Russia hasn’t lost that air show feeling

http://www.theguardian.com/world/2015/jun/14/paris-air-show-russia

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As advertisements go, the 1986 film Top Gun was perhaps not the most helpful tool for sales executives seeking commissions by flogging the MiG fighter aircraft.

Four of them got shot down by the heroic combination of the US Navy’s Pete “Maverick” Mitchell (Tom Cruise) and Tom “Iceman” Kazanski (Val Kilmer), while two others were so spooked by the brilliance of the world’s police force that they retreated to base, thereby allowing Cruise to rediscover that loving feeling with Kelly McGillis’s Charlotte “Charlie” Blackwood.

In the real world, the Russian maker of the MiG is less easily spooked by the Americans and their allies, and it has developed much improved sales lines. We saw that at the Farnborough air show last year when, despite the sanctions against their compatriots, the Russians embarrassed fellow delegate David Cameron by waltzing into Hampshire to exhibit their gear.

They will be doing the same this week at the UK trade fair’s biennial wingman, the Paris air show – where Rostec Corporation is organising the presence of nine Russian military contractors exhibiting a range of combat aircraft at one of the most important and prestigious international exhibitions in the industry. Or, as Maverick himself once put it: “This is what I call a target-rich environment.”

Ed Miliband for No 10: place your bets now

There’s a view in the City that the market is always right and the best predictor of the future. Members of this school always supply numerous examples to bolster their argument, while tending to ignore cases that seem to undermine the thesis, typically small blips such as, er, the financial crisis.

A slightly less costly example of the market calling things completely wrong is Betfair, the online betting group which the City failed to understand had been massively overpriced when it floated in 2010. It took a change in business model – and executive team – to reverse all that, and since then the shares have soared.

So as the company reports full-year results this week, what is the market expecting? Well, a nice rise in revenues and profits, which partly explains why investment banks remain extremely bullish on the shares (60% of them say buy, according to IG Group).

Still, there are those who are now worrying that the City is being too optimistic again – much like all of those betting markets last month which made Ed Miliband the favourite to walk through the door of 10 Downing Street. Among them? The amusingly entitled Betfairpredicts.com.

The mountain moves, the rate stays still

If you mention Mont Blanc during conversations in the Square Mile, folk tend to assume that you’re asking to borrow their fountain pen.

But a less brand-obsessed City faction will also have heard of the Alpine mountain – and a few of them might actually have climbed it.

One is Kristin Forbes, a US economist and member of the Bank of England’s monetary policy committee, who’s giving a talk at the London School of Economics this week, entitled: “Disinflation and Deflation: Where? Why? and What’s Next?”.

It will be timely, as a day earlier the latest data on UK inflation will be released, with economists expecting a slight rise after last month’s reversal of prices. Of course, any tick-up in the inflation rate will again prompt talk that Forbes and her fellow committee members might soon consider changing the UK’s interest rate, for the first time since March 2009.

Which brings us back to Forbes’s hobby. Mont Blanc was once said to stand 4,807m high, only to be revised up to 4,810.9m in 2007, and back down by 45cm to 4,810.45m in November 2009. So the height of the mountain scaled by Forbes has changed more recently than the UK interest rate she helps to set. Who says the City is fast-moving?