Skip to main content

BBC hatchet job shoots at the wrong target

A friend of mine, who used to be the Editor of Newsnight- the BBC's flagship current affairs programme once said to me "Of course you must understand that television is essentially a tabloid medium". Yet, amongst the increasingly bland litany of "human interest" reality TV, celebrity wankfests and all the dross on our screens, you might have hoped that news and current affairs could hope for a greater ambition.

But No.

On Newsnight this week- which I caught when it was rebroadcast on BBC World- there was a spectacular example of a journalistic hatchet job, which The Sun would have been proud of.

The purported scandal was that "London based investment banks"- boo hiss- were knowingly mis-selling swaps to Italian and other local government institutions.

 In order to make the story stick, you need to know how a swap- conceptually- works. On cue, up came a slide that was supposed to show this. Err.. it was meaningless. It was, literally, a bunch of arrows that might as well have come from the opening credits of Dad's Army. So the first thing we need to know is that the journalist- Joe Lynam- can not explain a swap because he does not understand what a swap is.

The rest of the programme was a series of ever more laughably obvious cliches- the shiny towers of the City contrasted  with sunny Italy, even an interview conducted with an actors voice to protect the identity of "John"- not his real name.

We were supposed to be shocked that some swaps contracts had been voided because of faults which the wicked "London based investment banks"- a formula used in nearly every sentence of the piece- knew about but would not admit. Yet this was totally meaningless too: in a market of tens of thousands of transactions every day, it would be nothing short of a miracle if some transactions were not voided- for a whole variety of reasons- but apparently this journalist expects a level of perfection in financial transactions that no-one else even dreams of.

The portentous tone of the piece grew increasingly like one of The Day Today's best skits. 

It was crap. It was dangerous crap.

I worked over 20 years in the City of London. I am well aware that there are serious issues of business ethics, competence and sound practice that need to be addressed across the financial services industry. Yet the idea that "London Based investment banks" were praying on innocent government bodies in Italy just won't wash. Government treasurers are not usually inexperienced innocents- many have just as much knowledge of the market as anyone else. Banks in fact simply act as intermediaries in the swaps markets, between the different principals- but remember the journalist, Joe Lynam, doesn't understand swaps, so is unlikely to know this. He also does not understand how the regulatory system works- transactions between market counterparties are mostly a function of contract law- and therefore the regulatory role of the FSA is necessarily highly limited, so his criticism was aimed at the wrong target.  

In the end the villains of the piece may well not be the banks at all, but rather the governments of Italian regions that are trying to welch on duly contracted debts which they entered into fully understanding the risks.

Oh and Italy isn't a formal Federation either- but general knowledge was just another thing missing in the terrible piece.

So a pretty low grade sub-tabloid journalism engaging in a bit of cheap banker bashing. Pity it had to be shown on the BBC's flagship current affairs programme.

You can watch the fiasco here. The full definition of a swap is here.

The motto of the BBC used to be "to inform, to educate and to entertain". Joe Lynam and Newsnight think it is "to bluff, to bullshit and to lead a witchhunt by the ignorant". It was a truly disgraceful piece that should never have been broadcast. 

Still, at least our hero got a nice sunny trip to Milan at the public expense. 

Comments

Popular posts from this blog

Concert and Blues

Tallinn is full tonight... Big concerts on at the Song field The Weeknd and Bonnie Tyler (!). The place is buzzing and some sixty thousand concert goers have booked every bed for thirty miles around Tallinn. It should be a busy high summer, but it isn´t. Tourism is down sharply overall. Only 70 cruise ships calling this season, versus over 300 before Ukraine. Since no one goes to St Pete, demand has fallen, and of course people think that Estonia is not safe. We are tired. The economy is still under big pressure, and the fall of tourism is a significant part of that. The credit rating for Estonia has been downgraded as the government struggles with spending. The summer has been a little gloomy, and soon the long and slow autumn will drift into the dark of the year. Yesterday I met with more refugees: the usual horrible stories, the usual tears. I try to make myself immune, but I can´t. These people are wounded in spirit, carrying their grief in a terrible cradling. I try to project hop

Media misdirection

In the small print of the UK budget we find that the Chancellor of the Exchequer (the British Finance Minister) has allocated a further 15 billion Pounds to the funding for the UK track and trace system. This means that the cost of the UK´s track and trace system is now 37 billion Pounds.  That is approximately €43 billion or US$51 billion, which is to say that it is amount of money greater than the national GDP of over 110 countries, or if you prefer, it is roughly the same number as the combined GDP of the 34 smallest economies of the planet.  As at December 2020, 70% of the contracts for the track and trace system were awarded by the Conservative government without a competitive tender being made . The program is overseen by Dido Harding , who is not only a Conservative Life Peer, but the wife of a Conservative MP, John Penrose, and a contemporary of David Cameron and Boris Johnson at Oxford. Many of these untendered contracts have been given to companies that seem to have no notewo

Bournemouth absence

Although I had hoped to get down to the Liberal Democrat conference in Bournemouth this year, simple pressure of work has now made that impossible. I must admit to great disappointment. The last conference before the General Election was always likely to show a few fireworks, and indeed the conference has attracted more headlines than any other over the past three years. Some of these headlines show a significant change of course in terms of economic policy. Scepticism about the size of government expenditure has given way to concern and now it is clear that reducing government expenditure will need to be the most urgent priority of the next government. So far it has been the Liberal Democrats that have made the running, and although the Conservatives are now belatedly recognising that cuts will be required they continue to fail to provide even the slightest detail as to what they think should guide their decisions in this area. This political cowardice means that we are expected to ch