Phone hacking: BSkyB deal on the ropes

11th July 2011

The BBC reports that Business Secretary Jeremy Hunt is seeking the advice of competition regulators, the Office of Fair Trading and the Competition Commission on the issue.

13 thoughts on “Phone hacking: BSkyB deal on the ropes”

  1. Mrs Edward Shambling says:

    Please add some punctuation to your sentences! Here’s a job-lot of commas for you.  Sprinkle ’em about: ,,,,,,,,,,,,,,,,,,,,,,,,, ,,,,,,,,,,,,,,,,,,,,,,,,,,,,,, ,,,,,,,,,,,,,,,,,,,,,,,,,,, ,,,,,,,,,,,,,,,,,,,,,,,, ,,,,,,,,,,,,,,,,,,,,,,,,,,,,, ,,,,,,,,,,,,,,,,,,,,,,,,,,,,,, ,,,,,,,,,,,,,,,,,,,,,,,,,,. 

    And some semi colons ;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;; ;;;;;;;;;;;;;;;;; ;;;;;;;;;;;

    1. Anonymous says:

      When I first read your post, I was tempted to ignore it. However, on reflection I shall answer you. It is common practice on this site to comment upon matters economic that are important to all readers and contributors; it is not a place to vent your spleen (or as I perceive, your pusillanimity). The content is more important and as with all who respond, we are busy individuals who often make typing errors. This is not to assume we are ignorant of our language but that we have more important things on our minds. Kindly take your comments to other sites. Thank you.

    2. stephen glanville says:

      The sentences are fairly short, and the meaning is clear. Further punctuation unnecessary.

  2. Anonymous says:

    Shaun -happy new year to you. Regarding Italy, I was speaking to an individual this morning who felt the current situation in Italy was “a false dawn”. Many large exporters here are deeply concerned as Italy is the most prominent market for exporters. Whilst her technocratic government may be making some headway, there is always room for something to spark unrest, especially in the south and it is becoming more than problematic for Croatian business.

    1. Anonymous says:

      Hi Ray

      Happy New Year to you too.

      As to “false dawns” I think that the country most evidencing this at the moment is Spain where the spotlight has been turned off for now and bond yields have dropped back much more than Italy’s. And yet the recent economic figures have been worse and the Bank of Spain cannot kick the housing markets problems forwards for ever…

      It is interesting to see an impact of Italy’s issues/problems, how much of Croatia’s exports does she represent?

      1. Anonymous says:

        Hi Shaun – you make a valid point about the Spanish housing bubble and I would agree that the time must soon come for a show-down. Concerning Croatian/Italian trade, exports to Italy represent something like 48% with Germany not too far behind. So it could be a considerable thorn in the flesh moving forwards. As an aside, this link
        http://www.privredni.hr/pvint/ 
        will give some indication of how Croatia has fared in the last year as well as an overview of potential going forward.

  3. Anonymous says:

    The can is just kicked a little further down the road in Italy. It is the same across most of the Eurozone and the UK. Insolvent banks, profligate spending in the public sector,  a private sector fighting for its life against the blood sucking taxes and cheap competition from the far east. We just don’t have the politicians with the balls to go on TV, address the nation and show them the books. They are hanging on to a forlorn hope that something will turn up. The longer they wait the worse it will be. Its not a rotten tooth, but cancer. If the cure is not administered soon, we will all suffer. The bond auction raised the equivalent of about €7bn which is a drop in the ocean. How is Italy going to refinance its €336Bn debt in 2012? I just don’t know.


  4. It made its largest ever effort by lending 489 billion Euros over 3 years and finds that it has taken in 452 billion Euros on deposit. ”

    Shaun i find it difficult to follow you on that one. The ECB deposit facility is an *overnight* facility. All banks deposit funds there, regardless if they have lent them on or not. A European bank has three (non-exclusive) options regarding its bank reserves accouns:
    * Keep the required reserves which will be remunerated at the ECB’s target rate anyway.
    * Deposit the reserves created by ECB itself through its SMP program (and any other outright purchases) at the term-deposits auctioned by ECB.
    * Deposit the rest at the overnight deposit facility.

    If it has lent reserves to another bank then the other bank will also have the same three options (i ‘m not counting reserves which are used for other purposes like buying government debt, increasing currency in circulation etc).

    1. Anonymous says:

      Hi Kostas

      Apologies if I was unclear. I was using the rise in deposits at the ECB  as a symbol of the current problems in European banking. So my point was more than the rise indicates problems which the ECB inspite of all its different measures finds that it cannot get on top of…

  5. Anonymous says:

    Good analysis, Shaun.Thank you and happy New Year. If banks are replacing unsecured term funding with collateralised central bank funding does this pressurize senior unsecured bond holders and creditors whilst balance sheets are pledged elsewhere? Others, including Mr Peston, have raised this.

    1. Anonymous says:

      Hi Shire

      It raises question after question I think as the lesson of the Lehmans/AIG episode was in my opinion that when the music stops (which is hard to predict accurately) who will be holding the parcel and what will be in it?

      At the same time banks are supposed to be raising capital just when their share prices are at their weakest……

      To my mine every banking risk has gone a notch higher and some more than a notch.

  6. Loafalot says:

    Hi Shaun, I have a question re the BoE’s QE program. It seems to me that the BoE is buying gilts from UK banks at high prices (2% yield as you point out). On the surface the objective has always been to ‘get cash into the UK economy’. However, I wonder if the real underlying reason is that when rates eventually rise (surely, one distant day) and gilt prices fall, the banks can then use the cash to buy them back at a lower price. This effectively reflates the banking system and avoids the otherwise inevitable credit crunch which would be triggered when historically low base rates rise, and the value of all the gilts held by the banks falls. My question is:  who takes the loss on this round trip and via what mechanism exactly? I think I know who (the UK taxpayer) but not how. I guess the BoE could monetise the loss instead, so the pound – i.e. savers – bears the cost??

    1. Anonymous says:

      Hi Loafalot
       
      The Bank of England is buying gilts in many cases at what are pretty much all-time highs (there is always debate about exact highs etc.). I pointed out on Fridays blog that the longest-dated conventional gilt rose from 97.8 to 132 in 2011.
       
      My argument has been that prices will only remain at these levels whilst people are worried about recession and frankly at these levels depression. So for prices to remain here QE has to be failing. If it works (which would be a first for QE) then gilt yields would rise and prices fall and it would make a loss and perhaps a large one.
       
      Would banks benefit? To the extent they have sold gilts perhaps, but there are two flaws in this argument.
       
      1. Banks have been buying more gilts as regulations etc. push them in that direction ( a type of passive QE in its way)
       
      2. If they do and get another bail out it will take a fair bit of time and by then credit crunch II will have already taken place.
       
      You have the right answer to your question which can come in three ways.
       
      Directly: refinancing the Bank of England
       
      Indirectly: via inflation
       
      Indirectly: Via exchange rate depreciation

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