“Our moral economy went bankrupt long before our financial one.” ― Steve Maraboli, Unapologetically You: Reflections on Life and the Human Experience
A 2016 special report by, Victor Romain – the long read
A lot of crazy things have happened this year and I believe that I could be right in saying that many years down the road from now – many people are going to be talking about 2016. The history books will surely be looking back at 2016 in awe. Just like me.
This year, we lost some of the greatest names in the music industry, from: David Bowie, Prince, Leonid Cohen, Rick Parfitt, of Status Quo, and more recently…George Michael.
This year also saw in some of the most surprising and, at the same time disruptive and seismic changes in the world of politics, which have impacted, very seriously indeed, on the world’s financial markets – from Brexit to the nail-biting, US election victory of Donald J Trump, who came in as a complete outsider: a property developer billionaire and (a now) former businessman: with absolutely no diplomatic experience, whatsoever, but who went on to win the presidency of the USA; in a down-to-the-wire and the most acrimonious election race ever.
In the meantime, and apart from Mr. Putin being blamed for Hillary Rodham Clinton’s losing the chance to occupy the White House – with the Kremlin being blamed for the hacking of their of their servers and the passing on of the information, of Clinton’s campaign manager, John Podesta’s (allegedly Russian hacked) emails to WikiLeaks; for them to be published during the election campaigning, which was all manna from heaven for Mr. Trump’s campaign election team(s).
Russia has also been accused of: covert, political influence-peddling, disinformation campaigns and cyber warfare – from the USA, to the UK and from Baltic States to Ukraine.
Mr. Putin was, however, also voted in at number one for the Forbes “Most Powerful Man in the World,” list for 2016, with Barak Obama sinking to the 48th position on the Forbes Most Powerful Men in the World list and with Donald J Trump coming in at number two. I cannot ever remember a serving US president coming in with such a low ranking.
However, the outgoing US president Barak Obama had said (today) that he firmly believed he was still confident enough to have won the presidential vote, had the rules of American politics allowed for serving US presidents to run for more than just two terms in office.
The Guardian reports that, “In a wide-ranging interview with former aide David Axelrod, the outgoing president expressed his belief that he could have won re-election in 2016, based on his view that most Americans still subscribed to his progressive vision and ideals.”
“I am confident in this vision because I’m confident that if I had run again and articulated it, I think I could’ve mobilized a majority of the American people to rally behind it,” Obama said on Axelrod’s CNN podcast.
The outgoing president summarized this progressive American spirit as one that “manifests itself in communities all across the country”.
“We see it in this younger generation that is smarter, more tolerant, more innovative, more creative, more entrepreneurial, would not even think about, you know, discriminating against somebody for example because of their sexual orientation.”
To, which Mr. Trump duly responded, as is the norm for him, via Twitter – President Obama said that he thinks he would have won against me. He should say that but I say NO WAY! – jobs leaving, ISIS, OCare, etc. (Source: The Guardian: 26/12/2016)
However, The UK’s Guardian newspaper has recently published an opinion piece, by Simon Tisdal, entitled, “2016 was the end of the world as we know it. So, what’s next?” (Source: The Guardian: 25/12/2016)
This, sensationalist reportage and eye-grabbing headline is, of course, is entirely within keeping of The Guardian’s neo-liberalist and political views. I.e. It didn’t like the outcome of the Brexit vote, The Guardian hates Nigel Farage, and it equally hates both Donald Trump and Vladimir Putin with a vengeance.
And, that’s even without Frances Marine Le Penn and Holland’s, Geert Wilders, the founder and leader of the Dutch Freedom Party, who has dominated Dutch polls during the year of. These people have captivated many of the 2016 news headlines in the political arena and quite possibly, they are going to be further upsetting the old, established, political elite (as well as the financial institutions and the forex markets) of the EU in 2017.
The UK’s (new) Winter of Discontent
I doubt that there will be few readers here, who would be old enough to remember the winter of 1978–79 in the United Kingdom, during which there were widespread strikes by public sector trade unions demanding larger pay rises, following the ongoing pay caps of the Labour Party government led by James Callaghan against Trades Union Congress opposition to control inflation, during the coldest winter for 16 years. However, I remember it well…very well indeed.
The phrase “Winter of Discontent” is from the opening line of William Shakespeare’s Richard III: “Now is the winter of our discontent.” Made glorious summer by this sun [or son] of York…”, and was first applied to the events of the winter by Robin Chater, a writer at Incomes Data Report. It was subsequently used in a speech by James Callaghan and translated to define a crisis by tabloids – including The Sun.
The weather turned very cold in the early months of 1979 with blizzards and deep snow, the coldest since 1962–63, rendering some jobs impossible, reducing retail spending and worsening the economy. (Source: Wikipedia)
I remember this period well…for it was a period, which was being wracked by inflation and a country which was embroiled in a series of seemingly, endless strikes: as well as it was being the one of the coldest and most severe UK winters in modern history – since the great freeze of 1962-53. Indeed, the UK was verily dubbed “The Sick Man of Europe.”
Well…the UK is now facing yet another ‘Winter of Discontent.’ However, this time around there are no bitingly-cold blizzards and sub-zero temperatures coming from the weather, at least.
There are, however, some very cold winds blowing over the UK, from discontented workers at some of our key business sectors – with thousands of workers, who had already started strike action several weeks ago, on Southern Rail. Last week Southern Rail cancelled all services due to strike action and this looks set to continue for a long while to come yet.
The strike action is over Southern Rail’s plans to implement the opening and closing of the trains doors, by drivers only, which it is argued, will put the safety of passengers, embarking and disembarking, at risk.
Unite members at Heathrow are planning to walk out on Christmas Day and Boxing Day if cabin crew dispute is not resolved
Talks aimed at averting strikes by British Airways cabin crew over Christmas will be held on Monday.
Unite union members based at Heathrow are due to walk out on Christmas Day and Boxing Day in a dispute over pay.
The row involves about 4,500 “mixed fleet” cabin crew who have joined BA since 2010. Unite says they are on lower wages than other staff, referring to the amount that recently hired staff receive as “poverty pay”.
BA, which employs about 16,000 cabin crew, said it was “appalled” that Unite proposed to disrupt customers’ travel plans on Christmas Day and Boxing Day and that it planned to ensure its customers could travel to their destinations.
Unite’s general secretary, Len McCluskey, said: “I am delighted that British Airways has heeded our calls for talks. It is only by getting round the table that we can find a solution to my members’ concerns.
“Given the huge profits BA’s parent company made last year, the mixed fleet’s calls for a living wage and for equal treatment at work and in their pay packets must be heard.
“These are young men and women fighting for justice. Unite will work tirelessly to defend them, to get this dispute solved and to win them the fair and decent treatment they deserve.”
Airport staff join BA crew, Virgin pilots, Post Office workers plus train drivers and conductors in announcing industrial action
On Friday 23 December and Christmas Eve, members of Unite employed by Swissport will walk out at Aberdeen, Belfast, Birmingham, Bournemouth, Bristol, Cardiff, Doncaster, East Midlands, Edinburgh, Gatwick, Glasgow, Heathrow, Leeds/Bradford, Luton, Manchester, Newcastle, Southampton and Stansted airports. Unite national officer Oliver Richardson called on the company to “engage in constructive talks.” Airport representatives have said they are putting contingency plans in place.
Virgin Atlantic pilots to take industrial action over union recognition
Pilots at the airline who are members of the Professional Pilots’ Union (PPU) will work to rule after they voted to take industrial action short of a strike. The action will see a removal of “pilot goodwill”, with pilots who are members of the PPU working strictly to their contracts.
Virgin Atlantic said it values its pilots “enormously” and expected its “flying programme to remain unaffected.”
The Post Office
A five-day strike, including on Christmas Eve, threatens to cause disruption for those wanting to send gifts and cards. The Communications Workers Union blamed a long-running dispute over jobs, pensions and branch closures.
The union blamed the “intransigence” of the Post Office, while the company said it was “extremely disappointed” and had believed talks were due to resume this week.
The UK retail industry – November 2016 news roundup
British shoppers lead the way in Europe, in Christmas 2016 spending spree
From what I have seen in my town of Canterbury and elsewhere, any Brexit fears about the future of the UK economy, is not stopping people from, spending and dining out.
According to a very recent Europe-wide report by “Real Business,” UK Christmas shoppers will be spending a record £77.56bn this year.
Although UK Christmas spending will only be up by 1.9 per cent year-on-year, UK households are set to spend almost double the European average.
The UK Christmas spending bonanza will be powered along by mobile devices, which will experience a major growth of 51.2 per cent on 2015.
The study from Vouchercodes.co.uk parent RetailMeNot and the Centre for Retail Research tracked British Christmas spending trends from a wider study of 450 large retailers in nine countries and 3,000 consumers.
According to the findings, smartphones and tablets will account for 42.3 per cent of UK Christmas spending where online is concerned, to generate £8.87bn for UK retailers. As a result, Britain will lead Europe for mobile shopping over Christmas.
In terms of UK Christmas spending, the average home will splash out £809.97 on average. This will go towards food and drink, travel, decorations and gifts, with the latter accounting for 58.5 per cent of the budget.
Comparatively across Europe, the average spend will be £540.32, while Spain Christmas spending will be the least on the continent at £348.25 per home. (Source: Real Business: 2016)
Britain enjoys a Christmas shopping bonanza with Brexit giving consumer spending a record-breaking boost
Because Christmas Day falls on a Sunday this year, buyers have effectively been given an extra Saturday of spending on Christmas Eve, bumping up sales to unprecedented levels.
Cash withdrawals this month are at an all-time high and stores say they expect records to tumble.
John Lewis has already broken its record week for trading, notching up almost £200million in sales in the week of Black Friday, up by 6.5 per cent.
In London, the shopping boom has been fuelled by foreign buyers cashing in on the falling pound
Jace Tyrrell, chief executive of New West End Company, which represents the capital’s busiest shopping district including Bond Street, Oxford Street and Regent Street, said Brexit had given the West End a “positive boost, driven by an influx of international shoppers looking to make the most of the weak pound.”
He added: “Christmas trading is expected to hit a record-breaking £2.34billion as a result.”
Shoppers have embraced a ‘Keep Calm and Carry on Spending’ attitude
18/12/2016. Richard Lim of Retail Economics says, “Shopping centres in other parts of the UK are also reporting a rise in numbers compared with last December.”
Gary McKinnon, operations director at Intu, which owns 18 shopping malls including Manchester’s Trafford Centre, said: “We’ve seen more and more people come through our doors and we expect to see this trend continuing.
“This week is going to be incredibly busy, with a million shoppers expected to visit our centres every day.” (Source: The Daily Express: 18/12/2016)
Co-chairman of European arm of Goldman Sachs to retire from Wall Street bank after 30-year career that included grilling by MPs over BHS (British Home Stores) collapse
21/11/2012. One of the City’s most influential and highest-paid bankers, Michael Sherwood, is leaving Goldman Sachs after a 30-year career, including becoming embroiled in controversy over the collapsed retailer BHS.
Sherwood, a Londoner who joined Goldman after graduating from Manchester University, plans to focus on charitable activities when he leaves the US bank in about six months.
A former bond trader who was paid $21m (£16.8m) last year, Sherwood usually keeps a low public profile. But this year he appeared before MPs investigating the collapse of BHS, which put 11,000 jobs at risk and left a £571m pension deficit.
It was a public appearance that Goldman bankers would usually prefer to avoid. The bank is proud of its work behind the scenes in securing deals and offering advice to governments and big businesses.
But Goldman was forced to talk about its relationship with Sir Philip Green when he was selling BHS. Green said he was “1,000,000%” would not have sold the department store chain to Dominic Chappell, had the buyer not passed an informal vetting by the bank.
The 51-year-old was co-head of Goldman’s European business, which employs 6,000 people and is grappling with the uncertainty caused by the vote for Brexit. Construction of a new head office in London – a stone’s throw from its existing headquarters on the edge of the financial district – is already underway. His co-head, Richard Gnodde, will become chief executive of the European operations.
Sherwood told the FT: “As you know, we were very much in the remain camp … We will readjust, we will have to do what we want. I hope it will be favourable to the UK and we are able to keep a lot of people here.”
He achieved the coveted status of partner while he was still in 20’s and he told the FT: “I stopped working for money a long time ago … when we went public.” Goldman floated in 1999, putting value on its partners’ stakes in the business for the first time. His stake is worth more than $70m.
“I’ve been a Goldman Sachs addict and it’s very hard to come off an addiction,” he added.
In a statement to the bank’s 36,800 staff, the two most senior executives at Goldman paid tribute to Sherwood.
Blankfeinand Gary Cohn, president and chief operating officer, said: “Please join us in thanking Michael, or Woody, as everyone calls him, for his commitment and extraordinary service to the firm, our clients and our people. We wish him, his wife Melanie and their family all the best in the years ahead.” (Source: The Guardian – Goldman Sachs: 21/11/2012)
He stopped “working for money a long time ago?” Lucky him. With his pay cheques and share options – he and his family won’t be going hungry in his lifetime.
However, if he stopped working for money a long time ago – what was he doing going into the office every day for then? Major UK bank fails BoE Stress Test
RBS fails Bank of England stress test
30/11/2016. The Royal Bank of Scotland was the biggest failure in the Bank of England’s annual health check of the UK banking system and has embarked on a new plan to bolster its financial strength by £2bn.
The Edinburgh-based bank, which is 73% owned by taxpayers, is to cut costs and reduce its exposure to risky assets after the results of the toughest tests yet on the banking system were published on Wednesday.
Two other banks, Barclays and Standard Chartered, also struggled in the so-called stress tests, which are based on hypothetical scenarios including house prices falling and the global economy contracting by 1.9%. Barclays already has a plan in place to bolster its financial position, while Standard Chartered said it has not needed to take any action.
As the Bank announced the results of its third annual stress tests it warned of a “challenging period of uncertainty around the domestic and global economic outlook.”
RBS shares initially fell 4% but ended the day 1.3% lower while shares in the other banks tested were higher.
Ewen Stevenson, RBS finance director, said: “We have taken further important steps in 2016 to enhance our capital strength, but we recognise that we have more to do to restore the bank’s stress resilience, including resolving outstanding legacy issues.”
Deeper cuts to costs are expected when RBS reports its results next year which could entail job cuts. Analysts at UBS said: “We expect a bigger cost and restructuring plan [from RBS] in February.”
Laith Khalaf, senior analyst at Hargreaves Lansdown, pointed out “RBS is in no immediate danger” although he said the bank was the “weak link in the UK banking chain.”
Barclays said it had passed the Bank’s test. Standard Chartered said it “has a strong and liquid balance sheet and the results of the stress test demonstrate its resilience to a severe global stress scenario.” (Source: The Guardian – Banking: 30/11/2016)
UK fuel prices surge upwards on new OPEC deal
01/12/2016. Hot on the heels of the latest OPEC deal to curb the flow of crude oil coming onto the market, which is its first in eight years the price of a litre of petrol in the UK has now risen to an average of £1.15 a litre – up from £1.10 barely a month ago.
OPEC, whose 14 members pump a third of the world’s oil, announced at a meeting in Vienna on Wednesday that it would trim production by 1.2m barrels a day to 32.5m from 1 January. Russia, the largest non-Opec producer, has also agreed to reduce its output gradually.
The news sent Brent crude, the global benchmark, 8% higher to more than $50 a barrel. Brent rose a further 0.6% to $52.42 a barrel on Thursday, trading around a six-week high, while New York crude climbed over $50 a barrel for the first time since the end of October.
The AA estimates that a rise in crude oil prices to $60 a barrel would push petrol prices including VAT up 9p a litre to about 123p a litre. That is £4.95 extra a tank and £18 extra a month for a family with two petrol cars – just as winter sets in and cars use more fuel to power heaters and lights.
Luke Bosdet, a spokesman for the AA, said: “Not only is this the fourth jump to $50 a barrel so far this year, but it also comes at the wrong time. With winter motoring cars consume more fuel.”
Changes in oil prices feed through to petrol prices after 10 to 14 days. Bosdet deplored that oil prices were driven more by “feverish speculation” than actual changes to production. He added: “The only silver lining is that oil hasn’t taken off massively.”
RAC fuel spokesman Simon Williams said oil prices would rise further in coming days and weeks, “likely pushing pump prices up in the short term, but it is what happens into 2017 that will be most important in determining if the days of relatively low prices of fuel that drivers have benefited from this year are coming to an end”.
Petrol prices dropped sharply in early 2016 to about 100p a litre when oil plummeted to below $27 a barrel, amid an oil glut. Iran ramped up production after international sanctions on the country were lifted. (Source: The Guardian: 01/12/2016)
I have a 2003 Mercedes-Benz S 350 limousine and the fuel tank capacity on that car is 88 litres. Filling that up, here in the UK, has now become a very expensive affair indeed. The price of the same, premium octane-grade fuel is far cheaper in Germany.
Deutsche Bank and Credit Suisse agree multi-billion-dollar settlements with US
23/12/2016 The US Department of Justice has extracted $12.5bn in settlements from Deutsche Bank and Credit Suisse for a decade-old toxic bond mis-selling scandal. It has also started legal proceedings against Barclays, which, in an unprecedented move, has refused to settle with the authorities.
Deutsche, Germany’s biggest bank, will pay $7.2bn (£5.9bn) to the DoJ. The sum is considerably less than the $14bn originally demanded. Credit Suisse has agreed to pay $5.3bn. Both settlements relate to the complex packaging of home loans, which was a lucrative business for the banking industry until the 2008 crisis.
The DoJ did not disclose the size of penalty it wanted to levy on Barclays, but it is understood to be $4bn. It accused the bank of “plainly irresponsible and dishonest” conduct.
The flurry of announcements just hours before the markets closed for the Christmas holiday came weeks before Donald Trump takes over as US president and follows months of negotiation between the banks and the DoJ, led by the US attorney general, Loretta Lynch.
The scandal dates back to 2005 and 2007, when banks packaged up home loans and used them to help create bonds – known as residential mortgage-backed securities (RMBS) – which were sold to investors. The mortgage repayments made by borrowers then provided a yield to the investor, so long as the borrower kept paying. The schemes fell apart when loans were made to borrowers who were unable to repay. (Source: The Guardian – Deutsche Bank: 23/12/2016)
The main events for 2016 were:
- January 3 – Following the fallout caused by the execution of Nimr al-Nimr, Saudi Arabia ends its diplomatic relations with Iran.
- January 8 – Joaquín Guzmán, widely regarded as the world’s most powerful drug trafficker, is recaptured following his escape from a maximum-security prison.
- January 16 – The International Atomic Energy Agency announces that Iran has adequately dismantled its nuclear weapons program, allowing the United Nations to lift sanctions immediately.
- January 28 – The World Health Organization announces an outbreak of the Zika virus.
- February 7 – North Korea launches a long-range rocket into space, violating multiple UN treaties and prompting condemnation from around the world.
- February 12 – Pope Francis and Patriarch Kirill sign an Ecumenical Declaration in the first such meeting between leaders of the Catholic and Russian Orthodox Churches since their split in 1054.
- March 14 – The ESA and Roscosmos launch the joint ExoMars Trace Gas Orbiter on a mission to Mars.
- March 21 – The International Criminal Court finds former Congolese Vice President Jean-Pierre Bemba guilty of war crimes and crimes against humanity, the first time the ICC convicted someone of sexual violence.
- March 22 – Three coordinated bombings in Brussels, Belgium kill at least 32 and injure at least 250. The Islamic State of Iraq and the Levant claims responsibility for the attacks.
- March 24 – Ex-Bosnian Serb leader Radovan Karadžić is sentenced to 40 years in prison after being found guilty of genocide and crimes against humanity committed during the Bosnian War.
- March 27 – A suicide blast in Gulshan-e-Iqbal Park, Lahore kills 75 people and injures around 340 others with a militant Sunni Islamic organization claiming responsibility for targeting Christians celebrating Easter.
- April 2 – Clashes between Armenian and Azerbaijani military in Nagorno-Karabakh kill at least 193 people, which becomes the heaviest breach of the 1994 ceasefire.
- April 3 – The Panama Papers Scandal. The International Consortium of Investigative Journalists (ICIJ) and the German newspaper Süddeutsche Zeitung publishes a set of 11.5 million confidential documents from the Panamanian corporate Mossack Fonseca that provides detailed information on more than 214,000 offshore companies, including the identities of shareholders and directors including noted personalities and heads of state.
These leaks resulted in the UK’s (then) Prime Minister, David Cameron, having to explain away his fathers and his family’s financial affairs; related to their off-shore and tax-free, usage and financial benefits when that came to light, as a result of the Panama Papers leaks and Iceland’s Prime Minister, Sigmundur Davíð Gunnlaugsson, having to resign his post.
They also revealed the fact that Ukraine’s current president, Petro Poroshenko, also had extensive dealings with Mossack Fonesca – despite his pledges to clamp down on money laundering and corruption in Ukraine + divest himself of all his business interests, when he took up the post of president of Ukraine in 2014.
Ukraine is currently one of the Western world’s poorest and most corrupt of countries and is currently wracked by civil war – between eastern and western Ukraine.
So far, about 10,000 people, or more, have lost their lives, in the Ukrainian civil war, since the putsch was started against Viktor Yanukovych in February 2014 – forcing him and his family to flee Ukraine, in fear of their lives, to Russia.
- May 19 – Egypt Air Flight 804 crashes with 66 people on board over the Mediterranean en route from Paris to Cairo.
- May 30 – Former Chadian President Hissène Habré is sentenced to life in prison for crimes against humanity committed during his tenure from 1982 to 1990, the first time an African Union-backed court convicted a former ruler of a country within its jurisdiction.
- June 1 – The Gotthard Base Tunnel, the world’s longest and deepest railway tunnel, is opened following two decades of construction work.
- June 23 – The United Kingdom votes in a referendum to leave the European Union.
- June 28 – ISIL claims responsibility for attacking Atatürk Airport in Istanbul, killing 45 and injuring around 230.
- July 1 – Latvia becomes the 35th member of the OECD.
- July 4 – NASA’s Juno spacecraft enters orbit around Jupiter and begins a 20-month survey of the planet.
- July 12 – The Philippines wins the arbitration case they filed at the Permanent Court of Arbitration regarding the legality of China’s “Nine-Dash Line” claim over the South China Sea under the United Nations Convention on the Law of the Sea.
- July 22 – The final video cassette recorder is manufactured by the Japanese company Funai.
- July 26 – Solar Impulse 2 becomes the first solar-powered aircraft to circumnavigate the Earth.
- August 5–21 – The 2016 Summer Olympics are held in Rio de Janeiro, Brazil.
- August 31 – The Brazilian Senate votes (61–20) to impeach the President of Brazil Dilma Rousseff. The Vice President of Brazil, Michel Temer, who had assumed the presidential powers and duties as Acting President of Brazil during Rousseff’s suspension, took office for the remainder of her term.
- September 3 – The US and China, together responsible for 40% of the world’s carbon emissions, both ratify the Paris global climate agreement.
- September 5 – Philippine president Rodrigo Duterte publicly calls Barack Obama a “son of a whore.” Duterte was angered by the warnings that he would have to face questioning by the US president over his crusade against drugs in the Philippines that has claimed more than 2,400 lives in just over two months.
“You must be respectful. Do not just throw away questions and statements. Son of a whore, I will curse you in that forum,” Duterte told a news conference shortly before flying to Laos to attend a summit. Obama called Duterte a “Colourful guy,” via way of reply.
- September 8 – NASA launches OSIRIS-REx, its first asteroid sample return mission. The probe will visit Bennu and is expected to return with samples in 2023.
- September 9 – The government of North Korea conducts its fifth and reportedly biggest nuclear test. World leaders condemn the act, with the South calling it “maniacal recklessness”.
- September 12 – David Cameron resigns as the UK’s Prime Minister and as the Conservative MP for Witney; after losing the Brexit referendum vote and he then gives his support to Theresa May, to take over the leadership of the Conservative Party and become the next UK Prime Minister.
- September 28 – International investigators conclude that Malaysia Airlines Flight 17 was shot down by a Buk missile that came from an area controlled by pro-Russian rebels.
- September 28 – Global CO2 levels exceed 400 ppm at the time of year normally associated with minimum levels. A 400 ppm level is believed to be higher than anything experienced in human history.
- September 30 – Two paintings by Vincent Van Gogh, Seascape at Scheveningen and Congregation Leaving the Reformed Church in Nuenen, stolen on December 7, 2002 from the Van Gogh Museum in Amsterdam are recovered, with a combined value of $100 million.
- October 13 – The Maldives announces its decision to withdraw from the Commonwealth of Nations.
- October 15 – 150 nations meeting at the UNEP summit in Rwanda agree to phase out hydrofluorocarbons (HFCs), as an amendment to the Montreal Protocol.
- November 19 – “The Big Short:” is the next financial crisis on its way? The Italian banks are in deep trouble. Steve Eisman saw the last crash coming and was portrayed in an Oscar-winning film. Now he believes Europe’s banks, especially Italy’s, are at risk.
“Europe is screwed. You guys are still screwed,” says Eisman. “In the Italian system, the banks say they are worth 45-50 cents in the dollar. But the bid price is 20 cents. If they were to mark them down, they would be insolvent.”
How worried should British bank account (and shareholders) be? “I’m not really worried about England’s banks,” says Eisman. “They are in better shape than most in Europe.” (Source: The Guardian – The Big Short: 19/12/2016)
- November 30 – President-elect, Donald Trump had announced that he would nominate Steven Terner Mnuchin as U.S. Secretary of the Treasury on his website. Mnuchin is a former is a former Goldman Sachs partner and senior manager and hedge fund investor.
- December 6 – Donald Trump tweets about the cost of the new Air Force One, being built by Boeing and sends its market value into a tailspin. Before Trump’s tweet, which was sent just before 9 a.m. Eastern, ahead of the stock market’s open, the stock had traded unchanged at $152.16.
The stock slid to a premarket low of $149.75, down 1.6% from Monday’s close, before recovering slightly. Since the opening bell, the stock has traded within a range of $150.02 to $152.64.
But, he also extracted a promise from Boeing’s chief executive on Wednesday that the cost of replacing Air Force One would not exceed $4 billion, in his latest move in using Twitter to pressure companies to help advance his economic agenda.
- December 7 – Donald Trump is named as Time Magazine’s Person of the Year. US President-elect Donald Trump has been named Time magazine’s Person of the Year for 2016.
The property tycoon and reality TV star completed one of the biggest upsets in political history when he beat Hillary Clinton to the White House. Mr Trump told NBC’s Today show shortly after the announcement it was a “great honour” which “meant a lot” to him.
He was chosen from a shortlist that included Mrs Clinton and Russian President Vladimir Putin. (Source: The BBC: 07/12/2016)
Donald J. Trump ✔ @realDonaldTrump
“Boeing is building a brand new 747 Air Force One for future presidents, but costs are out of control, more than $4 billion. Cancel order!”
- December 12 – One single Tweet by president elect Donald Trump, instantly wipes $4 billion off Lockheed Martin’s value, over the spiralling costs of the F-35 programme.
Donald J. Trump ✔ @realDonaldTrump
“The F-35 program and cost is out of control. Billions of dollars can and will be saved on military (and other) purchases after January 20th.”
The company added it will welcome “the opportunity to address any questions the president-elect has about the program.”
- December 13 – Rex Tillerson, CEO of ExxonMobil, is chosen by Donald Trump to become the US Secretary of State. This selection has (as is now usual with Donald Trump) proved to be very controversial, primarily because of Tillerson’s exceptionally close links with Vladimir Putin and the powerful CEO of Rosneft, Igor Sechin, who is nicknamed, “The Grey Cardinal,” in Russian political spheres, and is also on the US anti-Russian, personnel’s sanctions list.
Rex Tillerson has been a very vocal critic of the US-imposed sanctions against Russia: initiated by the outgoing president – Barak Obama.
- December 14 – Vladimir Putin retains his title, at the top of the Forbes list of the world’s most powerful people, after a year in which the Kremlin dominated foreign affairs and ignored the United States, with its lame duck President Barack Obama.
The outgoing president, who has just 3-4 weeks left in the White House, had already plummeted to 48th place on the list.
- December 15 – the website Quartz announces that the new president-elect, Donald J Trump’s pick of the 17 people, who he has selected for his cabinet or for posts with cabinet rank, have well over $9.5 billion in combined wealth, with several positions still unfilled.
The Quartz article goes on to state, “This collection of wealth is greater than that of the 43 million least wealthy American households combine – over one third of the 126 million households total in the US.
It would take about 120,000 households, Quartz writes, with the United States median net worth of about $83,200 to match the wealth of just the four richest members of Trump’s cabinet—Betsy DeVos, Wilbur Ross Jr., Linda McMahon, and Rex Tillerson.
“Affluence of this magnitude in a US presidential cabinet is unprecedented,” writes Quartz.
- December 19 – Andrei Karlov, the Russian ambassador to Turkey, is assassinated in Ankara.
- December 22 – A study finds the VSV-EBOV vaccine against the Ebola virus between 70-100% effective, and thus making it the first proven vaccine against the disease.
- December 22 – Lockheed Martin shares take another tumble after late evening Trump tweet.
- 22/12/2016 – yet another tweet, by president-elect, Donald Trump – once again directed at Lockheed Martin, knocks 2% off Lockheed Martin’s share price, over the soaring costs of the F-35 programme.
Donald J. Trump ✔ @realDonaldTrump
“Based on the tremendous cost and cost overruns of the Lockheed Martin F-35, I have asked Boeing to price-out a comparable F-18 Super Hornet!”
Lockheed Martin shares fell about 2 percent, while Boeing shares were up 0.5 percent. Trump’s tweet shaved off about $1.2 billion of Lockheed Martin’s market value.
President-elect Donald Trump’s ‘unconventional’ usage of Twitter is taking US companies defence contractors CEO’s into uncharted waters. And, it’s got them worried
Trump’s playing for leverage, via his Twitter account, is likely to be a hurdle for all US defence contractors in the next administration, Roman Schweizer, aerospace and defence analyst at financial services firm Cowen & Co, wrote in a note to clients on Thursday.
“We have no idea how this plays out but believe ‘Twitter risk’ for defence companies could be a significant issue over the next four years,” Schweizer wrote. “This is Lockheed Martin’s time in the barrel.” (Source: The Guardian)
So…there we have it. I have tried to cover some of the most influential and interesting topics of what has truly been a momentous year – in both the worlds of politics, political intrigue and, of course, finance.
A year in which the demographics of the political landscape has changed and changed, perhaps, forever; with the rise of the so-called “populist” movements, which are just about to begin in earnest, throughout the rest of the EU, with the elections of France, Holland and Germany coming up in 2017.
And, the shock, Brexit referendum result was just the start of all of that – followed by the victory of Donald J Trump over a seasoned politician – Hillary R Clinton.
Moreover, it has been a year, in which Vladimir Vladimirovich Putin has surely burnished his name in the history books of modern world affairs forever.
For, it was also the year, in which, Mr. Putin was voted in as Forbes Magazine’s, “Most Powerful Man in the World.” It looks like US president Obama took a back seat there.