The summer break provides a welcome escape from Brexit and an opportunity to spend some time catching up on reading. Our summer reading list provides six readable, thought-provoking articles to ponder on the beach or by the pool. All are available free and online.
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Over its 116-year history the Michelin guide has established itself as the Bible for top chefs and foodies. Earning or losing Michelin stars are career-defining moments for chefs and megacities boast about the number of Michelin-starred restaurants they are home to. But why does a tyre company publish the world's most respected restaurant guide? This Priceonomics article describes how Michelin came to produce its now famous Red Guide in 1900. It was a pioneering example of brand building though the creation of authoritative content unrelated to the firm's core business.
http://priceonomics.com/why-does-a-tire-company-publish-the-michelin-guide/ (12 pages)
In 2009, a rumour began circulating about an unnamed "Vietnamese official" who had ingested rhino horn and been cured of liver cancer. Demand shot up and the rhino poaching industry went into overdrive. Today, wealthy consumers across Asia are prepared to pay as much as £40,000 per kilogram to buy rhino horn making it more expensive than gold, platinum, diamonds or cocaine. The soaring prices led one enterprising criminal gang to target museums and private collections for rhino horn from long dead animals. In this Vice Magazine article, Mark Wilding how the gang's audacious plans were foiled by police.
The UK's recovery from the global financial crisis has not been felt by everyone. One of the most striking aspects of the recovery is the continued rise of inequality. In this important and readable speech, Andy Haldane – the Bank of England's chief economist – deploys an impressive array of data to identify society's winners and losers.
http://www.bankofengland.co.uk/publications/Documents/speeches/2016/speech916.pdf (18 pages)
This fascinating BBC article covers the story of a former stock market investor who left a well-paid job to search for lost treasure. Mark Eldred is now leader of the team looking to find the cargo of the SS Connaught; a steam ship that sank in the Atlantic more than 150 years ago taking millions of dollars' worth of gold coins with it. The article shows how the falling price of high-tech sonar, navigational systems and robots has tempted a new wave of entrepreneurs to take to the sea in search of treasure.
http://www.bbc.com/future/story/20160210-inside-the-hunt-for-a-million-dollar-haul-of-ocean-gold (21 pages)
The outcome of the EU membership referendum on 24th June came as a surprise to many. This gripping Guardian article charts the last fortnight of the contest from inside the "Remain" campaign.
http://www.theguardian.com/politics/2016/jul/05/how-remain-failed-inside-story-doomed-campaign (13 pages)
We have come to see the weekend as two whole days off work; two days of freedom to do as we please. In this short history, from 1991, Witold Rybczynski wonders whether what we do over weekends looks increasingly like work and describes how the modern weekend was created to demarcate a boundary between organised work and leisure.
http://www.theatlantic.com/magazine/archive/1991/08/waiting-for-the-weekend/376343/ (15 pages)
Finally, we conclude with a brief assessment of economic data published since the UK referendum on 23rd June. Some UK numbers show alarmingly large declines. Our CFO Survey shows that corporate optimism is down to its lowest level in nine years while the Purchasing Managers' Indices report that business activity is contracting at the fastest pace in seven years. The GfK measure of consumer confidence and Royal Institute of Chartered Surveyors measures of demand for new housing have also lurched down sharply. Meanwhile sterling has dropped by 13% against the dollar and economists have sharply downgraded their GDP growth forecasts for 2017 from 2.1% to 0.7%. Markets are assuming that the pace of UK growth will slow sharply in 2017 as a result of Brexit.
Yet some post-referendum data paint a more upbeat picture. The Bank of England's Agents survey showed that most businesses do not intend to alter their investment plans in the short term and a survey by manufacturers' organisation, EEF, showed that there was little change in orders placed with manufacturers. UK equities have headed higher, with the FTSE100 index up 7.5% since 23rd June.
Given that data shoot all over the place in response to big shocks it is too early to be sure of the how much damage the referendum vote has done. Sometimes external shocks generate one month, or one quarter declines in activity which are subsequently recouped. We will need to see at least another couple of months' UK economic data to get an accurate picture of the near term economic damage wrought by the referendum vote.
But meanwhile, and encouragingly, global economic have a slightly firm hue. US, euro area and emerging markets data have generally been coming in on the strong side of expectations. Buoyant US job and housing data have re-ignited speculation about a US interest rate rise later this year. Measures of financial stress remain subdued suggesting that so far Brexit risks have not been transmitted to the rest of the world through the financial system.
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