost the reverse.The 1920s were hard years for Britain, particularly in industrial regions, with high unemployment and weak growth. Global competition was one factor (see main story), as was a political desire to return to the pre-war status quo. World War I had left the major European powers heavily indebted, and the US had displaced the UK as the world’s banker. Britain was keen to repay its debts and restore sterling as the global reserve currency. This meant maintaining comparatively tight monetary and fiscal policies, which were locked in when, in 1925,…

Thousands of businesses that deferred VAT bills totalling as much as £30bn are due to begin paying off their debts in the new year. In the spring, the government announced that any business struggling during the Covid-19 crisis could decide not to pay VAT bills falling due between 20 March and 30 June, opting instead to pay by 31 March 2021. Those that took advantage of this deal will therefore need to think about how they’ll settle these liabilities alongside their normal VAT bills. The good news is that the deferred bills do not have to be repaid in one go. The government has subsequently announced that businesses will have the option of splitting what they owe into smaller, interest-free payments to be made over the course of 11 months.…

Markets can be more resilient that you think Global equities rallied quickly after the initial plunge. The S&P 500 had fully recovered by August. I should have taken profits on my shorts more quickly. Listen to short sellers My tips to short electric-lorry company Nikola and online insurance broker eHealth are making large profits. In both cases the initial idea came from short sellers. As they risk their own money it gives them a strong incentive to get the research right. Dividends are crucial In April I advised buying Shell, based on the fact that it had vowed to protect its dividend. A few weeks later it suspended the payout for the first time since World War II. I closed my position at a loss. Avoid returning to failures At…

Like most aviation companies, International Consolidated Airlines (LSE: IAG), the owner of British Airways, has had a dreadful year, says Daniel Smyth on IG. Travel restrictions worldwide have sent its revenue and stock price plummeting, and the recovery will take time. Summer 2021 bookings are unlikely to come anywhere near pre-pandemic levels, says Alan Oscroft on The Motley Fool. Debt is climbing sharply, up from €7.6m in September 2019 to €11.1m in September 2020. The company’s share price has slipped by 61.1% in the last 12 months.…

Anne Boden is well aware that she doesn’t exactly look like your average banking mogul, says Anna Moore in The Guardian. Asa 50-something woman, Boden embarked on a journey to start what is quite possibly the hardest business to crack: a bank. A challenger, online-only bank at that. Boden hails from “a very ordinary background” – she grew up in Swansea, her father worked for British Steel and her mother in the local department store. But she “did well in school… and ended up in London working for Lloyds”. Her corporate career peaked with a move to Dublin in 2012 to join Allied Irish Banks as group chief operating officer. It was here she began to picture a new kind of bank, “without the bureaucracy, where opening an account took…

Octola Private Wilderness is a luxurious lodge set within 750 acres outside Rovaniemi, the capital of Lapland in northern Finland, says Lisa Grainger in The Times. Its ten bedrooms can only be rented by one group at a time – generally, by “royals, prominent Silicon Valley tech figures, sports heroes and film stars” – but the estate’s “750 acres of snowy wilderness” now also includes a two-bedroom villa, glass-roofed wooden snug for two, outdoor dining cabin, and two wood-burning saunas amid the trees. There are snowmobiles for adults, and even a couple designed for kids. From £1,430 per person a night, full board – cooksonadventures.com…

It’s been a tough year for auction houses. The “big three” – Christie’s, Sotheby’s and Phillips – suffered a combined 79% drop in revenue for the second quarter of 2020 compared with the same three months in 2019, according to art market analytics firm Pi-eX. Spring is usually a busy period on the art-market calendar, but the dearth was hardly surprising given the pandemic. The first wave saw art fairs and galleries around the world close, while hammers fell silent as auction sales retreated online. But therein lay the silver lining. Sotheby’s says its online sales grew “a staggering” 540% year-on-year in the seven months to August, while the average lot value at online sales has “more than doubled” to $20,000 compared with last year. Two trends to watch Big-ticket…

“It feels like it’s 1999,” says a friend. “Then, it was the dotcoms trading at ridiculous prices. Now, it’s everything.” At the office this week, lunch was delivered by DoorDash. Friends who come to visit frequently use Airbnb to find a place to stay nearby. Unlike many of the dotcoms of 1999, these hip, new companies are operating in the real world and generating real revenues. But they’re not making any money. They lose it. They destroy wealth, they don’t create it. “Capital is yesterday’s achievements. It’s what the Fed is now destroying” That’s what happens when it costs more to provide a service or a product than you get from selling it. Not only do you lose money, but capital is wasted, and lost forever. My hypothesis is that…