A new kind of Davos Man

THE presence of self-styled ‘ stable genius’ Donald Trump will be a sight for sore eyes at the Davos World Economic Forum later this month.

The cast of self-important political leaders, financiers, company chiefs and the commentariat parading across the Swiss mountaintop and making grand pronouncements will only serve to underline inequalities that have given rise to nativism.

That last year the Chinese president, Xi Jinping, was hailed as the kind of leader we can all admire because of a deeply disingenuous speech on globalisation tells us all we need to know about the fragile conventional wisdom of such gatherings.

China is not a liberal democracy nor does it believe in free markets. The same commentators who worshipped at the Xi knee seem blissfully unperturbed that in 2017 a record number of 41 reporters were arrested and locked up in the People’s Republic.

They also seem happy to ignore how cheap steel dumped on Western markets destabilised jobs from Port Talbot in Wales to the American rust belt.

Also ignored is how executives of GlaxoSmithKline were trampled upon, how relatives of Xi were exposed as tax cheats and money launderers in the Panama Papers, and how Beijing reneged on promises of democracy and freedom in Hong Kong.

In the words of Paul Krugman, the Nobel prize-winning economist, Trump, is ‘an erratic, vindictive, uninformed, lazy, wouldbe-tyrant’. But as far as we know, while he has raged at journalists he has not incarcerated them and appears, along with his advisers, to have some notion of how laissez-faire capitalism works.

Taking credit for a Wall Street boom which has driven the Dow Jones above 25,000 may be crazy. If you take credit for the bull market, you will also be assigned some responsibility for the correction which follows.

Indeed, the latest run-up in US bond yields to 2.59pc, amid expectations of higher inflation, shows that the bull market in fixed interest bonds, buoyed by QE (printing money), could be coming to an end. Nothing is forever in financial markets.

At the same time we know that the derided Trump corporate tax cut from 35pc to 21pc has prompted a number of corporations, including Britain’s BP, Shell and BAT (all are powerful in the US) to project long-term earnings and investment opportunities.

Trump with his crude deregulation policies, lack of intellect and finesse may not be the kind of dreamy-Obama leader who the Davos luvvies look up to.

But he may offer a glimpse of how red-intooth-and-claw capitalism can deliver.

Retail therapy

CLOSER to home, trying to discern a pattern in the stories from Britain’s High Street is tricky. By rights the strongest aspect of grocer Sainsbury’s results ought to have been Argos, which was bought for its edge in non-food arising from online sales skills and hub-and-spoke logistics.

In the event, it was good old-fashioned food which delivered over the festive season, as was the case at recovering Morrisons and German interlopers Aldi and Lidl.

If the pattern is repeated we can expect similar upbeat premium foods tales from Tesco and M&S today. Another trend looks to be the preference for designer single brand retailers, such as premium shirt maker Ted Baker, over the multi-brand model of Debenhams, Mothercare and Moss Bros. The latter lack individuality and online capacity.

Mystery Ted Baker founder Ray Kelvin, who never shows his face in public, notes that Debenhams and Mothercare ‘are selling other people’s products’.

That is all very clever but doesn’t really stand up to much scrutiny. The fastestgrowing and most dangerous beast in retail sells everything from overpriced Whole Foods produce to discount books and easy to access electronics and household goods.

Aside from Echo, Kindle and a handful of other home-made goods, Amazon offers everyone else’s stuff.

Cedric the pig

GIVEN the chance to advise Persimmon’s £135m man Jeff Fairburn I would mention Cedric Brown. The former British Gas boss was humiliated and portrayed as an overweight porker in 1994 when he received a 75pc pay increase to £475,000.

Brown was eventually driven from office and became an undeserving watchword for unfettered corporate greed.

His reputation, and old British Gas (split into three parts), never recovered.