Across the pond

When I checked my email on arriving back in London this evening, I found the following message.

LAST 8 HOURS: War Room sign-up

This was not spam. It was from a Wall Street service I subscribed too, because I like to keep in touch with what Wall Street is doing.

The follow- up message was this:

In a few days, I’m going to start using $1 million of my own money to go for major bear market profits — and help you do it, too

Those of my readers – and they are probably a majority – whose priorities are not to do with following the financial markets, and who have only a vague notion of the difference between a bull and a bear, may have already checked out of this blog. For those who have not, please read on, while I explain, why you should be aware of what this firm, and hundreds of others, are doing in the current financial crisis.

So now comes the tutorial.

Bears are chaps who sell shares worth millions, which they do not own, in the hope of buying them back a few weeks later, much more cheaply. You have to be very rich to play this game, because if you get it wrong, you can easily go bankrupt. The only chaps who can play at these stakes are the likes of Fred the Shed, with their million pound bonuses, and the super rich.

As everyone knows, the stock markets of the world have been plunging over the last few weeks.

Because we are facing a severe financial crisis. We now know this definitely because of the World Bank report, which was leaked in yesterday’s Washington Post, but has so far got scant treatment in the British media, who are more concerned with Jade’s last interview, the ‘mob violence’ which greeted the returning soldiers from Iraq, and how Gordon Brown got on with Barack Obama.

The World Bank report says that the economic reality is that we are facing the worst recession since the 1940s and that world trade is showing its sharpest decline for 80 years. In other words this ‘recession’ is as bad as the depression of 1929. This report is based on economic facts.

But no-one knows whether the present prices of stocks and shares are too high or too low. Because share prices have been plunging for several weeks now, because, of course, the economic advisers of Wall Street firms, have known for a long time that we are in for a nasty down-turn.

For several months now the rich have been making money, as stock markets have plunged. They have sold shares they do not own, following the advice of Wall Street firms, like the one in my mail-box, and they have become richer, not poorer, in this ‘recession’.

Which is quite like how it was in 1928 and 1929.

I think Fred the Shed should be shamed into giving up the £12 million he is claiming for making a mess of running one of the biggest and best British banks.

But he is yesterday’s man.

What we have to deal with is all the would-be Fred the Sheds, who are even now trying to make fortunes of millions, at a time when many people are losing their jobs, and with it, their self-respect.

So I end this blog, with a plea to the business journalists of today.

Join with me in telling the readers that this is a grave financial crisis, but it is being made much worse, by the effect of short selling by the rich, which causes stock markets to fall much more than the economic facts warrant.