Thursday 14 December 2017

THE€ PUNT: Carney should note tradition before taking plastic plunge

NEW Bank of England governor Mark Carney is evidently not afraid to rock the boat. Weeks into the job, he has already tied future changes to interest rates with unemployment, and tried to dampen growing market confidence in a UK house price recovery.

But Mr Carney's latest move is the one that really takes the biscuit – he wants to roll out wipe-clean plastic bank notes, and 15pc smaller than what's currently in people's pockets.

The Punt has to ask if he understands his audience. The Brits, after all, are a nostalgic bunch. This is a nation that insisted on hanging on to the pound even as the rest of the modern world was switching over to euro. We doubt that a populace that still likes its uniformed guards to wear 3ft-tall bearskin hats will happily renounce banknotes steeped in history.

But more importantly, it seems to have escaped Mr Carney's attention that this has been tried before.

This is not the first UK attempt to print money on plastic – Northern Ireland did it more than a decade ago, with the issue of Northern Bank's Year 2000 commemorative £5 banknote on plastic polymer substrate from Australia.

Unfortunately, it all went horribly wrong. Following the theft of £22m of the notes from a money-handling centre in Belfast in 2004 – allegedly by the Provisional IRA – Northern Bank announced that all its notes were to be recalled.

 

All eyes on Fed favourite Summers

WE seem to be a little bit closer to finding out who will fill the most important finance job in the world.

According to Japan's 'Nikkei' newspaper, US President Barack Obama will name his former economic adviser Larry Summers as the new chairman of the Federal Reserve Board, the head of the US central banking system, as early as next week.

The newspaper, quoting unnamed sources, said Mr Obama was "in the final stages" of naming Mr Summers (right). Once his appointment is approved by the Senate, he will take over the job in January when Mr Bernanke's term expires. Fans of President Bill Clinton's former Treasury Secretary like that he is a stickler for market freedom.

Critics blame him for the 2008 financial meltdown – he was involved in the abolition of the Glass-Steagall Act, which allowed retail banks to get involved in speculative trading.

But when it comes to criticism, the Punt suspects he ain't seen nothing yet.

The chairman of the Fed is one of the most watched people in the financial world. The Punt hopes he is preprared for this new-found celebrity status.

 

Record sales for music-free pubs

AS it gets back in the mood for making a play in the Irish market, British pub group JD Wetherspoon has delivered a record sales figure for its financial year that ended in July. Having been at the altar of the Irish pub scene a decade ago when it bought a premises on Dublin's Capel Street, Wetherspoon did a runner without even opening, spooked by the high cost of doing business here. Now it's buying two pubs initially in Dublin – at Blackrock and Dun Laoghaire – where barflies will be able to experience the trademark absence of music that the chain of nearly 900 pubs is known for in the UK (it reversed its no TV policy some years ago). The Punt has been to a couple of Wetherspoon pubs in London – the understandably hazy memory of the visits is of a celebration of British beer that involved numerous tastings and of a venue that had the feel of a parish bingo hall. But JD Wetherspoon founder Tim Martin – known for (at least at one time) carrying around his office work in a plastic shopping bag – hit on a winning formula. The full-year numbers show that it generated £1.28bn (€1.52bn) in revenue, up 7pc, while pre-exceptional and pre-tax profits advanced 6.3pc to £76.9m (€91.6m). Staff were paid a total of £28.6m (€34m) in bonuses for the year. Martin, who's chairman, also slammed the fact that UK pubs pay higher taxes than supermarkets.

AS it gets back in the mood for making a play in the Irish market, British pub group JD Wetherspoon has delivered a record sales figure for its financial year that ended in July. Having been at the altar of the Irish pub scene a decade ago when it bought a premises on Dublin's Capel Street, Wetherspoon did a runner without even opening, spooked by the high cost of doing business here. Now it's buying two pubs initially in Dublin – at Blackrock and Dun Laoghaire – where barflies will be able to experience the trademark absence of music that the chain of nearly 900 pubs is known for in the UK (it reversed its no TV policy some years ago). The Punt has been to a couple of Wetherspoon pubs in London – the understandably hazy memory of the visits is of a celebration of British beer that involved numerous tastings and of a venue that had the feel of a parish bingo hall. But JD Wetherspoon founder Tim Martin – known for (at least at one time) carrying around his office work in a plastic shopping bag – hit on a winning formula. The full-year numbers show that it generated £1.28bn (€1.52bn) in revenue, up 7pc, while pre-exceptional and pre-tax profits advanced 6.3pc to £76.9m (€91.6m). Staff were paid a total of £28.6m (€34m) in bonuses for the year. Martin, who's chairman, also slammed the fact that UK pubs pay higher taxes than supermarkets.

 

Irish Independent

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