ALEX BRUMMER: Don’t sell Britain short – warning of sterling’s vulnerability to further falls, from hedge fund manager no accident
- Conservative donor Chris Rokos wants something to happen
- Otherwise, why would he share his opinions beyond a small group of customers?
- Bank’s Dave Ramsden suggested the UK still had work to do to restore its reputation
You must think that a warning about the pound’s vulnerability to further falls, from a top hedge fund manager, is no accident.
By allowing the message to appear in public print, conservative donor Chris Rokos wants something to happen.
Otherwise, why would he share his opinions beyond a small group of customers offering everyone else a business opportunity?
Vulnerable: Britain is the only advanced country that thinks it’s good policy to tighten fiscal and monetary policy while heading into recession
The founder of Rokos Capital Management is not alone in belittling Britain’s outlook. Bank of England Deputy Governor Dave Ramsden, a former Treasury mandarin, suggested this week that the UK still had work to do to restore its reputation in the wake of the mini-budget chaos.
We wonder what he has in mind. After all, Jeremy Hunt not only ditched nearly all of the Truss-Kwarteng tax cuts, but donned a cilice and presented a revenue-generating budget that will push millions of ordinary citizens into higher tax brackets. In fact, North Sea investors are reconsidering their investments in the UK after the government hit the sector with a higher and prolonged windfall tax.
Britain is the only advanced country that thinks it is good policy to tighten fiscal and monetary policy while heading into recession. Britain’s most successful economist, John Maynard Keynes, who favored supporting demand in tough times, reportedly disagreed.
What is odd about Rokos’ intervention is that she fails to acknowledge that the pound is now at $1.21 from its low of $1.03 since Hunt became chancellor. Moreover, a competitive pound, since the start of the year, has helped boost foreign investment.
Schneider’s bid for minority in software group Aveva and German sausage skin champion Devro are examples. There is more. Sky, owned by Comcast, this week opened a new innovation center on its campus in Osterley, London, reflecting the current dynamism of British creativity and filmmaking.
Reputational damage is in the eye of the beholder.
The £667million bid for Lanarkshire sausage skin maker Devro by secretive German group Saria is giving reason to stop.
As expected with a 65% premium to the stock price on Thursday, the board, chaired by Steve Good, severed the offeror’s hand. Good points out that the offer is 92% higher than when the company was first approached.
This raises questions as to why the shares rose sharply before the offer was revealed. There are other reasons to carefully consider the transaction. This is a blow to the Scottish government as there are very few listed companies north of the border.
As with the purchase of Morrisons by Clayton, Dubilier & Rice, the public-to-private sale of companies, which play an important role in the UK food supply chain, threatens UK food safety.
Germany may seem like a natural home for a sausage skin pioneer, but far too little is known about the secret billionaire Rethmann family behind the bidder. The history on the Control Group’s website is sketchy about the 1940s experience. There’s a lot of chatter in the offering document about strategic plans and a vague pledge not to significantly reduce the workforce. It’s hard to gauge how useful this will prove when Devro is out of the public eye and mind.
Devro follows British food producer Dairy Crest, which was bought by rival Muller in 2014 from German hands. Britain’s free and easy financial markets and low equity valuations are tasty fodder for foreign predators.
Schneider overcame sniping from dissident investors and won his fight to gain full control of £10bn Cambridge industrial software champion Aveva. Fund managers are still struggling to resist cash redemptions.
But there are much bigger issues. Aveva joins Arm Holdings in uncertain foreign ownership, with intellectual property built on top UK research universities passed on to foreign predators.
At Aveva, as at Arm, there is a risk of vital Western technology leaking to China.
Foreign takeovers also see head office functions undermined, create uncertainty for colleagues and often see the country’s corporate tax base erode.
What a great chance for the latest business secretary, Grant Shapps, to flex his muscles and order scrutiny, under the government’s new security powers.