Now that inflation — as measured by the Consumer Price Index — has risen to 3.5%, Mervyn King has had to write a letter to the Chancellor, Alistair Darling, to explain himself.

Helpfully, the Adam Smith Institute has drafted it for him. “Dear Al, as you are aware, the Bank of England recently printed £200 billion of new money.

“This new cash was used to plug your Government's record-breaking budget deficit, and pumped into the economy via public spending. You also raised VAT by 2.5% at the end of 2009, pushing up retail prices. Are you really that surprised that we are seeing inflation? Lots of love, Merv x.”

Brown and out at No 10

Much grumpiness from the contingent of small businessmen and women invited to meet Gordon Brown at Number 10 last week only to find he wasn't there when they turned up.

The entrepreneurs were fobbed off with Lord Mandelson instead — a far less appealing prospect. “It's like inviting someone to your house and not showing up,” grumbles one to City Spy.

Mandy's Dubai debt swap

Lord Mandelson has been giving the Dubai government a lecture about debt. Dubai must restructure its repayments — or face serious consequences, he tells them. How long before the Dubai business secretary turns up in London to deliver an equivalent telling off?

And in second place, again: Lady Judge

Gallows humour at the Non-Executive Director Awards at the Plaisterers' Hall in the City. As the not-for-profit sector prize was announced, a voice piped up: “That must be for the banks!”

Ken Olisa of Thames Reach pipped Barbara Judge for the award, the second year the formidable head of the UK Atomic Energy Authority and serial director had been shortlisted. One guest said he tried to cheer up Lady Judge with: “Third time lucky?” As if he dared.

AIG victims turn the heat up

The AIG Enhanced Fund Victims group — the lobby set up by wealthy clients who face losing a chunk of money invested with the American insurer — has sent out a gleeful missive to members.

It is trying to pin down wealth management giants including Barclays Wealth, Coutts and UBS for mis-selling the AIG Premier Access Bond Enhanced fund. And one of the victim group's organisers reckons he has scooped a crucial contact.

He tells investors: “The new administrator we've just hired in our firm has just resigned from… AIG. How useful, n'est-ce pas?”

Just in case John Varley and Oswald Grübel aren't yet quaking in their boots, he adds: “We have seen UBS and Barclays capitulate on cases, and minor private banks appear to have provided back to back loans to all their investors.”

Flagging up the FSA's recent £2.45 million fine on Standard Life for producing misleading literature, the lobbyist asks investors, “Ring any bells?”

One thing to reassure investors is that the closed fund has now grown by 24% since it started, which is in line with what both Alico and the lobby group's coordinator predicted. But it might distress those investors who took their money out of the fund - it's over 100 times better than the average money market fund. So maybe it pays to take advice…but not from a bank.

The scams that score

Ever wondered what sort of hit rate the average Nigerian email scammer can expect?

The website Scam Detectives has published a lengthy interview with a convicted email fraudster. He reveals the hierarchy of the scams, with a gangmaster paying teachers to recruit “foot soldier” children who are good at English and computers.

The children then spend days online hunting for email addresses, sending thousands of messages.
Around nine or 10 out of every thousand emails get a response, then about one out of every 20 replies saw a victim paying out.

“John” says he expected to make about $7500 from a victim, but one of his mates scammed someone out of $25,000…

Lending pigs a new name

If they dislike being called PIGS, then take the last letters of Portugal … Greece … Spain … Ireland … and whaddya get? LEND.

Foxtons brushes up its image

Could Foxtons, once a byword for sharp practice in residential estate agency, be mending its ways?

The company has reversed its decision — made on Christmas Eve — to appeal against a High Court judgment that the millions of pounds it charged landlords in renewal commissions and management fees were unfair.

The Office of Fair Trading won a case against Foxtons last July, when a judge agreed that its terms — which forced landlords to continue paying commission even if the agent was no longer involved in letting or managing a property — were a “trap”.

Landlords were due to receive refunds worth thousands of pounds but Foxtons wanted to use the subsequent success of the banks against their customers to challenge the OFT.

Now, however, Foxtons has decided not to pursue the argument any further. A spokesperson explained that the company had instead decided to amend its renewal terms and conditions, and that the new terms “have now been formalised in a High Court order”.

So bad news for m'learned friends, but good news for landlords, as Foxtons' renewal commission will from now be charged at a reduced level and for a maximum of two years. And good news for consumers, competition and good behaviour. Three cheers.

Singapore is the land of prosperity

Happy days! The recession is definitely over and the good times are back. How so? Because McDonald's has put a Prosperity Burger — with two slabs of beef, because diners are now rich enough to afford it — on its menus.

Alas, so far it's only available in Singapore, but now Britain's GDP is creeping up, it's surely only a matter of time…

FT gets overfamiliar with EMI

Is this a record? In a news story on EMI, the Financial Times cites “five people familiar with the situation…”