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The worst is over for the newspaper industry, hopes Johnston Press.

Let's hope so, if Scotland's national papers are to survive. But it's not just an upturn in advertising they need - it's a business plan that helps the transition from paper to online.

Edinburgh-based Johnston - publisher of The Scotsman and Scotland on Sunday as well as the Yorkshire Post and more than 200 local papers - is one of those publishers blaming the ³ÉÈË¿ìÊÖ's online presence, funded by the licence fee, for "distorting the market" - making it hard for the commercial sector to charge for online news content.

This evening at the Edinburgh Television Festival, James Murdoch of News International, has added a powerful blast to that line of criticism.

In a lecture that lambasts the ³ÉÈË¿ìÊÖ, he says it's "dumping" of news content on the internet for free means that diversity and alternative viewpoints in the media will wither.

Instead, the Son of Rupert suggests, in a sentence that could be the starting point for many an undergraduate essay: "The only reliable, durable and perpetual guarantor of independence is profit". (Discuss.)

The challenge of the ³ÉÈË¿ìÊÖ is only one part of Johnston Press's grim story over the past year.

Advertising revenue was down 34% in the first quarter, when compared with that period in 2008, and chief executive John Fry was claiming that a 31% drop in the second quarter looked like good news.

Compare that with Advertising Association figures showing UK advertising spend has dipped 16% during the first quarter of the year, and you can see papers are taking the brunt of the cuts.

Online advertising spend has only increased 1.3%, and Johnston has been one of those newspaper groups slow to pick up what could have been its share.

Circulation on daily titles was down an average of 7.7% and 7.1% on weeklies. That's partly down to the increase in cover prices in order to compensate for the advertising revenue fall.

Johnston's response has been a fairly brutal programme of cost cutting, down 15% in a year. And it seemed to have impressed its lenders, after months of uncertainty, with a secure deal now agreed.

Likewise, the Irish owners of The Independent newspaper are saying the advertising slump has run its course and hinted strongly that a deal on continuing to finance its debt may be around the corner.

Monthly figures newspaper sales have tracked the sharp falls in circulation for Scotland's national titles, several of them dropping more than 10% in a year, and The Independent far more.

But we have to wait for six monthly figures to get the circulation picture for papers classified as local.

That includes Scotland's cities' evening papers, in which the Glasgow Evening Times has fallen, at 12%, nearly twice as fast as its Edinburgh and Dundee counterparts, with the Aberdeen Evening Express holding up remarkably well, at only 2.5% fewer sales.

For The Courier and Press & Journal, both owned by DC Thomson in Dundee (now also the owner of Friends Reunited), circulation was down 6.2% and 3.9% respectively - slightly better than the industry average, and substantially better than the national titles.

There is a business upside for all the pain being experienced in old-fashioned inky publishing. Diageo reported yesterday the benefits of driving down the cost of their brand advertising.

And STV points out that its move into online classified advertising, although small-scale so far, could be helped by newspapers' weakness.

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Two hundred million bottles of Johnnie Walker in a year. It's the kind of success story you could raise a glass to.

The people of Kilmarnock claim it as their own success story, dating back to 1820 - and that's the source of the of the Ayrshire town's bottling and packaging plant.

But beyond that controversy, it's worth noting . Two months ago, that was the first act of Diageo's financial year.

The year before had begun with five strong months, motoring ahead as the global drinks giant had been doing for several years. Then in November, as global confidence collapsed, sales plummeted.

That's why the company is nervous about reading too much into this year's profits holding up fairly well in the circumstances.

The current financial year doesn't benefit from that strong start. Instead, the company's heading into those recessionary 'headwinds' beloved of market analysts.

With such brand and geographic diversity, the latest figures paint a mixed picture. Guinness may no longer be good for you, but it's looking good for Diageo, particularly in Africa, where sales are up 18%.

Whisky gone wrong

Smirnoff vodka, Captain Morgan rum and Jose Cuervo tequila have been doing well, Tanqueray gin and Diageo's wine cellars less so, while Scotch whisky has been doing worst.

Sales are down 3% by value, and 11% by volume. Johnnie Walker, as Diageo's main premium brand, was down 6% by value: J&B by double that.

What's gone so wrong for whisky? Several factors.

A key one is de-stocking - that is, offloading stock without replacing it.

That helps explain HM Revenue and Customs figures showing a 19% drop in whisky exports in the first three months of this year.

There's also been a problem with third party distributors. With a crunch on their bank credit, they have held off buying stock, or Diageo has itself pulled back on credit to its trade customers.

The company cites a sharp, recessionary drop in business entertainment budgets as well as passenger traffic through airport shops and duty free.

Cheap spirit

Johnnie Walker suffered in particular because it is the premium brand from which people trade down.

The most expensive versions, such as Blue Label, suffered most, so the company re-directed marketing effort to Black Label, which was down 7%.

Often, the trade was down to a cheaper local spirit, and more often than that, it was to trade down from going out to staying in. Asia's pubs and clubs lost custom, which had been a reliable source of demand.

Spain's acute economic contraction, with sharply increased unemployment, hit it particularly hard, with sales of all Diageo products down by a fifth.

Scotch whiskies had been doing spectacularly well with a young Spanish customer base seeing a dram as the cool drink of choice at late night bars.

Johnnie Walker was also the big seller for Diageo in Russia - another country where consumer spending has been harder hit by recession.

But then, another market growing in a similar way has bucked that trend. Helped with a marketing push, Greece's whisky business didn't have such a bad year at all.

Growing markets

And nor did Britain. It was "a robust Christmas", Diageo recalls, particularly for Bell's whisky and Bailey's liqueur.

It's getting beyond the UK market that the company's chief executive, Paul Walsh, wants the Scottish campaigners to keep in mind.

The future of Scotch whisky, he told me, is in growing markets such as China, Vietnam and Korea.

They have cheaper options, distilled locally, and it's against those producers that Scotland's whisky has to compete.

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Imagine what Americans might say if Google or Apple were to be bought over and their headquarters moved elsewhere.

There might be similar concern in London if that happened to Diageo or Tesco.

These are big companies. Their corporate power, their strategic economic significance and their headquarters' spending power matters to the countries where they're based.

These are the companies with stock market capitalisation in New York and London that puts them around 10th or 11th place in corporate size.

So you might think that if a company of similar significance in the Scottish economy were on the verge of takeover, there might be at least some concern about the implications for Scotland.

That's what's happening with Venture Production. It is a company now entering the end game of its takeover tussle with Centrica, even if the deadline has been moved back two weeks from Friday 28 August.

The energy utility, parent company of British Gas and Scottish Gas, has been circling the Aberdeen-based, North Sea oil and gas specialist, and is now closing in on investors.

On Friday, the European Commission announced it is clearing the takeover. And although Centrica has scaled back its estimate of the voting power so far secured, the direction of travel looks clear.

Centrica needs 50% of share voting power. It already has 40% of shares, but because of dilution through convertible bonds and share options, the real voting power currently stands close to 35%.

Venture's chief executive Mike Wagstaff has this week announced reasonably buoyant half-year results, with production moving comfortably ahead and good prospects on several appraisal wells.

He remained at work in Aberdeen rather than heading south to talk to analysts - the message apparently that it's business as usual "until it isn't".

The chief executive reckons the £1.2bn price Centrica put on Venture (at 845 pence per share) undervalues it. The bulk of that value is in its North Sea oil and gas assets. But he says that fails to put any value on its expertise.

Wagstaff's trying to persuade shareholders they should hold on for something better, hinting at the potential for his own acquisition spree, and he's deploying numbers helpful to the cause.

Since the takeover bid was launched, the FTSE 250 has risen 19%, similar-scale oil companies have moved ahead 21% and the forward oil price for July 2011 is up 13%. The current oil price adds a fourth helpful figure: Brent crude went over $74 on Friday.

Why has this imminent loss of a company that registers around 10th or 11th position in Scotland for its market capitalisation gone so little noticed? Because it's in the offshore sector, and seen as apart from the economic mainstream?

Or could it be because Scots are so used to losing headquarters as companies grow and are taken over - Scottish Power, Scottish & Newcastle and HBOS being the obvious recent examples - that this has ceased to cause much comment?

Talk of "economic nationalism" at the time of the Scottish Power takeover by Iberdrola has been replaced with a cosy relationship between the nationalist government in Edinburgh and the Spanish bosses. We're hearing less about the "spivs and speculators" who were accused by the First Minister of undermining HBOS last year and driving it into the arms of Lloyds TSB.

What is currently causing plenty comment, of course, is Scotland's relationship with Libya, and there's a link there. As I noted in a blog posted earlier this week, Libya is seen as a growing trading ally for Europe in helping it to diversify gas supplies.

While Russia maintains its current clout, gas prices are at Moscow's mercy. And it's because of the insecurity of that Russian supply that utilities, such as Centrica, want to secure supplies for their customers.

It's reckoned that acquisition of Venture would push its dependence on contracts with suppliers comfortably below 50%.

And while the Scottish saltire flag is flown in Tripoli, causing considerable controversy, this takeover would see it hauled down from another headquarters in Aberdeen - with no controversy at all.

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• - What's this?

As lead shareholder in two giant high street banks, and outright owner of another two smaller ones, Alistair Darling wants them to face more competition.

It may not help the share prices of Royal Bank of Scotland or Lloyds nor the value of Northern Rock and Bradford and Bingley, and so it may diminish his asset value when it returns to market. But the Chancellor reckons the limited choice currently on offer is not good for the economy or for savers and lenders.

That's why he was in Edinburgh this morning, welcoming the expansion of Tesco Personal Finance (TPF), as it announced the hiring of 800 new staff for a new contact centre in Glasgow, as well as the transfer of 500 who have been employed by the Royal Bank under contract to TPF.

RBS was in a joint venture with the supermarket giant until it sold its share to Tesco last December. The Glasgow staff shifting employer are to move to the newly-finished office. Those familiar with Glasgow will know it as being on the site of the former Scottish Television studios at Cowcaddens and next to the Theatre Royal.

Back to the Chancellor's case: that there's a gap in the market after around 30% of the British banking market suddenly retreated last autumn, mainly because Icelandic, American and Irish banks went home to sort out their profound problems. You can now get some of the best deals from the Bank of China or from Israel. And the Chancellor wants to see more competition.

"In the future, you will see new competition coming into the British market, and that's a good thing. What we want to do is to ensure we do make it easier for new people to come into the banking field," he said. "People need choice, and we've lost a bit of that choice in the last couple of years."

I asked him if this is an admission that the current banks are too dominant and bad for competition.

"Market share and competition is something the government is always going to keep under review," he replied. "It's inevitable at a time like this, when the Icelandic banks were really hit, the Irish retrenched, and a number of other foreign banks are doing less than they were, it means the other half a dozen or so main banks are more dominant than they were in the past.

"That's all the more reason to encourage others to come in. But of course, in relation to competition in banking or any other industry, that's something we will always keep under review."

The Chancellor was also talking excessive banker bonuses, for which he's now planning legislation, but without much detail yet available.

His concern now is that if measures are taken to crack down on excess and over-risky incentives, banks can simply take their business and high-earning traders to tax jurisdictions with less hard-line approaches. That's what they're already threatening.

So having discussed this with the French finance minister on Wednesday, he's taking the issue to the G20 finance ministers meeting at the start of next month. He wants more harmonisation, as yet unspecified, but it seems to stop a long way short of a common tax regime for top earners.

"We need far more openness," he said. "Banks should disclose what their policy is, and disclose how many in each organisation is getting how much. There is the problem when banks say if you do this, all our best traders will go to America or other parts of Europe.

"We need to sort this problem out, because it is a global problem. You can take domestic action, but it needs to be complemented with action in other parts of the world, so you don't get one bank playing one country off against another."

With Tesco Personal Finance having a bumper year of growth, its chief executive Benny Higgins told me he's aiming at organic growth, shunning speculation that Northern Rock and Cheltenham & Gloucester could soon be on the market.

His targets for market share? He has none, he claimed. But he doesn't yet see Tesco Personal Finance matching its parent company's dominance in grocery sales.

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The decision about the , the only man convicted of the Lockerbie bombing, requires a balance of justice with compassion.

But of course, there's a bit more to it than that.

The Libyans have made no secret that such a release or transfer would help to normalise its place in international relations.

It has already taken itself out of the rogue states category, renouncing any nuclear weapons ambition and distancing itself from sponsorship or support of terrorist groups.

Without sanctions since the process started 10 years ago, it's also talking business.

There can be few economies so dependent on one product, with 95% of export earnings from petroleum products.

Before that was discovered under the desert, this was one of the world's poorest nations.

Russan dependency

And there's lots more where that oil and gas came from.

Gas supplies are seen as an important alternative source for Europe, piped through Italy and in liquid form by ship, to avoid over-dependency on Russia.

But there are concerns Moscow is cosying up to the Tripoli government with transfer of weapons technology, as a means to exert more influence over the North African state than Europe and the US.

That's what took Prime Minister Vladimir Putin to Libya last year.

In Tripoli, economic reform includes a slow reduction of subsidies and a form of socialist privatisation - handing assets over to workers and the public.

There is also a recognition that the current lack of diversification in the Libyan economy means it must look to the post-oil era. There's only so much of a future in selling dates.

Its plans include the growth of tourism and the managing of its oil wealth.

Financial services

The tourism appeal, learning from neighbouring Tunisia's success, includes long beaches and impressive antiquities along the coastline.

The management of oil wealth is one of the bigger parts of Britain's current exports to Libya, providing financial services.

Tripoli is also on the lookout for investment opportunities. Britain's second biggest oil refinery, Stanlow in Cheshire, currently owned by Royal Dutch Shell, is reported to be an asset for which the Libyan National Oil Company is jointly bidding.

Of course, the business opportunities in the other direction are a key part of British and other nations' thinking, with £280m in exports last year.

France and Italy are other trading partners to watch.

Libya's not got a reputation as being an easy place to operate, but there are opportunities in financial services, construction, education and healthcare.

The big prospect is in selling oil and gas know-how to an industry with badly constrained infrastructure.

Meeting potential

BP, Shell and BG Group are already in co-operation deals with Libya's national oil and gas company. BP is the biggest British player by far, with an agreement signed two years ago to explore in the west of the country and offshore.

The deal was to invest $900m, under contract to the Libyan National Oil Company, though the oil major expects to sink as much as $1.2bn in the exploration.

If the fields prove to have the potential expected, it could mean a $20bn spend over the next decade.

BG has been in longer, but unsuccessful in the fields where it drilled, so Libya is not seen as one of its priorities now.

Shell signed a deal in 2005 to upgrade an LNG plant, with exploration for gas leading to the first drilling last year.

While there's little that's clear about the decision on the Lockerbie bomber, the speculation extends to rumour that the departure of Megrahi from Greenock prison will open the door to a whole lot more deal-making with the Libyan government.

Shell won't comment on its future plans, and BP's spokeswoman claims the current contract will keep it busy enough for now.

But one sector where the British are already making a significant impact is in the rodent sector.

It may not help the tourism pitch to hear reports of a recent outbreak of bubonic plague in a village near Tobruk, but one result is that British firm Rentokil Initial has found a handy line of business in catching Libya's numerous desert rats.

Update:1850 BST

There's a firm denial from the Foreign Office this evening that any trade deals are dependent on the release of the Lockerbie bomber.

The link between diplomacy and trade is subtler than that.

But there's more information come to light about the extent of the Libyan trade potential. And in updating my previous blog, I now learn that the £280m British export figure for last year only covers visibles. Invisible exports - that's services, and primarily in the finance sector - amount to another £244m.

Imports from Libya to Britain totalled £960m last year, up 66% on 2007.

So far this year, official figures show visible exports to Libya are up 49% on the same period in 2008.

Libya's petroleum sector has a long way to grow. Oil production is currently flowing at 1.7 million barrels per day. That makes this Africa's second largest oil producer, and the largest single exporter to Europe.

Only 25% of Libya's vast surface area has been explored for oil so far. It already has the largest proven oil reserves in Africa, at 42 billion barrels of oil and more than 1.3 trillion cubic metres of gas. "There is every chance that actual reserves are twice as big," according to an official source.

There are over 50 international oil companies already engaged, and Libyan investment plans in exploration and development total $42bn in the next five years.

And where does the oil income leave Libya's foreign currency reserves? With $136bn swilling around, looking for places to invest. The central bank holds around half of that, and the other half is with the Libyan Investment Authority. Handling its wealth is seeing more interest in partnership with foreign banks, which explains why HSBC is one of the British companies already working in Tripoli.

Not much sign of the Royal Bank of Scotland opening a Benghazi branch just yet. But Britain's exports do extend to high street fashion and bling. Not only Bhs and Marks & Spencer have a presence in the country. So too does Monsoon Accessorize.

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• - What's this?

Before you read this, you should be aware the contents of this blog may be recorded and used for training and security purposes.

Yes, normal blog service is resumed after a week spent moving house. This meant spending a lot longer than I would have wanted on the phone to numerous utilities' call centres.

I would have done more online, but most of the time was on the mobile to BT about its failure to provide a landline or internet access.

It was a reminder how much more difficult (and expensive) it is for the large minority who never have internet access from home.

And after many hours dealing with many different utilities, BT gets the booby prize.

I may return to this as the story develops, because the experience goes beyond that of myself as a random individual customer.

Despite the best efforts of its staff, the company's customer handling system seemed seriously dysfunctional.

And which was the best organisation at helping through one of life's more stressful events?

Could it be one of those customer-focussed companies that has harnessed new technology and allied it to the best of staff training and state-of-the-art customer information management?

No. It was Glasgow City Council's finance department, with a prompt reply, helpfulness and simplicity itself.

So far.

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You wouldn't want to be a Fred Goodwin lookalike, would you? Not if you value your personal safety. But what about a double for Stephen Hester? I was outside the Royal Bank of Scotland's London headquarters this week, where I was mistaken for the chief executive.

There's frankly not much similarity, but if I look that rich and powerful, I'm certainly going to ask for a ³ÉÈË¿ìÊÖ bonus package to match that status. And the £1.2m basic salary wouldn't be so bad either.

I was there to meet the bank boss for an interview. And duly quizzed on public fury about bank bonus culture, his response was to empathise with the common man. His first annual bank pay was £3000, he pointed out. That's less than he earns each day now - though, no, he didn't point that out. His first job, he said, was on a production line, packing Polo mints.

The point of this was to show the breadth of his experience, but it struck me that there's one striking similarity - just like a Polo, the Royal Bank of Scotland could also be described as a mint, of the money-making variety, which has had a very large hole in it.

Anyway, Stephen Hester was part of a mixed week for Britain's banks, from Barclays bonanza to Lloyds' losses - a Jekyll and Hyde, yin and yang, Donald and Selina sort of week. It's not just that some banks have done well, and some not. It's also that some banks are doing obscenely well and spectacularly badly at the same time, depending which bits you look at.

Of those largely owned by the Government because of their well-publicised problems, Lloyds threw the kitchen sink into its losses, blamed the Scots who ran the Bank of Scotland Corporate division as if the bank had a licence to print money - which, in one sense, of course it does - and then it promised things are about to get better.

The Royal Bank of Scotland said its half year figures were OK, but warned of grim times ahead, this year and next. The Lloyds' cup was half full: the Royal Bank's half empty.

The markets meanwhile were behaving as if the boss was on his Mediterranean yacht while the summer intern had hacked into the online trading account, and was making merry with it.

Stocks were buoyed by good indicators on housing and home prices, manufacturing and improving confidence. But then the mood changed. I was in London on Thursday when a dark ominous cloud descended on the humid city, deluging it in warm rain just as the Bank of England was flooding it with hot money - some 50 billion quid. The Old Lady's message was clear: don't think we're over this yet. This economic patient still needs shock treatment.

Fifty billion - a sum so large it's hard to comprehend, but the amount pumped into the economy so far is a bit like bolting the productive capacity of another Scotland onto the British economy. The new money is like adding Wales and Northern Ireland as well.

And where's it all gone? Business says it's not seeing the benefits in lending. A respected Financial Times columnist compares it to water being poured into a plumbing system that's either clogged or broken. So far, she suggested, it's sitting in a sort of stagnant pool of liquid cash. But beware of backflow as more is poured in. This could get messy.

Amid all these mixed signals, some seemed to think this was the week the economy turned. By week's end, it felt more like it was bouncing around the bottom. It will surely recover, but it's uncertain what shape that recovery curve will take: a sharply upward V, a hesitant U, a double-dip W, or even a VW - you could call that the Beetle recession.

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How many bank jobs still face the axe? It's one of the more prominent and recurring questions following from the problems in Britain's banks.

That's particularly so at Lloyds Banking Group and Royal Bank of Scotland, which have promised shareholders (that's mainly the UK government) that they will get back into the black with the help of colossal cuts in their cost base.

Lloyds has promised it will lop more than £1.5bn off costs by the end of 2011.

RBS is promising £2.5bn within its five-year turnaround plan.

It's just announced that it's so far identified £600m of that, so it's nearly quarter of the way to that target, and wants to get most of this out the way by the end of next year.

Translated into jobs - with RBS saying half its cost base is in salaries - that sounds painful.

Turning bad

So far, Lloyds has announced more than 6,000 are going, though trade unions see it as more than 8,000.

But with its half-year results, it also said it had identified £100m of its cost-cutting target , and it is on track to achieve £700m for the year's total by the end of the year.

RBS has so far announced roughly 15,000 jobs are going worldwide, more than 8,000 of them in Britain. A quarter of those have gone through compulsory redundancy.

However, we're being discouraged from thinking there is a direct correlation between cost-cutting targets and jobs shed.

I'm told Lloyds is achieving much of its £700m target by cancelling investments in product development.

For instance, quite apart from its well-publicised problems with legacy debt from Bank of Scotland Corporate and from its growing problems with mainstream personal, mortgage and business lending turning bad because of the recession, it has also been hit by the regulatory crackdown on payment protection plans.

Being binned

So its intention to extend its product range on that front is being binned.

There are bond and investment products, and a suite of pension options, that aren't going anywhere.

Of course, the cost of developing these can be measured in people and staff posts as well - in IT for instance, with the banks previously big investors in research and development for financial services innovation.

One of the changes that banks had in mind even before the crisis hit last year was a significant shift to a much higher proportion of banking being done online, which offered them, and still offers them, scope for rapidly slimming down branches and call centres.

Neither of the big banks has yet got stuck into branch networks.

With those being the customer-facing end of banking, it can expect squealing from affected communities.

'Painful decisions'

And it's Lloyds that has the most potential for savings there, as there are so many adjacent Lloyds TSB and HBOS branches.

Asked about continuing job losses with his half-year results, RBS's Stephen Hester told me on Friday: "There is no business anywhere in the world exempt from having to cut costs. We do have painful and difficult human decisions ahead of us."

He pledged staff would be first to know, with compulsory redundancies kept to a minimum.

"We will try and get into this year and next the overwhelming majority of all the changes we have to make so that the bank can move forward with confidence on the strategic plan I've laid out," he said.

"So the worst is still in process in job terms, but we're trying to move as quickly as possible."

He went on: "Although Scotland will not be exempt - nor should it be - Scotland will see less job losses in RBS than other parts of our business around the world."

It's not just troubled banks looking at staff numbers.

The half-yearly figures from Edinburgh-based Standard Life this week also flagged up 200 posts shed, a continuing chill on recruitment and parts of IT being outsourced.

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You'd be forgiven for looking at the Lloyds half-year results, and concluding that no Scot should ever again be given access to a Bank of Scotland cheque book with which to make corporate loans.

The Edinburgh bank's legacy for its new owners is bad debt on an awesome scale. It makes you wonder at those who thought HBOS could remain independent.

But it seems some are already getting out from under that shadow.

I'm told there are two factors underlying the interims which look like good news for Scotland.

One: Lloyds fund management arm is set to expand at its Edinburgh headquarters.

And two: there's an intention to get back to lending to Scottish business.

For the 442 people who work at Scottish Widows Investment Partnership (SWIP) - 400 of them in Edinburgh's west end - the news that they are not only to stay with Lloyds, but also to expand asset management, ends months of uncertainty.

Having previously been with Lloyds TSB, the uncertainty came from duplication with Insight Investment, based in London and built up since 2002 by HBOS.

Both were doing much the same thing. By the end of June, Insight had £122bn under management, the seventh biggest in Britain, according to the Investment Management Association. SWIP, by that point, was managing £83bn, in ninth position.

The bosses at Lloyds had toyed with putting the two together. But facing pressure to raise capital and not to become too large, it decided to sell one.

I'm told SWIP began as the favourite to go.

But it's now clear that Insight is about to be sold, as part of Lloyds' sale of £200 billion assets. There had been plans to announce the sale with the interim results, but the deal is not yet complete.

Expect it to close in the next few days.

What's not yet clear is how much of Insight will remain with Lloyds. Whatever the size of those funds, they are expected to be managed by SWIP from Edinburgh, and under the Scottish Widows brand.

The other part of the good news from Lloyds is that it's trying to expand its corporate lending in Scotland.

After Bank of Scotland Corporate division - headed by the uber-generous Peter Cummings - had splattered money around the economy, the realisation of its risk meant it slammed the brakes on lending towards the end of 2007.

That continued the case until earlier this year. With Government pressure on the banks it part-owns to get lending again, Bank of Scotland Corporate, now the north-of-the-border cousin of Lloyds Corporate, is trying to push loans out the door again.

Archie Kane, board level director responsible for Scotland and insurance, has been targeting medium-sized companies - with a turnover of the £1m to £15m range.

In the next six months, he wants to extend that "back in business" message to smaller and larger firms.

The claim is that it will be "on commercial terms", though that is open to interpretation. And there are figures in the Lloyds results that suggest its lending remains tight, as the business sector has been saying.

In any case, it'll have to go some to be "commercial" on the same basis as the Bank of Scotland Corporate of yesteryear.

Incidentally, the Lloyds half-yearly figures include an interesting section on the problems it faces from the European Commission.

There have been reports that it may be broken up or denied state aid under competition rules, but this concedes the extent of the risk to the bank's future plans:

"The aid given and proposed to be given by HM Treasury to the Group is subject to European state aid review.

"The outcome of this review is uncertain at this stage and may involve the imposition of conditions on the Group that may be materially adverse to its interests (including, for example, conditions as to restructuring), the prohibition of some or all of the aid, or a requirement that any aid received by the Group be repaid."

That's the worst case scenario. But Lloyds is getting quite used to them.

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Expect a whisky summit. In the wake of a jobs loss announcement from Whyte and MacKay, the GMB's Harry Donaldson suggested it, and Enterprise Minister Jim Mather seems to be up for some spirited mind-mapping on spirits.

The criticism from Whyte and MacKay of the UK's tax regime will find an echo round such a table - unless, of course, it includes the UK Government, as Mr Donaldson suggests.

Chief executive John Beard reckons 2008 tax on a bottle of whisky rose 13%, including the increase that compensated for the VAT cut in November. He describes that as "punitive".

So what does he think of the Scottish government's plans to put a minimum price on a unit of alcohol? He doesn't think it will have the desired effect on irresponsible boozing, but he is emphatically not linking that with the decision to cut 100 jobs, 85 of them in Scotland, from a total payroll of 574.

While neither the Whyte and MacKay announcement nor the Diageo job cuts is about moving bottling overseas, that's where the trade union fears lie. Already 15% of Scotch whisky is exported in bulk. And the union wants a legal requirement placed on all blends that they should not only be distilled and matured in Scotland, as at present, but also bottled here as well.

In international trade agreement terms, it would be hard, if not impossible, to justify that clawback of current export activity, though it should be possible for single malts - a small part of the market, which is likely soon to get that legal protection for its bottling.

At Glasgow headquarters of Whyte and MacKay, a kenspeckle modern building near Charing Cross and next to the M8, staff were said to be "devastated" by the news that the company is to follow Diageo into a corporate fitness regime. But it can't be a huge surprise, with its parent company in trouble.

Vijay Mallya, the boss at United Spirits who is big in Indian Kingfisher beer, whisky, airlines, politics and flamboyant bling, has amassed quite a rupee mountain of corporate debt, and he's been trying to offload a minority share of Whyte and MacKay since last year.

No luck with that yet, but Mr Beard commented: "It's common knowledge that we're looking at our debt ratio. We've been talking to a number of partners as we have been for several months.

"It's in the process as we speak. But to be clear, this decision was not driven by any need to de-leverage."

He's certain the company is not up for sale, so is it half up for sale?

"We're looking at various routes, and it's encouraging the number of people who have come forward to divest in a minority share."

Diageo has been the player most closely linked with buying a 49% share - or more. But it's reckoned it may be holding out while Mallya's problems mount up, and the price falls. The Indian paid a collosal £595 million for it, and analysts reckon he'd be lucky to get £350 million for the whole thing now.

In any case, Diageo has bigger plans to get into the Indian market. If the experience of its Guinness brand in Africa is any guide, there ought to be a whole lot of business for the black stuff on the sub-continent.

Whyte and MacKay is an unusual player in Scotch. Less than quarter of its product is in its own leading brands, notably Whyte and MacKay itself, plus Jura and Dalmore single malts. The rest is made up of supermarket own brands, some contract bottling for smaller operators and some development brands, such as Snow Leopard and Pinkie vodkas.

It's also unusually exposed to the British market, with 60% of output reaching UK taste buds. And that's not much of a growth market, compared with southern Europe and Indian, Russian and Chinese markets, where John Beard foresees Scotch gaining substantial ground over the next 10-plus years.

Meanwhile, it's worth noting the sharply different tone in response from the Scottish Government about the Whyte and MacKay announcement, as if it wanted to go out of its way not to make any link with Diageo's plan to pull out of Kilmarnock.

It's hard to imagine a more sympathetic announcement about job cuts - reflecting, it seems, the company's choice, in contrast with Diageo, of telling the politicians and government agencies before the workforce.

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Recession? What recession? Not if you're an investment banker.

When you thought it was the banks that got us into this mess, isn't it odd that banks seem to be getting out of it so fast, and with gigantic profits.

Half-year results for Barclays and HSBC on Monday morning showed both of them registering profits just below the £3bn mark.

It would be far more if it weren't for "the real economy" seeing so many loans going to the bad, harming the banks' balance sheets.

In Barclays' case, that was up 86% on the first half of last year.

This is a reminder of one of the long-term implications of the severity of this recession.

The clearing out of weaker competition means those companies that survive can look forward to profits being boosted as a consequence.

Housing boom

Not many are enjoying that windfall yet, but Barclays and HSBC look like they're on course to bounce back into hyper-profits when the worst is over.

It doesn't stop there.

The slamming of the brakes on the housing boom has not stopped the demographic pressure towards smaller households, which means Britain is heading for a substantial housing shortage.

Once building starts again and confidence returns to the market, we risk moving swiftly from housing shortage to steep hikes in prices again, meaning the risk of yet another bubble.

And there's another post-recession rebound, highlighted on Monday by The Independent.

The chief economist of the International Energy Agency, which advises the Organisation of Economic Co-operation and Development, is saying the depletion of oil reserves is moving at a much faster pace than expected.

Oil shortage

Fatih Birol says the decline is nearly twice the rate calculated two years ago.

That means an oil shortage, and upward pressure on prices.

That fear drove the oil market up to $147 per barrel last summer.

Recession drove it down again to a low point below $33 in December.

Monday's positive news from the banks and positive results from business surveys helped oil prices upwards today, with Brent crude above $73.

Birol is forecasting an "oil crunch" within five years, as the economy recovery boosts demand for oil, only to find there has been under-investment in new reserves by credit-strapped oil companies.

That's the under-investment happening right now, with oil majors including Shell and BP last week confirming the problems the sector is in.

'Prepare ourselves'

Here's what the IEA economist has been saying to The Independent: "One day we will run out of oil, it is not today or tomorrow, but one day we will run out of oil and we have to leave oil before oil leaves us, and we have to prepare ourselves for that day.

"The earlier we start, the better, because all of our economic and social system is based on oil so to change from that will take a lot of time and a lot of money and we should take this issue very seriously."

Birol goes on: "The market power of the very few oil-producing countries, mainly in the Middle East, will increase very quickly. They already have about 40% share of the oil market, and this will increase much more strongly in the future."

This casts a new light on the calculations about Scotland's remaining oil wealth, and on the valuation placed on Venture Production, Scotland's tenth biggest company, which Centrica wants to take over to secure its supply contracts.

But of course, it means far more than the impact on Scotland's oil sector.

A sharp rise in oil prices could blow economic recovery off-track.

It has big geo-political implications, exposing dependence on the Middle East.

And for all those reasons, it gives new impetus to the search for alternatives energy sources.

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