12th November 2019
Written by Scott Reid, Associate Partner
Edited by Laura Hamilton, Managing Partner
Dystopian fiction has been enjoying a renaissance of late. Clearly fascinated (or horrified) by the increasingly outlandish events that seem to mark our daily lives, we’ve also taken to the printed page for our thrill-seeking. Most will be well-acquainted with Netflix’s Black Mirror or Margaret Atwood’sThe Handmaid Tale by now. But my left field suggestion for your Christmas wish list would be Sinclair Lewis’ It Can’t Happen Here – a 1936 imagining of how populism, and then fascism, might take root in the US. One dystopian drama which has stuck with me most in 2019, however, and came uncomfortably back to mind again this morning, is the BBC’s Years and Years. Starting in the present day and tracking the lives of the Lyons family over the course of the next 15 years to 2034, the drama covers the logical next stages to some of the world’s most urgent crises. A “populist revolution” in Spain, “walls of flames” at the gates of Sydney and endless rain over Yorkshire. Whilst all plotlines aired to the nation in May of this year, they are all also headlines from today’s papers. In response to the emergency on the river Don, the prime minister has today convened a meeting of the emergency Cobra committee to coordinate a government response to the 44 weather warnings in place and the evacuation of some 1,200 properties in England. Jeremy Corbyn has suggested that a national emergency would have already been declared had “this happened in Surrey, not Yorkshire”, and Jo Swinson has outlined the EU flood defence funds that will be lost after Brexit. A sobering caveat to today’s news, however, is that the floods are only set to worsen. A report from data provider MSCI found last month that the number of households affected by flooding will more than double by 2050 to more than 1.9 million as a result of climate change. That includes some 30% of homes in the West Midlands, and 54% of the properties in Reading alone. Please excuse my flagrant catastrophising on your start to the working day – I’ve clearly had my head too much in the books if my reading habits are anything to go by. But today’s news does go to show why we can’t get enough of dystopia – not for its fiction, but its reality. To quote Sinclair Lewis; it really could happen here… and is.
An independent review has recommended that the HS2 rail project should go ahead despite rising costs. The leaked report, which was seen by The Timesand has been led by former HS2 chairman, Douglas Oakervee, also suggested that the project’s procurement strategy has been a failure, with prices significantly inflated to a currently estimated £88 billion, making it the largest planned infrastructure project in Europe. (£) Nigel Farage announced yesterday that the Brexit Party will not contest 317 constituency seats won by the Conservatives in 2017. Farage has suggested the move was prompted by informal commitments made by the prime minister not to extend the transition period following the UK’s departure from the EU beyond December 2020 and also suggests that he turned down the offer of a peerage. The Brexit Party will still compete in non-Tory held seats, and instead “focus” on capturing Labour seats in the North of England. Evo Morales has accepted political asylum in Mexico after resigning as president of Bolivia yesterday amid election fraud protests. The deputy head of Bolivia’s senate, Jeanine Ańez, has assumed an interim presidency before new elections are held in January. Meanwhile, 20 people among Morales’ supporters have been reported injured in clashes with Bolivia’s military.
Business and economy
British Steel has been bought by Chinese firm Jingye in a deal worth £70 million. Jingye also plans to invest a further £1.2 billion in increased production, blast furnaces and coke ovens which it said would “preserve thousands of jobs in a key foundation industry in the UK.” British Steel currently employs about 4,000 people in Scunthorpe and Teesside. T-Mobile USA boss John Legere is reportedly in talks to become the new chief executive of WeWork. Legere is thought to be a leading external candidate for the role alongside Artie Minson, WeWork’s COO, and Sebastian Gunningham, WeWork’s current vice-chairman. Legere is currently overseeing a $26 billion merger between T-Mobile and Sprint. BHP has said that oil will remain an attractive investment opportunity for “decades to come”. Speaking at an investor briefing yesterday, leaders from the mining conglomerate announced increased spending in oil and gas, and promised to deliver returns on par with other commodities in its portfolio, including copper, coking coal and iron ore. (£)
What happened yesterday?
The pound rose against the dollar and the euro following Nigel Farage’s announcement that the Brexit Party would not field candidates in Conservative constituencies in the upcoming UK general election. Sterling jumped 0.55% on the dollar to $1.29 and by 0.46% on the euro to €1.16.
The currency market’s gains were the main drag on the FTSE 100, however, which closed down 0.42% at 7,328.54 points. House builders and lenders were the day’s best performers following the latest ONS GDP figures which showed that the UK economy had narrowly avoided recession by posting annualised GDP growth of 0.3% in the third quarter. RBS (+4.04%), Lloyds Banking Group (4.02%), Barclays (+3.12%), Persimmon (+3.90%) and Barratt Developments (+2.52%) were among the beneficiaries. On the downside were miners Antofagasta (-3.02%), Glencore (-3.50%), Anglo American (-2.66%), and Evraz (-5.34%) which were hit by anxieties over worsening US-Chinese trade relations and protests in Hong Kong. Sector peer BHP was also down despite announcing increased margins and productivity in its petroleum business.
What's happening today?
Aveva Group Electrocomponents Gear4music Land Securities Premier Foods
Kainos Group Tatton Asset M.
BHP Group Craneware Galliford Try Mid Wynd International Investment Trust Pacific Horizon Surface Transforms
UK economic announcements
(09.30) Claimant Count Rate
Intl. economic announcements
(10.00) ZEW Survey (GER) – Current Situation (10.00) ZEW Survey (EU) Economic Sentiment (10.00) ZEW Survey (GER) – Economic Sentiment
Columns of note
Margaret Talbot writes a profile of liberal US Justice Elena Kagan in The New Yorker and suggests she is the last bulwark against a long-term rightward shift in the make-up of the Supreme Court. Despite suffering from a low-profile among the American public and certainly less than the “notorious RBG” (Ruth Bader Ginsburg) , Talbot says Kagan’s success lies in her willingness to build bridges across the bench, an acute political acumen and her relative youth. (£) Former IMF official Isabelle Mateos Y Lago writes in the Financial Times thatcentral banks must lead a regulatory charge against climate change. She argues that significant action is achievable within their current mandate. This may include cutting portfolio risk by diversifying foreign exchange reserves and amending the criteria upon which risk is assessed. (£)
Did you know?
Watching half an hour of Netflix produces as much CO2 as driving about four miles.
TODAY House of Commons The House of Commons is in dissolution. The House will next sit on Monday 16 December 2019. House of Lords The House of Commons is in dissolution. The House will next sit on Monday 16 December 2019. Scottish Parliament Topical Questions (if selected) Scottish Government Debate Protecting the Rights of EU Citizens in Scotland
Committee Announcements Members’ Business Tackling Intimidation in Public Life – Rachael Hamilton TOMORROW Scottish Parliament Portfolio Questions
Scottish Government Debate Artificial Intelligence and Data Driven Technologies: Opportunities for the Scottish Economy and Society Members’ Business Pancreatic Cancer Awareness – Clare Adamson