NTI Sunday Briefing
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What does the insolvency and restructuring business sector want to hear about as they negotiate the breakfast menu this sultry Sunday morning? There’s plenty of ‘no news’ around; ‘Chickens In Fear For Their Lives As The Search For Sunday Lunch Hots Up’, ‘Unions Demand Lifetime Furlough Scheme For Their Members’, etc., but what do followers of the NTI newsroom want to read about?
Neil tells us that he was a consultant for the Telegraph Media Group back around the beginning of the century. As part of this gig he coached the Chief News Editor, a feisty young man who made one principal demand of his hacks.
”What’s the story? Give me the story.”
Tracee from the office readily admits to blurring over during Neil’s regular updates on the life she suspects he never had, and heard only the words ‘telegraph’, ‘century’ and ‘news’, which aligns with her vision of our leader penning stories around campfires in a long-forgotten century in which she has no interest.
The lunchtime purveyors of the crayfish, spinach leaf and avocado, Pret A Manger, have made the front page of no less than The Sunday Times this morning with a story that has them requesting those remaining members of their staff, once 1,000 out of a total of 8,000 have been asked to leave when 31 of 410 stores around the UK have been closed, to work 20 per cent fewer hours. The German group JAB bought the group for ￡1.5 billion two years ago and must now be regretting their policy of encouraging the opening of 23 stores down London’s Oxford Street to sit proudly side-by-side.
But what is happening to sandwich shops, lunchtime stalls and casual dining outfits all over the country? Analysis by US investment bank Morgan Stanley has shown that workers in Britain have been slower to get back to their offices than those in other European countries. Only a third are back at their desks, compared with about two thirds in France, Germany, Italy and Spain. The survey was carried out in mid-July with 12,500 online interviews who were all enjoying a home-made sandwich made for the total cost of 30 pence, as they looked out over their back gardens. Is there a story there, perhaps?
There is here; a Freedom of Information request at the end of last month shows that in June 1,778 firms said were intending to cut more than 139,000 jobs in England, Wales and Scotland. In June 2019, only 345 firms had plans to cut 24,000 jobs. Airbus, Royal Mail, John Lewis, Marks & Spencer, Boots, the airport services group Swissport, HSBC, Centrica and the Restaurant Group, owner of Frankie and Benny's, were among the businesses to announce redundancy plans in June. Some of them admitted that the prospect of company restructuring had been rising up board meeting agendas for some time before only one in 12,300 people had ever used the word ‘pandemic’ in normal conversation (apparently), whilst others have simply been ravaged by making next-to-no-money for months.
Returning to the topic of ‘not news’, flirted with at the top of this piece, the UK is now officially in recession. This is ‘news’ in the same way as Philip Schofield’s painful outing of himself as gay wasn’t, when 80 per cent of an observant British population could have spared his family the excruciation of hearing about it on the BBC News At Ten, having been certain of it for the past 25 years (show us ‘the news’, Philip). Back to the the recession, the contraction of the UK economy by 20 per cent in the past quarter follows the 2.2% fall in GDP in the first three months of 2020, and will mean the UK meets the definition of recession by recording two successive quarters of decline.
May’s GDP disappointed economists as it rose by only 1.8%, and their expertise had it within a range of -13 per cent to +19 per cent and they wanted to be interviewed on TV in front of bad shelving and give their ‘view for now’, which will differ from their ‘view for tomorrow’ by plus or minus 40 per cent. Anyway, the awkward consensus is for an 8% rise in June.
Paul Dales, chief UK economist at Capital Economics, said that while the data would show the UK had met the definition of recession, the economy had stopped contracting in May. That must be good, mustn’t it, Paul?
“In reality, the ‘recession’ was in March and April,” he said. “We know the economy started growing again in May, [so] June will tell us how rapidly it has started to grow again.” However, the truth may out, for the first time in millennia of economic events, the coronavirus pandemic could prove the first big-data recession – trackable in real time. “It’s unique in many respects,” says Ruth Gregory, UK economist at consultancy Capital Economics. “In previous recoveries we didn’t have as much real-time information, so that has been a useful early indicator of where we’re heading.” What will economists do when their is real-time data to refer to? Agree with each other? Don’t be ridiculous.
Update on Billy’s away-cation holiday, he has got as far as being in the care of a Custody Controller at Antwerp and Neil is trying to put together a bail package. When he was still a free man, Billy told us that, when he was a kid, every time his Dad saw an AA van he would say, “I wonder who rescues the AA when they’re in trouble?” (How Billy and his sister would laugh ...). Well, now we know the answer; it may be Apollo, the Global Management Group, who are looking to secure a ￡3 billion rescue of the debt laden company. Co-founded by Leon Black, one of Wall Street's financiers, has joined a trio of rival bidders in approaching the AA, who are apparently a very good bet for long-term investors are in their cross-hairs.
Happy Sunday.