My Fantasy Tory Leadership Game


The “black swan” theory, developed by writer Nassim Nicholas Taleb, refers to unexpected events that have extreme consequences, but are then rationalized by experts who say, “It always had to happen.” Covid was a big one; Putin’s war against Ukraine is another. It is in the nature of world events that there is always a dark-feathered troublemaker lurking somewhere, waiting to make his presence felt. At present, it may well be hidden in reports of protesters in Zhengzhou, capital of China’s Henan province, demanding their money back from four local banks that suspended withdrawals in April.

Small bank runs are not unheard of in China; nor the embezzlement of funds by corrupt managers. The authorities’ response — using security forces to crush crowds and changing some depositors’ Covid app codes from green to red to prevent them from traveling to protest — is comparable to the course under Xi Jinping, the largest of which fear is widespread social unrest.

But behind this local eruption lie long-running rumors that the country’s entire ramshackle banking system is increasingly vulnerable to the prolonged pandemic downturn and a slump in the real estate sector, which has overheated to account for up to 30% of GDP and banks. ready.

A $300 billion collapse of Evergrande, China’s second-biggest property developer (mentioned here as a potential black swan last year), was averted thanks to state intervention. But unless Beijing can stave off the biggest systemic bailout of all time, an angry mob could one day storm the People’s Central Bank of China, causing God knows what shock to ripple across the globe. I’ll be one of the experts saying it would always happen, but that’s no consolation.

Who is high, who is low?

Whenever there is a Tory leadership race, I think of my late father’s standard for judging politicians, which was to estimate how high they could have risen in the Barclays Bank leadership hierarchy where he himself spent his professional life. His multiparty fantasy bank of long ago would have been chaired by Lord Carrington, with Labour’s Denis Healey as chief executive and Norman Tebbit as middle manager.

The game does not work today, because it is impossible to imagine that most of our novice politicians hold a serious position in a company outside of the public relations department. But an updated version came to me after a meeting at Spectator party with Konrad Kay and Mickey Down, who wrote Industry, the sexy and authentic TV drama about young investment bankers vying for favors. Suppose today’s candidates are the graduates of a company in the city: who would be the first to be promoted or the P45? Would it be the overly good Sunak or the cunning Zahawi, the fiery Truss or the femme fatale Mordaunt, the ambitious creep Hunt or the refusal to party Tugendhat? Choose your own imaginary competition frame – the island of love might as well work – and I think you’ll find the whole extended contest much more exciting.

A very British dotcom

I’m sorry to see trouble brewing at Bolton-based online white goods seller AO World – not because I’m a shareholder, but because I’ve always loved the story of this very British dotcom. Founded by kitchen salesman John Roberts after a pub pal bet him £1 he couldn’t start his own business, AO has created a shrewd new consumer offer and plenty of jobs for a depressed town; in its early days it was famous for its party vibe, led by Roberts with DJ Lionel Vinyl.

It then hit a valuation of £1.6bn after its IPO in 2014 attracted investors such as hedge fund prince Crispin Odey – with the pleasant side effect that a local backer pre -float, philanthropist Sir Norman Stoller, was able to bank £50million to be spent on charitable causes in the surrounding area. Shares hit a second high above £4 in early 2021 as online retail boomed during lockdown – but have since fallen to 43p, reflecting supply chain and insurance issues -credit.

Job cuts are in the offing and maverick tycoon Mike Ashley’s Frasers Group reportedly tried to ‘gatecrash’ a £40million fundraiser intended to ease AO’s cash flow last week. Some might see that last snippet as negative, but this column has always admired Ashley as a savvy judge of businesses worth saving. He and Roberts would make for a lively combination.

Musk’s new winger

Elon Musk is in trouble on his own over the $44 billion Twitter offer he now says he won’t accept. Some observers believe he never wanted to do this in the first place, but that the potential funding requirement for the bid was an excuse to sell a package of stock options in Tesla, his electric car company, at a favorable price. Either way, Twitter will now sue him for a $1 billion severance fee and may even seek a court order to compel him to complete.

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You will recall that I advised Musk to stay focused on Tesla in the first place. But what this advice-blinding mercurial changemaker needs is a gifted communicator at his side, much like Facebook-turned-Meta’s Mark Zuckerberg leans on former Deputy Prime Minister Sir Nick Clegg. . In Musk’s case, the job description would involve making the most outlandish visionary in the gambit at the moment while swearing that everything promised last week was never said at all – and the obvious candidate, suddenly available, is Boris Johnson.

The couple are a perfect match in another respect, with Musk having fathered at least nine of Johnson’s seven children, each by three mothers. The luxury California lifestyle would suit the Johnsons, who could share aggrieved exile reproaches and toddler play dates with the Sussexes. And Musk’s ultimate ambition to colonize Mars would literally give Boris a new world to conquer.

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