The Evil Diaries: “Dining rights for life”

I/my family own c. 250,000 Watchstone (WTG). Latish yesterday it emerged that a firm of solicitors, styled Your Legal Friend (hem hem), have submitted a claim against Watchstone for, essentially, the consequences of the actions of a previous board. WTG advise that the claims come to £9.4m and that they will in any event be vigorously defended and do not affect the payout schedule of 90p on 31st December. This leaves WTG stunningly cheap at 95p. As an experienced investor remarked to me, the timing of this letter from YLF is to achieve maximum effect and that it should be treated as a cappuccino – i.e. largely froth.

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Yesterday, as I scanned the RNS’s, I was surprised to encounter a disclosure of University College Oxford’s accounts. This is a charity and, therefore, I thought it very unlikely to feature in a stock exchange announcement. However, it transpires that Univ borrowed £40m in April 2015 at 3.08% p.a. for fifty years. Whoever arranged that must be awarded dining rights for life. It is not that Univ’s credit rating is in doubt (I am sure it is not). It is that nobody in their right mind would lend to anybody on that basis – including HMG. And the latter can print the stuff to get out of a hole. Which no doubt it will.

Incidentally, the costs of setting up the loan, borne by Univ, were c. £500,000. I cannot begin to imagine how it is possible to spend that much. It must be the lawyers involved since only a lawyer can dream up this sort of bill.