MICHAEL EISNER, the former Walt Disney chairman, likes to say that e-mail revived the lost Victorian art of letter-writing. The telephone and the television had for decades conspired against the written word, when, suddenly, the internet spurred everyone to start writing to each other again. (Mr Eisner likes to complain that the prose in the inbox is not always polished and the text message is not even English, but he is in no position to talk: he has a gift for the unprintable.)

Google may have just done for book-reading what e-mail has done for letter-writing. Yesterday the internet search engine started making classic, out-of-copyright books available to download and print free. The service makes available to everyone the dusty pages of old tomes that once were reserved only for those with privileged access to the likes of the Bodleian library in Oxford and Harvard University in Cambridge, Massachusetts. Google likes to boast that its mission is to organise the world’s information, but it is doing something better than that: it is is democratising it.

Inevitably, the Google service has been greeted by the book industry with the kind of welcome normally reserved for a can of kerosene and a box of matches. But suspicious publishers should draw strength from the experience of the music business and, to a lesser extent, the film industry. Only five years ago digital downloads threatened the music majors with extinction. Today they are the fastest growing segment of the business. In mid-2004 digital represented 1.5 per cent of music sales; a year later it was 4-5 per cent; today, it is close to 10 per cent. The internet has thrown up new creative talent and new commercial models. Some may work, others may not: Sony’s film studio just bought Grouper.com, a website where people can post and share videos; Universal Music is backing Spiralfrog, which allows people to download music free.

The book industry is lucky because the digital assault will be slow. The complete works of Trollope will not be easier reading printed out on looseleaf A4. Books are treasured, even when unread. But Google’s service will be a boon to researchers and students. It will enable people to browse bits of books and, it must be hoped, cultivate more interest in reading. For the publishing industry, it will ultimately foster demand. And, in the process, it will reinforce one of the more extraordinary features of the “lean forward” technology that is the internet, namely that it is generally not dumbing us down but lifting us up . . .

• Eric Schmidt, Google’s chief executive, has joined an exclusive club: the board of Apple. Steve Jobs, who runs the computer company that invented the iPod, already has on his board Al Gore, “the man who created the internet”. All they are missing are the people who drove the PC revolution. Unfortunately, those guys work for Microsoft and are not invited. Schmidt’s appointment highlights a new fault line on the West Coast: Microsoft v the icons of internet 2.0

  Central bankers get it right

  FOR central bankers, a hazy summer is coming to an end.

  Both the Bank of England and the US Federal Reserve took controversial decisions in August, when the visibility was unclear. The Bank moved aggressively to check inflation with a pre-emptive increase in interest rates; the Fed acted with surprising restraint, worried that the US economy is losing momentum. Suddenly, the economic mists on both sides of the Atlantic have cleared a little and both central banks can lay some claim to have been vindicated.

  Here, the Bank was charged by some with being too hawkish in pushing up rates earlier this month. Even the Bank’s own Monetary Policy Committee fretted that it might have to reverse course, as its rosy view of UK prospects depended on a potentially fragile revival in consumer spending.

  Yesterday, the CBI’s high street snapshot showed the resurgence in retail conditions continuing apace this month. Sales were at their strongest since late 2004. By contrast with three months ago, the majority of retailers now expect to raise prices.

  Yet more fuel for consumer spending will come from the persistent “mini-boom” in the housing market, with yesterday’s figures showing mortgage lending making its biggest gain since September 2003. With inflation already firmly above the Bank’s target rate, the MPC’s decision to ratchet up interest rates and rein in price rises looks prescient.

  Across the Atlantic, accumulating evidence that the US economy is faltering leaves Ben Bernanke’s Fed looking astute, too.

  It called a halt to further rate increases, fearing that the slowdown in growth outweighed the inflationary pressures. The Conference Board reported earlier this week a slump in consumer confidence and the GDP figures yesterday showed business investment at its lowest level for nearly four years. With hindsight, the Fed was right this summer to put any further interest rate rises on hold.

  The days of autumn look clearer: the Bank seems likely to raise rates before the end of the year, while the Fed is unlikely to act until 2007.

  Policing giants

  IF THE news that the investigation into Sir Philip Watts has come to nothing frustrates regulators and infuriates investors, it will come as timely relief to board directors of BP.

  Sir Philip was the chairman of Shell who was ousted when it emerged that his company had been overstating the size of its oil reserves for years. BP’s current problems are not as scandalous as the ones that engulfed Shell in 2004. BP is beset by external political problems in the US, whereas Shell was riddled with internal accounting issues at head office.

  But, like Shell, BP, currently in the glare of so much negative publicity, may find that the trial is worse than the punishment. The US Government has begun looking into insider dealing at BP. Traders working for an oil company can use internal information about imminent pipe closures, for example, to govern decisions in the market. This may not be allowed when buying and selling shares, but it is when dealing in crude oil. BP will have to weather the anger over high petrol prices and endure a long government investigation, but, it is likely that little will stick.

  The fact that the regulators fined Shell £17 million, but have been unable to identify any single person in the company ultimately responsible for misleading shareholders is baffling. To some, it reinforces the suspicion that giant companies — Shell has 109,000 people working in 140 countries and a market capitalisation of £124 billion — cannot be policed.

  However, such a narrow view of the checks and balances on big business ignores a powerful enforcer: the market. Investors punished Shell. Sir Philip lost his job. The company paid for its mistakes in a more painful way than a regulator could achieve.

Times Recommends

• Lies and cover-up at MG Rover exposed by report
• High oil prices push manufacturing costs up
• Primark founder steps down as chief executive