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Investment, fairness, prosperity

27 JuLY 2021

Barrack’s big idea 
Tom Barrack is the 74-year-old Lebanese-American private equity tycoon who backed Trump early in his presidential bid and is now facing charges in the US of acting as an illegal agent of a foreign country, in this case the UAE. That much alert Tortoise members may already know. Less widely known, perhaps, until this morning’s must-read writethru (£) in the FT, is that he was trying to buy part of Westinghouse, the US nuclear reactor maker, in order to be in a position to sell reactors to the Gulf. Not only that, he also pitched the transaction to Steve Bannon, Trump’s erstwhile White House advisor, as the perfect antidote to the negative publicity the new president was getting for the travel ban he imposed early in his administration on visitors from seven mainly Muslim countries (not including the UAE). It would “balance the current noise,” Barrack suggested. The deal didn’t fly. Barrack says he’s going to clear his name.

26 JuLY 2021

Crypto useless
Luke Ellis, chief executive of the world’s largest listed hedge fund manager, Man Group, told the Financial Times (£) that cryptocurrencies have “no inherent worth … whatsoever”. But his company, which manages $127 billion for clients, is trading them anyway because of their price swings. “If you look at cryptocurrencies as a whole, it is a pure trading instrument,” Ellis said. “It is a tulip bulb.” He also took issue with the idea that cryptocurrencies, like Bitcoin, which is mined, are of limited supply. “You can have an infinite number of different cryptocurrencies,” Ellis said. “Anyone can start another one any day.” Despite having no utility beyond a trading instrument, cryptocurrencies have a real-world impact, not least in the power demands of the servers that support them (but also in the investment foregone elsewhere). Bitcoin production is estimated to generate up to 23 million metric tons of carbon dioxide emissions a year.

23 juLY 2021

Tokyo and bust 
When Shinzo Abe won the 2020 Olympics for Tokyo the projection was that visitors to the games would spend $2 billion on board, lodging, transport and merchandise alone. Tickets to venues would be extra. Eleven years on there are no visitors and no ticket sales but the games are going ahead in stadiums and arenas that have cost $7 billion to build or renovate, according to the WSJ, which reckons Tokyo is looking at a $20 billion tab all-in. It was said in Montreal in 1976 that the games it hosted then had cost $1 billion. Nowhere has done a decent job of Olympic cost control or of repurposing venues since then, except possibly London. Why not host them here every time? Do join us for our Sensemaker Live ThinkIn at 1pm to discuss

22 juLY 2021

Brexit Frost
As trailed, Brexit minister David Frost told parliament the government has changed its mind about the Northern Ireland Protocol, which governs trade with the EU after Brexit and which Frost personally negotiated with the EU 18 months ago. He told parliament the protocol is disruptive to trade and damaging to the “fabric” of the UK. He outlined an alternative strategy that tries to eliminate most of the checks on the Irish Sea trade border that came into force in January. But, graciously, he said Britain would not unilaterally suspend the deal before speaking to the EU. In June, perhaps seeing this coming, the EU said it “cannot undo the core of the Protocol”. That core includes a role for the European Court of Justice in policing the protocol, which Frost says in today’s Times “has not worked well”. Translation: the die-hards I work for hate the ECJ. Yes, but you knew that, Mr Frost. What were you thinking? 

21 juLY 2021

Diamond heist 
There are several weightier business stories around today, including China’s crackdown on US listings for Chinese companies and Ben & Jerry’s run-in with Israel’s new government over its decision to stop selling ice cream in the occupied territories. We’ll get to them. But first: Lulu Lakatos, 60 and with nerves of steel, is on trial in London for her part in a made-for-Hollywood heist at Boodles the jewellers, in which she replaced diamonds worth £4.2 million with worthless pebbles in locked purse, left the purse in a vault and walked out the door with the diamonds. She was on a Eurostar to Paris within a couple of hours. She denies conspiracy to steal. The trial, as they say (£), continues.