21 August 2019

Scott Reid

21 August 2019

Good morning,

The behaviour of the social media giants has become a wondrous sight to behold of late.
 
Struck by the epiphany that the mass harvesting of personal data worthy of a Black Mirror episode was, in fact, not the utopia we had hoped for (and now, ironically enough, the subject of a recent Netflix documentary), they are trying to make amends.
 
Enter “Off-Facebook Activity” – a long-awaited privacy tool introduced by Mark Zuckerberg yesterday that will allow his site's users to prevent third party websites from accessing their data for the purposes of targeted advertising. A noble, high-minded endeavour for a onetime charlatan like Facebook, which wouldn’t be so shameless if it wasn’t in the end designed to get more of us “On-Facebook”.
 
You might also point to the tragic tale of Luka Ivezic, a 24-year-old student at King’s College London, whose Twitter account was suspended from the site as one of 936 identified as tools of Chinese efforts to sow dissent online. The real humdinger? Wee Luka’s dissertation topic was entitled “Disinformation, and how artificial intelligence can empower the tools that China and Russia have to misinform us.” Good job, guys!
 
It’s for reasons like these that I – in the words of a pithy blogger – have decided to the flip the (blue) bird to social media.
 
You’re right; I probably won’t last long. Seeking the thirty-second hit of a cat sticking its head in irregular-sized boxes, or checking-in on how many likes my latest home renovation post on Instagram has accrued, I will be back sure enough. But I don’t think I’m alone in at least trying to give up the social media ghost, and that should spell concern for the likes of Facebook. If one twenty-something urban millennial with reasonable spending power is willing to say adios, how many others are prepared to follow suit?
 
The answer might be more than you think. Research from September suggested that 40% of US Facebook users had taken a break “of several weeks”, and an additional 44% of younger users had deleted the app entirely.
 
I’m sceptical whether Facebook’s latest wheeze will amount to anything more than tinkering at the edges while the ship sinks. If the social media giant can’t effect a fundamentally more wholesome approach to its use of data, or at least, a less all-consuming experience of its apps, a more likely future headline might read “Off-Facebook Entirely”.

News

Giuseppe Conte has resigned as Italy’s prime minister, triggering snap elections if a new administration cannot be found within the current parliament. Speaking to the Senate yesterday, Conte accused Matteo Salvini, interior minister and leader of La Lega, of pursuing “his own personal interest and those of [his] party.” Conte’s resignation pre-empted a confidence vote that Salvini had earlier demanded.
 
Boris Johnson has warned that there is “no prospect of a deal” unless European leaders back down on the Irish Backstop. In a letter sent to European Council president Donald Tusk yesterday, Johnson called the backstop “anti-democratic”. Although Tusk and Irish prime minister Leo Varadkar rebuffed Johnson’s demands, German Chancellor Angela Merkel suggests the EU must find “practical solutions” to the impasse, but stopped short of suggesting this required reopening the Withdrawal Agreement. Johnson flies to Berlin today to meet with Merkel ahead of a Council summit next week.
 
Shale gas in Britain may only yield a tenth of its previous predicted supply, researchers have suggested. According to University of Nottingham scientists working with the British Geological Survey, the predicted supply may amount to five years’ worth of gas at the current level of demand. Research in 2013 based on US data had suggested the Bowland Shale foundation in northern England could house up to 50 years’ supply. (£)

Business & Economy

British tech start-ups are on course to receive more than $11 billion investment during 2019. According to the government’s digital economy council, Britain remains the most attractive European country for overseas tech investors, having already received £5.5 billion in new funding this year – a 50% increase on the same period last year. (£)
 
The average pay of a FTSE chief executive has fallen by 16% to £4.7 million, new research has shown. According to the High Pay Centre think tank, the data suggests companies “are listening” to concerns over exorbitant executive pay, but cautions against an established culture of restraint. Median chief executive pay also fell by £509,000 or 13%, to £3.46 million. Of the 99 chief executives monitored, pay packets rose for 43 and fell for 56.
 
Bloomberg reports that Saudi Aramaco has appointed advisers as it prepares to make a second attempt for its speculated trillion-dollar float. Investment banks Lazard and Moeils have been appointed for the bid, which is expected to pit stock exchanges in London, New York and Hong Kong against each other.

Markets

What happened yesterday?

A latter day jump in the pound following comments from the German Chancellor on Brexit led the London market to a lower finish on Tuesday, with the FTSE 100 sitting down 0.90% at 7125.00 points. Sterling was higher on both the US dollar by 0.24% at $1.22 and on the euro by 0.10% at €1.10.
 
Investors were also cheered by a CBI reading showing growth in UK manufacturing during August, having dropped in July, and which they expected to remain stable over the next three months. The CBI did caution however over the prospect of a “double whammy” hit to growth via a global economic slowdown and no-deal Brexit hit.
 
In equity markets, the big four supermarket were in the limelight as research firm Kantar showed that sales fell in the 12 weeks to 11 August. Sainsbury's shares rose, however, as it fared the best of the bunch, with sales there down just 0.6% versus a 2.7% drop at Morrisons, a 1.6% decline at Tesco and a 1.5% fall at Walmart-owned Asda.

What's happening today?

Interims
Charter Court
Costain
Empresaria Group
Hansteen Hldgs

AGMs
Albion Venture
Ide Hldgs
Latham Timber
Tekmar Group P.
Tp Grp

Trading Announcements
Pets At Home
 
Intl. Economic Announcements
(09.30) Public Sector Net Borrowing
 
Intl. Economic Announcements
(12.00) MBA Mortgage Applications (US)
(15.00) Existing Home Sales (US)
(15.30) Crude Oil Inventories (US)

Columns of Note

The Times’ banking editor Katherine Griffiths suggests the gender diversity of City trading floors might be improved by shortening market hours. Griffiths points out that last year only 13% of senior individuals in trading were women, also making up just 16% of senior roles at investment banks, and 18% in retail banking. She suggests the move, despite corporate support, would need concerted continental action in order to work. (£)
 
Andrew Marantz asks in a New Yorker long-read whether Silicon Valley’s current efforts to curb technological impact are evidence of deep introspection, or just canny P.R.? Charting the author’s experience of sharing a wilderness retreat alongside some leaders in Big Tech, Morentz concludes that the industry can’t just be treated like any other via regulation. (£)

Did you know?

An average of 100 people die every year as a result of choking on ball point pens.

Parliamentary highlights

House of Commons
In recess until 3rd September.
 
House of Lords
In recess until 3rd September.
 
Scottish Parliament
In recess until 2nd September.