This week: Bonuses, vultures, sanctions, ‘poor doors’ and the importance of side orders
Image of the week: Vulture stand-off
The graffiti reads “No to the debt payment” and the wall on which it is written is located in Buenos Aires, Argentina. The South American state said this week that it could not afford to pay “vulture fund” bondholders, so it wouldn’t be paying them, thank you very much.
Their enemy is the so-called “holdout” investors, or US hedge funds that bought the country’s debt on the cheap and didn’t agree to Argentina’s restructuring. They’re still holding out for the full amount. But if President Cristina Fernandez de Kirchner agrees to pay up, other bondholders who agreed to take cuts of up to 70 per cent in what they’re owed will come back looking for the rest of it. So a default it is. “Vulture funds” in Spanish, incidentally, is “fondos buitres”. Photograph: Marcos Brindicci/Reuters
In numbers: Bonus blues
Number of years in which bankers’ bonuses can be clawed back under new rules due to be unveiled by the Bank of England – yes, even if the money has been spent – in a bid to kill a culture where bad, risky practices are rewarded.
Number of years for which bankers’ bonuses in the City of London are usually deferred and can be clawed back under the current system. But misconduct such as, say, rigging interest rates can take longer than this to emerge.
Sum that Lloyds Banking Group has just been fined for “serious misconduct” over Libor benchmark interest rate-fixing, in another fine episode of financial scandal.
The lexicon: ‘Poor doors’
Housing complexes in London and other big cities have charmingly been installing separate “poor door” entrances for residents whose properties were made available via social housing schemes rather than sold on the open market.
Mayor of London Boris Johnson says he discourages the construction of poor doors – “I don’t like them and they are something that I try to get out of the planning application if I can” – but he also justifies them on the basis that lower-income tenants can’t always afford to pay service charges for concierges, fancy gyms and the other things rich people like to have about their fortresses.
The phenomenon, as Labour MP David Lammy points out, belongs “more in a Dickens novel than in a 21st-century global city”, but then 21st-century global cities seem pretty Dickensian all round.
Getting to know:
David Wild The chief executive of Domino’s Pizza says Domino’s Pizza isn’t “just about pizza”. It’s also about chicken goujons, fajita wedges, spicy BBQ wings and something called “strippers combo”. Meal deal promotions in which customers are encouraged to bulk up their 12-inches with a selection of side orders are doing the business for Domino’s, Wild happily noted this week.
In a previous life, Wild (58) worked for the other side of the obesity crisis, serving as the boss of UK bike retailer Halford’s, but his pedalling days came to an abrupt end in 2012 after “appalling” weather led to a plunge in sales of bikes and camping equipment. He’s also ex-Tesco, where he helped turn around its fruit and veg operation in the late 1980s. But who really needs fruit and veg when you can order up a Pepperoni Passion?
The list: Sanctions against Russia
It’s “not a new Cold War”, says President Obama, but “a very specific issue” – its involvement in Ukraine – that has prompted the US and the EU to unveil new sanctions against Russia. British foreign secretary Philip Hammond, meanwhile, said the West was prepared to “tighten the screws” further. So how has it decided to do this tightening?
1 Oil, not gas: Sales of arms and equipment to the oil industry have been restricted. Russia’s natural gas business, which fuels the factories of Europe, has unsurprisingly been left alone.
2 Judo mate: Eight individuals close to the Russian president have been added to the Brussels list of Russians subject to asset freezes and travel bans. They include Arkady Romanovich Rotenberg, Putin’s former judo sparring partner.
3 Propaganda chief: Also added is Alexey Alexeyevich Gromov, the man responsible for instructing Russian media outlets to “take a line favourable with the separatists in Ukraine”.
4 Bankers: The Russian National Commercial Bank, which has become the main bank in Crimea, is listed for undermining Ukraine’s “territorial integrity”.
5 Missile-makers: Almaz-Antey, a Russian state-owned manufacturer of missiles used by separatists in eastern Ukraine, finds its way onto the blacklist. It’s the maker of the Buk SA-11 system believed to have shot down flight MH17.