NATIONAL LIFE STORIES CITY LIVES Sir Nicholas Goodison Interviewed by Cathy Courtney C409/133 © The British Library Board http://sounds.bl.uk IMPORTANT Access to this interview and transcript is for private research only. Please refer to the Oral History curators at the British Library prior to any publication or broadcast from this document. Oral History The British Library 96 Euston Road London NW1 2DB 020 7412 7404 [email protected] Every effort is made to ensure the accuracy of this transcript, however no transcript is an exact translation of the spoken word, and this document is intended to be a guide to the original recording, not replace it. Should you find any errors please inform the Oral History curators ([email protected]) © The British Library Board http://sounds.bl.uk The British Library National Life Stories Interview Summary Sheet Title Page Ref no: C409/133 Digitised from cassette originals Collection title: City Lives Interviewee’s surname: Goodison Title: Sir Interviewee’s forename: Nicholas Sex: Male Occupation: Date and place of birth: 16 May 1934 Dates of recording: 28 October 1997, 20 February 1998, 3 March 2003, 5 March 2003, 17 April 2003, 24 April 2003, 25 April 2003, 12 April 2006, 10 May 2006, 20 July 2006, 27 October 2009 Location of interview: Lloyds TSB and interviewee’s home Name of interviewer: Cathy Courtney Type of recorder: Marantz CP430 and Marantz PMD660 Total no. of tapes: 29 Total no. of digitised tracks: 53 plus one born digital track Total no. of tracks: 54 (46 are accessible) Mono or stereo: Stereo Additional material: Also interviewed for National Life Stories projects Leaders of National Life (C408/009) in 1988 and 1994 and An Oral History of Barings (C1367/33) in 2013. The British Library has copies of off-air recordings deposited by NG: ‘I Know What I like’ (broadcast BBC Radio 3 1981), Desert Island Discs (broadcast BBC Radio 4 1987) and ‘Witness to History: Big Bang, A Revolution In The City’ (broadcast on BBC Four in 2002). Copyright/Clearance: Copyright assigned to the British Library. Tapes 1 – 16B are open, with no restrictions. The following tapes have restrictions or are completely closed until June 2033: Tape 17 is closed Tape 18 is closed EXCEPT between 23:17 and the end of tape 18 side B (Part 31 on BL Sounds) Tape 19 is closed Tape 20 is closed Tape 21 side B [Part 31 on BL Sounds] between 12:56 – 14:31 Tape 24 side B [Part 36 on BL Sounds] between 09:58 – 10:13 Tape 25 side B [Part 38 on BL Sounds] between 10:51 – 16:26 Tape 27 side A [Part 40 on BL Sounds] between 13:24 – 13:29, 14:29 – 14:43 Tape 28 side B [Part 43 on BL Sounds] between 08:51 - 15:36, 21:23 - 24:09 Tape 29 side A [Part 44 on BL Sounds] between 16:01 – 30:37 Tape 29 side B [Part 45 on BL Sounds] between 01:57 – 12:30 Born digital track 30 [Part 46 on BL Sounds] between 01:36:30 – 01:45:40 Notes: There is no tape 12, and due to further misnumbering there are two tapes numbered 16 (16 and 16B). © The British Library Board http://sounds.bl.uk Sir Nicholas Goodison Page 1 C409/133/01 Side A [Part 1] Tape 1 Side A [Part 1] Cathy Courtney recording Sir Nicholas Goodison at the TSB on October the 28th 1997. I’m just going to..... [break in recording] We are actually recording on a day when the Evening Standard placards outside are recording a lot of drama in share prices, and I wondered if I could have your summing up of the last few days and what you think the implications are. Well there may be no implications. I say that because I don’t think the economic fundamentals in most of the development countries are the same as they were in 1987 or on earlier occasions when stock markets have fallen very heavily. In America and in the United Kingdom and in most European countries, governments are now pursuing policies – anti-inflation – anti-inflation policies, more fiscally responsible policies than they were in those years. And so there’s no basic reason why those economies should be upset by a fall in the stock market. I think the reason for the falls has been two-fold. First there has been a calamity or two in the Far East – Thailand, the Philippines, Indonesia, Malaysia all over-extended their infrastructure projects, their government spending. They were growing too fast frankly. Hong Kong was also growing too fast, but has managed so far to keep its dollar pegged to the US dollar. And those markets had a big set-back because the authorities had to take action to get their fiscal problems back into balance, and that sent Far Eastern markets down. And that then, and this is the second point, did something to undermine the confidence of investors all over the world. We have to remember that all the main markets, the US market and the UK market particularly, have had huge rises, so there’s a level of expectancy built into the market that is rather difficult to justify in terms of corporate earnings. So this really probably is a corrective? © The British Library Board http://sounds.bl.uk Sir Nicholas Goodison Page 2 C409/133/01 Side A [Part 1] I think it’s a correction, yes. Yes. And this is the first time the system has come into action that froze trading in New York. Have you got anything to say about that? Well I don’t think it’s a good idea. I’ve always been against trading halts. I believe trading halts undermine confidence. People think, my goodness, they’ve stopped trading, there must be a good reason, and so they lose a little bit of self-confidence. So I’m against them. I was very much pressurised to bring in trading halts when we did the reforms in 1986 in London, and I was very much against it; because the new London system also has a break point where they can have a trading halt if – I’m not familiar with the details but I think it’s if it’s down ten per cent or something of that order – in any one stock. I’m afraid it’s something that people bring in because of the limitations of the machinery. I always think markets should not be driven by the technology, it should be the other way round. And was the circumstances that have been happening in the Far East totally foreseeable, or not? Well, hindsight is perfect vision, and there are plenty of people around now who are saying, yes of course they saw it coming, but they didn’t, did they? Or if they had seen it coming, they would have taken action earlier. And it’s only a year or less since people were saying, ‘You must invest in these tiger economies because their growth rates were so amazingly attractive, and you must have an interest in the Pacific Rim, and this is where the real growth is going to take place.’ And they were growing at a phenomenal rate, and some of those economies were achieving growth rates of eight per cent, nine per cent, twelve per cent, in GDP, which is a very high growth rate, unlike the Continent of Europe or indeed the States. I’m afraid when you get growth rates of that order you can’t expect them to be consistent; you are going to have hiccups, you’re going to have bubbles, you’re going to have moments when confidence is excessive and the bubble is pricked, and that’s what’s happened in many of those economies. © The British Library Board http://sounds.bl.uk Sir Nicholas Goodison Page 3 C409/133/01 Side A [Part 1] And when I was last doing a lot of recordings in the City, it was exactly as you are describing, everybody saying the Pacific Rim is the great new thing. And on the one hand it was a place to make money in from here, but on the other hand it was also a fairly long-term threat as to whether that part of the world would become the dominant financial centre. Has that been reassessed by this at all? I believe there’s still a fundamental belief that growth rates in the long run will be higher in the East than they are in the more developed economies in the West. The populations are substantial; there is a strong emphasis on education; there’s a lot of people in Eastern economies who are business-oriented, incidentally in China very much so; and there’s huge development potential. I don’t think any of that is dented. But what has happened is speculative bubble. To give you an illustration, a lot of properties have been put up in Shanghai and other towns on the seaboard of China, and there’s been a lot of property development in Hong Kong and Taiwan and other countries, and some of it has run ahead of demand. And some of those economies, particularly Hong Kong of course, are very much dependent on the value of property and the ability to fill those properties with rent-paying tenants. If there’s a hiccup the basis of credit is undermined, and so people lose confidence. And one of the pieces in the paper I was reading was talking about whether the Eastern European countries are going to be much affected and whether that could actually catapult us into a much worse catastrophe.