Charlotte Street Partners



Minute by minute policymaking

Written by Juan Palenzuela, associate 
Edited by David Gaffney,  partner
2 June 2020

Good morning,

Policymakers are facing a conundrum (yes, another one). They need to act quickly to introduce measures that slow the spread of the virus but also minimise the impact on people and the economy. We all want, after all, to get out of lockdown as soon as it is safely possible.
In normal times, they would use indicators such as GDP, unemployment, interest rates, to inform their decision making. But these are not normal times and, in a hard-paced crisis like this one, those indicators are just too painstakingly slow to be particularly useful. Many countries, including the US, unveiled GDP figures for their first quarter last week, even though we are already two-thirds of our way through Q2.
Thankfully, big tech might have some of the answers. Since the beginning of the pandemic, Google and Apple, among others, have been publishing aggregated, anonymised and easily accessible data on how people are moving. Thanks to these reports, we know that recreational park visits in Edinburgh have jumped by 136% from the usual baseline during last week, for example, and that grocery visits in the city are up only marginally.
These are powerful and practical insights. So much so that they now are one of the main tools for policymakers such as Nicola Sturgeon, Scotland’s first minister, who noted during her daily update yesterday that “on Saturday, in Loch Lomond, traffic was around three times higher than the previous Saturday.”.
In this time of experimentation, the benefits of using these types of indicators may prove so obvious that rescinding them after the pandemic could be in no one’s interest. Policymakers would lose a valuable – and relatively cheap, or even free – source of information; big tech would go some way towards restoring its reputation and all of us would benefit from more effective policies and from the ability to access the data itself. With so many difficult decisions to make, we should grasp the easy ones when they come around.


The US president, Donald Trump, suggested he could send soldiers to the streets to quell civil unrest in several American cities, sparked by the killing of George Floyd. Such a move would require Trump to invoke the 1807 Insurrection Act clause, which allows the president to deploy the military within its own borders. It was last invoked in 1992 during the riots that followed the acquittal of the policemen who had violently beaten Rodney King, an African-American man, in Los Angeles.

Britain and France have spoken out against inviting Russia to this year’s G7 summit, which is scheduled to take place in America in September. This was after Donald Trump suggested that the organisation should adapt and include Russia’s president, Vladimir Putin, in the gathering. Russia was excluded from the group after it invaded and annexed Crimea in 2014.
Boris Johnson, Britain’s prime minister, is reportedly planning to hold “crunch talks” with Ursula von der Leyen, the European Commission president, later this month in a bid to unblock post-Brexit trade negotiations.
During a press conference yesterday, the head of the World Health Organisation, Tedros Adhanom, said there was no evidence that the virus is losing its potency, despite the comments suggesting such from a leading Italian doctor. Instead, Adhanom suggested that it could be a result of the effort to contain the virus.

Business and economy

The European Central Bank is now expected to expand its Pandemic Purchasing Programme next Thursday. The programme, which launched in May and has spent more than €210bn so far, is falling short for some already. It is still not clear what additional amount will be committed.
The Business Growth Fund (BGF), an investment firm, is planning to team up with other investors to set up a £15bn private fund to help bail out businesses that struggle to repay state-guaranteed pandemic loans. Stephen Welton, chief executive of BGF, hopes that this could avoid a wider collapse due to what he believes is “a totally unsustainable debt mountain”.
Ted Baker’s founder, Ray Kelvin, reduced his stake in the fashion retailer by more than half, handing control of the company to one of the company’s main investors as part of an emergency £105m fundraising to get the business through the coronavirus pandemic.

Columns of note

Writing for the Financial Times, Yuan Yang explains why many citizens of Hong Kong are worried about their digital freedom and how censorship of the internet on the island not only affects its residents, but also the mainland Chinese who rely on proxies to access content freely.
In The Times, Melanie Phillips argues that a new group like the D10 can show up the corruption and inefficiency of the postwar international system.

Cartoon source: The Times


What happened yesterday?

Equity markets performed well yesterday in spite of greater tensions between China and America and civil unrest in the latter.
The Dow Jones Industrial Average ended the session up 0.36% at 25,475.02, the S&P 500 added 0.38% to 3,055.73, and the Nasdaq Composite was 0.66% firmer at 9,552.05.
In the UK, the release of the latest UK manufacturing data reassured investors. The FTSE 100 ended the session up 1.48% at 6,166.42, and the FTSE 250 was 1.38% firmer at 17,277.53.
In mainland Europe, the benchmark Stoxx 600 had added 1.1% to 354.2, alongside a 1.79% jump for the FTSE Mibtel to 18,523.71, while the Cac-40 added 1.43% to 4,762.78.
In company announcements, ABF, the owner of retailer Primark, said that only 34% of its total selling space is currently in operation but that it is now working to re-open its stores in England by 15 June, in line with government guidance. It notes high customer demand at re-opened stores, as evidenced by queues and larger basket sizes.
Balfour Beatty, meanwhile, cancelled payment of its final dividend stating that Covid-19 and lockdown measures have had a material impact on its financial performance. The infrastructure group also announced that it would buy £112m of preference shares due on 1 July and that its order book at the end of April was 20% higher than the previous year, boosted by contracts related to HS2.

What’s happening today?

Card Factory
Inspired Energy
Vianet Grp

Arrow Global
Mobeus I&g 4
North American
Plant Health

UK economic announcements
(07:00) Nationwide House Price Index
(09:30) Consumer Credit

Final dividend payment date

Source: Financial Times

did you know

The earliest known vending machine was invented in first century Rome by Hero of Alexandria. Customers could insert a coin into his machine, and the coin’s weight would depress a lever and open a valve to dispense holy water.

Parliamentary highlights

House of Commons

Recall of Parliament


Business of the House (Today) – Mr Jacob Rees-Mogg
Proceedings during the pandemic – Mr Jacob Rees-Mogg



House of Lords 

Oral questions

Orders and regulations

Private notice question

Hong Kong – Lord Alton of Liverpool

Telecommunications Infrastructure (Leasehold Property) Bill – Committee stage (day 2) – virtual proceeding – Baroness Barran

Orders and regulatons

Scottish Parliament 

Parliamentary bureau motions

Topical questions

Scottish government debate

COVID-19: Next Steps for the NHS
COVID-19 Next Steps (Economy)

Business motions

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