How John Lewis found fashion and became never knowingly underdressed; Clothing boss Peter Ruis tells how the stores known for good sense and slippers became the fashionistas’ darling

How John Lewis found fashion and became never knowingly underdressed

Clothing boss Peter Ruis tells how the stores known for good sense and slippers became the fashionistas’ darling

Sarah Butler

The Observer, Sunday 10 March 2013

Peter Ruis in the John Lewis chain’s Peter Jones store, Sloane Square. Photograph: David Levene

Fashionistas queuing round the block, a sell-out designer collection and breathless reviews by the style press. Can this really be John Lewis? As 84,700 partners working at the department stores celebrate their 17% bonus this weekend, they can rest assured they are back in fashion in a big way. A 9% rise in clothing sales helped drive a bumper year for John Lewis as it increased its market share, mainly at Marks & Spencer’s expense. The chain accounted for 2.1% of the UK clothing market in 2012, according to retail analysts Verdict, 10% up on a year before.

Once associated with sensible knitwear and cosy slippers, the 40-store chain has polished up its fashion credentials through designer collaborations, classy own-label products and the addition of upmarket brands that had previously steered clear of the store.

As a result, fashion sales topped £1.1bn last year – up from about £700m in 2005. That’s still only about a quarter of what Marks & Spencer sells, but it indicates the kind of growth that rivals can only dream of in the economic downturn.

Under the guidance of buying and brand director Peter Ruis, who took charge of fashion in 2007, John Lewis has created a buzz by recognising that shoppers of all ages now want to look trendy – and that older customers no longer want gold buttons and elasticated waistbands. Read more of this post

Retiring workers are being “ripped off” by financial companies making huge profit margins on annuities, campaigners have warned

Pensioners being ‘ripped off’ by profit margins on annuities

Retiring workers are being “ripped off” by financial companies making huge profit margins on annuities, campaigners have warned.

Experts warn that the industry is concealing large profits. Photo: PA

By Richard Evans, and James Kirkup

9:47PM GMT 08 Mar 2013

A Telegraph investigation has raised concerns about the profits that insurance companies and other firms are making on annuities. Only one annuities provider, Standard Life, has disclosed its margins on annuities, revealing that it pockets almost 20p of every pound a customer pays for an annuity. Other firms refuse to reveal their margins, and experts warn that the industry is concealing large profits. Ros Altmann, a pensions campaigner, said: “These huge margins are outrageous.” Annuities rates have tumbled in recent years as the Bank of England’s quantitative easing programme pushes down returns on the government bonds that are the basis of annuity income. Financial experts say that people can significantly boost their retirement income by shopping around. Steve Webb, the pensions minister, said: “Annuities are increasingly important. More openness on rates should help consumers get a better deal.” Standard Life pays an income of £4,990 on a £100,000 annuity for a 65-year-old. The market leader, Aviva, pays £5,600.

A ‘Politically Explosive’ Secret: Italians Are More Than Twice As Wealthy As Germans

A ‘Politically Explosive’ Secret: Italians Are More Than Twice As Wealthy As Germans

Wolf Richter, Testosterone Pit | Mar. 9, 2013, 7:17 AM | 6,192 | 29

In December 2006, the ECB established the HFSC network of survey specialists, statisticians, and economists from its own ranks, national central banks of the Eurozone, and statistical institutes. The acronym stood for Household Finance and Consumption Survey.

It would collect “micro-level structural information” on household wealth. A massive bureaucratic undertaking. Surveys went out in 2010. Results are now ready. No one in Europe had ever done a survey on that scale before.

And no one might ever do it again. Because, in the era of bailouts and wealth-transfers, the results are so explosive that the Bundesbank is keeping its report secret—and word has leaked out why.

The surveys were conducted on a national basis, with each central bank publishing its own report. They would then be combined and summarized by the ECB into a cohesive picture of how wealthy—or how poor—people in various parts of the Eurozone were. A number of countries already published their reports, including Italy and Austria.

What the Austrian National Bank found was not pretty (20-page PDF). The considerable wealth in Austria was very unevenly distributed. The wealthiest 5% owned nearly half of the country’s wealth. Their median wealth was €1.7 million in diversified assets. The lower 50% owned only 4% of the country’s wealth. Of them, 83% rented their homes. Their median wealth was a measly €11,000 consisting usually of a car and a savings account. That’shalf of the people! And 10% had a net wealth of less than €1,000.

This unequal distribution of wealth created a huge gap between median income (half the people earned more, the other half less) of €76,000 and average income of €265,000 (pushed up by a small number of extremely wealthy households). And that’s why some countries don’t even publish average income values. Too much truth would hurt.

Germany’s data is likely to be similar—but the Bundesbank is treating its report like a secret. Because the results are, let’s say, awkward for two reasons.

The highly unequal distribution of wealth is one of them. The German government already went through wild gyrations late last year, and now again, over its Poverty Report that exposed some inconvenient facts that were then edited out—something that was leaked immediately, and it caused a ruckus [read…. Censored: Poverty Report in Germany].

Italy is the other issue. But it may be too hot for the Bundesbank to touch. Italy’s report (142-page PDF) finds that median household net wealth has increased 56% since 1991. And from 2008 to 2010, it increased by about 5% annually, despite the crisis!

But the wealth of German households stagnated during much of that time while they paid taxes out of their noses. And now they might learn that Italy’s median household wealth is €163,875—while Germany’s is closer to Austria’s, around €76,000. Less than half!

“Politically explosive,” sources at the Bundesbank whispered to the FAZ. Read more of this post

Chinese consumers account for 50% of all LV sales

Chinese consumers account for 50% of all LV sales

Staff Reporter

2013-03-10

More than half of all Louis Vuitton purchases in the world are made by Chinese people, according to the Hurun Report, a magazine best known for its rankings of wealthy individuals in China. According to Rupert Hoogewerf, founder of the Hurun Report and chairman of the Hurun Research Institute, the 33 billionaires on their new Hurun Luxury Tycoon Rich List owe much of their success to Chinese shoppers and their notorious overseas shopping sprees. “The Chinese luxury consumer is today the most important customer group in the world for luxury brands, especially now that the Chinese luxury consumer has started to travel around the world,” Hoogewerf said. Read more of this post

State-owned firms ignore Beijing order to exit property sector

State-owned firms ignore Beijing order to exit property sector

Staff Reporter

2013-03-10

A 2010 order issued by the Chinese government requiring state-owned companies to exit the property sector if it is not their core business has failed to prevent such companies from winning bids for prime-location land across the country, reports the Guangdong-based Southern Weekly newspaper.

According to recent reports, less than a quarter of the 78 state-owned enterprises asked to terminate their property business operations more three years ago have complied. Read more of this post

China to split rail ministry after scandals; China Plans Overhaul of Debt-Laden Railways; China Unveils Government Agency Shake-Up Proposal

China to split rail ministry after scandals
Posted: 10 March 2013 0930 hrs

BEIJING: China will split its scandal-plagued railways ministry in two and bring its administrative functions under the control of the transport ministry, state media said on Sunday.

The plan is to “dismantle” the ministry, the official Xinhua news agency reported, citing a report on institutional reform to be submitted to the National People’s Congress parliament meeting in Beijing later.

The ministry’s commercial functions will be taken over by a new China Railway Corporation, it added.

The railway system has been one of China’s flagship development projects in recent years and the country now boasts the world’s largest high-speed network.

But the expansion — which has cost hundreds of billions of dollars — has seen widespread allegations of corruption and former railways minister Liu Zhijun, who was sacked in 2011, is awaiting trial on graft charges.

In July 2011 a high-speed crash in the eastern city of Wenzhou killed at least 40 people, sparking a torrent of public criticism that authorities compromised safety in their rush to expand the network. Read more of this post

BHP Billiton Plans to Sell 10 Assets After Debt Rises to Record; BHP has gone from holding $200 million in net cash at the end of 2010 to net debt of $30.4 billion at the end of 2012

BHP Billiton Plans to Sell 10 Assets After Debt Rises to Record

BHP Billiton Ltd. (BHP), the world’s largest mining company, is planning to sell about 10 of its assets amid a rise in debt levels after a two-year metals boom driven by Chinese demand stuttered.

The Gregory-Crinum coal mine in Australia’s Queensland state is among the assets being considered for sale, spokeswoman Eleanor Nichols said by phone today. The Australian newspaper first reported that Chief Financial Officer Graham Kerr told equity analysts last week the divestment program was focused on at least 10 BHP assets. The company owns mines, oil and gas wells, and processing plants.

Global mining companies are selling off businesses after slumping metal prices triggered more than $60 billion of writedowns to mineral resources. BHP’s debt has risen to a record $30.4 billion and Chief Executive Officer Marius Kloppers last month joined his counterparts at Rio Tinto Group and Anglo American Plc in stepping down from his role. Read more of this post

US professors lose it on CNBC over China real estate

US professors lose it on CNBC over China real estate

• Staff Reporter

2013-03-09

Professors Peter Navarro and Lee Ann show off their letters. (Internet Photo)

What was supposed to be civilized debate turned into an indecipherable cacophony of egos in a live show on CNBC. Peter Navarro, a professor at University of California at Irvine, and Ann Lee, a professor at the New York University, came to an impasse on the topic of the impact of the Chinese housing bubble on the global economy, reports Shanghai-based Xinmin Evening News. China released recently new regulations to curb China’s rising real estate prices, including an increase in down payments and loan rates for buyers of a second piece of property in cities. These policy measures worry investors and generate fears of a bubble building in China’s property market.

CNBC invited Navarro and Lee to share their perspectives over the concern, which kicked off well until Ann Lee started speaking. Before finishing her first sentence, Navarro began and kept up a string of snide comments about her affiliation with Beijing, and continously cut off Ann’s every attempt at an argument. The brawl boiled over when she said, “I don’t think there was a bubble at all. The Chinese government has been trying to slow and cool this part of the economy for years.” Navarro, a seasoned academic at a respectable university, came back with an extraordinary rebuttal in the middle of Ann’s sentence, “This is the most bullshit I have ever heard,” and “shame on you, Ann.” Eventually the hostess Michelle Caruso-Cabrera gave up trying to exact something viewers could understand and cut short the show.

China’s new leaders: Don’t get your hopes up; The only good news coming from the pending leadership changes is the near certainty of the end of China’s one-child policy

China’s new leaders: Don’t get your hopes up

March 8, 2013: 3:11 PM ET

The only good news coming from the pending leadership changes is the near certainty of the end of China’s one-child policy.

By Minxin Pei

FORTUNE — Ever since Xi Jinping, China’s new leader, ascended to the top spot of the ruling Communist Party’s hierarchy last November, he has promised repeatedly to restart China’s long-stalled economic reforms. With the opening of the annual session of China’s rubber-stamp parliament (officially known as the National People’s Congress), Xi and his colleagues finally have a chance to show the Chinese people what kind of reforms they have been thinking about.

Of course, it may be too early to analyze the pronouncements coming out of the congress since its most important business, such as announcing the restructuring of the State Council (the cabinet) and appointments of key economic officials, has not concluded. However, based on the information leaked to the press, it appears that the new leadership will not embark on a bold course of reform. Caution, not risk-taking, will remain the modus operandi of Chinese leadership. Read more of this post

Currency swings are rising in Malaysia at the world’s fastest pace as concern mounts that the ruling coalition will lose its 55-year grip on power after attracting more foreign capital than any other emerging market except Mexico

Volatility Rises Most in Malaysia as Flows Imperiled: Currencies

Currency swings are rising in Malaysia at the world’s fastest pace as concern mounts that the ruling coalition will lose its 55-year grip on power after attracting more foreign capital than any other emerging market except Mexico.

Three-month implied volatility for the ringgit, a measure of expected exchange-rate moves used to price options, jumped 2.2 percentage points to 7.4 percent in 2013, more than any of the 47 currencies tracked by Bloomberg. The ringgit has lost 1.6 percent this year and reached a five-month low in February as Credit Suisse Group AG and ING Groep NV cut their forecasts.

Polls show support for Prime Minister Najib Razak, who embarked on a $444 billion development plan to build railways and power plants, is the lowest since 2011 ahead of elections due before the end of June. Investors may pull from the local bond market as much as $10 billion, or 24 percent of their total holdings, as opposition leader Anwar Ibrahim pledged to review highway-toll contracts and the granting of tax permits to large companies, according to Credit Suisse. Read more of this post

PBOC’s Rise to Top a Story of Deft Politics Amid Turmoil; “It’s hard to believe that just three decades ago the PBOC was only a minor institution in the labyrinthine Chinese bureaucracy.”

PBOC’s Rise to Top a Story of Deft Politics Amid Turmoil

As of November 2012, the People’s Bank of China had total assets of $4.8 trillion, more than the European Central Bank or the Federal Reserve. The PBOC now supplies more than half the world’s total liquidity and manages foreign reserves worth almost $3.3 trillion.

Increasingly, the PBOC has become an international lender of last resort, particularly as European politicians try to persuade the Chinese to buy their bonds. No wonder that Zhou Xiaochuan, the bank’s governor, has been dubbed “the world’s central banker,” a man whose statements can move global markets.

It’s hard to believe that just three decades ago the PBOC was only a minor institution in the labyrinthine Chinese bureaucracy. Its ascension is a story of turbulent economic transition, skillful leadership and, above all, deft political strategy. And its most significant challenges may still lie ahead. Read more of this post