With a high percentage of the UK’s population on holiday, wishing they were on holiday or mourning the fact they are just back from their holidays, The Weekly has decided to adopt a rather different approach to its well-trodden three paragraph ditty. Instead, here are half a dozen news snippets that have caught our eye over the course of the last seven days…
England’s cricket team have still not found an answer to their batting woes. But we really shouldn’t be surprised. England's Test batting has been in a state of flux for almost seven years, dating back to when Andrew Strauss retired in 2012. In their last 35 Test innings, they have passed 300 on just 15 occasions and have been dismissed for less than 200 on 10 occasions, including a 77 all out in the West Indies in January, a 58 all out in New Zealand and an 85 all out against Ireland. They have also lost all 10 wickets in the space of a single session on four separate occasions in the past three years. England will shortly resume their second innings on 96-4, a meagre 104 runs ahead of Australia. Fingers crossed they don’t implode again on the final day of this heavily rain-influenced, but brilliantly poised second Ashes Test at Lords.
An imminent global recession? One of the most widely watched gauges of investor sentiment in the global economy flashed red on Wednesday. The spread between the two-year Treasury yield and the ten-year yield flipped so that the two-year was higher than the benchmark ten-year yield for the first time since June 2007. The U.S. thirty-year bond yield also fell to a record low on Thursday, touching sub 2% for the first time ever, whilst yields across Europe also fell, with the German 10-year Bund touching a new low of negative 0.65%. An inverted yield curve has long been a reliable recession indicator, but, reassuringly, does not always precede an economic contraction, whilst the length of time before a recession occurs also varies. According to Credit Suisse, the average length of time since the late 1990's for a recession to occur after an inversion was 22 months. That doesn’t sound like the definition of imminent to us.
CBRE’s August Yield Monitor released this week showed little change in July, with the retail sector continuing to impact overall property performance. However, according to Savills, the average all-property prime yield hit 4.90% in July, the highest level since November 2016. Yields were largely stable month-on-month but rose twenty-five basis points across retail warehousing and leisure assets. City of London offices marked an exception to the upwards trend, with prime yields hardening from 4.25% in June to 4.00% in July.
This week WeWork revealed the full scale of its global ambitions ahead of its planned IPO. They intend to “expand aggressively” across the 111 global cities that they currently operate in and launch in up to 169 more cities. Apparently, WeWork have only realised 0.2% of their total opportunity in their 280 target global cities. Oh, and they reported a loss of £570m ($689m) in the first half of 2019.
It won’t come as a shock to our regular readership, but the recent news from the UK high street continues to be poor. The number of empty shops in town centres is now at its highest for four years, with the vacancy rate at 10.3% according to the British Retail Consortium and Springboard survey. Footfall also fell by 1.90% in July, the worst July performance for seven years. In response, more than fifty major UK retailers, including Marks & Spencer, Harrods and Iceland, have called for an urgent reform of the business rates system to safeguard the future of the high street amid intense pressure from online rivals. The retailers have a point. Retail accounts for around 5% of the British economy but pays about 10% of all business taxes and about 25% of business rates. Whether the Government reacts favourably to their request is another matter altogether!
It was revealed this week that Network Rail paid out £28,000 after a passenger ‘possibly slipped’ on pigeon poo at Paddington station. A total of more than £950,000 was paid out by Network Rail for 290 claims over the past five years for slips, trips and falls resulting in compensation claims at the twenty stations it manages. Please be careful if you are travelling through Victoria station any time soon – this was the location for the most successful number of claims, with forty-four.