G

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BUSINESS WITH PERSONALITY
Chinas rate
cut bolsters
global stocks
SHARES throughout the world were
given a lift yesterday after an unex-
pected dose of monetary loosening
from China boosted hopes that it
could stimulate global demand.
The MSCI world equity index
rose 0.9 per cent to 301.94 points.
A global rally saw shares hit their
highest level in more than a week,
although gains were pared by a
less dovish statement from Federal
Reserve chief Ben Bernanke.
Nonetheless, news from China
helped to prop up equities. The
Peoples Bank of China announced
that the benchmark interest rate
would be slashed by 25 basis
points, brushing off fears over
inflation and delivering Chinas
first rate cut since the global
financial crisis.
An in a further step towards
liberalisation, authorities in the
fast-growing economy announced
that banks would be allowed
additional flexibility to set
competitive lending and deposit
rates.
Spanish Prime Minister Mariano Rajoy yesterday saw his countrys credit rating cut from A to BBB by ratings agency Fitch
SPAINS government took a huge step
closer to financial collapse last night as
credit ratings agency Fitch downgrad-
ed the state sharply, blaming the enor-
mous projected cost of cleaning up the
countrys troubled banking sector, the
deep recession and soaring national
debt.
Meanwhile Standard & Poors
warned the countrys banks are set to
lose 112bn (90.6bn), a leaked IMF
report showed the sector needs a
40bn cash injection, and Moodys said
house prices could fall by up to 52 per
cent in tough economic conditions.
The governments 10-year borrowing
costs jumped in an auction yesterday,
as investors worried the state will
struggle to pay its debts.
Ministers had already warned the
government was close to being locked
out of borrowing markets, which
would lead to the country needing a
bailout like those given to Greece,
Portugal and Ireland.
Fitch slashed the credit rating by
three notches from A to BBB, barely
above junk status, and kept the
country on a negative outlook.
The likely fiscal cost of restructur-
ing and recapitalising the Spanish
banking sector is now estimated by
Fitch to be around 60bn (six per cent
of GDP) and as high as 100bn in a
more severe stress scenario compared
to Fitchs previous baseline estimate of
around 30bn, the agency explained.
Debt is projected by Fitch to peak at
95 per cent of GDP in 2015 assuming a
60bn bank recapitalisation, com-
pared to Fitchs forecast at the begin-
www.cityam.com
ning of the year of 82 per cent by the
end of 2013.
Spain is forecast to remain in reces-
sion through the remainder of this
year and 2013. the report added.
The report came as Standard &
Poors warned that the recession will
worsen banks problems, leaving them
with between 80bn and 112bn of
losses to recognise by the end of 2013.
The warnings added to the moun-
tain of difficulties facing incoming
Spanish central bank governor Luis
Maria Linde, who will take charge of
supervising the financial sector.
And a leaked IMF report claimed the
sector needs a 90bn clean up, some of
which should be covered by healthy
banks. After some banks cover their
own losses, the IMF believes another
40bn of external cash will be needed.
Spains government yesterday bor-
rowed 2.07bn above the 2bn target
as demand remained relatively strong,
but only after paying higher yield.
The 10-year bonds sold for a yield of
6.044 per cent, up from 5.74 per cent at
a similar auction in April, but not yet
at the dangerous seven per cent level
beyond which Ireland, Greece and
Portugal sought bailouts.
Investors favoured safer countries
yields on French 10-year bonds fell to a
record low of 2.46 per cent.
UKS SUPERMARKET
BOSSES SEE PAY
PACKETS FALL
BY JULIAN HARRIS
FTSE 100 5,447.79 +63.68 DOW 12,460.96 +46.17 NASDAQ2,831.02 -13.70 /$ 1.55 unc / 1.23 unc /$ 1.26 unc
BY TIM WALLACE
SPAIN DOWNGRADED AS
BANKS FACE 112BN HIT
ISSUE 1,648 FRIDAY 8 JUNE 2012
THEFORUMPage 27
See Page 10
EUROZONE: Page 6

NO QE3 HINTS FROM FED: Page 2

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02/04/2012 till 29/04/2012 is 100,668
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IN BRIEF
UN peace plan crumbles in Syria
nUN monitors came under fire
yesterday while trying to investigate
reports of a new massacre that raised
the pressure on world powers
struggling to halt the carnage in Syria.
Speaking at a special session of the UN
General Assembly on Syria,
international envoy Kofi Annan
acknowledged his peace plan was not
working and said there must be
consequences for those who do not
comply with it. Opposition activists
said up to 40 women and children were
among those killed on Wednesday.
Facebook costs may hit $200m
nLosses by banks and brokerages
due to Facebooks botched debut on
the Nasdaq exchange last month may
be as high as $200m (128m),
Thomas Joyce, chief executive officer
of Knight Capital, said yesterday.
Nasdaq said on Wednesday that it
would offer $40m in cash and rebates
to clients harmed by its mishandling
of Facebook's market debut. It's
underwhelming at best, Joyce said of
the plan during a conference.
US corporate cash growth slows
nUS companies are sitting on around
$1.74 trillion in cash but this is
$500bn smaller than previously
thought, according to the Federal
Reserves flow of funds report
published last night. While firms are
holding 16 per cent more than they
were in June 2009, the Fed has
slashed its estimates in an apparent
slowing of the ever-growing corporate
cash pile in the US.
G
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No hints of QE3 from Fed
boss but euro fears linger
INVESTORS looking for a boost from
the Federal Reserve were left disap-
pointed yesterday as chief Ben
Bernanke refused to signal a move
towards more stimulus unless the
US is knocked by events in Europe.
Bernanke instead turned the focus
towards Americas elected politi-
cians, appealing to Democrats and
Republicans to avoid another show-
down over the debt ceiling.
His comments came as rating
agency Fitch repeated its threat to
downgrade the US next year if it
does not come up with a credible
deficit reduction plan.
The brinkmanship of last sum-
mer over the debt limit had very sig-
nificant, adverse effects for financial
markets and for our economy,
Bernanke told the Joint Economic
Committee. Again, it knocked
down confidence quite noticeably. I
urge Congress to come to an agree-
ment on that well in advance so not
to push us to the twelfth hour.
The Fed chief said that fiscal con-
solidation should not be too sharp
to destabilise the recovery, but must
be balanced between both short and
long term measures.
His concerns were echoed by Fitch.
The US is the only country of the
four major AAA-rated countries
which does not have a credible fiscal
Barristers face up to bankruptcy
Growing numbers of criminal barristers
are facing possible bankruptcy at a time
the government is making cuts to legal
aid funding. Figures confirm that in the
last three years, 130 barristers have given
notification that they are facing
bankruptcy proceedings, directors
disqualification proceedings or have
entered into CVAs
Best Buy founder exits firm
Richard Schulze, Best Buys founder and
chairman, raised the prospect of selling
his 20 per cent stake in the electronics
retailer by saying he was exploring all
available options as he announced his
immediate resignation from its board. The
news sent share down by one per cent.
Fortelus to liquidate part of fund
Fortelus, the London-based hedge fund
that made millions for clients by correctly
timing the collapsing share prices of the
UKs banks in 2008, is liquidating part of
its flagship fund following investor
pressure. It will split its $1bn main fund
into ongoing and liquidating share classes
to meet redemption requests.
Norway pumps 18bn into North Sea
The North Sea oil industry has received a
huge boost after Norwegian Statoil
promised to invest 18bn. The firm said
the fields, off the north coast of Scotland,
will produce 110,000 barrels per day from
the beginning of 2017.
Abramovich faces investor rebellion
Shareholders in Evraz, the steel producer
part-owned by Roman Abramovich, have
been urged by advisory group Pirc to vote
against the reappointment of two of the
oligarchs trusted lieutenants to its board.
UK banks make little profit
The British banking industry was the
second most unprofitable in the world in
2011, according to an analysis of lenders in
major economies. Britains banks
produced an average return on investors
equity last year of less than four per cent,
compared with 26 per cent in Indonesia.
XL Leisure boss to face 4m action
Travel tycoon Phil Wyatt, who wept on
national television when his former
company XL Leisure collapsed, is now
facing a 4m legal action over his
involvement with another failed operator.
Pharmacists add to Greek woes
Greece's health minister appealed to
panicked patients struggling to secure
medical treatment to remain calm after
pharmacists continued their boycott of
the country's largest state healthcare
provider by refusing to extend credit to
patients, in another sign of a credit
squeeze taking hold of the economy.
Spaniards say Stop Merkel
Populist sentiment against Angela Merkel
is bubbling up in Spain. Residents have
made Stop Merkel the No. 2 phrase
posted by Twitter users in the country.
WHAT THE OTHER PAPERS SAY THIS MORNING
FORMER Bear Stearns
shareholders who claimed they
were misled about the investment
banks deteriorating health
yesterday agreed to settle their
lawsuit for $275m (176m), four
years after the company was
bought by JP Morgan Chase.
The all-cash settlement resolves
claims against Bear and several
former executives including long-
time chief executive James Cayne,
his successor, Alan Schwartz, and
former chairman Alan
Greenberg.
Investors led by the State of
Michigan Retirement Systems
asked US District Judge Robert
Sweet in Manhattan to grant
preliminary approval of the
settlement. The defendants
denied wrongdoing in agreeing to
settle.
JP Morgan agreed to purchase
Bear on 16 March 2008, in an
emergency buyout brokered by
the US Federal Reserve, as fleeing
clients were causing a liquidity
crunch that drove Bear to the
brink of collapse.
After initially agreeing to pay
just $2 per share for Bear, JP
Morgan later consented to pay
$10 per share.
That was far below the $170
that Bear shares once
commanded.
Bear Stearns
investors agree
to end lawsuit
Bernanke warned against a fiscal cliff but said that the US deficit must be tackled
2
NEWS
BY CITY A.M. REPORTER
BY JULIAN HARRIS
To contact the newsdesk email news@cityam.com
I
T was FA Hayek, an economics
Nobel prize winner of
immeasurably greater distinction
than Paul Krugman, who put it
best. In his book the Fatal Conceit, he
launched a devastating attack on
those who believe that elites can
mould and control humanitys
destiny. Central direction is
impossible, a limitation those in
authority never accept.
Past fatal conceits include the view
that private property and markets can
be abolished, and replaced by pure
socialism and central planning,
whereby a small group decides what
is produced, what is consumed and
who works where and gets what. But
we remain plagued by many other,
contemporary fatal conceits. Here are
two especially pernicious ones.
The first is the belief that govern-
ments can endlessly create growth
EDITORS
LETTER
ALLISTER HEATH
Our fatally conceited elites are being confronted with reality
FRIDAY 8 JUNE 2012
out of thin air by manipulating aggre-
gate demand cutting rates, printing
money or borrowing and spending
more. Of course, such actions can
have a huge effect. Monetary policy
can be extremely potent; the cost of
borrowing is the most important
price in the economy and the quanti-
ty of money, and the speed at which it
circulates, is fundamental to the
health of an economy, because money
is used in every single exchange. It
may well have made sense to cut
interest rates in China, for example,
as the Beijing authorities did yester-
day for the first time since 2008.
Varying public spending to manipu-
late GDP, however, is pretty useless at
the best of times.
But there are two problems: the first
is that macroeconomic policy is itself
a soft form of planning, and as such
falls foul of the incentive and knowl-
edge problems outlined by Hayek.
How can a central authority know
what the right price of money is? It
doesnt know what the right price is
for other commodities, so what is dif-
ferent about money and credit? And
what about policymakers incentives?
Why do we assume that they are
angels? But there is a more immedi-
ate issue. It is one thing to try and use
macroeconomic policy while being
aware of its limitations the tradi-
tional approach pursued by the hum-
Bank of England and the Federal
Reserve did the thing right yesterday:
they didnt cut rates or boost QE.
The other fatal conceit is the euro
and the view that political will can
overcome everything. But politics is
about what a group of people would
like to do and economics is about
what they can do. Economics is the
reality check, the human equivalent
of gravity; it sets the constraints. The
world can only consume what it pro-
duces. You cant have a workable sin-
gle currency without labour market
flexibility. Spains three-notch down-
grade is just the latest blow to the
conceited elites; there will be many
more to come. Slowly but surely, real-
ity will reassert itself in the most
painful, ego-busting way possible.
bler central banks but it is complete-
ly another to imbue it with super-nat-
ural characteristics and believe that it
can be used to cure all evils.
It is increasingly clear that weak
growth in the US and the recession in
the UK have little to do with mone-
tary policy. There are real, supply-side
and other factors at play. The econo-
my simply isnt capable of growing at
anything faster than a snails pace
given the skills of the population,
incentives, the tax and regulatory
burden, extremely high levels of pub-
lic spending, crippling private and
public leverage, excessively tight rules
on bank capital and liquidity, and
competition from more dynamic
economies. Such is life: printing more
money, or cutting rates even further,
or borrowing even more wont
change any of these fundamentals.
That is why, for all their faults, the
consolidation plan, said Fitchs Ed
Parker. The US is the only one of the
four largest economies whose debt as a
percentage of GDP is expected to
increase over the next five or six years.
Despite a national debt of around
$15.7 trillion, analysts hope that the
US is recovering relatively well from
the financial crisis. And yesterday
Bernanke hinted that more stimulus
would only come in the event that
financial stresses escalate due to the
Eurozone crisis, while sounding fairly
upbeat over current indicators.
The housing market looks to be sta-
bilising which if true would be good
news and going forward it would
helpful to the recovery, he said.
The pace of improvements in the
labour market from last summer
through March was actually surpris-
ingly strong given the relatively tepid
rate of growth of overall economic
activity. It was a puzzle that we were
trying to understand.
Investors are waiting to see if the Fed
extends its scheme dubbed Operation
Twist, or even increases the size of its
total asset buying programme.
MORE ECONOMICS: Pages 6, 8, 23

The new jobs website for London professionals
CITYAMCAREERS.com
Jeffrey Rosen
used to be a
WPP adviser
PIRC, the shareholder advisory group
that is urging investors to vote
against Sir Martin Sorrells 12.9m
pay deal, yesterday questioned the
independence of Jeffrey Rosen, the
chair of the companys compensa-
tion committee.
Rosen, who joined the WPP board
in 2004, was earlier a bank adviser to
the group when he was at
Wasserstein Perella. He advised WPP
on the groups financial restructur-
ing in 2002.
Pirc last night queried his inde-
pendence to the group that once
paid his firm substantial fees.
One City banker said: You cant
expect somebody who has been
given those early bonuses and fees to
take a strong line years later against
the person who gave him all that
work.
However, WPP said it viewed Rosen
as quite clearly independent and
added that he had not advised WPP
on anything for 20 years. Lazard,
where Rosen is now affiliated, has
never advised WPP, the groups
GLENCORE chief Ivan Glasenberg has
splurged 10m on 2.9m shares in his
FTSE 100 company as part of his
promise to spend all of his $110m in
dividends on stock.
His move is intended to shore up
shareholder support ahead of the
commodities traders proposed
merger with Xstrata, which has
sparked anger among some investors
who say they are getting a bad
premium on their shareholdings of
the miner. Their ire was also stoked
after it emerged that Xstrata boss
Mick Davies is to get a $30m share
package just for staying on in the
role of chief executive after the
merger.
Glencore was given a boost
yesterday, however, by Australias
decision to grant permission for its
$6bn takeover of grain producer
Viterra. That followed on from
permission granted by Canada on
Friday. Glencore and Xstrata are
hoping to complete their
merger later this year.
It also emerged
yesterday that Qatars
sovereign wealth fund
has raised its stake in
miner Xstrata to
over 10 per cent.
Glencore boost
as Glasenberg
buys shares
BY JULIET SAMUEL
Critics question
independence
of WPPs Rosen
BY DAVID HELLIER
PRIME Minister David Cameron
yesterday vowed to protect the
UKs interests in Europe, while
both he and his chancellor George
Osborne ruled out playing any
part in a Eurozone banking union.
I can understand why Eurozone
countries may want to look at
elements of banking union,
Cameron said at a conference in
Berlin. [But] because we are not in
the single currency, we wont take
part I wouldnt ask British
taxpayers to stand behind the
Greek or Spanish deposits.
The European Central Bank are
Cameron and Osborne promise
to defend UK interests in Europe
BY JULIAN HARRIS pushing hard for the Eurozone,
and potentially the wider
European Union area, to set up a
three-pillared banking union
consisting of central monitoring
of banks, a fund to wind up big
lenders and a pan-European
deposit guarantee.
Earlier in the day Osborne had
said there was no way that the
UK would partake in the scheme.
I think Britain will require
certain safeguards if there is a full-
blown banking union, he said.
And Cameron added that he
would protect UK interests,
particularly the openness and
fairness of the single market.
FRIDAY 8 JUNE 2012
3
NEWS
cityam.com
The C-Class Coup AMG Sport.
From just 299
*
a month.
AMG body styling and 18
"
AMG alloy wheels, bi-xenon headlamps,
Attention Assist and when youve finished driving, theres Parktronic with
Advanced Parking Guidance. 299
*
can sometimes go an awfully long way.
Visit mercedes-benz.co.uk/oers
*For Business Users only. Advance payment applies. Ocial government fuel consumption gures in mpg (litres per 100km) for the C-Class Coup range: urban: 15.5(18.2)-44.8(6.3), extra urban: 33.6(8.4)-
65.7(4.3), combined: 23.5(12.0)-55.4(5.1). CO2 emissions: 280-133 g/km. Model featured is a C 180 BlueEFFICIENCY AMG Sport Coup at 31,580.00 on-the-road with optional panoramic glass sunroof at 1,350.00 (on-the-road price includes VAT, delivery, 12 months Road Fund
Licence, number plates, rst registration fee and fuel). *All payments subject to VAT: Finance based on a C 180 BlueEFFICIENCY AMG Sport Coup with metallic paint on a 36 month (6+35 prole) Contract Hire agreement, excluding maintenance, with an advance payment of 1,794.00. Based on 10,000 miles per annum.
Excess mileage charges may apply. Rental includes Road Fund Licence for the duration of the contract. Written quotations available on request including alternative contract lengths and mileages. Guarantees and indemnities may be required. Available on C-Class Coup models ordered/credit approved
between 1 April and 30 June 2012, registered by 30 September 2012. Oers subject to availability. Oers cannot be used in conjunction with any other oer. Some combinations of features/options may not be available. Please contact your Mercedes-Benz Retailer for availability. Credit provided subject to status by
Mercedes-Benz Financial Services UK Limited, MK15 8BA. Prices correct at time of going to press 05/12.
A

D
a
i
m
l
e
r

B
r
a
n
d
The Prime Minister said the UK would not take take part in a euro area banking union
spokesman said. The independence of
the companys board is crucial to
WPPs argument about Sir Martins
proposed pay increase, which is caus-
ing controversy amongst investors
and corporate governance lobbyists.
In a robust defence of his own pay
deal, Sir Martin wrote earlier this
week in the Financial Times that the
boards independence was a crucial
factor in persuading investors of the
merits of the pay deal.
WPP has a very independently
minded board and compensation
committee, which makes decisions
that they believe
are in the long-
term interests
of the compa-
ny and its
shareholders,
of which I am
one, he wrote.
Glencore boss
Ivan Glasenberg
BOTTOM
LINE: Page 14

NEW businesses face a longer wait to
gain approval from the City
regulator, according to new research.
Firms waited an average of 19.6
weeks in the first three months of
this year, according to Financial
Services Authority data obtained by
law firm Reynolds Porter
Chamberlain.
The 13.2 per cent jump, the third
consecutive quarterly rise, comes as
the FSA moves to a twin peaks
model before splitting in 2013.
The average time taken to
approve new firms stood at 17.3
weeks in the three months to June
last year. It comes as City frustration
grows over the FSA, which has
abandoned its light touch
approach after the financial crisis.
Authorisation times rocketed
after the credit crunch as the FSA
started to scrutinise the business
plans for financial services start-ups
to an unprecedented degree, said
Steven Francis, a partner at RPC.
The FSA said: While the FSA has
increased its scrutiny of
applications, timescales are also
driven by other factors including
the complexity of the business and
the number of people seeking
approval. In the future regulatory
structure, the statutory timeframes
for processing applications will
remain the same, and firms will
only need to make one application.
FSA approvals
taking longer
as split looms
BY PETER EDWARDS
G
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THE REMAINS of the high street
chain Clinton Cards were bought out
of administration yesterday by an
American cards company, in a deal
expected to safeguard 4,500 jobs.
Administrator Zolfo Cooper con-
firmed yesterday that American
Greetings, one of Clintons biggest
suppliers, had paid $37m (24m) to
buy the ailing retailers brand and
assets including 397 stores.
Clintons was forced into adminis-
tration last month after American
Greetings, which was already owed
25m, decided to call in a 35m loan
it had bought from the card groups
lenders Royal Bank of Scotland and
Barclays.
Zolfo Cooper has already shut
around 350 stores employing about
2,800 full and part-time staff, cutting
its estate in half.
Jones Day, the law firm acting on
behalf of American Greetings, said
the deal would allow Clintons to liq-
uidate its remaining assets and pay
off creditors.
The stores account for around
Supplier saves
4,500 jobs at
Clinton Cards
BY KASMIRA JEFFORD
$315m (202m) in annual revenues.
Under the agreement, Clinton Cards
still owes $19m to American
Greetings, a sum that is expected to
be largely repaid through the liquida-
tion of other assets in a process that
could take up to a year.
Jones Day warned that the exact
number of stores acquired will be
dependent on negotiations with land-
lords at each respective location.
The group, which had debts of
100m, has been struggling with com-
petition from internet and supermar-
ket retailers and a weak UK economy
that has sapped the spending power
of British consumers.
Darcy Willson-Rymer, a former
Starbucks executive who was hired as
chief executive last October with the
formidable task of turning around
the chain, had been due to present a
strategic review of the business.
American Greetings chief executive
Zev Weiss said: We believe that prop-
erly managed, and with the appropri-
ate capital structure, Clinton Cards
can be both an important and prof-
itable retailer in the specialty channel
of distribution over the long term.
Law rm Jones Day advised Lakeshore
Lending, the subsidiary of American
Greetings, on its acquisition of Clinton Cards
from its administrator Zolfo Cooper. The
Jones Day team acting on the rescue deal
included partners Corinne Ball, Michael
Rutstein and Andrew Rotenberg.
Ball, responsible for the business restructur-
ing side of the deal, led a team of attorneys
representing car-maker Chrysler during its
successful reorganisation in 2009.
Michael Rutstein has previously acted for
Connaught and subsequently, the rms
administrators with regard to its disposal of
gas and electricity business.
Andrew Rotenberg led a team of lawyers
counseling lenders and bondholders during
the Autodis, Hellas, Nybron, Thomson, and
Waterford Wedgwood restructurings.
Meanwhile Peter Saville, Simon Freakley
and Anne OKeefe, three partners at Zolfo
Cooper, acted as joint administrators over
Clinton Cards yesterday. In May last year,
Zolfo was appointed as administrator to
womenswear chain Jane Norman, which
was sold to Edinburgh Woollen Mill, and
more recently was involved in the rescue of
toy-maker Hawkins Bazaar. Saville, who
joined Zolfo in 1995, has been lead adminis-
trator on a number of retail deals.
ADVISERS JONES DAY
CORRINE BALL
JONES DAY
FRIDAY 8 JUNE 2012
4
NEWS
cityam.com
Clinton Cards has been rescued by an American company
THE SWISS National Banks (SNB)
foreign currency holdings hit
record levels in May, the central
bank revealed yesterday, as it
fights to maintain the francs cap
a struggle made more difficult
every time the Eurozone crisis
flares up.
The SNB said its reserves now
stand at 303.8bn Swiss f rancs
(204.7bn), up roughly one quarter
on the 237.6bn it held in April.
In the autumn the central bank
pledged to hold the franc at 1.20,
fighting the rapid inflow of euros
from troubled neighbours.
Capital flight into the country
made currency soar, threatening
the countrys economy as the
strong franc makes it very difficult
for Swiss exporters to compete
with rivals in other countries,
particularly those based in the
Eurozone.
The level of intervention may
have to increase even further in
coming months if the crisis
intensifies any more, with a Greek
exit now a possibility.
Swiss central
bank spends
billions on cap
BY TIM WALLACE
G
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YOUTH unemployment hit a new
record high in Greece in March, while
France also saw a surprise jump in job-
lessness.
Well over half of Greeces under-25s
are now unemployed, according to
official agency Elstat 52.8 per cent
were jobless in March, up from 42 per
cent in March 2011 and more than
double the 25 per cent in March 2009.
Total unemployment hit a new
record of 21.9 per cent in the month,
up from 21.4 per cent in February and
15.7 per cent in March 2011.
Economists warned that may get
worse as the recession continues.
Unemployment is usually a lagging
indicator of broader economic activi-
ty, said Platon Monokroussos from
EFG Eurobank.
It appears the jobless rate has not
yet peaked, although some support
may be provided during the summer
months from the tourism sector.
BY TIM WALLACE
Meanwhile France saw a surprise rise
in joblessness to 10 per cent in the first
quarter up from 9.8 per cent at the
end of 2011 to a euro-era high.
Labour minister Michel Sapin said
the Socialist government will try to
stop unemployment rising further by
making it more expensive for firms to
fire workers, a move attacked by some
economists. The main idea is to make
layoffs so expensive for companies
that its not worth it, Sapin said in an
interview with France Info radio.
GERMAN Chancellor Angela
Merkel said Europe was ready to act
to ensure stability in the Eurozone,
yesterday, while Prime Minister
David Cameron called for urgent
action to tackle the debt crisis.
However, she did not call for
jointly-guaranteed eurobonds
instruments which Italian PM
Mario Monti again called for as his
favoured solution to the crisis.
It is important to stress again
that we have created the instru-
ments for support in the Eurozone
and that Germany is ready to use
these instruments whenever it
may prove necessary, Merkel said,
referring to the European
Financial Stability Facility, and to
its permanent successor, the
European Stability Mechanism.
She also called for further steps
towards closer political union,
including a banking union
though the German Chancellor
said that will take time.
However, Monti insisted
eurobonds should remain on
the table and should be
adopted in a not very
long time.
The instruments would
be guaranteed by all
Eurozone nations
thus giving weak
governments
the backing of
Germany.
M o n t i
hopes this
would bring
down bor-
rowing costs
for govern-
ments like
Italys and
Spains, but Merkel opposes the
plan as it would undermine the
countries incentives to reform
their economies and restore com-
petitiveness and growth in the
long-run.
Meanwhile Cameron again
called for urgent action
to solve the crisis, explain-
ing the fiscal compact,
which will limit budget
deficits, is not enough by
itself to restore prosperity.
Specifically, he said
more bank recapitalisa-
tions are needed, as
well as a larger
firewall to stop
c o n t a g i o n
spreading from
Greece to other
nations.
Merkel vows action to
end crisis at long last
BY TIM WALLACE
EU PROPOSALS to avoid bank
bailouts in future are already
feeding through into credit cal-
culations, prompting ratings
agency Fitch to announce yester-
day that they will weaken state
support in the long term.
That is likely to mean a round
of credit downgrades for
European banks and an increase
in the cost of their debt.
On Wednesday, the European
Commission unveiled new rules
that aim to wind up failed banks
rather than bail them out at
huge cost to taxpayers.
Fitch said that implementing
them will be a huge challenge
but that the proposals will ulti-
mately result in us factoring less
support into EU bank ratings in
the coming years.
The aim of the new regulations
is to remove the implicit sub-
sidy whereby banks debt costs
less than their risk-taking merits
because markets assume credi-
tors will be bailed out if they fail.
They will force huge banks to
draw up living wills on how to
dismantle themselves without
destroying the financial system.
BY JULIET SAMUEL
Fitch: EU too big to fail rules
will erode bank credit ratings
Unemployment hits
new record high in
devastated Greece
THE SPOKESMAN of Greeces far-right Golden Dawn party, Ilias Kasidiaris, slapped one
female communist in the face and threw a glass of water at another leftist during a live
TV debate yesterday, causing a political uproar and an order for his arrest. Other
political parties condemned the assault ahead of the 17 June parliamentary election.
EXTREMIST POLITICAL PUNCH-UP IN ATHENS
Greek unemployment hit a record high in March
2012 2011 2010
10%
12%
14%
16%
18%
20%
22%
Merkel is still holding out
against eurobonds
FRIDAY 8 JUNE 2012
6
NEWS
cityam.com
GERMANY has moved a step clos-
er to finalising its position on a
European Tobin tax after the cen-
tre-right governing coalition and
opposition parties said they had
reached a deal.
The agreement would see
Germanys opposition vote in
favour of the Eurozone fiscal
pact in return for Chancellor
Angela Merkel pushing for the
imposition of a financial transac-
tion tax, which is supported by
France but fiercely opposed by the
UK. The tax could now be intro-
duced in some states but London
has vowed to veto it EU-wide.
BY JULIET SAMUEL
Germany closer
to Tobin tax deal
G
E
T
T
Y
HOPES for a renewed economic
recovery were bolstered yesterday as
influential survey data pointed to
robust growth in the service sector
last month the largest part of the
British economy.
The figures came as the Bank of
England surprised economists by
resisting pressure to print more
money, keeping interest rates and its
quantitative easing (QE) programme
on hold.
Last month the decision to hold
was finely balanced for some
members of the monetary policy
committee (MPC) but despite the
clouds gathering over the Eurozone,
they refused to try to stimulate
growth further.
Markits purchasing managers
index (PMI) for the service sector
held firm at 53.3 yesterday, the same
level recorded in April.
Any figure above 50 rising econom-
ic activity in the month.
That level was supported by a
quicker pace of incoming new busi-
ness, a reading that rose from 53.5 to
54.8.
This continued expansion fed into
employment growth, which came in
at 52, only slightly slower than the
Solid services
growth as Bank
holds on rates
BY TIM WALLACE
52.2 recorded in April. Such solid
growth in employment will be partic-
ularly welcome for its impact on the
wider economy.
The outlook for future business
also improved, but at a slowing pace
the business expectations index
slid from 72.6 to 69.2 on fears over
the impact of the growing Eurozone
crisis.
Economists had also been worried
about the state of the economy after
the manufacturing PMI showed out-
put fell in May and the construction
sectors growth slowed.
These results come as something
of a relief after the sharp decline in
activity reported in the manufactur-
ing survey last week, said economist
Andrew Goodwin from the Ernst &
Young Item Club.
FRIDAY 8 JUNE 2012
8
NEWS
cityam.com
Federal Reserve backs global
regulators on Basel III proposal
AMERICAS Federal Reserve last
night released a proposal to back
the Basel III agreement on higher
capital standards for banks, even
though it largely rejects pleas by
the US banking industry to soften
parts of the new standards.
The Fed board voted 7-0
yesterday to put the proposal out
for public comment. The Federal
Deposit Insurance Corp and the
Comptroller of the Currency are
also set to approve the proposal.
BY HARRY BANKS The Basel III agreement is the
cornerstone of efforts by
international regulators following
the 2007-2009 financial crisis to
make sure the global banking
system is more resilient.
The new standards would force
banks to rely more on equity than
debt to fund themselves, so that
they are able to better withstand
significant losses.
US banks had pushed the Fed to
allow them to more count
mortgage servicing rights and the
unrealised gains and losses of
certain securities toward their
capital requirements than allowed
by Basel III, but the US central
banks draft rule closely follows
the international agreement.
It is up to each country to write
rules to implement the Basel
agreement for its banks.
The accord will require banks to
maintain top-quality capital
equivalent to seven per cent of
their risk-bearing assets, about
three times what they are
required to hold under the
existing rules.
Mervyn King and the Bank of Englands Monetary Policy Committee held rates again
Service output kept growing in May
Jan12 Jan10 Jan08 Jan06
38
42
46
50
54
58
62
66 PMI Services Activity Index
HOUSE prices rose in May, figures
from Halifax showed yesterday,
but remain volatile due to the
moribund sales pace in the weak
market.
Prices rose 0.5 per cent in May,
following Aprils 2.3 per cent drop
and Marchs 2.2 per cent jump
volatility driven by the stamp duty
holiday for first time buyers which
expired in March.
Over the three months to May,
prices rose 0.8 per cent the
second consecutive quarterly
increase, suggesting that there
House prices weak as low sales
volumes leave market volatile
BY TIM WALLACE
could be some signs of life
emerging in the market.
However, that still leaves prices
0.1 per cent below where they
stood in May 2011, demonstrating
the underlying weakness in prices
over the last year.
Economists warned that only
Londons housing boom is keeping
national prices steady, and so any
blow to the capitals market could
knock prices nationally.
The market looks vulnerable to
a London-centric shock, such as a
new financial crisis, or a sharp rise
in the exchange rate, said Capital
Economics Ed Stansfield.
IN BRIEF
SAINSBURY chief executive Justin
King and Marks & Spencer boss Marc
Bolland have both seen their bonuses
cut after failing to meet targets, as the
recession forced them to slash growth
plans.
The cuts come amid a recent wave of
shareholder upheaval against exces-
sive executive pay which has swept
across boardrooms including Aviva
and Inmarsat.
Tesco boss Philip Clarke last month
opted not to take an annual bonus of
372,000 following the firms poor
performance in the UK, while Ocado
chief Tim Steiner also waived his
bonus after the online retailer failed
to make a pre-tax profit.
Sainsburys annual report published
yesterday showed that King took a
nine per cent cut in his total pay pack-
age to 3.37m, despite Britains third
largest grocer recently posting a seven
per cent rise in full-year profit.
His salary increased by two per cent
to 920,000 but his annual bonus
dipped by 6,000 to 514,000 after the
company said it failed to meet ambi-
tious sales targets set at the beginning
of the financial year.
But Marks & Spencers annual
report, also out yesterday, showed its
chief executive has taken the biggest
pay cut to date among Britains lead-
ing retailers. Bolland received a total
pay and bonus package of just under
Sainsbury and
M&S chiefs see
bonus slashed
BY KASMIRA JEFFORD
1.7m last year, over 60 per cent below
the 4.4m he received the year before.
Even excluding a 167,000 relocation
fee and a 2.6m golden hello he
received for leaving his previous
employer in May 2010, the
Dutchmans total package was down.
On top of a basic salary of 975,000,
pension contributions and perks such
as a car and driver, Bollands bonus of
633,000 including half paid in
shares fell from 1.02m last year.
The majority of his bonus is based on
targets set at the beginning of the year
that Marks & Spencer failed to meet,
after a 1.2 per cent drop in profits its
first fall in three years.
The rest of Bollands bonus comes
from meeting personal targets and
makes up roughly a third of his
potential bonus, which can be
worth up to 200 per cent of salary.
M&S shares closed up 2.9 per cent
at 340.5p yesterday while Sainsburys
dipped 0.1 per cent to 289.1p.
LSE share trading plunges as
global shocks take their toll
THE SCALE of the slump in capital
markets activity has been
underlined by new figures
showing typical trading values in
London have dropped by more
than a quarter.
The average daily value of
shares traded on the UK
electronic order book of the
London stock exchange has fallen
by 27 per cent over two years.
The figure was 4.3bn at the
end of May, down from 5.9bn for
the same month in 2010.
A series of major
BY PETER EDWARDS
macroeconomic shocks have,
however, triggered spikes in
trading at various points over the
last two years, leading to a more
dramatic comparison.
In May 2010 Eurozone leaders
agreed a 110bn (now 88.9bn)
package of emergency loans which
they hoped, at the time, would
rescue Greeces debt-stricken
economy.
The LSEs monthly market
report, published yesterday, also
showed the average daily number
of trades across the groups
electronic equity order books was
1.5m in May, down seven per cent
on the figure for April.
The average daily value traded
was 7.7bn in May, down six per
cent on the previous month.
J Sainsbury PLC
30May 31 May 1 Jun 6Jun 7Jun
292
290
288
286
284
p
289.10
7Jun
FRIDAY 8 JUNE 2012
10
NEWS
cityam.com
The new
jobs website
for London
professionals
The new
jobs website
for London
professionals
C
I
T
Y
A
M
C
A
R
E
E
R
S
.
c
o
m
Tesco chief executive Philip
Clarke waived 372,000 bonus
I wasnt satisfied with the
performance in the UK.

Sainsbury chief
Justin King
takes a 9pc cut
to total pay
package from
3.7m to 3.4m
Marks &
Spencer chief
Marc Bolland
sees bonus
cut by 50pc
from 1.02m
to 663,000.
Ocado chief
Tim Steiner
was paid
354,000,
down from
574,000 last
year.
Was 1.02m
NOW
663k
Was 3.7m
NOW
3.4m
W
as 574k
N
O
W

3
5
4
m
THE GREAT PAY DROP: HOW RETAIL
BOSSES ARE FEELING THE PINCH
London Stock Exchange Group PLC
30May 31 May 1 Jun 6Jun 7Jun
1,020
990
1,000
1,010
970
980
960
p
972.00
7Jun
PLUS Markets said yesterday that
it will lose its stock exchange
licence if shareholders reject a
bid for the division.
Broker ICAP has agreed to buy
the unit for 1, freeing regulatory
capital but rebel investors are
threatening to derail the deal.
Plus now says that if the sale
does not complete by 22 June
then the FSA will commence the
process to revoke the exchanges
valuable licence as soon as
possible, before warning that
once begun this process is
irreversible.
Leading rebel Simon Chapman
told City A.M. that Plus Markets
chief executive Cyril Theret
visited him yesterday afternoon:
I did suggest that their time
must be precious and the fact
that they wanted to spend so
much of it on a three per cent
shareholder must indicate that
they are running scared of the
ICAP bid being voted down.
I tried to convince them that
they needed to find something
which would incentivise
shareholders to sell which the
ICAP agreement conspicuously
fails to do.
Chapman and other
shareholders have already issued
AGM motions calling for the
chairman and CEO to resign.
It is understood that Plus will
publicly respond to shareholder
criticisms in a statement today.
Shares in Plus plummeted a
further eight per cent yesterday
to close at a mere 0.28p.
BY JAMES WATERSON
Plus Markets could lose stock exchange licence
UPMARKET retailer Marks & Spencer
is set to launch a retail bank in its
stores, the firm is expected to
announce today.
Initially it aims to launch the
service in its Marble Arch branch,
with plans to expand to up to 50
outlets before the end of the year.
Starting with current accounts, it
is thought that the firm could
expand its services to include
mortgages. Branches would be open
during shop hours including
Saturdays and Sundays according
to trade magazine Retail Week.
M&S Money, owned by HSBC,
already offers services including
credit cards.
Marks & Spencer declined to
comment last night.
M&S prepares
to launch bank
BY CITY A.M. REPORTER
HSBC has offloaded its Greek
securities businesses for an
undisclosed sum in a management
buyout that will see Nikos
Pantelakis, the current head of the
operation, take the helm of the
new firm.
The business is a minnow,
boasting around 35.8m in assets.
HSBC said that it will continue to
use it as a preferred broker in
Greece, providing the new firm
with a hefty first client.
HSBC Securities, one of Greeces
ten biggest stockbrokers, provides
broking services for Greek equities
and derivatives.
BY JULIET SAMUEL
HSBC ditches
unit in Greece
SHARES of HTC fell to their lowest
intraday level in more than two
years yesterday after the
smartphone maker warned of lower
revenues and was named in a patent
lawsuit by rival Apple.
The worlds fifth largest
smartphone vendor, battling to
regain market share from Apple and
Samsung, suffered a rapid fall from
grace in the second half of 2011
after its phones failed to keep up
with iPhones and the Galaxy range.
A day earlier, HTC cut its second-
quarter revenue target by 13.3 per
cent, citing lower-than-anticipated
sales to Europe and delayed sales in
the United States.
Adding to the pressure, Apple
filed a new enforcement action at
the International Trade Commission
in Washington, according to a
report, seeking an emergency order
that would block imports of HTCs
new smartphone and tablet. Apple
said HTC models including the One
X, One S, EVO 4G LTE and the Flyer
tablet continued to infringe upon its
data-detection technology, the
report said.
Shares in HTC
plummet to a
two-year low
BY CITY A.M. REPORTER
VODAFONE and Telefonica, owner of
the O2 brand, yesterday unveiled a
joint venture that will see the two
telecoms companies share their net-
work infrastructure in the UK.
The two companies will share a grid
of 18,500 masts across the UK an
increase of more than 40 per cent for
each operator.
But both Vodafone and O2 were
quick to insist that there will be no
joining of wireless spectrum, core net-
works or customer data.
Vodafone UK boss Guy Laurence told
reporters: We compete fiercely with
each other on a daily basis and there
are absolutely no plans for a further
merger.
While the joint venture is partly a
bid to improve 2G and 3G indoor cov-
erage across the nation, it will also
Vodafone and
O2 launch grid
share venture
BY LAUREN DAVIDSON
speed up the long-awaited rollout of
4G in the UK.
Vodafone and O2 said the partner-
ship will allow the competing net-
works to introduce 4G to the nation
faster than could be achieved inde-
pendently, reaching 98 per cent of the
population by 2015 two years before
the deadline stipulated by Ofcom.
HAVE YOU CHANGED YOUR LINKEDIN
PASSWORD? Interviews by Lisa Moravec
I will go and check that everything is ok with
my account. If it looks like there is anything
wrong I will change it. But I am not a very active user; the
last time I used it was two years back.
These views are those of the individuals above andnot necessarily those of their company
SIDDHARTH
ANKATHIL
DEUTSCHE BANK

I dont use LinkedIn but I know that Ive got an

account that is connected to my Twitter. So
yes, I will have a look at it. I am wondering if there is an
option to choose between a private or public prole.
GAURAV AHUJA
JP MORGAN
I have not changed it. To be honest, none of
my colleagues have changed their passwords
either but I dont know anyone affected by it. I dont
think that the password hacking will change how I use it.
RICHARD GOTLA
NEWGATE THREADNEEDLE

New boss at Samsung

as top jobs reshuffled
SAMSUNG Electronics, Asias
technology powerhouse battling
Apple for smartphone supremacy, is
shifting its chief executive to a new
role as the family-run parent
company prepares to transfer
ownership control to a third
generation.
Choi Gee-sung, 61, will
assume the new role of head of
corporate strategy at Samsung
Group, which presides over
some 81 companies
including its
flagship, Samsung
Electronics.
In a career with
Samsung spanning
more than three
decades, Choi has
worked in all of the
groups main
business divisions,
from semiconductors
to home appliances,
televisions and
telecoms, before
taking over as chief
BY CITY A.M. REPORTER
executive in 2010.
Crucially, he is widely seen as chief
mentor to Jay Y Lee, son of Samsung
Electronics chairman Lee Kun-hee
and the groups heir apparent. Jay Y
Lee, 43, stays as chief operating
officer. The South Korean group
named Kwon Oh-hyun as its new
CEO. Currently head of
Samsungs components
business, which oversees chips
and display, Kwon cemented
Samsungs position in memory
chips, where it has almost 50 per
cent global market share, and
expanded into non-memory,
or logic chips, which now
account for 40 per cent of
Samsungs overall
semiconductor revenue.
Samsung said earlier
yesterday it will spend
$1.9bn on a new logic chip
line to make processors
for mobile devices amid
explosive demand for
smartphones and tablets.
CITYVIEWS
Vodafone Group PLC
30May 31 May 1 Jun 6Jun 7Jun
175
173
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171
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169
167
168
p
168.95
7Jun
Samsung CEO Choi
Gee-sung has a new role
FRIDAY 8 JUNE 2012
12
NEWS
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The Cass MBA
Upgrade to
Business Cass
www.cassmba.com
Join us for our next MBA information session
Date: 14 June 2012 Time: 18:15 21:00
To register visit www.cassmba.com
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4S
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than one million staff.
G4S went on to post a 7.5 per
cent rise in revenues for the first
quarter of this year, however.
The firms wide-ranging inter-
ests include cash transportation
for high street shops, security at
Heathrow airport and a 15-year
contract to run two prisons on
behalf of the government. It also
has a 200m contract to supply
10,000 personnel for the London
Olympics.
Yesterday Buckles said G4S
would continue to spend 200m
to 300m a year on acquisitions,
with a focus on businesses in
developing markets and on facil-
ities services companies in
Britain.
Yesterday Alf Duch-Pedersen
bowed out as chairman, as
SECURITY group G4S is still trying
to heal the rift with shareholders
caused by its failed 5.2bn tie-up
with ISS, its chief executive has
admitted.
Nick Buckles said the mega-merg-
er, abandoned in the teeth of oppo-
sition from major investors, had
been a victim of the shareholder
autumn.
Buckles faced questions at the
firms annual general meeting,
although a shareholder revolt
failed to materialise after he decid-
ed to waive his bonus for last year.
Journalist were not allowed into
the meeting but Buckles said after-
wards that some shareholders had
described the ISS merger as a
great deal that should have hap-
pened. Others described it as a
waste of 50m, he added, a refer-
ence to the fees bill racked up.
Some were more upset than oth-
ers over the deal, Buckles said.
These things take a long time to
heal. We are 70 per cent to 80 per
cent of the way there.
Buckles walked away from a
750,000 bonus for performance in
2011 but appeared to defend the
importance of incentives for execu-
tives amid media or political pres-
sure, when he said: There is
always going to be a reason why a
CEO should not get a bonus.
Pre-tax profit fell 17 per cent to
279m for 2011, a turbulent year in
which G4S was forced to scrap the
ISS deal, which would have created
a support services giant with more
G4S boss: Healing rifts
over ISS will take time
BY PETER EDWARDS
L
A
U
R
A

L
E
A
N
/
C
I
T
Y
A
.
M
.
G4S boss Nick Buckles said the security firm is re-building bridges with investors
G4S PLC
30May 31 May 1 Jun 6Jun 7Jun
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p
276.00
7Jun
FRIDAY 8 JUNE 2012
14
NEWS
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The new jobs website
for London professionals
CITYAMCAREERS.com
E
VEN before the phrase
shareholder spring was
uttered, it was clear that
investors were becoming
unruly. More often than not it was
strategy rather than executive
remuneration that caused
discontent. Much of the recent
unrest, ostensibly about pay, is
really about direction. Andrew
Moss, the former Aviva boss, could
have paid himself 1 last year and
shareholders would still have
wanted his scalp. As with Sly
Bailey, the ousted Trinity Mirror
CEO, they didn't think she was up
to scratch.
Yesterday, G4S chief executive
Nick Buckles described his own
mauling over the companys
5.2bn bid for Danish cleaning
giant ISS last year as a
shareholder autumn. In the end,
the companys annual meeting
passed uneventfully yesterday, but
G4S has already paid a heavy price.
Its chairman walked the plank
after the ISS deal was aborted
while Buckles waived his 750,000
bonus.
BOTTOM
LINE
BY DAVID CROW
In the current climate, few chief
executives are brave enough to
attempt the kind of
transformational takeover that
almost cost Buckles his job. Such
deals have been fraught with risk
ever since Prudential chief
executive Tidjane Thiam
abandoned his 24.6bn bid for
AIA.
Those transformational deals
that did get through have ended in
disaster more often than not. HPs
acquisition of Autonomy for 7bn
last year is looking more and more
ill-judged as the days go by. Its
share price has plunged and its
chief executive Lo Apotheker has
paid the ultimate price. Last
month Autonomy boss Mike Lynch
followed him out the door, after
HP complained of disappointing
revenues at its expensive new buy.
Glencore and Xstrata might
want to pay attention. Their 60bn
tie-up has never been particularly
popular with the institutions that
own Xstrata, and is even less so
following the ridiculous 240m of
golden handcuff deals that chief
executive Mick Davis and others
will get if the merger goes
through. It is almost as though
Davis et al are oblivious to the
winds of change that are sweeping
though boardrooms around the
world. They ignore them at their
peril.
The shareholder spring also
appears to have passed Sir Martin
Sorrell by, despite his self-styled
reputation as a man of the
zeitgeist. Regardless of whether Sir
Martin deserves his dough, it is
impossible to claim that a 30 per
cent rise in base salary can be
closely tied to performance. His
swashbuckling attempt to defend
himself has only made things
worse. He might describe himself
as an owner, but with just two per
cent of the shares he is anything
but. The real owners deserve more
respect.
Some executives might believe
that the shareholder spring will,
like the season, end at the close of
June. They had better think again.
Xstrata and WPP ignore shareholder spring at their peril
Follow me on Twitter: @davidcrow83
announced in January. He was widely
seen as paying the price for the ISS
deal. He has been replaced by John
Connolly, chairman of engineering
group AMEC, who previously served
as global chairman of Deloitte.
Just under 99 per cent of votes cast
by G4S shareholders supported the
pay report.
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Moonpig walks off with M&A
prize after its sale to Photobox
G
E
T
T
Y
W
HEN Larry Ellison, the
worlds sixth richest man
and chief executive of
software giant Oracle,
appeared on Twitter earlier this
week, addicts of the bird-branded
social network waited with bated
breath for the tech gurus first 140-
character proclamation.
And while his debut tweet sent
moments before the stroke of mid-
night on Tuesday was not earth-
shattering, the billionaire did not
disappoint.
Knowing that well over 20,000 fol-
lowers had already flocked to his
Twitter account, Ellison took the
opportunity to slate his companys
arch nemesis, SAP.
He boasted: Oracles got 100+
enterprise applications live in the
#cloud today, SAPs got nothin but
SuccessFactors until 2020.
The Capitalist was impressed to see
Ellison knew how to use a hashtag,
despite being six years late to the
microblogging site.
But it seems neither the wording
nor the timing of the Oracle bosss
tweet was coincidental.
The Nasdaq-listed software compa-
ny had just unveiled its first step
into the cloud market, with a suite
of new products that means compa-
nies are no longer required to install
Oracles software on their own data
systems.
Much like his first tweet, Oracles
move to cloud has been a long time
coming, Ellison said.
In its reluctance to enter the cloud
market, Oracle has lagged behind
smaller rivals such as SalesForce and
Workday.
So Ellison decided to sling the mud
at SAP, which has been the snail to
Oracles tortoise in the cloud game.
The Frankfurt-listed software
group bought cloud expert
SuccessFactors in December for
$3.4bn but Ellison seems to think
SAP will not have a real cloud pres-
ence until next decade.
The third wealthiest American,
with a fortune worth $36bn accord-
ing to Forbes, owns almost a quarter
of Oracles stock so its in his inter-
est to keep his enemies down.
We cant wait for the next instal-
ments.
M
I
C
H
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E
I
N
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A
.
M
.
Selling the business has additional rewards for Moonpig founder Nick Jenkins
Got A Story? Email
thecapitalist@cityam.com
16
cityam.com
cityam.com/the-capitalist
THECAPITALIST
FRIDAY 8 JUNE 2012
The Capitalist can sense a congratula-
tions card coming on.
Moonpig scored a triumph at the
recent Vitesse Media M&A awards as
its sale qualified it for the Large
Company Deal of the Year.
The online greetings card business
won the award after its 120m sale to
Photobox. While the judging panel
commended company founder Nick
Jenkins for his role in developing the
company into a highly profitable
business, the successful entrepreneur
was sadly not present to receive both
the compliments and the award.
Moonpig joined other winners such
as CEO of Digital Barriers Tom Black,
who clinched Dealmaker of the Year,
and Intrinsic Technology, which was
named as Buyout of the Year.
Oracle chief executive and co-founder
Larry Ellison sent his first tweet this week
Larry Ellison slaps down
SAP in his maiden tweet
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ends Sunday

G
E
T
T
Y
HE MAY have earned a reputation for
gazumping rivals in the football
transfer market, but this time bil-
lionaire Chelsea owner Roman
Abramovich is the one who has been
outbid.
Abramovich had hoped to move
the recent Champions League win-
ners across the Thames to Battersea
Power Station but yesterday saw his
plans effectively sunk by a 400m
offer from Malaysian companies SP
Setia and Sime Darby.
The joint bidders have signed an
exclusivity agreement with adminis-
trators from Ernst & Young, allowing
them 28 days to carry out due dili-
gence and complete the purchase of
the 39-acre site in Wandsworth.
Developer SP Setia and the proper-
ty arm of plantations group Sime
Darby have promised a multi-use
real estate regeneration project
which will include a new
Underground station at Battersea.
Chelsea said in a statement that
the club was disappointed not to be
selected as preferred bidder, adding
Chelsea lose in
400m battle
for Battersea
BY FRANK DALLERES
that they would speak with more
confidence once the exclusivity peri-
od is over or a deal completed.
Blues chiefs instructed architects
KPF to draw up plans to turn the
grade II listed building into a 60,000-
seater stadium. Under the blueprints,
one of the stands was to be housed in
the existing structure, with the icon-
ic chimneys retained.
Abramovich is keen to relocate the
club from Stamford Bridge, which
has a capacity of 42,000, to a bigger,
more modern stadium that would
allow it to significantly increase its
matchday earnings. Failure of the
Battersea bid would constitute the
latest in a series of setbacks to those
plans and threaten to force him into
a major rethink.
Their hopes of moving to Earls
Court were dashed in February by a
rival housing project and an attempt
to buy the freehold to Stamford
Bridge rejected by a fan-led group late
last year. The Premier League club has
also examined the possibility of mov-
ing to a former Dairy Crest site in
White City, but are thought to have
been put off by the cost of the land,
which has been priced at 220m. Chelsea FC had intended to house a stand in the shell of the former power station
FRIDAY 8 JUNE 2012
20
NEWS
cityam.com
IN BRIEF
Europe hits Club Med bookings
nFrench holiday firm Club
Mediterranee has said European
bookings fell in the past four weeks
and warned profits at its resorts would
miss expectations this year as the
regions debt crisis meant fewer
consumers planned holidays.
Bookings over the past four weeks fell
2.7 per cent in Europe, but rose 1.5 per
cent in America and 2.5 per cent in
Asia. As of 2 June, total bookings were
still up 3.5 per cent. Revenue in the
first six months to 30 April rose 4.6
per cent to 798m.
Barclays invests in Namibia
n Barclays plans to buy a 49.9 per
cent stake in Namibia's second-largest
lender by assets, Bank Windhoek, the
country's central bank said yesterday,
in a deal that gives the British lender a
presence in the south-western African
country. The value of the potential
deal had not been determined as
Barclays was yet to start talks with the
bank that holds more than $2bn in
assets, Ebson Uanguta, the central
banks deputy governor told
reporters.
EU waits for Google response
n Google has yet to offer EU
regulators concessions to address
concerns it may have abused its
market dominance, the EU's antitrust
chief said yesterday. Nearly three
weeks ago, competition commissioner
Joaquin Almunia offered Google a
chance to settle the probe and avoid a
fine that could reach up to 10 per cent
of the company's global turnover.
IN BRIEF
Lamprell investors rebel over pay
n Shareholders in oil and gas engineer
Lamprell yesterday staged a minor
revolt over pay, with 11 per cent voting
against the directors remuneration
package. The meeting at the companys
headquarters in Dubai came just weeks
after the contractor issued a profit
warning in which it said pre-tax loss in
the first half to 30 June would slump to
around $5m (3.2m). Chief executive
Nigel McCues salary is set to rise five
per cent to $841,444 while chief
operating officer Christopher Hand is in
line for a 10 per cent hike to $440,000.
Ultra buys US power company
nDefence and security group Ultra
Electronics said yesterday it had paid
$12.5m (8m) for RFI, a US power
conversion business. RFI is owned by
US electronic systems and components
company DGT Holdings. The deal is
subject to approval by DGT
shareholders, but is expected to close
in the third quarter of this year.
Panasonic has no Olympus plans
n Japanese electronics maker
Panasonic has no plan to invest in
Olympus, president Fumio Ohtsubo said
yesterday, contradicting a report that it
would invest in the medical equipment
maker, which is struggling to recover
from an accounting scandal. Kyodo
news agency reported on Wednesday
that Panasonic was making final
arrangements to provide up to 50bn
(403m) in capital to Olympus.
G
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NETWORK RAIL saw profits after tax
almost double in the year to the end
of March, but debt soared by 2.2bn
after major projects such as the
Thameslink programme put pressure
on funds.
The company, which owns most of
Britains rail network infrastructure,
said that profit after tax rose
to 754m in the period
from 313m the previous
year, on revenues of 6bn
compared with 5.71bn.
But net debt increased
from just under 25.05bn to
27.28bn in the period,
which the company said was
due to its continuing
investment into proj-
ects including the
new concourse at
Kings Cross station.
Patrick Butcher,
finance director, said
the group was mak-
Network Rail
increases profit
but debts soar
BY KASMIRA JEFFORD ing steady progress in meeting effi-
ciency targets, which require it to cut
costs by 22 per cent between 2009 to
2014.
The group, which receives 4bn of
taxpayer funding each year, said its
financial performance during that
time meant it had been able to return
153m to the UK and Scottish govern-
ments.
Network Rail said it had added a mil-
lion more train services a year while
punctuality also improved, with 91.6
per cent of all trains arriving on time
compared to 90.9 per cent in the pre-
vious year.
But Butcher admitted it had more
to do particularly on long distance
journeys after it was recently
warned by the Office of
Rail Regulation being to
make improvements or
faces fines of 42m.
Airline traffic growth is knocked
off course by Eurozone worries
IAG, the parent firm of British
Airways and Iberia, has been hit by
Spains economic woes in the last
month, undermining the strength
in its long-haul London routes.
IAG said yesterday that its traffic,
measured in revenue passenger
kilometres, rose 6.6 per cent last
month versus May 2011, while
passenger load factor a measure of
how well it fills its planes was up
0.5 percentage points at 78.6 per
cent.
Underlying market conditions at
our London Heathrow hub continue
BY CITY A.M. REPORTER
to be firm, particularly in long haul
premium, the company said.
However, commercial
performance at our Madrid hub has
deteriorated further due to the
ongoing effects of the Spanish and
wider Eurozone macroeconomic
conditions and, the after-effects of
prolonged industrial action.
IAG said its first and business-class
travel the most profitable part of
its passenger business rose 1.7 per
cent, while non-premium traffic was
up 7.5 per cent. It added that trends
in June appeared to be stronger than
those in May.
Traffic at Iberia, which made an
operating loss of 170m (137m) in
the first three months of the year fell
1.8 per cent last month, IAG said.
Meanwhile, capacity cuts at Air
France-KLM contributed to a 0.2 per
cent fall in passenger traffic in May.
The airline also blamed four extra
public holidays in France for the
slide. Its cargo revenues fell 8.8 per
cent on a year ago, and are 7.3 per
cent lower in the year to date.
And budget airline Ryanair said
that while passenger numbers rose
five per cent to 7.5m last month,
thanks to expanding routes, its load
factor dropped one percentage point
to 81 per cent.
Sir David Higgins, chief
exec of Network Rail
SYNERGY Health said yesterday
it would buy US based SRI
Surgical Express to increase its
presence in the worlds largest
healthcare market and expand
its reach out of the struggling UK
and European economies.
Synergy, a healthcare services
provider, said it would pay $3.70
per SRI share, a two per cent
discount to SRIs closing price on
Wednesday, valuing the company
at $25.1m (16.1m).
We were looking to enter the
US hospital sterilisation market
in 2014, but we decided to bring
that forward, chief executive
Richard Steeves said.
SRI Surgical is a supplier of
Synergy Health bets on the US
with $25m SRI Surgical takeover
BY CITY A.M. REPORTER
sterile surgical gowns and
surgical instruments to hospitals
and surgery centres in the US.
He added that the company
was under-invested in the US,
which is at the helm of the
healthcare market.
Synergy reported a 13 per cent
rise in full-year adjusted profit
on the back of a strong
performance in emerging
markets.
It expects the bulk of its future
growth to come from Asia,
particularly China, and from the
US, with both markets
continuing to grow at 25 per cent
to 30 per cent. For the year
ended 1 April, Synergys adjusted
pre-tax profit rose to 43.4m
from 38.3m last year.
FRIDAY 8 JUNE 2012
21
NEWS
cityam.com
LONDON 2012 IMAGE OF THE WEEK
London 2012 has unveiled the key items that
will be used across the 805 victory
ceremonies at the Olympic and Paralympic
Games. The royal purple podiums have
been created by students from the Royal
College of Art in London. The bouquets were
designed by UK florist Jane Packer.
Between now and the start of the
Olympics, City A.M. is publishing its
Olympic Image of the Week. If you have a
shot you think our readers will like, please
email pictures@cityam.com with IOW2012
in the subject line.
Russias biggest lender posts
13 per cent jump in earnings
RUSSIAS biggest bank, Sberbank,
said yesterday that its net profit
grew 13.1 per cent for the first
five months of the year, driven by
growth in loans to corporate and
retail clients.
The figures reported are under
Russian accounting standards,
which have various differences to
international financial reporting
standards (IFRS) in the way they
account for fixed assets, capital
and reserves.
Sberbank posted a six per cent
rise in first quarter net profit last
week under international
BY CITY A.M. REPORTER
standards, supported by a cut in
bad debt charges.
Under Russian standards, it said
net profit for the five months to 1
June totalled 154.9bn roubles
(3bn), up from 136.9bn in the
same period the previous year.
Operating income before
provisions grew by 27.9 per cent,
outstripping the jump in the
banks costs, which rose by 22.7
per cent versus last year.
Corporate lending in the five
months grew 5.5 per cent and
retail lending grew nearly 20 per
cent. It said there was a small
improvement in the quality of the
loan portfolio in May, with
overdue loans declining to 3.28 per
cent of the total from 3.34 per cent
in the same period the year before.
Total provisions for losses on
loans declined as a result, from
13.8bn rubles last year to 11.6bn
rubles.
Sberbank has also been
snapping up other banks during
the last few months, having
bought Denizbank, one of Turkeys
biggest lenders, from bust Belgian
lender Dexia.
The Russian firm is largely
government-owned following the
postponement of a proposed
privatisation of a chunk of the
bank last year.
BWIN.PARTY has survived its
annual general meeting almost
unscathed by the recent
shareholder spring.
Less than eight per cent of
shareholders yesterday voted
against the gambling firms
remuneration report, which was
backed by a majority of 92.36 per
cent.
This is a significantly better
result than the average
shareholder dissent so far this
year, more in line with last years
average figures before the
shareholder spring gained
momentum.
By comparison, 51 per cent of
Bwin.Party executive pay deal
dodges the shareholder spring
BY LAUREN DAVIDSON
investors refused to back rival
gaming company William Hills
remuneration report last month.
Bwin.Partys co-chief executive
Jim Ryan took home 1.63m
(1.3m) last year, comprising a
573,000 salary, 519,281 cash
bonus, 523,772 worth of deferred
shares and 15,933 in benefits.
Co-boss Norbert Teufelbergers
total remuneration amounted to
1.48m, including a 429,750
salary and 519,281 bonus.
But the ride was less smooth for
Georg Riedl, a non-executive
director of Bwin.Party and lawyer
with the Riedl law firm.
Almost 30 per cent of investors
yesterday voted against Riedls
reappointment to the board.
MINING group Cluff Gold said
yesterday it was on course to hit its
production targets.
Underlying earnings jumped by 15
per cent in the quarter to 31 March
to $5.3m (3.4m).
Cluffs main projects are in the
Ivory Coast, Burkina Faso and Sierra
Leone. The Aim-listed company said
its 2012 production guidance
remains unchanged at 60-70,000oz,
though its first quarter production
slipped 26 per cent on a year ago to
12,504oz.
In the first quarter it acquired the
Sega project, 20km north of Kalsaka,
which the company said
immediately helped its cash flow.
Chief executive Peter Spivey said:
Our production performance this
quarter was as envisaged in Kalsakas
mine plan, and we continue to
generate healthy cash margins to
fund our business development.
The company said that initial
findings at its Yaoure site in Ivory
Coast were positive.
John McGloin, former head of
mining at Collins Stewart, has been
appointed executive chairman.
Cluff Gold on
course to hit
output target
BY JOHN DUNNE
R
E
U
T
E
R
S
TULLOW Oil said yesterday that it
had found oil in the Ivory Coast, giv-
ing it confidence that it will make
additional discoveries in waters to
the west of its key Jubilee field in
Ghana.
The British explorer said that the
Paon-1X exploration well in the CI-
103 licence had found good quality
light oil.
The successful result in the Ivory
Coast followed disappointment in
the country in April when the com-
pany drilled a dry hole.
Tullow operates the huge Jubilee
oil field in Ghana, which is the first
commercial oil development in the
country. The firm has been pushing
its hunt for oil westwards in the
hope of discovering more oil off the
Ivory Coast.
Tullow buoyed
by Ivory Coast
oil discovery
BY HARRY BANKS
The discovery of light oil in our
first well in CI-103 extends the proven
play for oil westwards from our suc-
cesses in Ghana and is encouraging
for our future exploration efforts else-
where in this licence, said Tullows
exploration director Angus McCoss.
Tullow owns a 45 per cent stake in
the CI-103 licence and is partnered
with US explorer Anadarko.
Johnson Matthey proposes a
special dividend as profit lifts
JOHNSON Matthey, the worlds
largest supplier of catalytic
converters, yesterday posted
larger than expected profits and
proposed its first ever special
dividend.
The company was buoyed by
sales of trucks in North America
and more diesel cars in Europe.
Johnson Matthey, which
makes catalysts to convert toxic
engines emissions, sells
pharmaceutical ingredients and
refines platinum, said its
underlying profit before tax, for
the year to the end of March
rose 23 per cent to 426m.
That was above a consensus
analyst estimate of just over
411m and came on the back of
a 20 per cent rise in revenues as
sales of catalysts outpaced
growth in global car and truck
production.
Johnson Matthey said its
balance sheet, combined with a
strong outlook even with
BY JOHN DUNNE
uncertainties in Europe and
weak precious metals prices, had
prompted the group to
recommend its first ever special
dividend, of 100p per share, on
top of a full-year dividend of 55p,
up 20 per cent.
We feel the company is in
good shape and the long-term
prospects of the group remain
strong, finance director Robert
MacLeod said, despite the impact
of softer prices on its precious
metals division.
He said the group had plenty
of firepower remaining to
finance its increased research
and development and capital
spending plans, as it moves into
new areas and tries to keep up
with growing catalyst demand,
particularly for trucks.
The group will consolidate its
share count after the 212m one-
off payout, at a ratio to be
announced to shareholders later
this month.
Johnson Matthey has been a
major beneficiary of rules to
tighten car and truck emissions,
helping it outpace the market, and
it expects to gain even from new
carbon emissions rules, which will
require not catalysts but improved
engines.
We are not complacent ... We are
uncertain exactly what is going to
happen in Europe, exactly how
many cars are going to be sold, how
many petrochemicals plants will be
built, MacLeod said.
Sales of heavy duty diesel
catalysts jumped almost 50 per
cent, driven by the North American
market.
Johnson Matthey PLC
30May 31 May 1 Jun 6Jun 7Jun
2,400
2,250
2,300
2,350
2,150
2,200
2,100
p
2,304.00
7Jun
ADAM COLLINS
LIBERUM CAPITAL
The perform-
ance is strong
and has allowed the
special dividend. The
company has invested
over the years and
now it is harvesting the rewards.
Regulations on emissions have helped the
business to grow. It was thought to be quite
conservative but now has a relatively new
chief nancial ofcer and seems to
be going in the right direction.

ANALYST VIEWS
WHAT DO YOU MAKE OF JOHNSON MATTHEYS
RESULTS AND DIVIDEND? Interviews by John Dunne
AUBREY K McClendon, the chief
executive officer of Chesapeake
Energy Corp, has intertwined his
personal and financial interests
with those of the publicly traded
company he runs to a far greater
degree than shareholders may
realise, according to interviews,
public records and hundreds of
internal Chesapeake documents
Chesapeake chief in spotlight
over use of company resources
BY CITY A.M. REPORTER
reviewed by Reuters.
The executive has deployed a
team of Chesapeake employees to
handle his personal business
affairs and uses the corporate jet
regularly to ferry family members
and friends to holiday destinations
documents show. In 2010,
meanwhile, employees spent more
than 15,000 hours working on
McClendons personal projects. He
was unavailable for comment.
FRIDAY 8 JUNE 2012
22
NEWS
cityam.com
Documents show that Aubrey K McClendon mixed his finances with those of the firm
GLOBAL BUSINESSES
RECRUITING LONDONS
BEST PROFESSIONALS
YOUR FUTURE IS OUR BUSINESS
CITYAMCAREERS.com
WWW.CITYAMCAREERS.COM
OVER
OR SCAN HERE
4000
SALARIES UP TO
JOBS
300K
KEITH BOWMAN
HARGREAVES LANSDOWN
The company
remains
astutely positioned.
Environmental trends
are being captured,
whilst geographical
exposure to both the US and Asia is also
playing its part. Management continues to
invest, whilst a strong nancial position
supports both a progressive dividend policy
and the announced special divi-
dend. We say buy.

CHARLES PICK
NUMIS SECURITIES
The results are
comfortably
clear of market expec-
tations. This could help
to alleviate concerns
regarding Johnson
Matthey's Eurozone exposure and cyclical
end markets. But the nature of the business
means that forward orders cannot be pre-
dicted. The unpredictable cost of precious
metals, a business which they are
also in, is a factor as well.

Tullow Oil PLC

30May 31 May 1 Jun 6Jun 7Jun
1,525
1,450
1,475
1,500
1,400
1,425
1,350
1,375
p
1,468.00
7Jun
INVESTOR confidence in the state of
the economy fell sharply into the
second quarter, a major survey of
fund managers shows today, as the
hopes of recovery that emerged at
the start of the year were stamped
out by the resurgent Eurozone crisis.
The study from Capital Spreads
also shows that only a minority
believe the Olympics will bring in
more money than it will cost to run.
Only 49 per cent of fund
managers expect the economy to
improve over the next year sharply
down from the 68 per cent seen in
the first quarter.
City confidence
in GDP is down
BY TIM WALLACE
MALE and female pensioners are
becoming more equal, while poverty
rates as a whole are declining, indus-
try and official data showed today
but only because incomes are falling,
cutting inequalities.
Men retiring this year only expect
an income of 18,000 down to a five-
year low from 19,400 last year and
20,313 in 2009.
Meanwhile female income expecta-
tions declined more slowly from
12,900 last year to 12,250 this year.
That cuts the gap between male and
female incomes by 750 to 5,750.
Prudential said that much of this
fall is down to low annuity rates,
caused by quantitative easing push-
ing down interest rates, and the over-
all weak economic outlook.
The practical steps women can take
to improve their retirement income
prospects include maintaining pen-
sion contributions during career
breaks, said Prudentials Vince
Smith-Hughes.
Meanwhile figures from the Office
for National Statistics yesterday
UK is becoming
more equal
as incomes fall
BY TIM WALLACE
showed average incomes fell through
the financial crisis, also reducing
inequality.
Median disposable income fell from
15,068 in 2008 to 14,488 in 2010.
As someone is defined as at risk of
poverty if they are earning below 60
per cent of median income, the fall in
incomes dragged down the poverty
threshold by 348 per year, reducing
the proportion from 19 per cent to 17.1
per cent.
However, despite this fall in incomes
and in the gap between low and high
incomes, the UK still has above-average
poverty levels on this measure. In the
EU as a whole, 16.4 per cent are at risk.
M
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Incomes fell after 2008, pushing down poverty levels
2005 2006 2007 2008 2009 2010
30
28
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UK
EU
THE GOVERNMENT risks missing a
key chance to make the Bank of
England fit for purpose unless it
makes drastic changes to the
financial services bill going
through parliament, an influential
backbench MP warned today.
The governing Court of the Bank
of England must be brought up to
date with best practice in corporate
leadership, said Treasury Select
Committee chairman Andrew
Tyrie, and cannot go on with its
antiquated system when the Bank
is given extended regulatory
powers.
Top MP wants state to rethink
rushed regulatory reform bill
BY TIM WALLACE The Financial Services Bill is the
most important overhaul of
financial regulation ever
undertaken in this country. It is
crucial that we get it right. This bill
will transform the regulation of
Britains leading global industry,
said Tyrie.
The chairman also hit out at the
governments whole approach to
the regulatory reform, arguing the
bill has been rushed, and has been
amended so many times that it is
now unnecessarily complicated.
No explanation has been given
for the rush to produce the bill.
Better to take a little more time,
and get it right, he said.
FRIDAY 8 JUNE 2012
23
NEWS
cityam.com
Andrew Tyrie says the Banks governance system is antiquated and needs proper reform
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THE GOVERNMENTS deficit
reduction programme will not
work unless politicians create a
popular ideological vision to gain
public support, researchers at a
top City brokerage warned today.
Tim Morgan from Tullett
Prebon believes that urgent steps
must be taken to fill the centre-
right ideological gap if the
government wants to achieve
long-lasting reforms like those
achieved by the Atlee and
Thatcher governments.
Cameron told
he needs vision
BY TIM WALLACE
FRIDAY 8 JUNE 2012
LONDONREPORT
Marsh & McLennan
Mark Weil has joined the
insurance broker and risk
adviser as chief executive. He
will oversee Marshs UK and
Ireland operations. Weil
graduated from the University
of Cambridge with an
engineering degree and has 15
years of consulting experience
with Marshs sister company
Oliver Wyman.
Eruma
Nicolas Marks has joined the specialist provider of
counter terrorism, intruder prevention products and
intelligent lighting as its new finance chief. The qualified
accountant has spent the last 20 years in strategic
financial management. He has mainly worked in practice
and industry in the engineering sector.
Royal London Asset Management
The fund management company has appointed Ian
Furtado as its new business development manager. He
has previously worked at Occam Asset Management,
Liontrust Asset Management and BDT Invest.
Kestrel Investment Partners
The company has elected Dan McCausland as chief
operating officer. He has previously worked at Aspect
Capital; under his management the company grew from
$1bn to $6bn. His responsibilities encompassed new
funds, including the successful launch of a UCITS product
and the set up of Hong Kong and Swiss subsidiaries.
KPMG
The global network of professional firms providing audit,
tax and advisory services has appointed one partner and
three directors to its company turnaround team. Lukas
Fecker has joined as a partner from Alvarez & Marsal.
Joan Slatkin joined as a director following a successful
stint at Titan Outdoor. Matt Johnston and Duncan
Calverley have also joined KPMG as directors after
working at AlixPartners.
Barclays
The bank has appointed John Rodriguez as relationship
director to join its financial institutions team. His
responsibilities will include establishing and
strengthening Barclays transaction banking relationships
with financial institutions in Latin America. Previously, he
worked at HSBC in a key Latin American role.
BNP Paribas
The corporate and investment banking group has named
Christian Mundigo as global head of rates trading in
addition to the responsibilities he holds as co-head of
fixed income Americas and as a member of the fixed
income executive committee. Mundigo has been part of
the BNP Paribas team since 1991.
WHOS SWITCHING JOBS Edited by Lisa Moravec
+44 (0)20 7092 0053
morganmckinley.com
SPECIALISTS IN GLOBAL PROFESSIONAL RECRUITMENT
Investors find
no sign of QE3
from Bernanke
T
HE S&P 500 ended barely
changed yesterday as optimism
about Chinas interest-rate cut
was offset by Federal Reserve
chairman Ben Bernankes comments
that dimmed hopes for more US
stimulus.
Both the Dow industrials and the
Nasdaq ended off session highs, with
the Dow rising modestly for the day
and the Nasdaq slipping.
Stocks lost ground following
Bernankes comments a day after
experiencing the best one-day rally so
far this year. Over the previous three
days, the S&P 500 gained 2.9 per cent,
recovering some of Mays losses.
The surprising move by Chinas cen-
tral bank to cut its benchmark inter-
est rate by 25 basis points helped ease
worries about faltering global
demand.
Speculation has been rising that
central banks will take more action to
combat escalating debt problems in
Europe and slower global growth.
Bernanke, in testimony yesterday, said
the Fed was ready to take action but
gave no hint of imminent steps.
His remarks were seen as offsetting
more supportive comments from
other Fed members in the last 24
hours, but still leaving the door open
for more action at the Feds next
meeting on 20 June.
Bernanke threw traders a curveball.
After his vice chair made it seem like
QE was a foregone conclusion, he real-
ly messed people up. We tried to
shake that off, but there was a lack of
follow-through and we lost momen-
tum, said Phil Flynn, senior market
analyst with PFG Best in Chicago.
The rate cut in China, the worlds
second biggest economy, helped lift
the stocks of US companies linked to
Chinas commodity-hungry industrial
complex.
An S&P index of industrial shares
gained 0.6 per cent and an S&P mate-
rials index rose 0.2 per cent.
The Dow Jones industrial average
advanced 46.17 points, or 0.37 per
cent, to 12,460.96 at the close. The
Standard & Poors 500 Index edged
down 0.14 of a point, or 0.01 per cent,
to 1,314.99. The Nasdaq Composite
Index slipped 13.70 points, or 0.48 per
cent, to close at 2,831.02.
US stocks jumped more than two
per cent on Wednesday, a third day of
gains for the S&P 500. The index has
rebounded since hitting its 200-day
moving average, a key technical sup-
port level, last Friday.
The S&P 500 is still well off its highs
for the year.
While Europe was still very much in
the spotlight, stocks showed little
reaction to a downgrade by Fitch in
Spains credit rating to BBB with a
negative outlook, just two notches
away from junk status.
Germanys government and main
opposition agreed on the outlines of a
proposal for a European financial
transaction tax, which could pave the
way for parliament to approve a fiscal
pact and permanent rescue plan for
the Eurozone.
B
RITAINS top shares hit a three-
week high yesterday as Chinas
surprise move to cut interest rates
and firm UK services sector data
boosted investors appetite for risk,
although charts signalled strong
resistance on the way up.
German Chancellor Angela Merkels
comments that her country stood ready to
use the existing instruments already cre-
ated in the Eurozone to combat the debt
crisis also helped investors to stay positive
despite the gathering crisis in Spain.
Sectors, whose fate is linked with eco-
nomic conditions, made solid gains, with
the UK banking index, miners and energy
shares up 1.5 to 2.5 per cent.
However, investors hungry for hints of
more stimulus from central banks were
disappointed as the Bank of England left
its policy unchanged and US Federal
Reserve chairman Ben Bernanke offered
little to suggest that further monetary
stimulus was imminent.
The FTSE 100 lost some shine in late
trading and closed below a session high
because a lot of investors had positioned
for some support from the Fed and the
Bank. But it was still up 63.68 points, or
1.2 per cent, at 5,447.79 points, helped by
Chinas move to cut interest rates by 25
basis points.
The rate cut from China shows their
ability to continue pulling the relevant
levers to keep GDP on an expansionary
path and the rhetoric coming from the
European Central Bank regarding the
future of Spain shows the Eurozone isnt
set to break up any time soon, said Mike
Jarman, chief strategist at H2O Markets.
For the short term, were advising
clients to have more of a risk on mentali-
ty, but know the volatility is here to stay.
After the close, Fitch cut Spain's credit
rating by three notches to BBB.
Chinas rate cut to shore up slackening
economic growth was the first since the
depths of the 2008/09 financial crisis. The
consensus view had been that the central
bank would refrain from an outright cut
to interest rates in 2012.
The market also got some support from
a UK survey showing Mays services pur-
chasing managers index (PMI) unexpect-
edly held firm at Aprils level of 53.3,
showing moderate growth. The British
Retail Consortium reported a stronger-
than-expected 3.4 per cent annual rise in
the value of retail sales.
Yesterdays finish for the FTSE 100 index
was the highest closing since mid-May, a
move which looked impressive given the
fact that the market had slipped to a six-
month low just last week on Eurozone jit-
ters, deteriorating economic numbers and
Spains banking sector woes.
Risk sentiment has improved dramati-
cally in the past few days as hopes of an
EU deal to recapitalise Spains banks has
attracted buyers back to equities, said
Angus Campbell, head of market analysis
at Capital Spreads.
Societe Generale said a monetary policy
intervention, progress towards a
European banking union, a victory of
moderate parties at Greek elections and
signs of economic recovery could trigger a
rebound. It highlighted high beta assets,
which tend to offer higher returns than
the broader market during rallies and fall
more sharply during corrections.
RBS jumped 5.3 per cent yesterday,
Barclays was 2.7 per cent higher and
Kazakhmys advanced 1.9 per cent.
Among other movers, Johnson Matthey
rose 4.9 per cent after the worlds largest
supplier of catalytic converters reported
better-than-expected results, while
Burberry rose 5.1 per cent as Credit Suisse
upgraded its rating on the luxury goods
firm to outperform from neutral.
FTSE jumps as Chinese rate cut and
UK services stats hearten traders
BESTof theBROKERS
Diageo PLC
30May 31May 1Jun 6Jun 7Jun
p 1,600
1,580
1,560
1,540
1,520
1,577.00
7 Jun
DIAGEO
Liberum Capital rates the drinks company buy with a 12-month target
price of 20. If Diageo goes through with its 2bn - 2.3bn purchase of
Cuervo tequila, the broker thinks the acquisition could add 50 basis points
to sales growth and provide access to a new taste for the liquor in the
United States. Liberum reckons a deal could be done by offering Diageo
shares to Cuervos current owners.
FTSE
5,500
5,450
5,400
5,350
5,250
5,300
30May 31May 1Jun 6Jun 7Jun
5,447.79
7 Jun
DASHBOARD CITY
CITY MOVES
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cityam.com
Tesco PLC
30May 31May 1Jun 6Jun 7Jun
p 304
298
300
302
296
303.50
7 Jun
TESCO
Shore Capital rates the supermarket hold with a target price of 301p
ahead of its first quarter results on Monday. The market is sceptical that
Tesco can recover from its recent profit warning, the broker thinks, but
adds that it is unlikely sales have fallen off a cliff since January.
However, like for like sales figures are expected to be materially lower.
Shore also expects to see chief executive Philip Clarke reveal more details
of his turnaround plan for the UK business.
Halfords Group PLC
30May 31May 1Jun 6Jun 7Jun
p 290
260
270
280
240
250
245.60
7 Jun
HALFORDS
UBS has upgraded the DIY retailer from sell to neutral but has
trimmed its target price from 260p to 240p. The broker has lowered its
2013 forecasts after a grim outlook took the shine off Halfords recent
results, but believes cost cutting measures will cushion the firm from
further earnings downgrades. UBS sees some risk in managements
strategic overhaul, but thinks the long-term benefits will make up for the
short-term earnings risk.
T
HE Barbicans new Bauhaus
exhibition is full of ghosts.
These early twentieth-century
disciples of modernism are
renowned for furniture as
coolly perfect as an equation, but it
is the human messiness of
achievement that haunts every
room. A chair that takes the breath
away is posed between half-finished
student exercises, invitations to
parties and dozens of photographs
of the German design schools
members eating, playing and
working. Its a reminder that
permanent achievement in design
and elsewhere is never a sterile
process, but a living conversation
between creative minds as they
grapple with their materials.
T
HE subprime mortgage crisis
isnt over. On the back of
misguided government
policies, taxpayers in the US
and UK remain on the hook
for huge sums. The ideology of
affordable housing must end.
It took just 13 years to destroy the
American mortgage market with dev-
astating effects for the rest of the
world. The process began in 1995,
when President Clinton introduced
the national home ownership strate-
gy, aiming to extend home owner-
ship to a further 8m families by 2000.
The affordable housing ideology was
born. Lenders were encouraged to
provide mortgages for everyone,
adopting flexible underwriting stan-
dards so that they could lend to peo-
ple who wouldnt otherwise be able
to buy their own homes. Relevant
incomes could be welfare payments,
unemployment benefit or child sup-
port. Borrowers did not need to have
good credit scores and deposits were
as low as 3 per cent.
Fannie Mae, the Federal National
Mortgage Association, and Freddie
LONDON CITY TO E
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cityam.com/forum
Governments need
to wake up to the fact
its not possible for all to
own their own homes
In association with
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26
FRIDAY 8 JUNE 2012
OONAGH MCDONALD
The subprime mortgage crisis isnt
over UK taxpayers remain liable
Mac, the Federal Home Loan
Mortgage Corporation, played a piv-
otal role in the US housing market.
They were owned by their sharehold-
ers, but subject to public policy goals.
They did not make loans themselves,
but bought loans made by banks and
other lenders. Targets for the propor-
tion of loans made to low and moder-
ate-income families and very
low-income families were set by their
mission regulator, the housing and
urban development department.
Fannie and Freddie were able to
issue debt cheaply, as their debt was
thought to have an implicit govern-
ment guarantee. The market believed
in the implicit guarantee, which
Fannie and Freddie did little to dis-
courage (although their charters
explicitly stated that their debt did
not have the full faith and credit of
the US government). Fannie and
Freddie borrowed cheaply from a
wide range of investors, including
foreign central banks, and made a
profit on their guaranteed fees.
During the 1990s, James Johnson,
chief executive of Fannie, announced
a trillion-dollar commitment for tar-
geted housing finance for 10m poor
families. His successor, Franklin
Raines, went further, ensuring that
Fannie entered into partnerships
with a wide range of lenders, of
which the largest was Countrywide
Financial. Countrywide teetered on
the verge of bankruptcy in 2008,
when Bank of America bought it for
$4.1bn.
For the UK, the damage was done
when banks bought mortgage-
backed securities, credit default
swaps, and collateralised debt obliga-
tions backed by mortgages of dubi-
ous quality but which were at the
time given triple-A ratings by the rat-
ing agencies. The ratings were taken
for granted, until falling house
prices, higher interest rates and
increasing numbers of foreclosures
exposed the real extent of the risks.
Banks were unwilling to lend to each
other, not only in the US, but
throughout the world. That was the
beginning of the financial crisis from
which we all continue to suffer.
Fannie and Freddie are still in exis-
tence, under conservatorship. They
still require state support: $183bn at
the last count. And their mortgage
loan guarantees totalled $3.2 trillion
for Fannie Mae and $2 trillion for
Freddie Mac at the end of 2011. Given
the ailing mortgage market, no one
knows the extent to which such guar-
antees may be called upon. Because
the guarantees are off balance sheet
it does not mean that they are not
there, or that one day they will not
come back and bite us all.
But the danger doesnt only come
from the US. Prime Minister David
Cameron, when announcing a
930m injection into the housing
market, said he wanted to make the
dream of home ownership a reality
for everyone. The limited scheme for
100,000 first-time buyers involves cut-
ting deposits to 5 per cent, with the
builders and the government sharing
the risks of buyers defaulting.
Taxpayers could face a maximum of
1bn in liabilities much more if the
scheme was extended.
Governments need to wake up to
the fact that it is not possible, howev-
er desirable, for all to own their own
homes. The past 13 years of American
affordable housing ideology shows
that only too painfully.
Dr Oonagh McDonald is a former Labour
MP and board member of the FSA. Fannie
Mae and Freddie Mac: Turning the
American Dream Into a Nightmare, is pub-
lished by Bloomsbury Academic.
London today is blessed with its
own thriving design community. Its
true that theres a good pinch of self-
congratulation in the Victoria and
Albert Museums retrospective of
modern British design. In an Olympic
year, what else can you expect? But
we have real reason to be proud of
what our designers are achieving
today. And I dont just mean Sir Jony
Ives iconic work for Apple. Thanks to
the community of talent in London,
government commissions that could
be expected to produce the stodgy,
the anaemic and the ephemeral are
proving revelations.
Take Thomas Heatherwick, my
favourite modern designer. His stu-
dio has the first big solo exhibition of
its work at the V&A this summer too
and its well-deserved. Heatherwick
is responsible for taking Boris
Johnsons pledge of a new
Routemaster and living up to the old
masterpiece. His contemporary
response adds a swirling ribbon of
glass, opening up the twin stairways
and bringing a touch of delight to
our everyday streets. The handful of
new buses in service deserves to
grow. Heatherwick is also responsible
for this summers Olympic cauldron,
and no doubt it will be as provoking
and original as the rest of his work.
But we dont have to rely on one
man for inventive design, as the
Barber Osgerby Olympic torch has
already demonstrated. The Duchess
of Cambridges outfits for last week-
ends Jubilee and both the
Middleton sisters dresses at last
years Royal Wedding proved that
despite the loss of Alexander
McQueens irreplaceable talent,
Sarah Burton could keep his fashion
brand in rude health.
It is the creative imagination of
individuals like Burton and
Heatherwick that brings life to
design. The students at the Bauhaus
were often politically naive. Towards
the end of the Barbican show, theres
a series of plans for a socialist city,
where the schools stripped-down
industrial aesthetic ends in a terrible
reductio ad absurdum of identikit,
inhuman blocks. The movement
itself was crushed in the end by Adolf
Hitlers national socialism. Their
most elegant visions live on, and we
owe a great deal to them, but there
are dangers in industrial chic too.
Neither designs consumers nor its
producers are machines, and despite
the geometric charms of a chilly
beauty the best work reminds us that
it is made by individuals, for individ-
uals.
Marc Sidwell is City A.M.s business fea-
tures editor.
THE LONG
VIEW
MARC SIDWELL
Londons contemporary design lustre is a reflection of its inspiring heritage
EDINBURGH
Four fights daily to Edinburgh. Check-in within 15 minutes*. Fly from
the heart of London. Fly CityJet from London City Airport.
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27
Wins-consin
[Re: Wisconsin victory threatens Obamas
November prospects, yesterday]
As Ewan Watt points out, Romneys victory in
Wisconsin moves him from being seen as a GOP
one percenter to being a credible threat to
Obama. Until now he has been seen by many
Republican voters as not Rick Santorum or
not Newt Gingrich and by swing voters as
another GOP politician in a $3,000 suit. But if he
can keep up momentum, he can turn the attacks
on his wealth accumulated from Bain Capital
into: Romney, a successful businessman versus
Obama, the career politician.
James Williams
Its worth pointing out that Romney hadnt visit-
ed Wisconsin during the recall process.
AdrianScott
Up downunder
[Re: Aussienomics: Big cuts, no QE, booming
growth, yesterday]
Oliver Cooper highlights many of the factors
that help account for Australias economic sun-
shine. The relatively strong public debt position
is testament to the wisdom of fiscal strategy
decisions a decade ago, and a focus on bal-
anced budgets, paying off debt and long-term
fiscal sustainability.
As a result, Australia has been in a strong posi-
tion to weather the worlds financial and eco-
nomic storms. It hasnt come through the
global financial crisis untouched, but it has
remained a recession-free zone. No small feat,
and one that demonstrates the value of policy
making that considers more than just the short
term.
ElizabethFells
I
F THE German people are
persuaded by their politicians
to continue funding the
Eurozone, based on much
greater integration, many
existing EU member states will
swallow concerns about undue
austerity. But the UK will have a
choice to make.
Britain must not remain passive
any longer this is our EU by
treaty. It is not pedantic to insist it
can only legally be changed by una-
nimity. So the UK must now start
to champion a credible, but differ-
ent, design to set alongside other
reforms. Politicians must have the
determination to stay at the negoti-
ating table until there is unanimi-
ty. No walk-outs, just quiet
persistence. Where the UK can act
with others, so much the better,
but Britain must have the confi-
dence to set out its design for
Europe a wider Europe and a
deeper Europe, living alongside
and in harmony with each other.
Turkey deserves to be involved in
this single market restructuring;
so do the European Economic Area
(EEA) countries, Iceland, Norway
and Liechtenstein. The EEA was set
to have Switzerland as a member,
but a referendum on joining
returned a no vote. However, that
has been largely circumvented and
Switzerland is in fact closely associ-
ated.
The setting up of the EEA on 1
January 1994, as the then President
of the European Commission,
Jacques Delors, claimed, marked a
further step in the long-standing
process of rapprochement between
the European Union and the
European Free Trade Association
(EFTA) countries. The EEA, however,
is a hand-me-down structure from
the EU. It has to change and be
funded and controlled by all its
TOP TWEETS
When will the EU learn that the answer to the
problem is not yet more of what caused the
problem and listen to those who called this
right?
@Conor_BurnsMP
No change from the MPC but China cuts
interest rates. More scope for Asia to
provide stimulus to the world economy than
for Western nations like the UK.
@asentance
Osbornes admit a mistake, move on
strategy would be more credible if he
wasnt still leaving landmines like loss relief
around.
@mjsinclair
Should we be trusting of social networking
companies to protect our online privacy?
YES
Like all firms, social networks can only succeed by giving
customers what they want. If people want privacy, the profit
motive will give social networks a good incentive to offer it to
them. LinkedIns security breach this week will probably provoke
new innovations in security. Social networks have to constantly
innovate and compete with each other to stay alive. If ever there
was a good reason for other sites to improve security, losing
users valued for Facebook at $121 each is it. Getting the
government involved would be a disaster. Markets are dynamic,
with a strong profit motive to give the customer what she wants.
Government is monolithic and, as repeated high-profile NHS and
police data losses demonstrate, it is no better than private firms
at protecting data. The big difference is that, with private firms,
we can opt out.
Sam Bowman is head of research at the Adam Smith Institute
Sam Bowman
NO
Nick Pickles
Lets not beat about the bush. Personal information is the
currency of the digital age. Its the fuel that powers free services
we all take for granted. Business models are already maturing to
offer freemium services, trading your cash for enhanced privacy.
But this has come at a price. Companies now know more about
us through a webmail service or social network than the
government knows about us. Who can blame them in seeking to
maximise the revenue that they can make from this easily
accessible natural resource?Thats the trade-off profit versus
privacy. The problem is that when the time comes to make that
decision, the companies already have the data. Until we can
make an informed choice about how much data we hand over,
empowered rather than confused by privacy policies, we cant
trust the companies collecting it.
Nick Pickles is the director of Big Brother Watch
RAPIDresponses
My proposal for
a referendum on
Europes future
members. It should have the exist-
ing acquis communitaire, qualified
majority voting and a single nego-
tiator for world trade.
My e-book, Europe Restructured?,
provides a description of a trans-
formed EEA, which includes
Turkey. Turkey already has a cus-
toms union with the EU. The rul-
ing Turkish Justice and
Development Party, AKP, was first
elected in 2002 and was re-elected
for a third time in June 2011. It is a
recognisable European political
party. In economic and industrial
performance, Turkey has become a
mainstream European country.
A UK referendum on Europe is
inevitable. It will need to take place
between 2013 and 2016, depending
on how soon Eurozone integration
takes place and I think the people
of this country should be asked
two questions:
1. Do you want the UK to be a
part of the single market in a
wider European Community?
Yes/No
2. Do you want the UK to remain
in the European Union, keeping
open the option of joining the inte-
grated Eurozone? Yes/No
Its time for the British people
and politicians to punch their
weight.
Lord Owen is a cross-bench peer. He is
a former Labour Party foreign secretary
and was chairman of New Europe from
1999-2005, campaigning against the
UK adopting the euro.
FRIDAY 8 JUNE 2012
DAVID OWEN
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Email theforum@cityam.com or comment at cityam.com/forum
28
TV & GAMES
cityam.com
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SKY SPORTS 1
7pmLive Darts 11pmTest Cricket
1amSuper League 3amTest
Cricket 5amPremier League World
5.30am-6amNRL Fulltime
SKY SPORTS 2
5.30pmLive Junior World
Championship Rugby Union
7.30pmLive Super League:
Warrington Wolves v Leeds Rhinos
(Kick-off 8.00pm). 10pmWWE:
Late Night Smackdown 12am
WWE: Late Night Bottom Line
1amDarts 5amThrillseekers
5.30am-6amAmericas Cup
Uncovered
SKY SPORTS 3
7pmTight Lines 8pmLive PGA
Tour Golf 11pmCurtis Cup Golf
12amEuropean Seniors Tour Golf
1amEuropean Tour Golf 3am
Curtis Cup Golf 4amEuropean
Seniors Tour Golf 5amATP Tour
Uncovered 5.30am-6amRoad to
London
BRITISH EUROSPORT
7pmUEFA Euro 2012 Show
7.30pmFrench Open Tennis
10.30pmCycling 11.30pmBradley
Wiggins: Skys the Limit
12am-12.30amGame, Set and
Mats
ESPN
7pmNBA 9pmNBA Tonight
9.30pm30 for 30 11.30pmPress
Pass 2012 12amFootball Is God
1amMMA Live 1.30amNBA
Action 2amLive NBA Basketball
4.30am-7.30amLive Australian
Rules Football
SKY LIVING
6.30pmCSI: Crime Scene
Investigation 7.30pmBattle of the
Brides 8.30pmCougar Town 9pm
FILMUncle Buck 1989. 10.55pm
Bones 11.55pmLadyboys 12.55am
Criminal Minds 2.40amMedium
3.30amBones 4.20amNothing to
Declare 5.10am-6amJerry
Springer
BBC THREE
7pmThe Apprentice: The Final
8pmSnog, Marry, Avoid? 8.30pm
FILMThe Accidental Husband
2008. 9.55pmGreat Movie
Mistakes 2011: Not in 3D 10pm
EastEnders 10.30pmRussell
Howards Good News Extra
11.15pmFamily Guy 12am
American Dad! 12.45amLive at
the Electric 1.15amHow to Be
England Manager 2.10amRussell
Howards Good News Extra
2.55amSnog, Marry, Avoid?
3.25amAngry Boys 3.55amDont
Tell the Bride 4.55am-5.25am
Worlds Craziest Fools
E4
7pmHollyoaks 7.30pmHow I Met
Your Mother 8pmThe Big Bang
Theory 8.30pm2 Broke Girls 9pm
FILMZoolander 2001. 10.45pm
Revenge 11.45pmThe Big Bang
Theory 12.40amScrubs 1.05am
How I Met Your Mother 1.35am
Rules of Engagement 1.55am
Shameless 2.50amFranklin & Bash
3.30amDesperate Housewives
4.15am90210 5am-6amGreek
HISTORY
7pmStorage Wars 7.30pmPawn
Stars 8pmStorage Wars 9pm
American Pickers: The pair meet a
man who claims to be a psychic
picker. 10pmVietnam: Lost Films
11pmStorage Wars 11.30pm
Pawn Stars 12amAmerican
Pickers 1amVietnam: Lost Films
2amSwamp People 3amIce Road
Truckers 4amHeir Hunters 5am
Pawn Stars 5.30am-6am
American Restoration
DISCOVERY
7pmBear Grylls: Born Survivor
8pmFreddie Flintoff Goes Wild
9pmWhale Wars: Viking Shores
10pmAircrash Confidential 11pm
River Monsters 12amWhale Wars:
Viking Shores 1amAircrash
Confidential 2amAuction Kings
3amAmerican Chopper: Senior
Versus Junior 3.50amFlying Wild
Alaska 4.40amBear Grylls: Born
Survivor 5.30am-6amDestroyed
in Seconds
DISCOVERY HOME &
HEALTH
7pmA Wedding Story 8pmI
Didnt Know I Was Pregnant 9pm
19 Kids and Counting 10pm
Worlds Worst Mom11pmSecretly
Pregnant 12am19 Kids and
Counting 1amWorlds Worst Mom
2amSecretly Pregnant 3amA
Wedding Story 4amA Baby Story
5am-6amBirth Stories
SKY1
7pmThe Simpsons 8pmFuturama
8.30pmThe Simpsons 9pmA
League of Their Own 10pmAn
Idiot Abroad 2 11pmDog the
Bounty Hunter 12amRoad Wars
1amRoss Kemp: Extreme World
1.55amBrit Cops: Rapid Response
2.55amGadget Geeks 3.45am
Medical Emergency 4.35am
Raising Hope 5.05am-6amDont
Forget the Lyrics
BBC2 ITV1 CHANNEL4 CHANNEL5
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Euro 2012
7pmBBC News
7.30pmBBC London News
8pmEastEnders
8.30pmCasualty
9.20pmHave I Got News for You
10pmBBC News 10.25pm
Regional News 10.35pmThe
Graham Norton Show11.20pmThe
National Lottery Friday Night
Draws 11.30pmMatch of the Day:
UEFA Euro 2012 Highlights
12.20amEastEnders 2.40am
Weatherview2.45amSign Zone:
Silk 3.45amSign Zone: Great
British Menu 4.15am-6am
BBC News
6pmEggheads
6.30pmGreat British Railway
Journeys
7pmCHOICE Great British
Menu
8pmCoast
8.30pmGardeners World
9pmThe Great British Story:
A Peoples History
10pmEpisodes
10.30pmNewsnight
11pmThe Book Review Show
11.45pmWeather
11.50pmFILMThe Black
Balloon: Premiere. 2008.
1.20amTaken 2.45amBBC News
4.50am-6amClose
6pmLondon Tonight
6.20pmITV News
6.45pmEmmerdale
7.15pmCHOICE Euro 2012
Live: Russia v Czech Republic
(Kick-off 7.45pm).
10pmITV News at Ten
10.30pmLondon News
10.35pmFILMBurn After
Reading: Comedy, starring
Brad Pitt and George Clooney.
2008.
12.25amThe Store; ITV News
Headlines
2.30amFILM A Very Long
Engagement 2004.
4.45am-5.30amITV Nightscreen
6pmThe Simpsons
6.30pmHollyoaks
7pmChannel 4 News
7.30pmUnreported World
7.55pm4thought.tv
8pmCome Dine with Me
9pmCHOICE Alan Carrs
Summertime Specstacular
11.05pmStand Up for the
Week
11.55pmFILMBig Mommas
House: Comedy, starring Martin
Lawrence. 2000. 1.50amRandom
Acts 1.55amMy Name Is Earl
2.35amDirty Sexy Money 4.05am
Mommas Boy 4.20amDeal or No
Deal 5.15amMy Eden
5.20am-6.05amCountdown
6pmHome and Away
6.30pm5 News at 6.30
7pmCricket on 5: England v
West Indies; 5 News Update
8pmNCIS: An agents funeral
leads Shepard on a covert
mission.
10pmBig Brother: Live
Eviction
11pmBig Brothers Bit on the
Side
12amSuperCasino
3.55amMotorsport Mundial
4.25amHouseBusters 4.45am
HouseBusters 5.10amMichaelas
Wild Challenge 5.35am-6am
Michaelas Wild Challenge
Fill the grid so that each
block adds up to the total
in the box above or to the
left of it.
You can only use the
digits1-9 and you must not
use the same digit twice in
a block. The same digit may
occur more than once in a
row or column, but it must
be in a separate block.
COFFEE BREAK
Using only the letters in the Wordwheel, you have
ten minutes to nd as many words as possible,
none of which may be plurals, foreign words or
proper nouns. Each word must be of three letters
or more, all must contain the central letter and
letters can only be used once in every word. There
is at least one nine-letter word in the wheel.
Place the numbers from 1 to 9 in each empty cell so that
each row, each column and each 3x3 block contains all the
numbers from 1 to 9 to solve this tricky Sudoku puzzle.
Copyright Puzzle Press Ltd, www.puzzlepress.co.uk
KAKURO
QUICK CROSSWORD
LAST ISSUES
SOLUTIONS
KAKURO
WORDWHEEL
SUDOKU
SUDOKU
QUICK CROSSWORD
WORDWHEEL
1 2 3 4 5 6
7
8 9 10
11 12
13 14 15
16 17
18 19 20
21
22 23 24 25
26
27 28
9 16 8
45
5 27
24 11
11 3 5
45
10 17 15
19 15
12 13
45
6 6 7
17
17
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43
6
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10
23
14
38
20
18
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23
7
7
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39
13
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ACROSS
1 Elephants proboscis (5)
3 Large parrot (5)
7 Popular drink (4)
8 Partially melted
snow (5)
10 Measure the depth
of something (5)
11 2240 pounds (3)
13 Breakfast food (6)
15 Device in which
pepper is ground (4)
16 Hens produce (3)
18 Cassette (4)
19 Rub elbows with
(coll) (6)
21 Pitch (3)
22 Name of eight kings
of England (5)
25 Mrs George W Bush (5)
26 Witnessed (4)
27 Outstanding players
in a tournament (5)
28 Tired of the world (5)
DOWN
1 International
games, especially
in cricket (4,7)
2 Birds homes (5)
3 Cleaning
implement (3)
4 Completely (3)
5 Warning (7)
6 Australian musical
instrument,
played by holding
in both hands
and exing (6,5)
9 Opening into
or through
something (4)
12 Dark period (5)
14 Wide scope (7)
17 Ambition (4)
20 Hurray! (5)
23 Colour (3)
24 Afrmative
answer (3)
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R E B U S U M B E R
H U W E V
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S A L A M I R D
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R L R A F T E R
T O W E R E D E O
N T A R S
D A T E D R O S E S
8 9 4 5 2
6 3 4 2 1 2 1 3
7 1 7 3 6 8 4 9
9 6 7 9 7 5 8
8 4 6 2 4 1
2 5 9 1 8 3 4
9 8 5 9 8 2
1 2 3 5 4 6 1
2 3 4 6 7 1 9 3
9 7 8 9 8 6 7 4
1 2 6 1 2
4
4
4
4
4
4
4
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The nine-letter word was
OBTRUSIVE
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BBC1 BBC2 ITV1 CHANNEL4 CHANNEL5
FRIDAY 8 JUNE 2012
GREAT BRITISH MENU
BBC2, 7PM
The winners prepare their dishes for
the Olympic Feast, hosted by Steve
Redgrave at the Old Royal Naval
College in Greenwich.
EURO 2012 LIVE
ITV1, 7.15PM
Russia v Czech Republic (Kick-off
7.45pm). Adrian Chiles presents
coverage of the second match on the
opening day of the tournament.
ALAN CARRS SUMMERTIME
SPECSTACULAR CHANNEL4, 9PM
The comedian throws a summer party,
celebrating everything from the
Queens Diamond Jubilee to British
holidays.
TVPICK
The Innkeepers is a bog-standard horror
outing but Woody Allen film fascinates
City A.M. and Brewin Dolphin have been shining a spotlight on a series of
City Treasures for the last month, celebrating some of the great places and
institutions around us. Many of them are established with a long
and interesting heritage yet they still exude their core values
based on service and excellence.
www.brewin.co.uk
The City is a London treasure that is home to a plethora of hidden treats
G
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R
ushing from the train to your
office, dashing out at lunch for a
sandwich and maybe dropping
into one of the Citys ultra-
modern shopping arcades to pick up a
top or a new tie, it is easy to forget
(indeed, unusual to remember) that
you are treading ground the Romans
colonized 2,000 years ago. That
indeed, the Square Mile, as the area
roughly covered by the Roman city of
Londonium is called, was once sacked
by the Iceni, led by Queen Boudica,
and saw numerous bouts of
devastating fire and plague.
You might also, in your daily rush,
forget that nestled among the newer
buildings of the post-war era and the
impressively gleaming retail outlets,
there are relics of that wild, ancient
period the Temple of Mithras (a
Roman temple whose ruins were dis-
covered on Walbrook near Bank Tube
in 1954) and the London Stone are
gems not to be missed.
The City is unique in many ways its
governance today as well as its ancient
history. Its local authority is the City of
London Corporation which, unlike
other local authorities, is also respon-
sible for the Citys police. The City of
London corporation is headed up by
its very own Lord Mayor of the City of
London a much older office than the
Mayor of London. Also unique to the
City is its two council bodies: the
Court of Aldermen and the Court of
Common Council. The first represents
the Citys 25 wards, each one with one
Alderman, no matter its size.
The parameters and organisation of
the City have changed remarkably lit-
tle over the millennia; but that doesnt
mean it has stayed the same.
Architecturally, the Square Mile joined
the modern world with a slew of sky-
scrapers, the first of which appeared
in the 1970s. And from a shopping and
eating point of view, the City is unrec-
ognizable now to what it was even 30
years ago. High street (and high-end)
fashion shops have joined the old-fash-
ioned clothiers of yore in places like
the glossy One New Change, the Royal
Exchange and Threadneedle Street.
Jamie Olivers Barbacoa, Coq
DArgent, Rhodes 24, Prism and One
Lombard Street are among Londons
best restaurants, and are staples of the
Citys vibrant networking landscape.
The Romans would have been
impressed.
THE FINANCE HUB THAT HAS MORE TO IT THAN MEETS THE EYE
Antigone is astute
but star disappoints
FRIDAY 8 JUNE 2012
cityam.com
29
LIFE&STYLE REVIEWS
THE SQUARE MILE

C
hristopher Eccleston is
theatre gold the kind of
name guaranteed to sell out
a run.
He has certainly chosen a cracker
in Antigone: an expertly crafted
play thats as politically astute as it
is deftly choreographed.
Unfortunately and surprisingly,
given his excellent track record
Eccleston himself turns out to be
the weak link.
Polly Findlays interpretation of
Sophocles classic play is set dur-
ing an ambiguous point in the
20th century but the political
message is searingly contempo-
rary. The action takes place in a
military headquarters, with a
gripping opening scene recalling
the infamous photograph of
President Obama and Hillary
Clinton watching the siege on
Osama Bin Ladens compound. It
paves the way for a frenetic 90
minutes thats over long before
you have time to appreciate the
meticulous direction and flashes
of brilliance from the outstanding
supporting cast.
Eccleston plays the tragic king
Creon, whose dogged insistence
on upholding his principles
against the weight of popular and
moral opinion a clash between
relativism and objectivism with
clear modern parallels threatens
to topple the entire state. But his
hubris-driven descent into desper-
ate self-preservation is never quite
plausible and Eccleston too often
looks a little lost.
Jodie Whittaker is also overshad-
owed in her role as the epony-
mous Antigone, daughter of
Oedipus through his incestual
relationship with his mother. Her
decision to bury her brothers
body against Creons wishes sets
in motion the tragic chain of
events, which ends up how these
things tend to. She plays the
doomed girl as a plucky rebel but
is easily forgotten during her long
periods off-stage.
Jamie Ballard does neither
Eccleston nor Whittaker any
favours, delivering a bravado turn
as the blind oracle Tiresias; his
latex-clad face alive with rage at
Creons pigheaded arrogance. A
performance this powerful could
upstage almost anyone.
Perhaps Eccleston had an off
night he certainly didnt wear
the expression of a man who had
put in a great shift when he
returned to the stage to take his
bow but Im not sure Id be mak-
ing excuses for him if he werent a
household name.
AN EMPTY, rustic, provincial
hotel is the setting for Ti Wests
latest indie horror flick, The
Innkeepers. New Englands The
Yankee Pedlar Inn, which is said
to harbour paranormal forces in
real life as well as fiction, is
closing down presumably
customers grew tired of the
doors slamming themselves shut.
In the hotels last days, two of
its employees, Claire (Sara Paxton)
and Luke (Pat Healy), attempt to
expose the unworldly goings on
with amateur recordings and late-
night saunters through the
myriad corridors and deserted
rooms. What unfolds, though, is
average horror-movie fodder:
histrionic build-up music;
creaking signs and spooky false-
alarms. The limited number of
characters and locations does add
to the appeal, much like a
supernatural sitcom minus the
comedy. Lukes offbeat
personality, la Juno, makes him
the most likable of the bunch but
even he cant answer some of the
more ambiguous points that
come up towards the end. Its
mediocre horror with just enough
scares to get you by.
DIE-HARD WOODY Allen
fans should
probably be aware
that this
commentary on
the career of one
of Americas
directorial
sweethearts is,
overall, non-
revelatory. The
documentary is
the brainchild of
Curb Your Enthusiasm director
and producer, Robert Weide. His
unprecedented access into the
colourful life of such a complex
mind didnt come without
sacrifices, with the more
controversial moments of Allens
past only briefly touched upon.
Using interviews with big name
stars, including Allens ex-lover
and colleague Diane Keaton;
fellow Hollywood heavyweight,
Martin Scorsese; and recent muse
Scarlett Johansson, the
documentary aims to paint
an in-depth and varied
picture of the beloved
director, including the
moments when things
went wrong.
The archive footage of
his appearances on US chat
shows and even the BBC is
littered with quips and gags
from Allens early years as a
comic; people who know
little of him will find this a
fascinating portrait.
THEATRE
ANTIGONE
The National Theatre | By Steve Dinneen
hhhii
FILM
THE INNKEEPERS
Cert 15 | By Natasha Culzac
hhiii
FILM
WOODY ALLEN:
A DOCUMENTARY
Cert 15 | By Natasha Culzac
hhhhi
Christopher Eccleston shows flashes of brilliance as king Creon but too often looks lost
Early interviews with Woody Allen
are both insightful and hilarious
Fifty shades of blockbuster success
THE author of modern classics
including Fahrenheit 451 and
The Martian Chronicles Ray
Bradbury died this Tuesday
aged 91, but his work will
endure. Few can match
Bradburys gift for employing
fantastic settings to such
thought-provoking and often
horrifying effect. A master of
the short story, his best works
draw the reader in with a cosy,
sometimes over-wrought prose
style, only to burn a troubling
and indelible image into the
imagination. The humanist and
classical scholar Gilbert Highet
placed him in the great
tradition of literary fantasists
from Hoffman to Poe.
Bradburys stories combine
fear with a childlike wonder. In
A Sound of Thunder, time-
travelling hunters kill a single
butterfly in the age of the
dinosaurs, trapping them on
their return in a terribly altered
present, where a fascist has just
won power. The Small Assassin
records a new mothers
creeping realisation that her
baby wants to kill her.
But it is for Fahrenheit 451
that Bradbury will be
remembered. His novella opens
up a nightmare future where
the state burns books to keep
the population mindlessly
happy and brutally enforces its
authority. Born of an encounter
with an overbearing policeman,
it is a book that celebrates the
well-stocked mind as a bulwark
against tyranny. It turns reading
into an act of defiance.
Marc Sidwell
Zoe Strimpel on the book thats intoxicated
women worldwide, despite its awful prose
FRIDAY 8 JUNE 2012
30
cityam.com
LIFE&STYLE BOOKS
lisher in May 2011. Word of mouth and
book blogs boosted its sales and eventu-
ally it caught the eye of Random
House, who re-published the book in
March this year. In its current version,
it tells the story of the hopelessly inno-
cent undergraduate Anastasia Steele
and the unlikely burgeoning of her
relationship with Christian Grey, a
multi-millionaire entrepreneur. Its
not a regular relationship, mind you:
its dominant-submissive, the only sort
Grey, who is damaged goods, can
stomach.
Fifty Shades is both vanilla and racy.
There is some extreme action con-
tained wherein, but the language
remains steadfastly PG13. Which must
be why the mommies of America
(the book became instantly dubbed
Mommy Porn) found it so palatable
they could have the titillation and
escapism without the seediness.
Palatable for mommies, maybe for
feminists, a disgrace on many counts,
from the evasive language for female
body parts, to the unfeasible inno-
cence of the heroine and, of course,
the whole submissive-to-rich-powerful-
possibly-dangerous-dominant-man
thing. American journalist Katie
Roiphe invited a hate storm by writing
in Newsweek that the submissive role,
as depicted in Fifty Shades,
was something women secret-
ly wanted because power and
all of its imperatives can be
boring.
Lots of intra-media panting,
then hardly surprising for a
book that touches on two such
hotly debated topics: sex and
how to turn books into money.
But what about the book
itself? Blockbuster
erotic/romance fiction is hard-
ly new; think of Mills & Boone
and Danielle Steele. So what is
it about Fifty Shades, exactly,
that has led millions of
women, from Oklahoma to
London to Tel Aviv, to break
out in sweats?
Its simple: the appeal of a
kinky Prince Charming and
the fantasy of being utterly
taken in hand (some could
rephrase this as being com-
pletely controlled). Its not
quite being saved, as
Anastasia does have a life plan
and her own resources. But
once Grey decides shes the
woman for him, he buys her
cars, first edition books worth
thousands and ferries her to his dream
penthouse in the helicopter that he
himself commands.
The book is long and dull, the char-
acters irritating and unbelievable in
the extreme. However, there are one or
two interesting themes that con-
tribute to the storys appeal. The main
one is the strength of Anastasias
resistance to Christians love contract
(he wants her to sign one, saying shell
do whatever he pleases, including eat
from a particular list of foods, see a
personal trainer four times a week on
so that shes limber for his whips-and-
cuff-filled Room of Pleasure, and take
whatever sexual advance he cares to
throw at her). She is so beside herself,
so overcome with Christians stagger-
ing potency, forceful nature, intelli-
gence and the looks frequently
described as so freaking hot, that her
ability to resist the letter of his law is
quite amazing. But resist it she does,
and this resistance forms the backbone
of the story. In fact, Fifty Shades is more
a tussle of will than a tussle of bodies
(though there is plenty of the latter),
with neither party able to walk away
but neither able to make the ultimate
compromise.
If the book was better written, it
would be a love story. As it stands, even
the erotic element escaped me the asi-
nine language renders it almost cold.
(How many times can a leading man
mutter and a heroine blush,
flush, and quake? This heroine also
has both a sarky subconscious and an
inner goddess who dances when
Christian proposes something inappro-
priate.) You can add all the tools, tricks
and kinks you want, but on the nine-
teenth retelling of a mindblowing
encounter in a boathouse, or a bathtub,
even the most heated and original of
tussles gets boring to read about if the
characters themselves leave you bored.
Whats more pernicious even than
the prose is that by the end, youve
developed a crush on Christian Grey,
whose perfect body, tousled copper
hair and searing grey eyes have been
emphasised for 500 pages. Then you
realise that any yearning for a
Christian Grey of your own is both
impossible and disturbing. Because
there are very few multi-millionaire
men out there who can pull off sado-
masochism with just the right
amount of horse-tail whip and
maroon leather handcuff and (good)
pain. And very few who will also fall in
love with you and fly you home in
their very own helicopter, where a bot-
tle of Pouille Fume awaits your delecta-
tion. And anyway, you ask yourself, is
that what you really want? Judging by
the sales, and the speed with which
you yourself read the book: the answer
is yes. It looks like it is. Which is the
most disturbing thing of all.
BOOKS
FIFTY SHADES OF GREY
By EL James (Arrow)
A
n urgent message reached me
last week as I was heading to
the airport for a Jubilee
weekend trip to Israel: Bring
four copies of Fifty Shades of Grey
pretty please. It came from a 34 year
old friend in Tel Aviv who, along with
three other thirty-somethings, were
dying to get their hands on the book
that in just six weeks sold 10m copies,
instantly reached number one in the
UK and has, with its unprecedented
success through viral marketing,
heralded a new publishing age.
Fifty Shades of Grey if you have
managed to miss the fuss (or are a
man) is the first in a trilogy, and
began life as a piece of self-published
Twilight fan fiction, starring vampires.
First published on a fan site, then on
author E.L. Jamess own Fifty Shades
website, the story was bought and
released by an Australian digital pub-
EL James with her creation. No wonder shes smiling: Fifty Shades has made her fantastically rich.
Ray Bradbury, 1920-2012
Americas master of dark fantasy
VOTE FOR THE WORLDS
BEST WATCH
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Jaeger-LeCoultre
00/24 WatchWorld is published quarterly, with in-depth articles on the
finest watches from the world's revered brands and watchmakers. A year's
subscription is 25. www.0024watchworld.com
City A.M. is partnering with the luxury magazine for watch
lovers, 00/24 WatchWorld, to identify the most impressive
new wristwatch.
Watch-loving readers are invited to go online and pick their
favourite from all the models nominated for this years 00/24
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entered into a prize draw for which winners will receive a high-
luxury leather watch box (pictured), a
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WatchWorld and two tickets to the
glamorous Watch of the Year awards
ceremony in London in September.
The Readers Award, voted for by City
A.M. and 00/24 WatchWorld readers,
will be presented alongside awards
to the best watches in five price
categories, picked by an esteemed panel
of expert judges.
TO VOTE: Please visit http://tinyurl.com/0024vote
FRIDAY 8 JUNE 2012
cityam.com
31
THEPUNTER
FOOTBALL TRADER
BEN CLEMINSON PREVIEWS THE EURO 2012 OUTRIGHT AND TOP-SCORER MARKETS
S
PAIN once again go into a
major tournament as
favourites and victory at Euro
2012 will make them the first-
ever European team to win three
straight titles. That would be some
achievement by a country branded
perennial underachievers until four
years ago.
Vicente Del Bosques men always
have to be feared, but the Spanish
have had some serious injury prob-
lems and both David Villa and Carlos
Puyol will be missing. With influen-
tial midfielder Xavi also struggling
for fitness, its going to be a huge
task for the champions and this
could just be one tournament too far.
Germany are the obvious dangers,
with a whole host of top class players,
but they are no bigger than 3/1 and
that is just too short for me. Yes, we
all know how they consistently come
alive on the big stage, and at 5/1
theyd be a bet, but I cant bring
myself to back them at the
current price.
Netherlands are next on the list at
13/2 and Im happy to oppose them.
The Dutch made it to the World Cup
final, but by playing a brand of foot-
ball that was the polar opposite of
what we have all become accustomed
to. Robin van Persie is going to be the
big hope for the Oranje, but they are
in the Group of Death and I actually
wouldnt be surprised if they were
packing their bags before the
knockout stage.
That brings me nicely on to
Portugal, who have been completely
overlooked by the bookmakers.
Cristiano Ronaldo has had an out-
standing season for Real Madrid and
he is the only player in world football
at the moment who is even close to
Lionel Messi. It would be unfair on
his Madrid team-mates to say that he
single-handedly won them the
title, but his contribution has
been immense.
Its true that Portugals qualifying
campaign was shoddy, to say the
least, but the pressure is off and that
could result in a better than expect-
ed showing. They have to overcome
the hardest group by knocking out
one of either Germany or
Netherlands, but if they do that,
their odds will be less than half the
current 20/1 that is available.
There will be huge pressure on
Ronaldos shoulders and teams will
set themselves out to try to nullify
his threat. However, he has always
promised to take a tournament by
storm and this could be the time
when he shows his true greatness.
Either way, you can back Portugal at
20/1 and lay them back on Betfair at
a much shorter price if they qualify
for the latter stages.
England are 14/1 and even though
theyve got a seemingly easy group, I
wouldnt be at all surprised to see
them fall at the first hurdle. In any
case, if they do survive the group
stage, it would be a shock if they
could progress past the quarter-finals.
The Three Lions chief threat in
Group D looks to be the 2000 champi-
ons, France. They have looked much
better in qualifying and manager
Laurent Blanc seems to have built up
some much-needed team spirit.
There are a number of outstanding
creative players in the French team
and they will surely score plenty of
goals. Karim Benzema has come into
his own at Madrid this season, while
Franck Ribery and Samir Nasri both
have the potential to make game-
changing contributions at any point.
I think Les Bleus are definitely
worth a saver at 10/1 with Coral and
they should sail through the groups
so would be happy to buy their out-
right index (winner = 100 points, run-
ner-up = 75, losing semi-finalist = 50
and losing quarter-finalist = 25) at 32
with Sporting Index.
Italy dont look good enough at
the moment, while although Russia
are dangerous, they will find it diffi-
cult to get past the quarters. Co-hosts
Poland are slightly interesting, as
they are in the weakest group and
they could easily outrun their pre-
tournament odds of 50/1, but I will
be sticking with Portugal and France
as my two selections.
IM ASKING a lot of Cristiano
Ronaldo here, but I think he has
the ability to not only take Portugal
to the latter stages, but be the tour-
nament top scorer too.
Free-kick, dribble, header or a
tap in there is no goal, too simple
or spectacular, that Ronaldo cannot
score. He has it all.
Hes shaken off the tag of being a
big-match bottler and, since his last
few years at Manchester United, the
Portugal captain has been on the
rampage, destroying defences in
domestic, European and interna-
tional football, amassing a huge
tally of goals along the way.
Hes struck 32 times in 90
appearances for Portugal, but his
scoring rate in qualifying was bet-
ter than that with seven in eight
games. And, as likely penalty taker,
he will surely be among the goals
here. Take Corals 14/1 for him to
win the golden boot each-way, with
the firm paying quarter the odds
for the first four places.
Among the names Ronaldo is up
against in the top scorer betting is
Mario Gomez of Germany. The pro-
lific striker is 9/1 favourite in the
market, but Im keen to look
beyond him, with doubts about
his ability to deliver when it
really matters.
Robert Lewandowski, of Poland,
has received much attention and he
could be firmly in the running if he
has a good group phase, which he
is perfectly capable of against the
defences of Russia, Greece and
Czech Republic, but now 22/1 with
Coral, the value has gone.
Karim Benzema will spearhead
the France attack and he knows
exactly how to find the back of the
net, with 32 goals for Madrid last
season. If France go as far as I think
they will then he should be among
the goals and is also worth backing
each-way, at 12/1.
nPointers
Cristiano Ronaldo e/w at 14/1 with Coral
Karim Benzema e/w at 12/1 (general)
nPointers
Portugal e/w at 20/1 with Coral
France e/w at 10/1 with Coral
Buy France outright index with Sporting Index at 32
Portugal are a massive price in the pre-tournament betting and, with Real Madrids influential forward Cristiano Ronaldo, feature one of the worlds most talented players
Madrid maestro can carry his superb club form over to the international stage
Portugal too
big at 20/1
with Ronaldo
in the line-up
32 cityam.com
FRIDAY 8 JUNE 2012
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FIRST
TODAY'S MATCHES
Evs Poland 11/5 Draw Greece 3/1
Kick-off 5pm, Live on BBC1
11/10 Russia 11/5 Draw Czech Rep 13/5
Kick-off 7.45pm, Live on ITV1
First Goalscorer
4/1 R. Lewandowski (P)
11/2 J. Blaszczykowski (P)
7/1 T. Gekas (G)
7/1 P. Brozek (P)
7/1 A. Sobiech (P)
8/1 D. Salpingidis (G)
8/1 S. Lyberopoulos (G)
8/1 K. Grosicki (P)
First Goalscorer
5/1 A. Kerzhakov (R)
6/1 R. Pavlyuchenko (R)
6/1 A. Dzagoev (R)
6/1 P. Pogrebnyak (R)
7/1 M. Baros (C)
7/1 A. Arshavin (R)
7/1 D. Lafata (C)
7/1 J. Rezek (C)
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EURO 2012
THEPUNTER
N
O host nation has won
the European
Championship since
France in 1984, and while
Poland are 50/1 shots to scratch
that 28-year itch, they do look
set for an extended involvement
in their own backyard.
They will be more encouraged
by the fact that of the 15 coun-
tries to have held the previous 13
tournaments Belgium and
Netherlands were co-hosts in
2000 and Austria and
Switzerland the same in 2008
12 have reached at least the
last four.
Poland might be the only
member of Group A not to have
won the competition previously,
but they can beat Russia (1960
winners), Czech Republic (1976)
and Greece (2004) to top spot in
the pool, at a best-priced 13/5
with Coral.
Russia will be the main dan-
ger, at 6/4, and Im not writing
them off by any means, but
home support will be a big boost
to the Poles and they have plenty
of talent in their line-up, not
least the free-scoring Borussia
Dortmund striker Robert
Lewandowski, whose odds to win
the golden boot have been ham-
mered in to, from 33/1 to 22/1.
There are another three ex-
winners in Group B, in the shape
of Denmark (1992), Germany
(1972, 1980, 1996) and
Netherlands (1988), as well as
Portugal, the 2004 runners-up.
Of the quartet, there is no
shortage of hype about
Germany, who won all 10 of
their qualifying games to reach
Euro 2012. They are rightly
favourites, at 11/10 with Coral, to
come out on top.
They certainly look impressive
and Im pretty sure they will
progress, at the expense of
the overrated Dutch, along
with Portugal.
The Germany/Portugal dual
forecast backing the duo to
advance in no particular order
is advised at 3/1 on Betfair.
Paulo Bentos troops might
have scraped their way to the
tournament, finishing below
Denmark in qualifying, but,
from five previous appearances
at European Championships,
Portugal have reached one final,
two semis and another two
quarter-finals.
On paper, Group C looks like it
will be a straight race between
Spain and Italy, but I wouldnt
advise writing off either Croatia
or Republic of Ireland.
Despite my doubts about La
Roja lifting the title, they should
be all right here. Italy, on the
other hand, could be in all sorts
of trouble.
They arrive in Poland and
Ukraine on the back of more
match-fixing allegations in Serie
A, which cost defender
Domenico Criscito a place in the
squad after he was dropped to
clear his name. But more press-
ing is the concern over their cur-
rent form of three consecutive
defeats, with no goals scored,
against Uruguay, USA
and Russia.
The straight forecast of
Spain/Croatia appeals at 4/1 with
Betfred, but Ireland could be this
summers surprise package.
Ireland are undefeated since
March 2011, with their 14 game
run including a 2-0 win against
Italy a year ago. The
Spain/Ireland straight forecast
represents great value at 9/1.
Expectations about England
are at an all-time low and Im
only too happy to dampen
them further.
I cant even see them escaping
Group D, let alone Steven
Gerrard holding the trophy aloft
on Sunday 1st July.
England are 11/8 not to qualify
and Im more than happy to sell
their Group D index at 11 with
Sporting Index. That will ensure
a profit if they finish second or
lower and my moneys going on
the France/Sweden straight fore-
cast at 10/1.
Ukraine, ranked 52nd in the
world by FIFA, are a poor side
and although home support will
give them a boost, it wont be
enough to see them progress.
Sweden, though, are very
capable and make it to the sec-
ond round more often than not.
In their three tournament
meetings with England they
have drawn twice at the 2002
and 2006 World Cups and
Three Lions followers hardly
need reminding of the
Scandinavians victory in the
other match, courtesy of Tomas
Brolins winner, at Euro 92.
nPointers
Poland to win Group A at 13/5 with Coral
Germany/Portugal dual forecast in Group B at
3/1 on Betfair
Spain/Croatia straight forecast in Group C at
4/1 with Betfred
France/Sweden straight forecast in Group D at
10/1 with Coral
Sell Englands Group D index at 11 with
Sporting Index
STARVED of competitive foot-
ball for two-and-a-half years,
Poland will be chomping at the
bit and they can get the Euro
2012 party started with a
win against Greece in
Warsaw tonight, at 21/20
with BetVictor.
They come into the fixture
with three wins in the bag from
their warm-up games against
Latvia, Slovakia and Andorra
and although they may not be
the mightiest collection of
opponents, Poland have lost
just once in 12 outings.
Greece did well in qualifying,
finishing top of a section which
also included Croatia, but they
are an ordinary side that the
Poles should beat in front of
their own fans.
The opening day of competi-
tion continues with Russia
against Czech Republic this
evening. Like Poland, Russia are
expected to win and Im happy
to side with the favourites
again, at 6/5 with William Hill.
They boast a renowned man-
ager in Dick Advocaat, who led
Netherlands to the semis in
2004, and he looks to be getting
the best out of his troops after
they beat Italy 3-0 a couple of
weeks ago.
After a weekend of fantastic-
looking matches, where
Germany v Portugal and Spain v
Italy will vie for top billing,
France play England
on Monday.
It is a game neither team can
afford to lose, but I see it ending
in disappointment for England.
Due to the nature of the
game, the draw comes into con-
sideration at 11/5, but France at
6/4 is a decent bet.
They are on a 21-game
unbeaten run and looked con-
vincing putting four unan-
swered goals past Estonia
on Tuesday.
You certainly cannot say the
same for Roy Hodgsons men
after two lifeless victories
against Norway and Belgium.
Les Blues deservedly beat
England 2-1 in their last meet-
ing, at Wembley in November
2010. That was their fourth win
in five contests in this fixture.
nPointers
Poland to beat Greece at 21/20 with BetVictor
Russia to beat Czech Republic at 6/5 with
William Hill
France to beat England at 6/4 with Coral
THE TAJ 6.40pm Doncaster
(Tonight)
SHAMELESS MAN 3.50pm Worcester
(Tomorrow)
PEARL ACCLAIM 4.35pm Newmarket
(Tomorrow)
Follow Bill on Twitter @BillEsdaile
Bill Esdailes
Top Weekend
Racing Tips
BEN CLEMINSON PREVIEWS THE EURO 2012 GROUPS AND OPENING GAMES
Polishpromise
hints at happy
start for hosts
Borussia Dortmunds striker Robert Lewandowski is key to Polands hopes
IN BRIEF
Wiggins builds Criterium lead
CYCLING: Britains Bradley Wiggins
yesterday extended his Criterium du
Dauphine lead by winning the 53.5km
time trial by 34 seconds. It was a real
test in the conditions, said Wiggins.
Exiles begin promotion appeal
RUGBY UNION: London Welsh have
begun their appeal to overturn the
Rugby Football Unions decision to
block their promotion to the
Premiership, despite their
Championship victory. The RFU barred
their promotion on the grounds their
stadium did not meet Premiership
criteria, despite their use of Oxford
Uniteds Kassam Stadium.
G
E
T
T
Y
HE WAS part of the team pursuit
quartet who smashed records to win
the world track cycling champi-
onship this year, but Steven Burke
believes he and his Team GB col-
leagues will have to set a new bench-
mark if they are to claim Olympic
gold at London 2012.
Burke, Geraint Thomas, Ed Clancy
and Pete Kennaugh dramatically
pipped Australia to the title on their
own soil in April in a contest British
cycling chief Dave Brailsford called
the best race Ive ever seen.
Less than two months from
now they are confident of
repeating that feat in the
Olympic velodrome,
although the 24-year-old
Lancastrian, who rides for
Team IG-Sigma Sport, con-
cedes they will have to
rewrite the record books
for the second time
this year.
I think were going to
have to break the world
record again because every
Burke predicts
world record for
Team GB riders
team will improve, he told City A.M.
Every rider should be at their peak
so we expect the world record to go.
Burke, whose place in the Team GB
squad is set to be officially
announced next week, won bronze in
the individual pursuit in Beijing four
years ago and is targeting two more
Olympic Games after this year.
World Championship glory tasted
even sweeter, Burke says, having lost
to Australia at the London 2012 test
event just weeks previously, when he
admits he was taken aback by the
vociferous home support.
It was so loud it was hard to com-
municate and shout down the line,
we couldnt hear each other. It was
like a wall of noise following you
around it was awesome.
Of revenge in Melbourne, he
added: It was sweet especially
after they had done the same to
us in the London 2012 test
event in London. Its a good
boost especially a few months
out from the Games. ENGLAND duo Joe Marler, above, of Harlequins, and Exeters Tom Johnson will make
their debuts in tomorrows Test against South Africa in Durban, respectively replacing
prop Alex Corbisiero and injured flanker Tom Croft. There are also recalls for scrum-half
Ben Youngs and full-back Mike Brown, while Owen Farrell continues at fly-half.
MARLER AND JOHNSON SET FOR ENGLAND BOWS
BY FRANK DALLERES
Steven Burke won a bronze
medal at Beijing 2008
SPORT
33
FRIDAY 8 JUNE 2012
cityam.com
Results
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T
HE WORLD Cup may be
seen as the ultimate prize
but the European
Championship is actually
a tougher tournament. The
quality of player is very high so
teams have to hit the ground
running because if they dont,
they can find themselves out
before the knockout stage.
This all makes the
competition, which starts
today when Poland host
Greece, very tricky to predict,
but for me there are four
teams that stand out, who are
well equipped to reach the
last four and who would be
disappointed if they didnt.
Germany would normally
be right up there but have
fallen back slightly following
Bayern Munichs Champions
League final defeat, a friendly
loss to France and a 16-year
wait for a trophy. They boast
so much creativity in the likes
of Mesut Ozil and Toni Kroos
with Chelsea recruit Marko
Marin not even in the squad
have a great goalkeeper in
Manuel Neuer and
experienced centre-backs. If
there is a weakness it is at left-
back where Holger
Badstubers deficiencies may
see Philip Lahm deployed
there and Jerome Boateng
played on the right, while
striker Mario Gomez is either
red hot or really cold.
France are on a brilliant run
which, when you consider
their World Cup debacle just
two years ago, is remarkable.
They have a really good
balance, Yohan Cabaye is
crucial in the playmaker role,
Franck Ribery is back scoring
again and Karim Benzema has
come through a difficult spell
and proved himself at Real
Madrid. The only worry is
their back four, who were
given problems by Estonia
recently, when they really
shouldnt be. If they are solid
France could do very well.
Holland are virtually the
same side that reached the
World Cup final two years ago
and, in Wesley Sneijder, Robin
van Persie, Klass-Jan Huntelaar
and Arjen Robben, have the
best front four at the Euros.
Again, there are problems at
the back, with John Heitinga
prone to switching off, but
their attacking talent is so
great, with all of the four bar
Sneijder coming off the back
of outstanding seasons.
Lastly, Spain, the holders in
search of an unprecedented
third major trophy in a row
are sure to be there or
thereabouts, although I
suspect they will find it
extremely difficult. Their
players are that little bit older,
teams are more familiar with
them and they have suffered a
huge loss in Carles Puyol, who
is not only a superb defender
but also one of their few
leaders. Likewise, without
David Villa I feel they have lost
some cutting edge. We dont
know whether Fernando
Llorente can lead the line in a
big tournament, however a
strong Fernando Torres, if
selected, could take Spain far.
Torres and Spain
are seeking a third
successive major
trophy, having won
Euro 2008 and the
2010 World Cup
EXPECTATIONS for England
are at an all-time low going
into these Euros and I cant see
them enjoying much possession,
which is why I hope they focus on
pace in attack.
Roy Hodgsons men will need to
be hard to beat and hit teams on
the break and, with little speed in
midfield, that means relying on
the forwards.
Id like to see three in attack
Theo Walcott on the right, Ashley
Young left and Danny Welbeck,
rather than Andy Carroll, through
the middle, at least until Wayne
Rooneys ban finishes.
While I think England need at
least three points on the board
going into the final group game
against Ukraine, it is far from over
if they lose Mondays opener
against France, with Sweden still
to come on the Friday.
FRIDAY 8 JUNE 2012
34
SPORT
cityam.com/sport
MY FOUR TIPS
Germany
France
Holland
Spain
EURO 2012
PREVIEW
TREVOR STEVEN
Spain need Torres if they are to
defend the toughest title of all
Yohan Cabaye
Cabaye has fewer defensive
duties with France than at
Newcastle because there are
more midfielders around him,
which allows him to be more of
a playmaker. If he has a good
tournament they will go far.
Klaas-Jan Huntelaar
He has a fantastic international
record, has had a great season
with Schalke and is part of the
deadliest front four at the
Euros, with Van Persie, Robben
and Sneijder. Im expecting a
big tournament from him.
Christian Eriksen
If, as they say, Denmark are far
stronger than two years ago,
then the Ajax youngster will be
at the fore. I love watching
No10s and Eriksen is a highly
promising, technically brilliant
example of the genre.
James McClean
The Republic of Ireland wont
do a great deal but Im keen to
see how the Sunderland
winger gets on. Like Gareth
Bale, he is powerful, fearless
and doesnt take any prisoners.
Could be their secret weapon.
Andriy Yarmolenko
Ukraine may have Andriy
Shevchenko but the joint hosts
hopes of progress rest heavily
on Yarmolenko. All of Europes
big clubs have watched the
dynamic wide man, who has
received rave reviews.
Robert Lewandowski
Rarely can you say Poland have
a striker among the worlds
best dozen or so, but Borussia
Dortmunds Lewandowski is
that man. Tall but not a target
man, he is so quick and takes
up brilliant positions.
TREVOR STEVENS
MEN TO WATCH
35
ENGLAND goalkeeper Joe Hart
insists the team will not react to
racial abuse by abandoning matches
at the European Championship
unless a referee instructs them to
do so.
Michel Platini, President of
European footballs governing body
Uefa, has already confirmed that any
player that chooses to leave the pitch
without the referees consent will be
booked even if they have been
subjected to racism and Hart is
adamant England will not be
tempted to rebel, admitting the
squad trusts the authorities to deal
with any potential issues.
Our advice is to get on with it and
see how the referee and Uefa deal
with it, said Hart. Its not for us to
do. Hopefully the referee and Uefa
will take it into their own hands if
that problem does occur.
Fingers crossed we wont have to
deal with anything like that. Its
down to the referee. We cant take
rules into our own hands. If the
referee feels its right for us to walk
off then well follow.
Hart was Englands third-choice
goalkeeper during their woeful 2010
World Cup in South Africa but is
now a key player and believes that,
though expectations are low
following several disappointing
campaigns during which England
have failed to fulfill their potential,
they are now genuinely capable
of success.
Were all hungry guys, he added.
We want success. We have high
expectations otherwise theres no
point us being here. Weve come to
win, weve come to do well, weve
come to represent our country, and
we want to make people proud.
Striker Jermain Defoe, meanwhile,
has returned home following the
death of his father, though a
replacement will not be called up as
it is expected he will return. England
face France in Donetsk on Monday.
Hart: Only refs
will make us
stop for racists
P
A
G
E
T
T
Y
Englands third Test against West Indies at Edgbaston was postponed by heavy rain
Joe Hart trusts Uefas advice about racism
NORWICH Citys new manager
Chris Hughton admits it will be
difficult to replace predecessor
Paul Lambert, though he is
relishing the challenge regardless.
Hughton was yesterday
confirmed as Lamberts successor
after the latter left to join Aston
Villa following three successful
seasons in which he established
Norwich in the top tier, but
Hughton is adamant he can
maintain their progress.
The job Paul has done here is
wonderful, to rise from League
One to the Premier League, said
Hughton. Its a hard act to follow.
Its about making progress and
with every new manager and
player comes a new challenge.
Abramovich outbid as Chelsea lose
out in fight for Battersea Power Station
cityam.com
FRIDAY 8 JUNE 2012
BY DECLAN WARRINGTON
WORLD No2 Maria Sharapova
declared her delight after defeating
Petra Kvitova 6-3, 6-3 to reach the
French Open final, believing her
chances of success in tomorrows
showpiece to be significantly
strengthened by doing so.
Sharapovas straight-sets victory
potentially boosts not only her
confidence, but leaves her physically
fresh ahead of her final meeting
with Italys Sara Errani, something
the Russian felt to be an important
part of her preparation.
It was tough to play a great
match because of the conditions,
said Sharapova who, in victory,
guaranteed she will become the new
world No1 at Victoria Azarenkas
expense. I think most importantly
it was about playing a solid match.
I think patience was very
important today.
I was also facing a tough
opponent whos given me a lot of
trouble in the past. So I was really
happy that I was able to win in two
sets today.
The French Open remains the only
grand slam to elude Sharapova but
though she may be favourite to
complete her collection, 21st seed
Errani insisted she would not be
content with merely reaching her
first Major final, even if she had not
expected to make such progress.
Errani defeated US Open
champion Sam Stosur, who had yet
to drop a set this year at Roland
Garros, 7-5, 1-6, 6-3 and conceded
afterwards that she would have to
readjust her ambitions.
Its incredible for me, she said. I
didnt expect it, and Im here.
I dont feel like Im top 10 but
now I will be, so its strange. Maybe
my problem was I couldnt believe
that I could beat the strong players.
But now Ive beaten three in a
row. Im in the final of a grand slam.
So I have to maybe try to think a bit
different.
Quick win sets
me up for final,
says Sharapova
BY DECLAN WARRINGTON
BY DECLAN WARRINGTON
Hughton hopeful over Norwich
despite daunting Lambert legacy
BRITISH Taekwondos selection
process for London 2012 is to be
investigated by the World
Taekwondo Federation over its
decision to overlook world No1
Aaron Cook.
WTF will also today meet with
British Olympic Association figures
including performance director Sir
Clive Woodward and chief executive
Andy Hunt, while Cook has sought
legal advice from firm Harbottle
and Lewis.
We are extremely disappointed
by the way in which British
Taekwondos selection process has
been conducted and it is clear that
the lack of a conclusive rationale
has caused confusion, said WTF
secretary general Jean-Marie Ayer.
BY DECLAN WARRINGTON
Storm Cooking over British
Taekwondo hopeful Aaron
ENGLAND hope their third Test
against West Indies will finally
begin this morning at Edgbaston
after heavy rain meant yesterdays
play being abandoned without the
bowling of a solitary ball.
Umpires Kumar Dharmasena
and Tony Hill made the call
yesterday afternoon, the first time
such a conclusion has been
reached since the 2009 Ashes at
the same venue.
England have already won the
series but hope to secure an
overall 3-0 victory if play proceeds
today, even though early weather
forecasts suggest that is unlikely
to be the case.
West Indies batsman Shivnarine
Chanderpaul, however, may yet
benefit, as he attempts to recover
from a soreness in his side.
BY DECLAN WARRINGTON
England target Test win over rain and Windies
News: Page 20
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