Senior Barclays managers were worried over negative headlines during the financial crisis and contributed to a culture that fixed key funding rates artificially low, U.S. and UK regulators said in reaching a settlement with the bank. The findings based on internal emails and other communications raise questions about how high up the Barclays management chain came instructions to submit lower rates, and who knew about the rate rigging. Without naming individuals, the regulators' reports refer to pressure and directives from "senior management" at the firm. Barclays was fined $453 million on Wednesday for manipulating interbank lending rates over several years. These are known as Libor and Euribor, underpinning trillions of dollars of derivatives deals plus corporate and personal borrowing rates. The U.S. Commodity Futures Trading Commission, the U.S. Department of Justice and the UK's Financial Services Authority settled with Barclays on a civil basis, while Canadian authorities said they still had an open investigation. The Justice Department said it still had a criminal investigation in progress. Barclays Chief Executive Bob Diamond, the investment bank unit's boss at the time of the rate fixings, and three of his key lieutenants, said they were giving up their 2012 bonuses in response. Investigators faulted individual derivatives traders for fixing rate submissions for their own profit, while Barclays was slammed for regularly reporting lower borrowing rates than it was actually paying throughout the financial crisis. Staff responsible for submitting rates in some instances told colleagues of "internal political" pressure to set these low, the FSA's report shows. Barclays "senior management at high levels" became concerned over the media scrutinizing the bank's funding access early in the financial crisis, in August 2007. "Senior management's concerns in turn resulted in instructions being given by less senior managers at Barclays to reduce Libor submissions in order to avoid negative media comment," the UK's FSA said in its report. "The origin of these instructions is unclear." The U.S. CFTC said specific instructions to lower submissions came from "senior Barclays Treasury managers". They asked submitters to provide rates at a level where Barclays wouldn't be "sticking its head above the parapet". Barclays' submissions to Libor - a rate compiled daily through a panel of banks quoting the rate at which they estimate they can borrow from one another, in various currencies - were higher than many competitors, attracting attention. It was this scrutiny, at a time when negative headlines could be incredibly damaging - by September 2007, British savings bank Northern Rock had to be bailed out - that made the bank change its approach to Libor submissions, the regulators said. CONCERNS RELAYED "UPSTAIRS' The submission process and the artificial rates were discussed in several conference calls and in emails among Barclays staff, including with senior managers. The regulators' reports do not show any evidence of specific instructions being relayed to and from the top ranks of the bank, which would have included finance director Chris Lucas or then CEO John Varley. But there are various references to management above senior treasury functions. In one phone discussion with senior treasury managers from November 2007, a supervisor of the dollar Libor rate submitters raised concerns that submitting Barclays' truer borrowing rate would "cause a shit storm," the two regulators said. He then asked that the issue be taken "upstairs", to be discussed among higher level managers, the CFTC's report says. A day later, a senior treasury manager reported back his understanding that "senior management" had discussed the issue, and gave submitters guidance to "stick within the boundsso no head above parapet," the CFTC report added. Barclays did flag concerns that the Libor rate as a whole was flawed to the rate compiler the British Bankers' Association, and to the FSA and other authorities. But the bank did not tell the FSA it was making submissions influenced by press perceptions, and for many months no changes to the internal submission process were made. The regulators' reports also lay bare how concerns were not always systematically followed up between compliance units, submitters and senior management, sometimes allowing confusion to reign. At one stage in late 2008, the FSA's report shows rate submitters thought they were operating under instructions from the Bank of England to lower submissions, after a phone conversation between a "senior individual at Barclays" and the BoE was relayed down the chain of command and miscommunicated. Though the error was brought up internally, compliance never followed up and spoke with submitters to make sure they were not following this instruction, the FSA said.
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Wednesday 27 June 2012
Sunday 24 June 2012
Labour Party MPs demanded an emergency recall of the Chilcot inquiry last night after new revelations that Tony Blair blocked the Government's most senior lawyer from explaining to Cabinet the legality of the war in Iraq.
According to the newly published full version of Alastair Campbell's diaries, the Attorney General Lord Goldsmith wanted to "put the reality" to cabinet ministers that there was a case against, as well as for, military action in March 2003. But, according to his former spin doctor, the then Prime Minister feared that the legal opinion was too "nuanced" and would allow the war's ministerial critics Robin Cook and Clare Short to say that the case had not been made. The disclosure is significant because, while it has long been suspected that Mr Blair and his inner circle put pressure on Lord Goldsmith to change his legal advice, this is the first evidence that the PM actively blocked the Cabinet from hearing the full details of the case for war. MPs from all parties urged Sir John Chilcot, who has finished taking evidence and is now preparing his report into the Iraq war, to reconvene a special session to hear from Mr Blair, Mr Campbell and Lord Goldsmith. The former Liberal Democrat leader Sir Menzies Campbell said: "According to the diaries, Tony Blair was determined that the decision should not rest with the Cabinet and overruled his Attorney General. Sofa government prevailed at the expense of constitutional requirements. The diaries prove that once a decision to go to war against Iraq had been taken, intelligence and legal advice was manipulated to support that decision." Lord Goldsmith presented a longer legal opinion to Mr Blair on 7 March 2003 in which he said he believed there was a "reasonable case" in favour of military action, but that "there was also a case to be made the other way". According to Mr Campbell's diaries, Lord Goldsmith warned Mr Blair that he did not want the Prime Minister to "present it too positively" in favour of military action because there was a "case to be made the other way". Mr Campbell wrote: "TB also made it clear he did not particularly want Goldsmith to launch a detailed discussion at Cabinet, though it would have to happen at some time, and ministers would want to cross-examine. With the mood as it was, and with Robin [Cook] and Clare [Short] operating as they were, he knew if there was any nuance at all, they would be straight out saying the advice was that it was not legal, the AG was casting doubt on the legal basis for war. Peter Goldsmith was clear that though a lot depended on what happened, he was casting doubt in some circumstances and if Cabinet had to approve the policy of going to war, he had to be able to put the reality to them." But Mr Campbell added that this was blocked by Mr Blair and his gatekeeper, Sally Morgan, during a meeting of Mr Blair and his closest aides on 11 March: "Sally said it was for TB to speak to Cabinet, and act on the AG's advice. He would simply say the advice said there was a reasonable case." Following the 11 March meeting, Lord Goldsmith produced a new, one-page legal opinion which put the "reasonable case" for war – which was discussed at Cabinet and used in Parliament to justify military action. In his own memoir, A Journey, Mr Blair did not reveal details of how he tried to block Lord Goldsmith. He said only that the Attorney General had "set out the arguments for and against and on balance came out in favour". When he gave evidence to the Chilcot inquiry in January 2010, Lord Goldsmith was asked by inquiry panel member Sir Roderic Lyne whether anyone asked him to "restrict what you said to Cabinet to the fairly limited terms in which you presented this to Cabinet". Lord Goldsmith replied: "No." Sir Menzies added: "There seems to be a substantial difference between the contents of the diaries and the evidence given to the Chilcot inquiry, and the inquiry would be well advised to reconvene itself." Last night Clare Short said she was not surprised that Mr Blair had been "deceitful" in presenting the case for war. Peter Kilfoyle, a minister in the Blair government, also called for the Chilcot inquiry to be recalled. "There is a straightforward contradiction between the two positions and it needs to be corroborated." The Conservative MP Patrick Mercer said: "New facts have come to light and this makes me question whether we know enough about the then Prime Minister's attitude that justified the war." Mr Campbell said last night: "Peter Goldsmith's legal opinion is in the public domain and it was no secret he had concerns at various points. This is entirely consistent with what he and Tony Blair said to the Chilcot inquiry."
The outspoken attack on the prime minister's flagship policy by Rowan Williams
The archbishop of Canterbury has denounced David Cameron's "big society", saying that it comes across as aspirational waffle that was "designed to conceal a deeply damaging withdrawal of the state from its responsibilities to the most vulnerable".
– his strongest to date – is contained in a new book, Faith in the Public Square, that is being prepared for publication ahead of his retirement.
Passages from the book, obtained by the Observer, reflect the archbishop's deep frustration not just with the policies of Cameron's government and those of its Labour predecessors, but also with what he sees as the west's rampant materialism and unquestioning pursuit of economic growth. Williams also laments spiralling military expenditure, writing that "the adventure in Iraq and its cost in any number of ways seems to beggar the imagination".
But it is his suggestion that the big society – Cameron's personal vision of a more active civic society – is seen by people as a deliberate cover for plans to shrink the state that will be most controversial. On Saturday night, Cameron revealed he was considering scrapping most of the £1.8bn in housing benefits paid to 380,000 under-25s, worth an average of £90 a week, forcing them to support themselves or live with their parents. He also told the Mail on Sunday he might stop the £70-a-week dole money for the unemployed who refuse to try hard to find work or produce a CV.
Commenting on the "big society", Williams, who steps down in December after 10 years in his post, writes: "Introduced in the runup to the last election as a major political idea for the coming generation, [it] has suffered from a lack of definition about the means by which such ideals can be realised. Big society rhetoric is all too often heard by many therefore as aspirational waffle designed to conceal a deeply damaging withdrawal of the state from its responsibilities to the most vulnerable."
He suggests that ministers have fuelled cynicism over the Cameron vision by failing to define what the role of citizens should be. "And if the big society is anything better than a slogan looking increasingly threadbare as we look at our society reeling under the impact of public spending cuts, then discussion on this subject has got to take on board some of those issues about what it is to be a citizen and where it is that we most deeply and helpfully acquire the resources of civic identity and dignity."
Williams has never been afraid to wade into sensitive political issues during his decade at Lambeth Palace. But his valedictory work, to be released three months before he leaves office, is more strident in its criticism than anything that has come before. It is certain to cause fury in the government, which is being criticised, including from some Conservatives and Liberal Democrats, for lacking a compelling message other than the necessity of public spending cuts and austerity.
A perception that the government is failing to prioritise the needs of the most vulnerable as it pursues growth has spread since the chancellor, George Osborne's, decision to end the top 50p rate of tax on incomes of more than £150,000 a year in his March budget.
In a powerful section questioning economic assumptions that govern modern societies, the archbishop takes issue with the idea that growth, defined as increasing production, is necessarily a good thing. "Practically speaking, at the individual and the national level, we have to question what we mean by growth," he writes. "The ability to produce more and more consumer goods (not to mention financial products) is in itself an entirely mechanical measure of wealth."
The archbishop argues this mindset creates new demand for goods and thus new demands on a limited material environment for energy sources and raw materials. "By the hectic inflation of demand it creates personal anxiety and rivalry. By systematically depleting the resources of the planet, it systematically destroys the basis for long-term wellbeing. In a nutshell, it is investing in the wrong things."
No 10 said: "The launch of Big Society Capital in April is a concrete example of the government delivering on its plans – £600m to help create a funding model that is truly self-sustaining and that will help charities and social enterprises to play their part in building a bigger society."
The archbishop says that the Labour party was wrong in 2006 to make incitement to religious hatred a criminal offence, arguing that anti-Muslim statements could show courage. "The creation under British law of a criminal offence of incitement to religious hatred has provoked bitter and sustained controversy. Disproportionate attention has been given to a hypersensitive minority.
"Some anti-Muslim images or words (foolish and insulting as they may be) may well exhibit courage in a world where terrorist violence reaches across every national boundary." He also calls for greater integration of Muslims living in Britain and insists they make their loyalty to "the nation state" rather than "the international Muslim community". "To suggest that the Muslim owes an overriding loyalty to the International Muslim Community [the Umma] is extremely worrying," he writes. "Muslims must make clear that their loyalty is straightforward modern political loyalty to the nation state."
Publisher Robin Baird-Smith, who runs Continuum, part of Bloomsbury, said that the book was "a powerful, carefully reasoned rebuttal of Williams's critics. This is not a work of theology. It is a book about the role of religion in public life – it touches on economics, ecology, public morality, atheism," he said. "This is thus a book of supreme importance."
Taliban soldier who killed in battle wins fight to stay in UK
An Afghan Muslim who claims he killed people while fighting for the Taliban has used the Human Rights Act to remain in Britain – despite Government efforts to deport him. Zareen Ahmadzai, who spent three years fighting in Afghanistan, has admitted using a Kalashnikov rifle and firing rockets, as well as supplying weapons and food to the Taliban. The Home Office rejected his claim for asylum, and when his appeal also failed, Ahmadzai was detained at Harmondsworth immigration removal centre in West London while awaiting deportation.
Tony Blair: UK may face 'interesting choice' over euro
Tony Blair has said the UK will face an "interesting choice" over whether to join the euro if the currency's current crisis is resolved. The former prime minister told the BBC he believed the UK should still be keeping open the option of joining it. He said that looking at the "broad sweep of history" in the long term "the European integration project" was going to go ahead, "like it or not". The UK, as a "small island nation", had to be part of it to have influence. Mr Blair said that the only thing that would save the single currency now was to have a "grand plan" where Germany was ready to commit its economy fully - "treating the debts of one as the debts of all". This would be difficult for Germany, he said, and would have to be in return for other countries having "precise, deliverable" programmes of change and reform that could restore European competitiveness. As well as economic changes, political change was also inevitable with Europe needing reform of labour markets, pensions, welfare, public services the role of the state, he said. He told BBC One's Andrew Marr Show that his former chancellor Gordon Brown had "always been right" on the economic case against the UK joining the euro when Labour was in power.
Cameron suggests cutting housing benefit
The prime minister has suggested that people under the age of 25 could lose the right to housing benefit, as part of moves to cut the welfare bill. Scrapping the benefit for that age group would save almost £2bn a year. In an interview in the Mail on Sunday, David Cameron said he wanted to stop those who were working from feeling resentment towards people on benefits. Downing Street said the proposals were Conservative plans for after the next general election. Mr Cameron said the existing system was sending out "strange signals" on working, housing and families. He called for a wider debate on issues including the cost of benefits. BBC political correspondent Vicki Young said the article was a clear appeal to core Tory voters and MPs who have criticised Mr Cameron for failing to promote Conservative values.
Tuesday 19 June 2012
Assange seeks political asylum
On Tuesday night WikiLeaks founder Julian Assange applied for political asylum at the Ecuadorian Embassy in London after failing in his bid to avoid extradition to Sweden to face sex crime allegations. The 40-year-old Australian is currently inside the building in Knightsbridge, having gone there on Tuesday afternoon to request asylum under the United Nations Human Rights Declaration. The country's foreign minister Ricardo Patino told a press conference in the South American country that it was considering his request. In a short statement last night, Mr Assange said: "I can confirm that today I arrived at the Ecuadorian Embassy and sought diplomatic sanctuary and political asylum. This application has been passed to the Ministry of Foreign Affairs in the capital Quito. I am grateful to the Ecuadorian ambassador and the government of Ecuador for considering my application." The computer expert, who was on £200,000 bail after failing in several attempts to halt extradition, attracted several high-profile supporters including Ken Loach and socialite and charity fundraiser Jemima Khan, who each offered £20,000 as surety. Other supporters included Bianca Jagger and veteran left-winger Tony Benn. The Swedish authorities want him to answer accusations of raping a woman and sexually molesting and coercing another in Stockholm in August 2010 while on a visit to give a lecture. Assange, whose WikiLeaks website has published a mass of leaked diplomatic cables that embarrassed several governments and international businesses, says the sex was consensual and the allegations against him are politically motivated. The Supreme Court last month ruled in favour of a High Court ruling that his extradition was legal. Last week the Supreme Court refused an attempt by him to reopen his appeal against extradition, saying it was "without merit". He had until June 28 to ask European judges in Strasbourg to consider his case and postpone extradition on the basis that he has not had a fair hearing from the UK courts. A statement issued on behalf of the Ecuadorian Embassy said Mr Assange would remain at the embassy while his request was considered.
Sunday 17 June 2012
Police study Murdoch's 'secret' iPhone account
Scotland Yard detectives investigating phone hacking at the News of the World are examining the call records of four newly discovered Apple iPhones issued to senior executives at News International. The smartphones, issued by O2 in a contract beginning in October 2009, included a handset given to James Murdoch, the former chairman and chief executive of News Corp Europe. Despite billing for the phones totalling nearly £12,000 between June last year and May this year, neither Operation Weeting nor the Leveson Inquiry was told of the existence of the smartphone accounts. Phone text messages and emails sent and received by News International executives and advisers have provided some of the most controversial evidence heard by Lord Justice Leveson's inquiry into press practices and ethics. It had been assumed that the email and text traffic from key News International executives was centred solely on their company BlackBerry account with Vodafone. In accounts seen by The Independent, issued through 02's corporate customer services at Arlington Business Park in Leeds, Mr Murdoch's iPhone account is listed as "active". Mr Murdoch is said to have told 02 that he specifically wanted a "white iPhone" when the smartphone was issued to him in the summer of 2009. Katie Vanneck-Smith, listed as News International's chief marketing officer, also has an active account. Two other NI executive numbers are described as disconnected. Between June last year – just before The Guardian revealed in July that the mobile phone of murdered schoolgirl Milly Dowler had been hacked into – and the beginning of the Leveson Inquiry in November, the NI iPhone accounts were billed for £9,650. Last night, Labour MP Tom Watson said people would be "shocked" to learn that the smartphones had been issued to key NI executives, while the company's disclosures focused only on the BlackBerry Vodafone accounts. Mr Watson said he hoped that News Corp's Management and Standards Committee, which is responsible for all matters relating to phone hacking, would enforce its own promise of full transparency and appropriate disclosure, by revealing all the data and logs held on the discovered phones to both the police and the Leveson Inquiry. Last night, a spokeswoman for News International, said: "Mr Murdoch fully co-operated with the Leveson Inquiry. It is ridiculous to suggest that James Murdoch keeps or kept a 'secret phone'." Meanwhile sources close to the Leveson Inquiry have denied that Lord Justice Leveson threatened to quit his judicial investigation following comments made in February by Michael Gove. The Education Secretary told a gathering of political journalists that the inquiry into press ethics and practices was creating a "chilling atmosphere" towards press freedom. During Prime Minister's Questions in the Commons the day after Mr Gove's lobby speech, David Cameron appeared to back his cabinet colleague's view. Concern that Mr Gove might be the Prime Minister's advance messenger prompted Lord Justice Leveson to call the Cabinet Secretary, Sir Jeremy Heywood. Whitehall sources say Lord Justice Leveson wanted to learn directly from Mr Cameron whether his inquiry was wasting public money on an ultimately futile exercise or whether his initial remit stood. Although the reassurances from No 10 took two days to arrive, sources claim there was no threat from the judge to resign from his own inquiry.
Thursday 14 June 2012
50 year storm heading for Britain bringing downpours and 70mph winds
England and Wales are back on flood alert as Britain braces for a "once in 50 years” storm which could bring a month's worth of rain in 24 hours and 70mph winds.
The Met Office has issued a new warning of wet and windy weather with periods of persistent heavy rain for parts of Wales and south-western England from late today until Saturday.
The Weather Channel said rivers would be overwhelmed and warned of a “major flooding event.” Up to 50mm more rain is due in many areas on Friday.
The Environment Agency told people in the South-West, Wales and Midlands to “prepare for flooding.” Dozens of flood alerts and warnings are expected to be in place tomorrow.
EA bosses implemented 24-hour shift patterns, visited all 150 campsites in Devon and Cornwall to warn of flooding and dispatched hundreds of extra flood specialists to assess nationwide defences and clear debris blocking rivers and drains.
Scout leader, retired teacher and members of Armed Services are among 76 arrested in nationwide paedophile swoop
Seventy-six suspected paedophiles, including a Scout leader, a retired teacher and Government employees, have been arrested across the UK in a major police investigation into sickening child sex images on the internet. Members of the armed forces, a pathologist and a firefighter were also among those detained in the 48-hour operation, which involved more than 40 police forces nationwide. About 80 children have been taken to safety as part of the investigation, including 20 who were found to be living at the properties searched by officers.
Cameron's insistence that there was nothing untoward in the decision to allow Coulson to operate with lower security vetting than his predecessors
Questions about why Andy Coulson was not security vetted to the same level as his predecessors and successors when he became director of communications at Downing Street are "a complete red herring", David Cameron has told the Leveson inquiry.
The Cabinet Office confirmed that all holders of the equivalent post from 1996 to May 2010 completed higher level background checks than Couslon did, but the prime minister said he believed it was not unique that Coulson was not "develop vetted" when he started work at No 10.
The former News of the World editor was vetted to "security check" level, which only allows supervised access to the most secret government documents, and only started the developed vetting process six months into the job. He never completed it before he resigned.
Developed vetting checks involve testing whether an individual's background might make him or her vulnerable to blackmail and investigators ask questions such as: "Is there anything else in your life you think it appropriate for us to know?". There would also be a review of the person's finances and background checks made with friends and family.
The year before Couslon was appointed in Downing Street The Guardian revealed that up to 3,000 people may have had their voicemails hacked by News of the World journalists. In 2007 the paper's royal correspondent, Clive Goodman, had been jailed for phone hacking during Coulson's editorship of the Sunday tabloid.
"Having looked at all this I am absolutely convinced this is a red herring," Cameron told the inquiry. "I know it is one of those things where people have been looking for some abnormality and I believe there is none."
He said the decision on what level of security clearance Coulson would need was a task for the civil service, not the prime minister. The decision to start developed vetting of Coulson after the East Midlands airport terror alert in October 2010 was "absolutely rational and sensible", he said.
Cameron's insistence that there was nothing untoward in the decision to allow Coulson to operate with lower security vetting than his predecessors came after detailed questioning by Robert Jay QC of the prime minister's efforts to seek assurances from Coulson that he knew nothing about phone hacking at the News of the World. Cameron said Coulson had given him several assurances and he had accepted them, in part because the Press Complaints Commission, the Crown Prosecution Service, the police and a parliamentary select committee appeared to have done so as well.
Despite only having mid-level security clearance, Coulson told the Leveson inquiry last month that he had unsupervised access to top-secret files. Downing Street has previously said Coulson is likely to have attended meetings on Afghanistan, counter-terrorism and UK military matters at which intelligence was discussed.
The issue of Coulson's security status was raised with Cameron after Leveson requested a breakdown of the security clearance of previous holders of the same office during evidence given by the former cabinet secretary Gus O'Donnell in May. At the time Leveson said he wanted to find out whether or not the issue represented "a smoking gun".
The Cabinet Office produced a note for the inquiry which showed that of the Downing Street communications directors in post before Coulson, three were already develop vetted, two others were granted the status around three months after starting and another after seven months.
The Guardian has established that Sir Christopher Meyer was already cleared to the highest level before he became John Major's press secretary in 1994. Alistair Campbell was developed vetted in the months after he was hired to act as press secretary for Tony Blair.
Simon Lewis was develop vetted to work as press secretary to Gordon Brown while his predecessor, Michael Ellam, is understood to have already achieved the clearance before he started.
Under Cameron's premiership, Craig Oliver has been develop vetted as has Gabby Bertin, who was Coulson's deputy.
THAT CRINGEWORTHY TEXT IN FULL
The full extent of just how close the Prime Minister was to former News International chief executive Rebekah Brooks was revealed by the disclosure of an astonishing text message at the Leveson Inquiry into press ethics today. The message, sent on October 7, 2009 by Mrs Brooks, the day before a keynote speech by David Cameron and seven months before he became Prime Minister, lavished praise on him and his 'wonderful' wife Samantha. Mrs Brooks, a near-neighbour of the Camerons, even suggested they have 'country supper soon'.
THAT CRINGEWORTHY TEXT IN FULL
The Leveson Inquiry today heard that Rebekah Brooks sent David Cameron the following text message on October 7, 2009:
'But seriously I do understand the issue with the Times.
'Let's discuss over country supper soon.
'On the party it was because I had asked a number of NI people to Manchester post-endorsement and they were disappointed not to see you.
'But as always Sam was wonderful – (and I thought it was OEs [Old Etonians] that were charm personified!).
'I am so rooting for you tomorrow not just as a proud friend but because professionally we're definitely in this together! Speech of your life!
'Yes he Cam!'
The explosive text message released at the Leveson Inquiry today showed the cosiness of the personal relationship enjoyed by Rebekah Brooks and David Cameron.
At the start of the message, Mrs Brooks conjured up an image of the privileged, rural get-together she and near-neighbours the Camerons and others in the Chipping Norton set had become accustomed to.
She said: 'But seriously, I understand the issue with The Times.
'Let's discuss over country supper soon.'
The reference to The Times is thought to be in connection with Mr Cameron's unhappiness at an article that day in the newspaper.
Mrs Brooks talked about Mr Cameron's failure to attend a conference party thrown by NI - for which he told the inquiry the message was a reply to his apology.
'On the party it was because I had asked a number of NI people to Manchester post endorsement and they were disappointed not to see you,' she wrote.
Close ties: Rebekah Brooks (pictured left) sent an embarrassing text message to David Cameron (right) telling him 'professionally we are all in this together'
Mrs Brooks paid a compliment to Mr Cameron's wife Samantha by comparing her to the 'charm personified' of OEs (Old Etonians) like Mr Cameron and her husband, racehorse trainer Charlie, who were pupils together at the elite establishment and remain friends.
The text was read out by the inquiry's counsel Robert Jay QC as he grilled Mr Cameron about his close friendship with former Sun editor Mrs Brooks - questioning which the previously assured premier appeared uncomfortable dealing with.
Glowing: The Sun's leader column on October 9, 2009 praised David Cameron's speech from the day before
Sent on the eve of Mr Cameron's speech to the Conservative Party conference in 2009, and shortly after The Sun switched its support to his party from Labour, it said: 'I'm so rooting for you tomorrow not just as a proud friend but because professionally we are in this together.
'Speech of your life? Yes he Cam!'
The 'all in this together' remark, almost certainly referring to a Tory conference speech by the then shadow chancellor George Osborne the previous day, revealed just how remarkably close the pair had become.
Mr Jay said the text message had been supplied as the result of a Section 21 request to NI - 'requiring people to disclose material'.
In her own evidence, Mrs Brooks said she had been able to access only a limited number of her personal communications after resigning over the phone-hacking inquiry.
Mr Jay said it was one of a batch from October 2009 to May 2011 but it was the only one relevant to the line of questioning.
It was partly redacted, apparently removing a personal part of the text at the start.
In the course of an extended grilling over his close personal ties to Mrs Brooks, Mr Cameron repeatedly said that he could not be certain how frequently they met or spoke by telephone.
'I do not think every weekend, I do not think most weekends. But it would depend,' he said.
The frequency rose after she began seeing Mr Brooks and moved into his home, becoming a near neighbour of the Camerons in Oxfordshire.
Nor was he able to say even approximately at what point he believed she had become sympathetic to his party's cause, though he accepted it was more than weeks before the formal announcement of the Sun's support.
Asked to explain the message, Mr Cameron said: 'The Sun had made this decision to back the Conservatives, to part company with Labour.
'The Sun wanted to make sure it was helping the Conservative Party put its best foot forward with the policies we were announcing, the speech I was making. That's what that means.'
He went on: 'We were friends. But professionally, me as leader of the Conservative Party, her in newspapers, we were going to be pushing the same political agenda.'
And Mr Cameron lost a little of his relaxed composure when asked if he spoke to Mrs Brooks every week between 2008 and 2009.
'The level of contact went up and we saw each other socially more,' he said, because Mrs Brooks had moved to Chipping Norton.
Asked if he saw Mrs Brooks socially, Mr Cameron said: 'I don't think every weekend. I don't think most weekends.'
By 2008, Mrs Brooks was a 'good friend', Mr Cameron admitted.
Backing: The Sun's front page from October 9, 2009
His relationship with her became closer when she married his old school friend from Eton College, Charlie Brooks, Mr Cameron said.
One now infamous gathering of the Chipping Norton set was a Christmas meal on December 23 in 2010 at the home of Mrs Brooks and husband Charlie.
Mr Cameron and other members of the Chipping Norton set - including Top Gear host Jeremy Clarkson - tucked into a Christmas dinner.
The party took place days after Mr Cameron stripped Business Secretary Vince Cable, an avowed enemy of Rupert Murdoch, of his power to decide on Mr Murdoch’s attempt to take full control of BSkyB.
Mrs Brooks yesterday made her first appearance in court on charges of conspiring to pervert the course of justice over the phone hacking scandal.
On Friday, October 9, 2009, the day after Mr Cameron's speech, The Sun carried a large front-page picture of the Prime Minister and the headline 'Cam can have a go 'cos we think he's hard enough'.
A glowing front page piece by the paper's then political editor George Pascoe-Watson began: 'David Cameron shows he has the strength to get battered Britain back on its feet as he makes a power-packed speech at the Tory conference yesterday.'
Inside the newspaper, a leader column had the headline 'Yes, he Cam' in a reference to President Obama's 'Yes we can' slogan.
The column started: 'David Cameron yesterday swept aside any last doubts about his capacity to lead this nation.'
Less than a fortnight before, on Wednesday, September 30, 2009, led with a front-page story headlined Labour's Lost It.
Explaining its decision to switch its backing to the Tories under Mr Cameron, the tabloid said the Labour Party 'have had that chance and failed'.
The paper added: 'Britain needs a brave and wise Government to restore our self-respect, our natural entrepreneurship and the will of every family to improve its lot through its own efforts, without depending on handouts.
'We hope, and pray, that the next Government will have the guts and the determination to do these things.
'And we believe David Cameron should lead it.'
Tuesday 12 June 2012
Lloyds Banking Group plc (LON:LLOY) and Royal Bank of Scotland Group plc (LON:RBS) are set to be downgraded
Lloyds Banking Group plc (LON:LLOY) and Royal Bank of Scotland Group plc (LON:RBS) are set to be downgraded as the latest gust from the Eurozone crisis blows through the UK. RELATED ARTICLES M&S banking partnership with HSBC announced, new threat to Lloyds Bank Lloyds Banking Group plc makes board appointments RBS warn on 'serious cash-flow problems' for business over Queen's Jub Lloyds Banking Group, Barclays plc get behind dairy farmer cooperative RBS, Lloyds Banking Group plc shares: Two long term cash-cows, but on Moody's is expected to issue the ratings downgrade to the tune of two notches. The Times reports that RBS and Lloyds Banking are likely to have to pay more money to borrow money. Despite the looming downgrades, the Lloyds share price and RBS share price are both sharply higher courtesy of the weekend bailout of the Spanish banking sector.
Thursday 7 June 2012
Bank of England meets amid talk of £50bn stimulus
Bank of England policymakers meet today to decide whether to change interest rates or to pump in more money into the ailing economy, with leading economist saying they may opt to inject a further £50bn of stimulus.
Europe is on the verge of financial chaos.
Global capital markets, now the most powerful force on earth, are rapidly losing confidence in the financial coherence of the 17-nation euro zone. A market implosion there, like that triggered by Lehman Brothers collapse in 2008, may not be far off. Not only would that dismantle the euro zone, but it could also usher in another global economic slump: in effect, a second leg of the Great Recession, analogous to that of 1937. This risk is evident in the structure of global interest rates. At one level, U.S. Treasury bonds are now carrying the lowest yields in history, as gigantic sums of money seek a safe haven from this crisis. At another level, the weaker euro-zone countries, such as Spain and Italy, are paying stratospheric rates because investors are increasingly questioning their solvency. And there’s Greece, whose even higher rates signify its bankrupt condition. In addition, larger businesses and wealthy individuals are moving all of their cash and securities out of banks in these weakening countries. This undermines their financial systems. 423 Comments Weigh InCorrections? Personal Post The reason markets are battering the euro zone is that its hesitant leaders have not developed the tools for countering such pressures. The U.S. response to the 2008 credit market collapse is instructive. The Federal Reserve and Treasury took a series of huge and swift steps to avert a systemic meltdown. The Fed provided an astonishing $13 trillion of support for the credit system, including special facilities for money market funds, consumer finance, commercial paper and other sectors. Treasury implemented the $700 billion Troubled Assets Relief Program, which infused equity into countless banks to stabilize them. The euro-zone leaders have discussed implementing comparable rescue capabilities. But, as yet, they have not fully designed or structured them. Why they haven’t done this is mystifying. They’d better go on with it right now. Europe has entered this danger zone because monetary union — covering 17 very different nations with a single currency — works only if fiscal union, banking union and economic policy union accompany it. Otherwise, differences among the member-states in competitiveness, budget deficits, national debt and banking soundness can cause severe financial imbalances. This was widely discussed when the monetary treaty was forged in 1992, but such further integration has not occurred. How can Europe pull back from this brink? It needs to immediately install a series of emergency financial tools to prevent an implosion; and put forward a detailed, public plan to achieve full integration within six to 12 months. The required crisis tools are three: ●First, a larger and instantly available sovereign rescue fund that could temporarily finance Spain, Italy or others if those nations lose access to financing markets. Right now, the proposed European Stability Mechanism is too small and not ready for deployment. ●Second, a central mechanism to insure all deposits in euro-zone banks. National governments should provide such insurance to their own depositors first. But backup insurance is necessary to prevent a disastrous bank run, which is a serious risk today. ●Third, a unit like TARP, capable of injecting equity into shaky banks and forcing them to recapitalize. These are the equivalent of bridge financing to buy time for reform. Permanent stability will come only from full union across the board. And markets will support the simple currency structure only if they see a true plan for promptly achieving this. The 17 member-states must jointly put one forward. Both the rescue tools and the full integration plan require Germany, Europe’s strongest country, to put its balance sheet squarely behind the euro zone. That is an unpopular idea in Germany today, which is why Chancellor Angela Merkel has been dragging her feet. But Germany will suffer a severe economic blow if this single-currency experiment fails. A restored German mark would soar in value, like the Swiss franc, and damage German exports and employment. The time for Germany and all euro-zone members to get the emergency measures in place and commit to full integration is now. Global capital markets may not give them another month. The world needs these leaders to step up.
Monday 4 June 2012
A Facebook crime every 40 minutes
A crime linked to Facebook is reported to police every 40 minutes. Last year, officers logged 12,300 alleged offences involving the vastly popular social networking site. Facebook was referenced in investigations of murder, rape, child sex offences, assault, kidnap, death threats, witness intimidation and fraud.
Prince Philip in hospital
The Duke of Edinburgh has been taken to hospital with a bladder infection and will miss the rest of the Diamond Jubilee celebrations. Buckingham Palace said Prince Philip, 90, had been taken to the King Edward VII Hospital in London from Windsor Castle as a "precautionary measure". The Queen is still expected to join 12,000 others at the Jubilee concert which is under way at the palace. The prince will remain in hospital under observation for a few days. The prince had appeared to be in good health when he accompanied the Queen on Sunday on the royal barge the Spirit of Chartwell, which formed part of the rain-drenched Jubilee river pageant. He and the Queen stood for most of the 80-minute journey, as they were accompanied by 1,000 boats travelling seven miles down the river to Tower Bridge.
Luka Rocco Magnotta, the 'Canadian Psycho,' arrested in Berlin
Luka Rocco Magnotta was arrested in Berlin Monday after a four-day international manhunt that spanned three countries. The 29-year-old Canadian wanted over a horrific Montreal ice pick murder and decapitation of a Chinese student that he allegedly filmed and posted to the Internet, was arrested in or near an Internet cafe, Berlin police said. Montreal police confirmed they are aware of the reports that Magnotta was arrested, but said they are still in the process of contacting their Berlin counterparts. The arrest comes after French authorities said they were investigating a tip that Magnotta travelled from Paris to Berlin via bus on the weekend. “Somebody recognized him and (then) all the police recognized him,” Berlin police spokesperson Stefan Redlich told CP24 Monday. Handout (Click to enlarge) Magnotta's alleged victim is Lin Jun, a 33-year-old Concordia University student from Wuhan, Hubei, China. He was last seen on May 24, police said, and reported missing on May 29. Redlich said police were called in by a civilian who spotted Magnotta and he was arrested after police asked for his identification at about 2:00 p.m. local time in Berlin. Reuters is reporting it was an employee of the cafe, Kadir Anlayisli, that recognized Magnotta. The cafe is on Karl Marx Strasse, a busy shopping street filled with Turkish and Lebanese shops and cafes in the Neukoelln district of Berlin. German television quoted the owner of the cafe saying Magnotta was surfing the Internet for about an hour before his arrest. Redlich said Magnotta has been taken into custody without incident and will go in front of a judge Tuesday. Canadian officials are expected to start the extradition process for Magnotta in the near future.
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