Morning Brief – Surge Pricing

Surge Pricing

Lots recently in the Financial Times and the examples of surge pricing in the price of concert tickets to see top name music artists. Once again and a bit of a theme for today, it’s legendary Group Pink Floyd and its erstwhile leader Roger Waters who is leading the way. To see Pink Floyd in concert in 1977 would have set you back GBP3.50 a bit less than their then newly released album Animals. By 1980 the concert price at London’s Earls Court was up to GBP8.50. Roger Waters has since gone his own way both musically and politically but is still cashing in on his founder membership status of Pink Floyd: the price on an inflation adjusted basis for a ticket to see him in concert in 2023 should be GBP35. Instead of which the cheapest ticket on his latest tour is an eye watering (no pun) GBP254.

GBP/USD 1.2195.

Eurozone Bond Yields

All too easy to get fixated on the US situation with the brinkmanship that almost led to a shut down of the US Government over the weekend or the political jockeying in the UK that is the Party Conference season in the final year leading up to a General Election. Meanwhile the EU does not look too bright on the economic front with 10 Year Italian Bonds at 4.69%, Germany’s at 2.85% and France at 3.20%. France’s debt position has mushroomed to become the third largest in the world behind the USA and Japan and the EU bond markets as a result are looking wobbly. It is one thing and it is broadly expected that Italy is at the bottom of the heap when it comes to economic prudence, but if France finds it hard to sell its bonds, that would be a very different matter and would send shockwaves across the Eurozone.

EUR/USD 1.0570.

Evergrande

What does it mean for the wider world when this huge Chinese property company looks to be in danger of collapse? At one end of the spectrum-the worst one-it may lead to a chain reaction, other defaults and a credit crunch as banks withdraw credit lines. At the other end, it means that the many thousands of Chinese who have placed deposits on flats will lose them and will as a result be poorer and will spend less. While that will doubtless be bad for the wider global economy, the main effect will be felt in the domestic Chinese economy. This is in large part why the Yuan is suffering.

USD/CNY 7.3010.

Tour Demands

Of course the annals of rock and roll history is littered with artist demands that vary from outlandish and expensive to merely eccentric for their dressing rooms and as part of their appearance contracts. At one end of the scale is poseur actor George Clooney who requires a basketball court to be built next to his trailer which costs in the region of USD 200,000. At the other end is Jennifer Lopez who stipulates that her coffee must be stirred counter clockwise which is priced at a steep sounding USD 5,000.

Fat Old Sun

This day in 1970 Pink Floyd released their album Atom Heart Mother which for diehard Floyd fans is considered to be their finest album ever, even if some of the songs suffer from poor reproduction, indistinct lyrics and in one case the sizzling of bacon and eggs. This number however is generally rated highly with David Gilmour’s singing and the band’s instrumentals:

When that fat old sun in the sky is falling
Summer evening birds are calling
Summer Sunday and a year
The sound of music in my ears

Distant bells, new mown grass smells so sweet
By the river holding hands
Roll me up and lay me down

And if you see, don’t make a sound
Pick your feet up off the ground
And if you hear as the warm night falls
The silver sound from a tongue so strange
Sing to me, sing to me

When that fat old sun in the sky is falling
Summer evening birds are calling
Children’s laughter in my ears
The last sunlight disappears

And if you see, don’t make a sound
Pick your feet up off the ground
And if you hear as the warm night falls
The silver sound from a tongue so strange
Sing to me, sing to me

Discussion and Analysis by Humphrey Percy, Chairman and Founder

Click Here to Subscribe to the SGM-FX Newsletter