It’s time to end Project Fear
STEP forward David Cameron, George Osborne, Alistair Darling, Mark Carney, Christine Lagarde and all the other politicians and experts who predicted that Britain would go to hell in a handcart if we voted to leave the European Union. Time to explain yourselves.
According to your Project Fear prognosis, the UK would need an emergency Brexit Budget to put up taxes, petrol prices and slash NHS spending to plug a £40bn black hole in the event of a Leave vote.
You also warned the UK might dip into a ‘technical recession’, that hundreds of thousands of jobs would be lost as swathes of foreign banks and overseas owners would flee the country, that foreign investors would stop coming and that house prices would collapse.
Where are Cameron and co now to explain the new job figures out yesterday showing the number of people working in the UK is the highest since records began 45 years ago? Or that the stock market is close to new highs and the pound is holding steady at $1.30?
How will they explain that those claiming out of work benefits has fallen by 8,600 – Remain experts had forecast a rise of 9,000 – and that unemployment is down to 4.9pc.
This is nearly three percentage points lower than when Carney first introduced his ‘forward guidance’ figures, and the lowest it has been since before the crash in 2008.
The data up to the end of July out yesterday was the first proper indicator we have had of post-Brexit sentiment. What it shows is that the vote has not derailed the economy but that it is proving steady if not rather robust.
It always struck me as peculiar that the former Chancellor and his overseas cronies had so little faith in his own stewardship that a potential change of trading relations with the EU would trash the good work done in restoring economic credibility after the crash.
Au contraire, Osborne should be pleased with the latest tally as they show a big rise in the number of full-time jobs, as well as parttime, disproving the criticism that the new jobs created over the last few years were those with zero-contracts or part time.
Over the first five months of the year, there were more than a third of a million new fulltime jobs, although many of them were filled by European Union citizens. Most of the jobs were filled by men, which is great news, but there are still far too many claiming benefits. There were other bright spots: the fastest rises were in the north-east of England.
With average earnings up for June and the minimum wage still filtering through, we might see claimants continuing to fall.
There comes a point when working is worthwhile again for most people, and we may be close. A bullish survey from Markit on consumer confidence added to the optimism.
It’s been a good few days with a raft of UK and overseas companies reporting strong results and shrugging off the Brexit-sceptics.
It would be rash to call a mini-Brexit boom but it is time to bury Project Fear.
Cobham clean-out
FOLLOW the man, or woman as the case may be, and the share price will follow. That old stock market adage came to mind after Cobham finally got shot of Bob Murphy as chief executive, replacing him with David Lockwood, boss of Laird. Shares in Cobham rose 5pc while Laird’s shares fell 6pc.
Mortifying for Murphy but then he is used to being under the cosh – the shares are down nearly 40pc this year.
Murphy has been under pressure throughout his reign for a costly strategy aimed at taking Cobham out of a hard-hit defence market and tough Asia trading. This led him to buy US rival Aeroflex which left the aerospace giant with huge debt and heavy losses.
Then came a whopper of a rights issue, more losses, accounting scandals over contracts and the firing of staff, and the loss of the finance director as well and talk of a ‘fear-based culture’. No wonder he is on the way out.
Lockwood, ex-BT, Marconi, BAE Systems and Thales, looks just the man for a clean-out. And maybe the man to fight potential suitors. Cobham, which still has some of the highest margins in the defence business, has been touted as a takeover target in the past. BAE, America’s Northrop Grumman and Italy’s Finmeccanica have cast their eye. With the shares down and a lower pound, they may take another look.
Goldman sees the light
LLOYD Blankfein, the Goldman Sachs boss, has told young interns at the US bank that they need to ‘chill out’ more and relax.
Can this be true? Goldman has the most ruthless reputation on Wall Street for its maniacally-driven work ethic.
To get a job there, potential employees have to go through about 20 interviews. Making it through to partner level, which is like winning the lottery, is one of the most vicious fights on the Street. Only the toughest survive.
Perhaps this is some sort of new test for interns, weeding out the weak? Or has Blankfein finally seen the light? Has the vampire squid converted into a fluffy bunny? After all, it was Blankfein who claimed after the crash that bankers are doing ‘God’s work’.