The BBC World Service, though current, considered and topical, still had a slight aura of antiquity for Keith. The locations of bureaux a poignant reminder of its scope across this earth: Tokyo, Seoul, Beijing to Delhi and west across the old Silk Road, back to Bush House, London – an image formed in Keith’s mind’s eye of RKO radio pylons bleeping into monochrome clouds and a slight cosmic haze. No wonder radio has been described as “the theatre of the mind.” Orson Welles’ War of the Worlds, the Archers…The King’s Speech. Did video really kill the radio star? mused Keith.
The first report he caught was from a BBC correspondent in New York, prefacing his interview with a thumbnail of the ratings agencies scene – there are only 3 major players (Standard & Poor – S&P, Moody’s and Fitch) and they rate the world’s bonds and derivatives – but omitting an essential piece of information:
Listeners were not told that these same ratings agencies derive their primary, if not sole revenue stream, from the commission that they are paid by the merchant banks and governments that are issuing the bonds that they, the ratings agencies, rate.
Err, herein lies an inherent contradiction – a whopping great, objective conflict of interest. “Bloody great elephant in the proverbial!” Keith recalled that in late 2010, a Eurobond dealer broke away from the conformist consensus of his peers and spoke out against the ratings agencies. This lone voice had made it onto the BBC World Service and clearly stated that the ratings that these agencies had given toxic Greek, Spanish and Irish sovereign debt were incorrect. He ‘called’ these government bonds as sub-junk trash. He derided the ratings as being as fetid as the subprime ‘miscalculations’ of 2008 and earlier.
Mr Gray’s thoughts then drifted momentarily to Dumsfeld, Harridan et al…the Melbourne conference…self raising or plain?…only to be jolted back to the radio by the announcement of the next item on the air, an interview with Norman Boyd, CEO of The Corrections Corporation, (FTSE: CorrectCorp). He visualised an orange-tanned, bouffanted grinning suit, arm around the shoulder of orange-tanned ‘Sir Cliff’ on the Barbados plantation, with orange-tanned Bliar and the obsequious (and orange-tanned) Mandelson. Boyd en vacances…and not too far away from Cuba…
Comment on CorrectCorp’s stellar performance on the London markets and the increasingly ubiquitous Boyd segwayed into the first question:
“Norman Boyd, welcome to Hard Cash…Could you describe for our listeners the relationship between your spiritual foundations – your Evangelism – and your sense of duty to shareho…”
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